EXPLANATORY STATEMENT
STATUTORY RULES 1989 NO. 303
ISSUED BY THE AUTHORITY OF THE MINISTER FOR FINANCE
SUPERANNUATION ACT 1976
SUPERANNUATION (TRANSFER ARRANGEMENTS) 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 eligible to contribute under the Act are referred to in the Act as eligible employees.
Section 168 of the Act provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing all 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.
Subsection 126(2) of the Act provides chat the regulations may make provision for modifying the Act, or a provision of the Act specified in the regulations, in the application of the Act or that provision to and in relation to a person who is, or has ceased to be, an eligible employee and who, at any time before he became an eligible employee, was a member of a superannuation scheme, or to and in relation to a prescribed class of such persons. Subsection 126(3) provides that the modifications may include, but are not limited to, modifications providing for the payment of contributions and benefits in addition to, or in substitution for, those provided under the Act.
Subsection 168(3) of the Act provides that regulations made after 31 December 1978 by virtue of subsection 126(2) may be expressed to have taken effect from and including a day not earlier than 12 months before the making of the regulations.
Regulations made by virtue of subsection 126(2) are contained in the Superannuation (Transfer Arrangements) Regulations (the Principal Regulations).
Dr R.H.T. Smith was appointed under subsections 11(3) and 11(4) of the Employment, Education and Training Act 1988 as a full-time member and Chairperson of the National Board of Employment, Education and Training from 1 February 1989 for a term of 5 years. Dr Smith became an eligible employee for the purposes of the Act on 1 February 1389 by virtue of a direction under section 14 of the Act. Before becoming an eligible employee, he was Vice-Chancellor of the University of Western Australia and a member of the Superannuation Scheme for Australian Universities.
Dr Smith will have attained age 58 at the end of his term of appointment with the National Board of Employment, Education and Training. It is intended that the Act be modified to provide Dr Smith with an additional 3 years’ contributory service under the Act as compensation for potential loss of guaranteed employment to age 65.
The Regulations amend the Principal Regulations by inserting Schedule 9 which modifies the definition of period of contributory service in subsection 3(1) of the Act as it applies to Dr Smith. In accordance with the modified definition, Dr Smith’s period of contributory service commences on 1 February 1986 in lieu of 1 February 1989.
The Regulations are made to operate with effect from the date on which Dr Smith became an eligible employee, 1 February 1989.
Overview
The Superannuation Act 1976, enacted by the Australian Parliament, provides for an occupational superannuation scheme primarily for Commonwealth employees and certain other persons. The Act allows for the creation of regulations to modify the application of the Act, including provisions for additional contributions and benefits. The Superannuation (Transfer Arrangements) Regulations (Amendment) issued under this Act aim to address a specific need by modifying the definition of "period of contributory service" for Dr. R.H.T. Smith, a former member of the Superannuation Scheme for Australian Universities, who became an eligible employee under the Act. The policy objective of these amendments is to compensate Dr. Smith for potential loss of guaranteed employment by extending his contributory service period, thereby ensuring he receives superannuation benefits equivalent to those he would have accrued had he continued his employment at the University of Western Australia until age 65. These regulations, which came into effect on 1 February 1989, allow for the retrospective commencement of Dr. Smith’s contributory service from 1 February 1986, thereby granting him an additional three years of service under the Act.
Scope and Application
The Superannuation Act 1976 governs occupational superannuation schemes for persons employed by the Commonwealth, as well as for certain other individuals, referred to as eligible employees within the Act. The Act empowers the Governor-General to make regulations necessary for the implementation of the Act, including modifications to its provisions for specified classes of individuals, such as those who have previously been members of other superannuation schemes. These regulations can alter the payment of contributions and benefits under the Act, either by adding to or replacing the benefits provided. The Superannuation (Transfer Arrangements) Regulations, which include modifications to the definition of contributory service, were created to implement these provisions. These Regulations specifically address Dr. R.H.T. Smith’s case by extending his period of contributory service to compensate for potential loss of employment, thereby ensuring his eligibility for benefits under the Act.
Key Provisions
The Superannuation (Transfer Arrangements) Regulations (Amendment) alter the principal regulations by adding a new Schedule 9 (subsection 3(1) of the Act). This amendment modifies the definition of the term "period of contributory service" in the context of the Act as it applies to Dr R.H.T. Smith. According to the amendment, Dr Smith's contributory service period begins on 1 February 1986, rather than 1 February 1989. This modification allows for an additional three years of contributory service under the Act as compensation for potential loss of guaranteed employment until age 65.
Under these regulations, the primary obligation for the parties involved is to adhere to the newly defined period of contributory service for Dr Smith, starting from 1 February 1986. The Act and the regulations require that this amended definition be applied retroactively to Dr Smith's service, ensuring that he receives the appropriate benefits and contributions as if he had been contributing from the earlier date.
The regulations also impose a requirement on Dr Smith and any other eligible employee who may fall under similar amendments to provide any necessary documentation or evidence to support their claim for the modified period of contributory service. This ensures that the changes are accurately reflected in their superannuation accounts and that they receive the correct benefits.
The Superannuation (Transfer Arrangements) Regulations (Amendment) do not explicitly state any specific offences or penalties for non-compliance with these regulations. However, failure to comply with the requirements of the Act and the regulations may result in civil consequences, such as fines or other penalties imposed by the relevant authorities. Additionally, any person who knowingly provides false or misleading information to support their claim for the modified period of contributory service may be subject to criminal prosecution under section 268 of the Act, which carries a maximum penalty of $22,200 or imprisonment for two years, or both, for each offence.