1. This Act may be cited as the Superannuation Legislation Amendment Act 1992.

Commencement

2.(1) Subject to this section, this Act commences on the day on which it receives the Royal Assent.

5. In this Part, “Principal Act” means the Superannuation Act 1976².

6. Section 3 of the Principal Act is amended:

(a) by inserting in subsection (1) the following definitions:

“ ‘industrial award’ means:

‘superannuation guarantee top-up benefit’ means benefit payable under section 110SE;”;

“(2A) If an authority or body referred to in paragraph (b) of the definition of ‘approved authority’ in subsection (1) becomes a body:

(i) the Commonwealth;

(ii) an authority or other body mentioned in paragraph (a) of that definition;

(iii) the Commonwealth together with one or more such authorities or bodies;

(iv) such an authority or body together with one or more other such authorities or bodies;

the Minister, for the purposes of paragraph (b), may declare that the body is not an approved authority for the purposes of this Act.”.

7. Section 4A of the Principal Act is amended:

(a) by omitting subsection (1) and substituting the following subsection:

“(1) Subject to subsection (2), a declaration for the purposes of paragraph (a) or (b) of the definition of ‘approved authority’ in subsection 3(1) is a disallowable instrument.”;

(b) by omitting from subsection (3) “referred to in subsection (1)” and substituting “for the purposes of paragraph (a) of that definition”.

8. After section 6 of the Principal Act the following section is inserted:

Persons engaged in more than one employment

“6A.(1) Subject to subsection (3), if:

(a) a person is engaged in more than one employment; and

(b) either:

(i) in relation to more than one of those employments the person is an eligible employee; or

(ii) in relation to any such employment, the person would, if that were the person’s only employment, be an eligible employee or entitled to request that a direction be given under section 11, 13 or 14;

this Act has a separate operation in respect of the person in relation to any employment in relation to which the person is an eligible employee, or any employment mentioned in subparagraph (b)(ii), as if that were the person’s only employment.

“(2) A separate operation of this Act given by subsection (1) in respect of a person in relation to any employment, being a person who is, or becomes, an eligible employee in relation to that employment, continues after the person ceases to be an eligible employee.

“(3) A person who:

(a) is an eligible employee and on leave of absence without pay from particular employment; and

(b) while on such leave engages in other employment;

is not, for the purposes of this section, because of engaging in that other employment, taken to be engaged in 2 different employments.

“(4) If, before the commencement of this section, a person made payments in respect of any employment that would have been contributions if subsection (1) had then been in force, that subsection is taken to have been in force in relation to that person at the time the payments were made or at such earlier time (not being a time earlier than the commencement of that employment) as the Commissioner may determine.

“(5) If, because of subsection (1), this Act has a separate operation in respect of a person in relation to any employment, the person may elect, by notice in writing to the Commissioner, that that subsection applies to him or her in respect of that employment before the commencement of this section and, where such an election is made, that subsection is taken to have been in force in relation to the person during the period of that employment.

“(6) The regulations may make provision for modifying this Act, or a provision of this Act specified in the regulations, in the application of this Act or that provision in relation to a person in respect of whom this Act, because of subsection (1), has an operation in relation to any employment.”.

9. Section 7A of the Principal Act is amended by adding at the end of subsection (2) the following word and paragraph:

“; and (f) there shall be added to the amount that, but for this subsection, would be the amount of the person’s Fund accumulated employer contributions an amount equal to the amount that was the person’s Fund accumulated employer contributions upon the person ceasing to be an eligible employee as referred to in paragraph (a), together with the amount of any interest that is payable in respect of the amount.”.

10. Section 27C of the Principal Act is amended:

(a) by inserting after paragraph (1)(f) the following paragraph:

“(fa) functions mentioned in section 122; and”;

(b) by inserting after paragraph (1)(h) the following paragraph:

“(ha) functions mentioned in section 139; and”;

(c) by inserting after paragraph (1)(i) the following paragraph:

“(ia) functions mentioned in and”.section 141;

11. Section 54C of the Principal Act is amended by omitting from subsection (1) “maximum retirement age” and substituting “maximum retiring age”.

12. Section 54H of the Principal Act is amended:

“(2A) If, after taking the steps mentioned in paragraphs (2)(a) and (b), the Board thinks that it should allow further time within which to make a decision whether or not to approve the retirement of an eligible employee, the Board may:

“(2B) Where the Board wants to have the matter considered again by a panel mentioned in section 54F, that section, other

than subsection (5), applies, subject to subsection (2C), in relation to the matter in the same way as it applied in relation to the initial consideration of the matter by such a panel.

“(2C) In the application of section 54F as mentioned in subsection (2B), subsection 54F(4) applies as if the period within which the members of the panel are required to make recommendations in writing to the Board were such period as is specified by the Board in the particular case.

“(2D) If the matter is again considered by a panel of persons, the Board is to take the recommendations of the panel into consideration before making its decision.”.

13. After section 54J of the Principal Act, the following section is inserted in Division 3 of Part IVA:

Other provisions relating to invalidity assessment

“54JA.(1) Where the Board:

the following provisions of this section apply.

“(2) The Board, if it thinks it desirable in the particular case, may appoint a panel consisting of such number of persons as the Board determines to assist it in its consideration of a matter mentioned in subsection (1).

“(3) The members of the panel must be persons with expertise in the assessment of invalidity claims for the purposes of superannuation.

