explanatory statement
SUPERANNUATION (PRODUCTIVITY BENEFIT) ACT 1988
ISSUED BY THE AUTHORITY OF THE MINISTER FOR FINANCE AND ADMINISTRATION
DECLARATION UNDER SUBSECTION 4C(1)
APPROVED FUNDS
The Superannuation (Productivity Benefit) Act 1988 (the PB Act) provides the mechanism by which the Superannuation Guarantee (SG) minimum employer superannuation support is made available to Australian Government sector employees (and certain other employees) who have no other employer-sponsored superannuation cover. Prior to 1 July 1992, the PB Act provided productivity superannuation to these employees.
Since 1 July 1990, the designated employers of employees covered by the PB Act arrangements have been required to pay periodic contributions in respect of those employees to a superannuation fund nominated or approved by the Minister for Finance and Administration. Where the employee is eligible, contributions may be paid to another regulated superannuation fund as defined by the Superannuation Industry (Supervision) Act 1993.
Subsection 4C(1) of the PB Act enables the Minister to declare a superannuation fund to be an approved fund for the purposes of the PB Act. Section 4D of the PB Act provides that the Minister is not to declare a superannuation fund to be an approved fund unless the fund is a complying fund within the meaning of Part IX of the Income Tax Assessment Act 1936.
Earlier declarations of approved funds were reviewed and due to a number of changes the need for a new declaration was identified. Details of these changes are set out in the Attachment.
This Declaration cited as the Superannuation (Productivity Benefit) (Approved Funds) Declaration 2004 revokes all previous declarations made under subsection 4C(1) of the PB Act. Seven superannuation funds are declared to be approved funds:
1) Australian Retirement Fund
2) Construction and Building Unions Superannuation Fund
3) Health Employees Superannuation Trust Australia
4) JUST SUPER
5) Labour Union Co-operative Retirement Fund
6) Superannuation Trust of Australia
7) TWU Superannuation Fund
These superannuation funds have previously been declared to be approved funds and continue to be active. All funds included in the list of approved funds are complying funds in accordance with section 4D of the PB Act. This declaration has no effect on the current or future membership of these superannuation funds. No new approved funds have been declared.
The Declaration commences on gazettal.
ATTACHMENT
CHANGES TO EARLIER DECLARATIONS OF APPROVED FUNDS
Past Superannuation Funds Declared to be Approved Funds | Changes | New List of Approved Funds |
Australian Retirement Fund | No change. | Australian Retirement Fund |
CANPLAN Multi-Industry Superannuation Plan | Taken over by the Australian Superannuation Trust, which in turn merged with the Australian Retirement Fund. | |
Building Union Superannuation Fund | Taken over by the Construction and Building Unions Superannuation Fund. | Construction and Building Unions Superannuation Fund |
Health Employees Superannuation Trust Australia | No change. | Health Employees Superannuation Trust Australia |
Joint Entertainment Superannuation Trust | Taken over by JUST SUPER. | |
Journalists Union Superannuation Trust | Changed name to JUST SUPER. | JUST SUPER |
Labour Unions Co-operative Retirement Trust | Changed name to Labour Union Co-operative Retirement Fund. | Labour Union Co-operative Retirement Fund |
Professional Employees Superannuation Fund of Australia | Wound up and replaced by the Association of Professional Engineers Scientists and Managers of Australia Superannuation Plan, which is part of a master trust within MLC MasterKey Business Super and as such is not an actual fund and therefore does not have complying fund status. Only complying funds may be approved funds. | |
Superannuation Trust of Australia | No change. | Superannuation Trust of Australia |
Transport Workers Superannuation Fund | Changed name to TWU Superannuation Fund. | TWU Superannuation Fund |
Overview
The Superannuation (Productivity Benefit) Act 1988 was enacted to provide a mechanism for delivering superannuation support to Australian Government sector employees and certain other employees who do not have employer-sponsored superannuation cover. This Act ensures that these employees receive a minimum level of superannuation contributions through designated employers, who are required to make periodic contributions to a nominated or approved superannuation fund. The Minister for Finance and Administration has the authority to declare superannuation funds as approved funds under this Act, provided they are complying funds as defined in the Income Tax Assessment Act 1936. In 2004, a new declaration was issued under subsection 4C(1) of the Act, revoking previous declarations and updating the list of approved funds to reflect changes such as mergers and name changes, while maintaining the requirement that only complying funds may be approved. This declaration, known as the Superannuation (Productivity Benefit) (Approved Funds) Declaration 2004, ensures that eligible employees continue to receive the intended superannuation benefits.
Scope and Application
The Superannuation (Productivity Benefit) Act 1988 applies to Australian Government sector employees and certain other employees who lack other employer-sponsored superannuation cover. These employees are entitled to a minimum level of employer superannuation support, referred to as the Superannuation Guarantee (SG). The Act requires designated employers to make periodic contributions to a superannuation fund approved by the Minister for Finance and Administration, or to another regulated superannuation fund as defined under the Superannuation Industry (Supervision) Act 1993. The explanatory statement clarifies that the Minister has the authority under subsection 4C(1) of the PB Act to declare specific superannuation funds as approved, provided they are complying funds as per section 4D of the Income Tax Assessment Act 1936. The Superannuation (Productivity Benefit) (Approved Funds) Declaration 2004 revokes all previous declarations and lists seven funds as approved: Australian Retirement Fund, Construction and Building Unions Superannuation Fund, Health Employees Superannuation Trust Australia, JUST SUPER, Labour Union Co-operative Retirement Fund, Superannuation Trust of Australia, and TWU Superannuation Fund. This declaration takes effect upon gazettal and does not alter the membership of these funds. Any changes to the list of approved funds are detailed in the attachment, which explains the mergers, takeovers, and name changes affecting previously declared funds.
Key Provisions
The Superannuation (Productivity Benefit) Act 1988 (PB Act) operates to provide a minimum level of employer superannuation support to certain employees who do not have other employer-sponsored superannuation cover. Section 4C(1) of the PB Act allows the Minister for Finance and Administration to declare certain superannuation funds as approved funds, while section 4D stipulates that only funds that are complying funds under Part IX of the Income Tax Assessment Act 1936 can be declared as approved. The Superannuation (Productivity Benefit) (Approved Funds) Declaration 2004, issued under this authority, revokes all previous declarations and lists seven superannuation funds that are approved: Australian Retirement Fund, Construction and Building Unions Superannuation Fund, Health Employees Superannuation Trust Australia, JUST SUPER, Labour Union Co-operative Retirement Fund, Superannuation Trust of Australia, and TWU Superannuation Fund. These funds are all complying funds and have previously been declared approved.
The obligations under the Act primarily concern the approved funds themselves. The funds must comply with the conditions set out in the Income Tax Assessment Act 1936 and meet any additional criteria specified by the Minister for Finance and Administration. The approved funds are required to manage the contributions paid by designated employers to ensure that they are deposited into the correct accounts and used for the benefit of eligible employees. Additionally, these funds must maintain records and provide reporting to the relevant authorities as required by the Superannuation Industry (Supervision) Act 1993.
Failure to comply with the provisions of the PB Act or the associated regulations can result in serious consequences. Designated employers who fail to make the required periodic contributions to an approved fund may be subject to civil penalties, which can include fines or other financial penalties. Additionally, any person who knowingly makes a false statement or representation in relation to the Act may face criminal penalties. The maximum penalties for these offences can vary, but they are intended to be significant enough to deter non-compliance. These penalties serve as a deterrent and ensure that the integrity of the superannuation system is maintained.