EXPLANATORY STATEMENT
STATUTORY RULES 1990 NO 128
ISSUED BY THE AUTHORITY OF THE MINISTER FOR FINANCE
SUPERANNUATION ACT 1976 - SUPERANNUATION (SALARY) REGULATIONS (AMENDMENT)
The Superannuation Act 1976 (the Act) makes provision for and in relation to an occupational superannuation scheme for persons employed by the Commonwealth and for certain other persons. Persons who are eligible to contribute under the Act are referred to in the Act as eligible employees (contributors).
Section 168 of the Act provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing matters which the Act requires or permits to be prescribed, or which are necessary or convenient to be prescribed, for carrying out or giving effect to the Act.
The rates of employer-financed pensions payable under the Act are expressed as a percentage of the former contributor’s final annual rate of salary. A contributor’s final annual rate of salary is, in the generality of cases, his or her annual rate of salary on his or her last day of service. Contributions payable under the Act are also expressed as a percentage of a contributor’s annual rate of salary.
Subsection 5(2) of the Act provides that, subject to subsection 5(3), a contributor’s annual rate of salary on a particular day is the amount per annum of the salary for the purposes of the Act payable to the contributor on that day. Subsection 5(3) enables regulations to be made prescribing an alternative amount to be a contributor’s annual rate of salary. Regulations for the purposes of section 5 are contained in the Superannuation (Salary) Regulations (the Principal Regulations).
Section 47 of the Act provides in effect that, where a contributor’s salary is reduced, his or her annual rate of salary for the purposes of the Act after the reduction is to be:
(a) if no election is made under subsection 47(2) - the fixed annual amount applicable immediately before the reduction; or
(b) if an election is made under subsection 47(2) - the annual amount of the lower rate of salary as updated from time to time.
Regulation 20 of the Principal Regulations, however, provides that in the case of an officer of the Australian Public Service (other than a fixed-term appointee):
(a) who is a Secretary of a Department and who is redeployed to a lower classification of Secretary or to a Senior Executive Service classification; or
(b) who is a Senior Executive Service Officer and who is redeployed to a lower Senior Executive Service classification or to a lower classification that is not a Senior Executive Service classification,
and who does not make an election under subsection 47(2), the annual rate of salary of the person for the purposes of the Act after the redeployment, or subsequent such redeployments, is the annual rate of salary as updated from time to time applicable to the classification held by the person immediately before the first redeployment.
It is intended that similar arrangements apply in relation to Secretaries of Departments who are appointed to the office of Administrator of Norfolk Island where the salary payable in respect of the appointment is less than that payable to the person immediately before the appointment. The Regulation amends regulation 20 of the Principal Regulations to provide that that regulation applies to such persons until their actual salary exceeds the salary applicable to the classification held by them immediately before the reduction.
The amending Regulation operates from the date of its gazettal.