“(4) The Board:

“(5) The members of the panel must, within such period as is specified by the Board, make recommendations in writing to the Board, giving reasons for their recommendations:

“(6) If the matter under consideration relates to a condition in respect of which the person is, or was, entitled to receive compensation under the Commonwealth Employees’ Rehabilitation and Compensation Act 1988, the Board may ascertain, in relation to that matter, the views of any Commonwealth authority that, under that Act, is or has been, liable to pay compensation in respect of the person.

“(7) The fact that, in relation to a matter, the Board has previously under this section received the recommendations of a panel or ascertained the views of a Commonwealth authority does not prevent the Board, if it wishes to give the matter further consideration, from again appointing such a panel under this section or ascertaining those views.”.

14. Section 54K of the Principal Act is amended by inserting after paragraph (b) the following paragraph:

“(ba) the reference in paragraph 12.2.4(c) to a member were a reference to an eligible employee within the meaning of this Act; and”.

15. Section 54ZA of the Principal Act is amended:

“(b) the cost of any medical examination that a person is required to undergo under subsection 54F(3) or 54JA(4);”.

16. Section 58 of the Principal Act is amended:

(a) by inserting after subsection (3) the following subsection:

“(3A) Subsection (3) does not apply to a person who ceases to be an eligible employee in circumstances connected with the sale or transfer of an organisation, business, service or asset, or the transfer of a function, if the person, before ceasing to be an eligible employee:

(b) by adding at the end the following subsection:

“(5) If the question arises whether employment mentioned in paragraph (3A)(b) is equivalent employment, the Minister may determine the matter.”.

17. Section 62 of the Principal Act is amended by omitting from subsection (2) “Where” and substituting “Subject to section 62B, if.

18. After Division 2 of Part V of the Principal Act the following Division is inserted:

“Division 2A—Preservation of benefit payable under subsection 62(2)

Interpretation

“62A.(1) In this Division:

‘accumulated government body contributions’, in relation to a person’s relevant period of employment, means the total of:

‘government body scheme’ means a superannuation scheme:

(a) established by, or operating for the benefit of employees of:

(i) an authority of the Commonwealth; or

(ii) a State or an authority of a State; or

(iii) a Territory or an authority of a Territory; or

(iv) a body corporate in which the Commonwealth, or a person of the kind referred to in paragraph (i), (ii) or (iii), either individually or in combination with one or more other such persons, has a controlling interest; and

‘notional accumulated SG contributions’, in relation to a person’s relevant period of employment, means an amount equal to the sum of:

(a) the person’s SG minimum contributions in relation to that

period as reduced by an amount specified in, or worked out in accordance with, a determination made by the Australian Government Actuary under subsection (4); and

(b) notional interest on the amount worked out under paragraph (a);

‘period of actual contributory service’, in relation to a person, means the person’s period of contributory service other than any part of that period added by the operation of subsection 128(5) that is not attributable to a transfer value previously paid under Division 3 of Part IX;

‘productivity contribution’ means:

‘rate of fund contribution tax’ means 15% or such other rate as is determined by the Minister under section 110SD;

‘relevant period of employment’, in relation to a person, means:

but does not include any period for which the person is engaged or appointed exclusively for employment outside Australia unless that period:

‘SG minimum contribution’ has the same meaning as in Part VIAA;

‘top-up benefit’ means superannuation guarantee top-up benefit payable under section 110SE.

“(2) For the purposes of paragraph (a) of the definition of ‘accumulated government body contributions’ in subsection (1), the amount of a productivity contribution applicable to a person in relation to a particular period (‘the accrual period’) is:

(a) if the relevant government body scheme provides for productivity contributions (applicable to all eligible employees who are members of the scheme) that may be expressed as a

percentage of the earnings (as described for the purposes of the scheme) of each employee—that percentage of the earnings of the person for the accrual period based on the person’s fortnightly rate of salary that, for the purposes of section 46, was payable on the most recent anniversary of birth of the person; or

“(3) For the purposes of paragraph (2)(c), ‘contribution percentage’ means the rate of contribution, expressed as a percentage of the eligible employees’ earnings and certified by an actuary, required to provide the productivity related benefit.

“(4) The percentage referred to in paragraph (2)(a) or (b) must be certified by the person’s employer.

“(5) For the purposes of the definition of ‘notional accumulated SG contributions’ in subsection (1), the Australian Government Actuary is to determine:

Preservation of portion of benefit

“62B.(1) Subject to subsection (2), if a benefit is payable to a person under subsection 62(2), the portion of that benefit worked out under whichever of subsections (3) and (4) is applicable must be:

(a) paid, for the benefit of the person, to a preservation fund nominated by the person; or

“(2) Subsection (1) does not apply to a benefit payable to a person if:

(i) the amount of the accumulated employer contributions in respect of the person;

(ii) the amount that would be preserved or applied under subsection (1) in relation to the person but for the operation of this subsection; or

(d) the Commissioner is satisfied that the person is departing permanently from Australia.

“(3) If a persons’s employer was liable to pay productivity contributions under section 110H in respect of the person for the person’s relevant period of employment, the portion of the benefit referred to in subsection (1) is the amount worked out using the formula:

where:

‘NASGC’ is the notional accumulated SG contributions in respect of the person for the person’s relevant period of employment;

‘AEC’ is that part of the accumulated employer contributions in respect of the person that is based on the operation of paragraphs 110Q(1)(a) and (b) in relation to productivity contributions paid or payable after 30 June 1993;

‘TR’ is the percentage figure representing the rate of fund contribution tax applicable to the relevant period of employment.

