Superannuation (PSS) Maximum Benefits
(2007-2008) Determination 2007 –
Explanatory Statement
1 Name of Determination
This determination is the Superannuation (PSS) Maximum Benefits (2007-2008) Determination 2007.
2 Commencement
This determination takes effect on 1 July 2007.
3 Purpose
The purpose of the determination is to set new maximum benefits for the Public Sector Superannuation (PSS) scheme to apply for the financial year beginning on 1 July 2007.
4 Background
Establishment of the PSS Scheme
The PSS scheme is established by the Superannuation Act 1990, a Trust Deed and Rules.
The PSS Rules were renumbered with effect from 1 July 1995, as a result of amendments made by the Ninth Amending Trust Deed.
The PSS Rules were amended by the Twentieth Amending Trust Deed executed in 2004 by the addition of a “B” before each rule with effect from 1 July 2005.
Maximum Benefits
The PSS Rules contain specific rules specifying maximum benefits for scheme members and employees of the Australian Federal Police (AFP).
These specific rules are designed to ensure that the maximum attainable PSS benefits do not exceed the community wide superannuation Reasonable Benefits Limits administered by the Australian Taxation Office.
The lump sum and pension maximum benefits for AFP employees who are PSS members are designed to take into account a special superannuation entitlement paid by the AFP. The maximum benefits for these members place a limit on the combined AFP special benefit and the PSS benefit.
The maximum benefits also place a cap on the employer cost of the PSS.
Relevant Rules
Under the renumbered PSS Rules that came into effect on 1 July 1995, rules B5.6.1, B5.7.1 and B5.7.2 set out the Table of Maximum Benefits Rates.
In particular, the rules dealt with the following:
- rule B5.6.1 – maximum lump sum benefits for members;
- rule B5.7.1 – maximum lump sum benefits for AFP employees; and
- rule B5.7.2 – maximum pension benefits for AFP employees.
The amounts in the tables in rules B5.6.1 and B5.7.1 are the same.
Each rule sets out a table containing the maximum benefits to apply from 1 July 1995 until amended.
Power to Amend Maximum Benefits
Pursuant to rules B5.6.5 and B5.7.7 the Australian Reward Investment Alliance (ARIA) is empowered to determine maximum benefits for the purposes of the PSS scheme, with effect from 1 July 1995 each year.
- under rule B5.6.5 ARIA has the power to determine the amounts to be substituted into the Table of Maximum Benefits in rule B5.6.1.
- under rule B5.7.7 ARIA has the power to determine the amounts to be substituted into the Table - AFP Preliminary Maximum Benefits - Lump Sums in rule B5.7.1 and the Table - AFP Preliminary Maximum Benefits - Pensions in rule B5.7.2.
Delegation
ARIA has delegated its power under rules B5.6.5 and B5.7.7 to relevant officers in Commonwealth Superannuation Administration.
Maximum Benefits in the Period 1 July 1996 - 30 June 2005
In the period from 1 July 1996 to 30 July 2005, the amounts set out in the tables in rules B5.6.1, B5.7.1 and B5.7.2 were replaced on 1 July each year, pursuant to the PSS (Maximum Benefits) Determination No 1, which was amended each year. That Determination was revoked on 1 July 2005 by the Superannuation (PSS) Maximum Benefits (2005-2006) Determination 2005 which set out the maximum benefits for the financial year commencing on 1 July 2005.
Maximum Benefits in the Period from 1 July 2005
Maximum benefits in the period from 1 July 2005 are set out in annual determinations that apply for the financial year commencing on 1 July each year.
5 New Maximum Benefits
The new maximum benefits that apply with effect from 1 July 2007 are
set out in the determination.
6 Consultation
As the instrument is for internal machinery of Government purposes only, no consultation was considered necessary with other persons (see sections 17 and 18 of the Legislative Instruments Act 2003).