explanatory statement

Issued by the authority of the Minister for Finance and Administration

Superannuation Act 1990

Declaration under paragraph 6(1)(j)

The Superannuation Act 1990 (the Act) makes provision for and in relation to the Public Sector Superannuation Scheme (PSS) for Australian Government employees and for certain other persons.

Section 6 of the Act specifies the various persons who may be a member of the PSS (PSS member).  Paragraph 6(1)(j) provides that the Minister may declare a person to be a PSS member.

The Superannuation (PSS) Membership Inclusion Declaration 1995 (the Principal Declaration) identifies the persons who are declared PSS members under paragraph 6(1)(j).

The purpose of the Superannuation (PSS) Membership Inclusion Amendment Declaration 2005 (No. 2) (the Amending Declaration) is to amend the Principal Declaration in order to provide PSS membership for former employees of Totalcare Industries Limited (Totalcare) who were transferred to Rhodium Asset Solutions Limited (Rhodium) when it was established on 31 December 2004.

The Amending Declaration ensures continued membership of the PSS for a person who became an employee of Rhodium on 31 December 2004 and who:

• immediately before becoming an employee of Rhodium was employed by Totalcare;
• was a member of the PSS; and
• continues to be employed by Rhodium.

The Amending Declaration also provides that PSS membership for employees of Rhodium will cease in the circumstances set out in the Declaration. Membership would cease when Rhodium is no longer controlled by the ACT Government or a body controlled by the ACT Government or where the person becomes a member of an alternative superannuation scheme.

The Amending Declaration has been prepared in consultation with the Australian Capital Territory’s Department of Treasury and the Office of Legislative Drafting and Publishing.  The Office of Regulation Review has advised that a Regulation Impact Statement is not required for the Amending Declaration.

No further consultation is required as the instrument is machinery in nature and does not alter existing arrangements for those employees who transferred from Totalcare to Rhodium.

The Amending Declaration is a legislative instrument for the purposes of the Legislative Instruments Act 2003.

The Amending Declaration is taken to have commenced on 31 December 2004.  Subsection 45(4) of the Act provides that a declaration made under paragraph 6(1)(j) may be expressed to have taken effect from and including a day not earlier than 12 months before the making of the declaration.  Employees of Rhodium who meet the conditions in the Amending Declaration have been treated as PSS members from 31 December 2004.

The details of the Amending Declaration are explained in the Attachment.

Attachment

Superannuation (PSS) Membership inclusion Amendment Declaration 2005 (no. 2)

Section 1

This section provides that the name of the Declaration is the Superannuation (PSS) Membership Inclusion Amendment Declaration 2005 (No. 2).

Section 2

This section provides that the Declaration is taken to have commenced on 31 December 2004.

Section 3

This section provides that Schedule 1 of the Declaration amends the Superannuation (PSS) Membership Inclusion Declaration 1995 (the Principal Declaration).

Schedule 1 – Amendments

Item 1 inserts subsection 3(17), which describes the circumstances that result in PSS membership of employees of Rhodium Asset Solutions Limited (Rhodium) ceasing. Subsection 3(17) provides that PSS membership is only maintained for a person who has membership through item 24 in Schedule 1 of the Principal Declaration while a controlling interest is held in Rhodium by the following:

• the Australian Capital Territory (the ACT) or its nominees;
• an authority or body established for a public purpose by or under a law of the ACT; or
• a company or other corporate body in which the ACT, its nominees or an authority or body established for a public purpose by or under a law of the ACT has a controlling interest.

Item 2 inserts item 24 in Schedule 1 of the Principal Declaration.

Item 24 provides that employees of Rhodium can retain PSS membership if they:

• were employed by Totalcare Industries Limited and transferred to Rhodium on 31 December 2004;
• were members of the PSS immediately prior to the transfer;
• continue to be employed by Rhodium; and
• are not members of an alternative superannuation scheme (as defined in the Principal Declaration).