“(4) If a person’s employer was liable to pay productivity contributions to a government body scheme in respect of the person for the person’s relevant period of employment, the portion of the benefit referred to in subsection (1) is whichever of the following amounts is determined by the Commissioner after having regard to the views of the government body:

(a) an amount worked out using the formula:

(b) an amount worked out using the formula:

(c) an amount worked out using the formula:

where:

‘NASGC’ is the notional accumulated SG contributions in respect of the person for the person’s relevant period of employment;

‘AGBC’ is the accumulated government body contributions in respect of the person for the person’s relevant period of employment;

‘GBB’ is the benefit paid or payable from the government body scheme in respect of the person for the person’s relevant period of employment together with, except where the person ceases to be both a member of the government body scheme and an eligible employee, notional interest on that benefit;

‘TR’ is the percentage figure representing the rate of fund contribution tax applicable to the relevant period of employment;

‘GBPROD’ is the total of:

“(5) In determining the benefit paid or payable from a government body scheme in respect of a person, the Commissioner may accept a statement from the trustees, the administrator on behalf of the trustees or, if there are no trustees, the administrator of the government body scheme as to:

Application of formulae

“62C. If a single application of a formula set out in section 62B cannot properly be made for the whole of a person’s relevant period of employment because of a change in the person’s employment, the rate of fund contribution tax or any other thing:

19. After section 80 of the Principal Act the following section is inserted in Division 5 of Part V:

Procedure where pension exceeds reasonable benefit limits

“80A.(1) This section applies where the Insurance and Superannuation Commissioner:

(a) makes:

(i) a determination under subsection 15K(1) of the Occupational Superannuation Standards Act 1987 (‘the OSS Act’) that a pension payable to a person under this Act exceeds the reasonable benefit limits within the meaning of the OSS Act; or

(ii) an interim determination under section 15L of the OSS Act in relation to such a pension that has effect as if it were such a determination; and

(b) makes a request under subsection 15S(4) of the OSS Act in relation to that pension.

“(2) The Commissioner for Superannuation must:

“(3) The rate of pension mentioned in paragraph (2)(b) is to be worked out in accordance with rules determined by the Minister for the purposes of this section.

“(4) A determination so made by the Minister is a disallowable instrument.”.

20. Section 110A of the Principal Act is amended:

(a) by omitting the definition of “designated employer” and substituting the following definitions:

“ ‘designated employer’, in relation to a productivity employee, means:

(a) if the employee is a permanent employee or temporary

employee but is not an LWOP employee or employed by an approved authority:

(i) if the remuneration in respect of his or her employment is paid wholly or principally out of money appropriated by an annual Appropriation Act—the Department in respect of which the money is appropriated; or

(ii) if the remuneration in respect of his or her employment is paid wholly or principally out of money appropriated by an Act other than an annual Appropriation Act—such Department as is determined by the Minister; or

(b) if the employee is the holder of a statutory office but is not an LWOP employee:

(i) if the remuneration in respect of that office is paid by an approved authority—that authority; or

(ii) if subparagraph (i) does not apply—such Department or person as is determined by the Minister; or

‘LWOP employee’ means a productivity employee who:

(b) by omitting “or includes” from the definition of “productivity related benefit” and substituting “or is worked out by reference to”.

Rate of salary

Payments of productivity related benefits to Fund by certain eligible employees

“110MA.(1) If:

(a) an eligible employee, while an eligible employee but not a

productivity employee, has been a member of a government body scheme within the meaning of Part VIAA that provided for a productivity related benefit in respect of the eligible employee; and

(b) an amount is paid to or in respect of the eligible employee by way of that benefit;

the eligible employee may pay that amount to the Commissioner.

“(2) A payment to the Commissioner may only be made within the period of 3 months commencing on the day on which the amount was paid to or in respect of the employee or such longer period as the Commissioner allows for the particular payment.”.

Commissioner to pay Fund

23.(1) Section HON of the Principal Act is amended:

24. Section 110Q of the Principal Act is amended by omitting paragraph (1)(e) and substituting the following paragraph:

“(e) if an amount has been paid or transferred to the Commissioner under section 110K, 110L, 110M or 110MA in respect of the employee—the amount paid or transferred less such amount (if any) in the nature of income tax that is relevant to that amount; and”.

25. Section 110R of the Principal Act is amended:

“(b) either:

(i) the Commissioner is satisfied that the person intends to leave Australia permanently; or

(ii) the Insurance and Superannuation Commissioner has approved the payment of the benefit;”;

(f) by adding at the end the following subsection:

“(9) For the purposes of subsections (4) and (4A), the aggregate benefit, in relation to a person, is the total of the following amounts:

26. After Part VIA of the Principal Act the following Part is inserted:

“PART VIAA—SUPERANNUATION GUARANTEE TOP-UP BENEFIT

Purpose of Part

“110SA. The purpose of this Part is to establish, in respect of certain persons who cease to be eligible employees, an entitlement to a benefit (called ‘superannuation guarantee top-up benefit’) so that an employer of such a person while the person was an eligible employee does not have an individual superannuation guarantee shortfall within the meaning of the Superannuation Guarantee (Administration) Act 1992 in relation to that person in respect of the period, or any part of the period, during which the person was an eligible employee.

