Superannuation (PSS) Productivity Contribution (2011-2012) Determination 2011 – Explanatory Statement
1 Name of Determination
This determination is the Superannuation (PSS) Productivity Contribution (2011-2012) Determination 2011.
2 Commencement
This determination takes effect on 1 July 2011.
3 Purpose
The purpose of this determination is to set new productivity contribution rates for the Public Sector Superannuation (PSS) scheme to apply for the financial year beginning on 1 July 2011.
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 further amended by the Twenty-Eighth Amending Trust Deed executed in 2007 by the deletion of a “B” before each rule with effect from 29 June 2007.
Productivity Contribution Rates
PSS Rule 4.3.2 sets out a Table of Productivity Contributions Rates to apply from 1 July 1995 until amended.
PSS Rule 4.3.3 provides for the productivity contribution rates set out in
the Table in rule 4.3.2 to be amended by the Australian Reward Investment Alliance (ARIA) with effect from 1 July each year, to reflect changes in the general salary levels of members. The increase in the amounts in the Table of Productivity Contribution Rates maintains the real value of the productivity contributions in relation to the overall salaries of PSS members.
Delegation
ARIA has delegated its power under rule 4.3.3 to relevant officers in Commonwealth Superannuation Administration.
Productivity Contribution Rates in the Period 1 July 1996-30 July 2005
In the period from 1 July 1996 to 30 July 2005, the amounts set out in the table in rule 4.3.2 were replaced on 1 July each year, pursuant to the PSS (Productivity Contribution Rates) Determination No. 1, which was amended each year in consecutively-numbered determinations. That Determination was revoked on 1 July 2005 by the Superannuation (PSS) Productivity Contribution (2006-2007) Determination 2006, which set out the productivity contribution rates for the financial year commencing on 1 July 2005.
Productivity Contribution Rates in the Period from 1 July 2005
Productivity contribution rates 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 Productivity Contribution Rates
The new productivity contribution rates that apply with effect from 1 July 2011 are set out in the determination.
6 References to ARIA
At the date of the signing of this determination, ARIA was legally responsible for the administration of the PSS.
As a result of the Governance of Australian Government Superannuation Schemes Bill 2011, passed by Federal Parliament on 21 June 2011 and currently awaiting Royal Assent, the responsibility for the administration of the PSS will vest in the Commonwealth Superannuation Corporation (CSC), with effect from 1 July 2011.
In accordance with section 25B of the Acts Interpretation Act 1901, any reference to ARIA in an instrument made prior to 1 July 2011 shall be construed as a reference to the CSC.
Further by virtue of clause 22 of Schedule 2 of the Superannuation Legislation (Consequential and Transitional Provisions) Bill 2011, passed by Federal Parliament on 21 June 2011 and currently awaiting Royal Assent, all current delegations under a governing deed continue to be in force on or after 1 July 2011. As such an instrument signed by the delegate of ARIA shall be deemed to be in force after 1 July 2011 as if it were an instrument of the CSC.
7 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).
Overview
The Superannuation (PSS) Productivity Contribution (2011-2012) Determination 2011 was enacted to establish new productivity contribution rates for the Public Sector Superannuation (PSS) scheme, effective from 1 July 2011. This determination addresses the need to adjust productivity contributions to reflect changes in the general salary levels of PSS members, thereby maintaining the real value of contributions in relation to their overall salaries. The determination was enacted by the Australian Reward Investment Alliance (ARIA) but due to the forthcoming Governance of Australian Government Superannuation Schemes Bill 2011, the responsibility for the administration of the PSS will transition to the Commonwealth Superannuation Corporation (CSC) from the same date. The policy objective of this determination is to ensure that the PSS scheme continues to operate effectively in line with broader economic changes, thereby supporting the financial stability and attractiveness of public sector employment.
Scope and Application
The Superannuation (PSS) Productivity Contribution (2011-2012) Determination 2011 pertains to the Public Sector Superannuation (PSS) scheme, established by the Superannuation Act 1990, and is applicable to members of this scheme, including Commonwealth employees. It aims to set new productivity contribution rates for the financial year starting 1 July 2011, with the responsibility for administering these rates transitioning from the Australian Reward Investment Alliance (ARIA) to the Commonwealth Superannuation Corporation (CSC) from the same date. The rates themselves are intended to maintain the real value of the productivity contributions in relation to the overall salaries of PSS members, reflecting changes in general salary levels. The application of this Determination is limited to the Commonwealth and does not require consultation with external parties as it is considered an internal government matter. Any references to ARIA in the instrument prior to 1 July 2011 are to be construed as references to the CSC, with current delegations under a governing deed continuing in force post-transition.
Key Provisions
The Superannuation (PSS) Productivity Contribution (2011-2012) Determination 2011 establishes new productivity contribution rates for the Public Sector Superannuation (PSS) scheme for the financial year starting 1 July 2011 (section 5). This determination, which takes effect on the same date, sets these rates in accordance with PSS Rule 4.3.3, delegating this responsibility to the Australian Reward Investment Alliance (ARIA) and relevant officers in the Commonwealth Superannuation Administration (sections 2, 3). These rates are intended to maintain the real value of productivity contributions in relation to the overall salaries of PSS members (section 4).
The Act imposes specific obligations on the entities it governs. Primarily, it mandates the Australian Reward Investment Alliance (now the Commonwealth Superannuation Corporation as of 1 July 2011) to amend the productivity contribution rates annually to reflect changes in the general salary levels of members (section 6). It also requires relevant officers in the Commonwealth Superannuation Administration to carry out these amendments in accordance with the determination. Additionally, the Act ensures that any delegations by ARIA remain in force post-1 July 2011, implying that instruments signed by ARIA’s delegates will continue to be effective as if they were instruments of the CSC (section 6).
There are no explicit offences, penalties, or civil/criminal consequences detailed within this determination for breach. However, the failure to comply with the mandated productivity contribution rates could potentially lead to administrative or regulatory scrutiny, given the statutory nature of the PSS scheme. The determination also clarifies that, due to its internal nature, no external consultation was necessary (section 7).