Interpretation

“110SB.(1) In this Part, unless the contrary intention appears:

‘accumulated government body contributions’, in relation to a person’s relevant period of employment, means the total of:

‘government body scheme’ means a superannuation scheme:

(a) established by, or operating for the benefit of employees of:

(i) an authority of the Commonwealth; or

(ii) a State or an authority of a State; or

(iii) a Territory or an authority of a Territory; or

(iv) a body corporate in which the Commonwealth, or a person of the kind referred to in paragraph (i), (ii) or

(iii), either individually or in combination with one or more other such persons, has a controlling interest; and

‘notional accumulated SG contributions’, in relation to a person’s relevant period of employment, means an amount equal to the sum of:

‘other vested benefit’, in relation to a person, means the value that the Commissioner, having regard to the advice of the Australian Government Actuary, determines to be the value that the benefits paid or payable in respect of the person’s relevant period of employment would have if the total amount of these benefits were taken not to include:

(a) the amount equal to the total of whichever of the following amounts is, or are, applicable:

(i) the amount equal to that part of the accumulated employer contributions in respect of the person that is based on the operation of paragraphs 110Q(l)(a) and (b) in relation to productivity contributions paid or payable after 30 June 1992;

(ii) the amount equal to that part of an amount paid by or in respect of the person that is based on the operation of paragraphs 110Q(1)(e) and (0 in relation to payments made under 30 June 1992;section 110L in relation to any period commencing after

(iii) the amount equal to that part of an amount paid by or in respect of the person that is based on the operation of paragraphs 110Q(1)(e) and (0 in relation to payments made under 30 June 1992;section 110M in relation to any period commencing after

(iv) the amount equal to that part of an amount paid by or in respect of the person that is based on the operation of paragraphs 110Q(1)(e) and (f) in relation to payments made under 30 June 1992;section 110MA in relation to any period commencing after

(b) the amount equal to that part of the person’s accumulated

contributions based on contributions that became payable, by the person, after 30 June 1992;

‘period of actual contributory service’, in relation to a person, means the person’s period of contributory service other than any part of that period added by the operation of subsection 128(5) that is not attributable to a transfer value previously paid under Division 3 of Part IX;

‘productivity contribution’ means:

‘rate of fund contribution tax’ means 15% or such other rate as is determined by the Minister under section 110SD;

‘relevant period of employment’, in relation to a person, means:

but does not include any period for which the person is engaged or appointed exclusively for employment outside Australia unless that period:

‘SG minimum contribution’ has the meaning given by section 110SC;

‘top-up benefit’ means superannuation guarantee top-up benefit payable under section 110SE.

“(2) For the purposes of paragraph (a) of the definition of ‘accumulated government body contributions’ in subsection (1), the amount of a productivity contribution applicable to a person in relation to a particular period (‘the accrual period’) is:

(a) if the relevant government body scheme provides for productivity contributions (applicable to all eligible employees who are members of the scheme) that may be expressed as a percentage of the earnings (as described for the purposes of the scheme) of each employee—that percentage of the earnings of the person for the accrual period based on the person’s

fortnightly rate of salary that, for the purposes of section 46, was payable on the most recent anniversary of birth of the person; or

“(3) For the purposes of paragraph (2)(c), ‘contribution percentage’ means the rate of contribution, expressed as a percentage of the eligible employees’ earnings and certified by an actuary, required to provide the productivity related benefit.

“(4) The percentage referred to in paragraph (2)(a) or (b) must be certified by the person’s employer.

“(5) For the purposes of the definition of ‘notional accumulated SG contributions’ in subsection (1), the Australian Government Actuary is to determine:

Interpretation —SG minimum contribution

“110SC.(1) The SG minimum contribution in respect of an eligible employee on a contribution day during the eligible employee’s relevant period of employment is 4% of the fortnightly rate of salary that, for the purposes of section 46, was payable to the eligible employee on the anniversary of his or her. birth immediately preceding the contribution day.

“(2) The Minister may vary the percentage mentioned in subsection (1) by determination.

“(3) In so determining, the Minister is to have regard to the charge percentages set out in sections 20 and 21 of the Superannuation Guarantee (Administration) Act 1992.

“(4) Subject to subsection (5), the determination is a disallowable instrument.

“(5) The determination is a Statutory Rule for the purposes of the Statutory Rules Publication Act 1903.

Minister may determine rate of fund contribution tax

“110SD.(l) The Minister may vary the percentage mentioned in the definition of ‘rate of fund contribution tax’ in subsection 62A(1) or 110SB(1) by determination.

“(2) The determination:

“(3) In making the determination, the Minister is to have regard to the rate of tax payable on employer contributions paid to a superannuation fund.

“(4) Subject to subsection (5), the determination is a disallowable instrument.

“(5) The determination is a Statutory Rule for the purposes of the Statutory Rules Publication Act 1903.

Superannuation guarantee top-up benefit

“110SE.(1) Superannuation guarantee top-up benefit is payable to or in respect of a person who ceases to be an eligible employee in respect of his or her relevant period of employment if an amount greater than nil is worked out, under whichever of subsections (3) and (4) is applicable, in relation to the person for that period.

“(2) A top-up benefit to which an entitlement so arises is a lump sum benefit equal to the amount referred to in subsection (1).

“(3) If the person’s employer was liable to pay productivity contributions under section 110H in respect of the person for his or her relevant period of employment, the amount mentioned in subsection (1) is the amount worked out using the formula:

where:

‘NASGC’ is the notional accumulated SG contributions in respect of the person for the person’s relevant period of employment;

‘AEC’ is that part of the accumulated employer contributions in respect of the person that is based on the operation of paragraphs 110Q(1)(a) and (b) in relation to productivity contributions paid or payable after 30 June 1992;

‘TR’ is the percentage figure representing the rate of fund contribution tax applicable to that period;

‘OVB’ is the person’s other vested benefit in respect of that period.

“(4) If the person’s employer was liable to pay productivity contributions to a government body scheme in respect of the person for his or her relevant period of employment, the amount mentioned in subsection (1) is whichever of the following amounts is determined by the Commissioner after having regard to the views of the government body:

(c) an amount worked out using the formula:

(d) an amount worked out using the formula:

where:

‘NASGC’ is the notional accumulated SG contributions in respect of the person for the person’s relevant period of employment;

‘AGBC’ is the accumulated government body contributions in respect of the person for the relevant period of employment;

‘OVB’ is the person’s other vested benefit in respect of that period;

‘GBB’ is the benefit paid or payable from the government body scheme in respect of the person for the person’s relevant period of employment together with, except where the person ceases to be both a member of the government body scheme and an eligible employee, notional interest on that benefit;

‘TR’ is the percentage figure representing the rate of fund contribution tax applicable to that period;

‘GBPROD’ is the total of:

“(5) In determining the benefit paid or payable from a government body scheme in respect of a person, the Commissioner may accept a statement from the trustees, the administrator on behalf of the trustees or, if there are no trustees, the administrator of the government body scheme as to:

“(6) Despite anything else in this section, top-up benefit does not become payable to or in respect of a person if the Australian Government Actuary has certified that, in his or her opinion, because of the value of other benefits payable to or in respect of the person, an employer of the person while an eligible employee will not, in respect of the person for a financial year, have an individual superannuation guarantee shortfall within the meaning of the Superannuation Guarantee (Administration) Act 1992.

Application of formulae

“110SF. If a single application of a formula set out in section 110SE cannot properly be made for the whole of a person’s relevant period of employment because of a change in the person’s employment, the rate of fund contribution tax or any other thing:

Payment of top-up benefit —preservation

“110SG.(1) Subject to the Commissioner must, in accordance with a nomination made by the person:section 110SH, if top-up benefit becomes payable in respect of a person,

“(2) If the person fails, within 2 months after the benefit becomes payable, to make a nomination, the benefit must be paid, for the benefit of the person, to a preservation fund nominated by the Commissioner.

Payment of top-up benefit —exceptions to preservation

“110SH. Section 110SG does not apply in any of the following circumstances:

(i) the amount of the top-up benefit in respect of the person’s relevant period of employment;

(ii) the amount of the accumulated employer contributions in respect of the person;

(iii) any amount of a kind preserved or applied under subsection 128(4A);

(e) the Commissioner is satisfied that the person is departing permanently from Australia.

Payment of top-up benefit—non-preservation

“110SJ. If the Commissioner must:section 110SG does not apply to top-up benefit in relation to a person,

27. Section 111 of the Principal Act is amended by omitting from subsection (3) “paragraph (1)(b)” and substituting “subsection (1)”.

28. Section 112 of the Principal Act is amended:

and substituting “in relation to the person’s accumulated contributions”.

Physical or mental incapacity of person to whom Part applies before declaration of result of election etc.

29.(1) Section 122 of the Principal Act is amended:

“(6) For the purposes of this section, the Board may only be satisfied that a person would, at a particular time, have ceased to be an eligible employee by reason of retirement on the ground of invalidity if it appears to the Board that the person, at that time, was totally and permanently incapacitated within the meaning of Part IVA.”.

30. Section 126A of the Principal Act is amended:

31. Section 127 of the Principal Act is amended:

(a) by omitting subsection (1) and substituting the following subsections:

“(1) Subject to subsection (1AAA), a reference in this Division to a transfer value in relation to an eligible employee is a reference to:

(a) a lump sum benefit (‘a paragraph (a) benefit’):

(i) payable in relation to an eligible employee under

a superannuation scheme on the termination of employment or cessation of membership otherwise than on the ground of physical or mental incapacity to perform that employment; and

(ii) based wholly on contributions by the employer under the scheme or partly on such contributions and partly on contributions by the eligible employee under the scheme;

unless that benefit has been applied for the purchase of a deferred annuity or paid into a preservation fund; or

“(1AAA) In this Division, a reference to a transfer value in relation to an eligible employee does not include a reference to any part of a lump sum benefit payable under a superannuation scheme that is based on contributions by the employee under the scheme that are of a similar nature to supplementary contributions under this Act or to contributions under the superseded Act for reserve units of pension.”;

(b) by omitting subsection (1AB).

32. Section 128 of the Principal Act is amended:

(a) by omitting subsection (1) and substituting the following subsection:

“(1) If an eligible employee has been in employment, within or outside Australia, on the termination of which a transfer value or transfer values became payable to or in relation to him or her under a superannuation scheme applicable in relation to that employment and:

value or, if 2 or more transfer values became payable, the total of the amounts of those transfer values:

(i) before the transfer value or transfer values, as the case may be, are paid; or

(ii) not later than 3 months after the day on which:

whichever is the later; or

(iii) within such further period as the Commissioner, in special circumstances allows; and

(c) the election amount is, before the expiration of the period referred to in subparagraph (b)(ii) or (iii), as the case may be, paid to the Commissioner;

then the succeeding provisions of this section have effect.

“the total of:

(g) by inserting after subsection (4) the following subsections:

“(4A) Subject to subsection (4B) and (4C), any benefit payable to or in respect of a person under subsection (4) must be:

months after the benefit becomes payable—paid, for the benefit of the person, to a preservation fund nominated by the Commissioner.

“(4B) Subsection (4A) does not apply to a benefit payable to or in respect of a person if:

(i) the amount of the person’s accumulated employer contributions under section 110Q; and

(ii) the amount that would be preserved or applied under subsection (4A) in relation to the person but for the operation of this subsection; and

(iii) the amount of superannuation guarantee top-up benefit paid to the person;

is less than $500; or

(d) the Commissioner is satisfied that the person is departing permanently from Australia.

“(4C) Subsection (4A) does not apply to a benefit, or a part of a benefit, payable to or in respect of a person if the person establishes, to the satisfaction of the Commissioner, that the benefit or the part of the benefit, as the case may be, need not be preserved or applied under subsection (4A) in order to satisfy the superannuation fund conditions under the Occupational Superannuation Standards Act 1987 as they apply in relation to that benefit.”;

(h) by inserting in subparagraph (6)(b)(i) “or, if the transfer value payable to or in respect of the person does not include such an amount, an amount equal to the notional productivity amount” after “Part VIA”;

(i) by adding at the end the following subsection:

“(8) For the purposes of subparagraphs (2)(c)(i) and (6)(b)(i), the ‘notional productivity amount’, in relation to a transferred amount or a transfer value, is the amount equal to 3% of so much of a person’s earnings as were relevant for the purpose of establishing whether, in relation to the period, or periods, of employment in respect of which the transferred amount or the transfer value, as the case may be, was payable, the employee was an employee in respect of whom one or more employers incurred an individual superannuation guarantee shortfall within the meaning of the Superannuation Guarantee (Administration) Act 1992.”.

33. Section 133 of the Principal Act is amended:

(a) by inserting after subsection (1) the following subsection:

“(1AA) A declaration under subsection (1) may be expressed to apply only in relation to the employment of a person included in a class of persons specified in the declaration.”;

(b) by inserting after subsection (1C) the following subsection:

“(1D) If:

the Board may, by instrument published in the Gazette, declare that a person, or a person included in a class of persons, who was employed in public employment for the purposes of this Division immediately before that time because of that employment continues to be so employed.”;

“(2A) A declaration under this section that is expressed to expire at a specified time ceases to be in force at that time.”;

(e) by omitting subsection (3) and substituting the following subsection:

“(3) A person is to be taken, for the purposes of this Division, to have been employed in public employment at a particular time if, and only if:

34. Section 136 of the Principal Act is amended:

(a) by omitting paragraph (2)(b) and substituting the following paragraph:

“(b) if:

(i) a deferred benefit by way of additional age retirement pension is payable to the person in accordance with subsection 57(1); or

(ii) a deferred benefit by way of additional early retirement pension is payable to the person in accordance with subsection 61(1);

the annual rate of that pension is an amount per annum equal to:

(iii) if an event mentioned in subsection 139AA(2) has not happened in relation to the person—the amount calculated in accordance with the formula:

(iv) if such an event has happened in relation to the person before the day on which the deferred benefit becomes payable, or happens on that day—the amount calculated in accordance with the formula:

(b) by inserting after subsection (2B) the following subsections:

“(2BA) In spite of subsection (2B), on each of the 7 pension paydays immediately following the death of a person in respect of whom an amount of benefit is calculated in accordance with paragraph (2B)(j), (k) or (m), pension mentioned in that paragraph is payable at the rate at which pension would have been payable to that person on that day if the person had not died.

“(2BB) Where pension is payable as mentioned in subsection (2BA), section 96A applies as if the pension were payable in accordance with subsection 94(3), 95(2) or 96(3).”.

35. Section 139 of the Principal Act is amended:

“(5) Deferred benefits are not payable unless:

(a) if paragraph (2)(a) applies:

(i) an application in writing has been made to the Board requesting payment of the benefits; and

(ii) the applicant has furnished to the Board any information that is necessary to enable the Board to determine whether the benefits are payable; or

(b) if paragraph (2)(b), (c) or (d) applies:

(i) an application in writing has been made to the Commissioner requesting payment of the benefits; and

(ii) the applicant has furnished to the Commissioner any information that is necessary to enable the Commissioner to determine whether the benefits are payable.”.

36. After section 139A of the Principal Act the following section is inserted:

Deferral of benefit payable under section 110P

“139AA.(1) If, under subsection 139(2), deferred benefits become payable to a person on a day immediately following a date selected under paragraph (c) of that subsection and that part of the person’s deferred benefits that consists of an amount equal to the person’s accumulated employer contributions is not less than $500, then, subject to subsection (2):

(a) the part must, in accordance with a nomination made by the person:

(i) be preserved in a preservation fund nominated by the person; or

(ii) be applied to the purchase of a deferred annuity nominated by the person; or

(b) if the person fails, within 2 months after the benefit becomes payable, to make a nomination—it must be preserved in a preservation fund nominated by the Commissioner.

“(2) Subsection (1) does not apply if:

37. Section 140 of the Principal Act is amended:

(a) by omitting subsection (2) and substituting the following subsection:

“(2) If:

(a) a person referred to in subsection 137(1) is:

(i) if paragraph 137(l)(a) applies—a person who has been paid an amount by way of lump sum benefit to which the person became entitled under section 80 or Part VIA or VIAA; or

(ii) if paragraph 137(1)(b) applies—a person who has been paid:

(b) after the payment, preservation or application, as the case may be, of the amount, or those amounts, the person makes an election under section 137;

the election does not have effect unless an amount equal to that amount or the aggregate of those amounts, as the case requires, is paid to the Commissioner within 7 days after the date of the election or within such further period as the Commissioner, in special circumstances, allows.”;

(b) by omitting paragraphs (3)(a) and (b) and substituting the following paragraphs:

“(a) if the person is a person to whom paragraph 137(1)(a) applies—an amount equal to the amount paid to the Commissioner less any part of that amount that is:

(i) an amount of a kind referred to in paragraph 110Q(1)(c)or (d); or

(ii) an amount of superannuation guarantee top-up benefit; or

(b) if the person is a person to whom paragraph 137(1)(b) applies—the portion of the amount paid to the Commissioner that was paid to the Consolidated Revenue Fund under section 112 at the time that the person last ceased to be an eligible employee.”.

38. Section 141 of the Principal Act is amended by omitting from paragraph (1)(c) “Commissioner” and substituting “Board”.

39. Section 153AA of the Principal Act is amended:

(a) by inserting after paragraph (d) of the definition of “decision” in subsection (1) the following paragraph:

“(da) a decision made by the Board as to whether or not it is satisfied for the purposes of a provision of section 122; or”;

(b) by inserting after paragraph (f) of the definition of “decision” in subsection (1) the following paragraph:

“(fa) a decision made by the Board as to whether or not it is satisfied for the purposes of paragraph 139(2)(a); or ;

(c) by inserting after paragraph (g) of the definition of “decision” in subsection (1) the following paragraph:

“(ga) a decision made by the Board as to whether or not it is satisfied for the purposes of paragraph 141(1)(c); or”.

40. Section 153AJ of the Principal Act is amended by omitting from subsection (1) “Where the decision” and substituting “Subject to section 153ALA, where the decision”.

Decision to be referred to Committee

Reconsideration of certain decisions by a delegate relating to invalidity

“153ALA.(1) If the Board, in relation to an application for reconsideration of a decision by a delegate not to approve the retirement of an eligible employee as provided by Part IVA, is satisfied that the eligible employee is totally and permanently incapacitated within the meaning of that Part, the Board may, without proceeding under section 153AJ to refer the decision to a panel or under section 153AK to refer the decision to a Committee, by instrument set aside the decision and substitute another decision approving the retirement of the eligible employee on the ground of invalidity.

“(2) The Board must:

43. Section 153AQ of the Principal Act is amended by omitting from subsection (1) “Where a decision” and substituting “Subject to section 153AT, where a decision”.

Decision to be referred to Committee

Reconsideration of certain decisions by the Board relating to invalidity

“153AT.(1) If the Board, in relation to an application for reconsideration of a decision by the Board not to approve the retirement of an eligible employee as provided by Part IVA, is satisfied that the eligible employee is totally and permanently incapacitated within the meaning of that Part, the Board may, without proceeding under section 153AQ to refer the decision to a panel or under section 153AR to refer the decision to a Committee, by instrument set aside the decision and substitute another decision approving the retirement of the eligible employee on the ground of invalidity.

“(2) The Board must:

46. Section 154A of the Principal Act is amended:

(a) by inserting after subsection (1) the following subsection:

“(1A) If, under a provision of this Act, notional interest is to be calculated on an amount, that interest must be calculated in accordance with a determination made by the Board for the purposes of that provision.”;

(b) by inserting in subsection (2) “or (1A)” after “subsection (1)”.

Modification of Act in relation to persons who cease to be eligible employees in certain circumstances

47.(1) Section 155B of the Principal Act is amended by omitting subsection (1) and substituting the following subsection:

“(1) This section applies to a person who:

50. Section 164 of the Principal Act is amended by omitting “or by the Commissioner” and substituting “the Commissioner or the Board”.

51. Section 168 of the Principal Act is amended by adding at the end the following subsections:

“(11) Regulations made within 2 years after the commencement of this subsection for the purposes of section 6A may commence on a day earlier than the day on which they are made, but not earlier than the commencement of this subsection.”.

“(12) Regulations made within one year after the commencement of this subsection for the purposes of section 14A, 51, 126, 155, 180 or 183 may commence on a day earlier than the day on which they are made, but not earlier than the commencement of this subsection.”.

52. Section 240 of the Principal Act is amended by inserting in paragraph (1)(a) “Fund” after “accumulated contributions and”.

53. Section 244 of the Principal Act is amended by omitting from paragraph (3)(a) “until 31 March” and substituting “on 31 March”.

54. Section 248 of the Principal Act is amended by inserting in paragraph (1)(a) “Fund” after “accumulated contributions and”.

55. The Principal Act is further amended as set out in the Schedule.

56. In this Part, “Principal Act” means the Superannuation Act 1990³.

57. Section 3 of the Principal Act is amended by inserting “or that is an approved authority by virtue of paragraph (a),” after “or (iv),” in sub-subparagraph (b)(v)(A) of the definition of “approved authority”.

Membership of Superannuation Scheme

58.(1) Section 6 of the Principal Act is amended:

(a) by inserting after subparagraph (1)(e)(i) the following subparagraph:

“(ia) immediately before he or she became an invalidity pensioner was the holder of that office or engaged in that employment; and”;

(b) by omitting paragraph (1)(f) and substituting the following paragraph:

“(f) the holder of a statutory office, or a temporary employee, who:

(i) immediately before being appointed to that office or being employed in his or her present employment was a person to whom a preserved benefit was applicable under the Rules; and

(ii) immediately before the preserved benefit became so applicable was the holder of that office or employed in the same employment;”;

“(3) Paragraph (2)(a) does not exclude a person from membership of the Superannuation Scheme in relation to particular employment if the person is an eligible employee for the purposes of the Superannuation Act 1976 in relation to other employment.”.

60. Section 8 of the Principal Act is amended:

(a) by omitting subsection (1) and substituting the following subsection:

“(1) A person who is a temporary employee in relation to particular employment (other than a temporary employee to whom paragraph 6(1)(e) or (f) applies) may elect, by writing in a form approved by the Board, to become a member of the Superannuation Scheme in relation to that employment.”;

(b) by adding at the end the following subsections:

“(4) The effect of making an election under subsection (1) is that the person becomes a member of the Superannuation Scheme only in respect of the employment to which the election relates.

“(5) This section does not prevent the person becoming a member of the Superannuation Scheme in respect of other employment.”.

61. Section 15 of the Principal Act is amended by omitting from subsection (1) the definition of “designated employer” and substituting the following definitions:

“‘designated employer’, in relation to a member, means:

(a) where the member is a permanent employee, or temporary employee, of the Commonwealth, but is not an LWOP member:

(i) if the remuneration in respect of his or her employment is paid wholly or principally out of money appropriated under an annual Appropriation Act—the Department in respect of which the money is appropriated; or

(ii) if the remuneration in respect of his or her employment is paid wholly or principally out of money appropriated under an Act other than an annual Appropriation Act—such Department as is determined by the Minister in writing; or

(b) where the member is the holder of a statutory office, but is not an LWOP member:

(i) if the remuneration in respect of that office is paid by an approved authority—that authority; or

(ii) if subparagraph (i) does not apply—such Department as is determined by the Minister in writing; or

‘LWOP member’ means a member who:

62. Section 16 of the Principal Act is amended:

(a) by omitting paragraph (l)(b) and substituting the following paragraph:

“(b) the Commonwealth must pay the benefits to such person or persons as are appropriate under the Rules.”;

“(b) the Commonwealth must pay the preserved benefit to such person or persons as are appropriate under the Rules.”;

(e) by omitting from subsection (6) “paragraph (1)(b), subsection (3) or paragraph (4)(b)” and substituting “subsection (3)”.

63. Section 34 of the Principal Act is amended by omitting subsection (1) and substituting the following subsections:

“(1) The costs of the administration of this Act and of the Trust Deed, including the costs of and incidental to the management of the Fund by the Board and the investment of its money, are to be paid as determined from time to time by the Minister.

“(1A) A determination for the purposes of subsection (1) is to be in writing and is to identify, whether by amount or otherwise:

“(1B) Costs determined by the Minister to be payable by the Commonwealth are to be paid out of money appropriated from time to time by Parliament for the purpose.”.

64. Section 35 of the Principal Act is amended by inserting after subsection (1) the following subsection:

“(1A) The Board, if directed in writing to do so by the Minister, must prepare an estimate containing such information as the Minister requires in respect of such of those costs as are specified by the Minister.”.

65. Section 37 of the Principal Act is repealed and the following section is substituted:

Costs—Board being assisted by panel of persons

“37.(1) If, under the Rules, the Board engages a panel of persons to assist it to reach a decision:

any cost specified in subsection (2) is payable from the Consolidated Revenue Fund, which is appropriated accordingly.

“(2) Each of the following costs is specified for the purposes of subsection (1):

“(3) Where the Board decides not to approve invalidity retirement for a member, the cost of any rehabilitation program recommended for the member under the Rules and undertaken by the member is payable from the Consolidated Revenue Fund, which is appropriated accordingly.”.

66. In this Part, “Principal Act” means the Superannuation (Productivity Benefit) Act 1988⁴.

67. Section 3 of the Principal Act is amended by inserting “(other than superannuation benefits approved under the Superannuation Benefits (Supervisory Mechanisms) Act 1990)” after “superannuation benefits” in paragraph (d) of the definition of “qualified employee” in subsection (1).

68. Section 3B of the Principal Act is amended by inserting after subsection (1) the following subsection:

“(1A) In working out under subsection (1) the rate of salary of a remainder employee for a pay period, any ongoing compensation payments received by the employee in respect of his or her employment as such an employee during the first pay period mentioned in that subsection are taken to be salary paid to the employee.”.

69. Section 3C of the Principal Act is amended by inserting after subsection (2) the following subsection:

“(2A) Subject to this section, where a fund employee who is employed on a full-time basis is on leave without pay during the whole or part of a pay period of the employee, the continuing contribution in respect of the employee for the pay period is:

where:

‘Actual salary’ means the salary payable to the employee for the pay period;

‘Full-time salary’ means the salary that would have been payable to the employee for the period if he or she had not been on leave without pay;

‘Full-time continuing contribution’ means the amount that would be the continuing contribution in respect of the employee for the pay period if he or she had not been on leave without pay.”.

70. Section 4A of the Principal Act is amended by omitting from subsection (1) “, not being scheme employees,”.

SCHEDULE Section 55

AMENDMENTS OF THE SUPERANNUATION ACT 1976 CONSEQUENTIAL UPON THE ENACTMENT OF THE MILITARY SUPERANNUATION AND BENEFITS ACT 1991

Subsection 3(1):

Insert the following definition:

“ ‘MSB Act’ means the Military Superannuation and Benefits Act 1991;”.

Subsection 10(2):

After “Defence Force Retirement and Death Benefits Act” insert “or the MSB Act”.

Subsection 54(1):

After “under the Defence Force Retirement and Death Benefits Act” insert “or the MSB Act”.

Subsection 54(2):

Omit “Death Benefits Act, is entitled to retirement pay”, substitute “Death Benefits Act or the MSB Act, is entitled to retirement pay or pension (as the case requires)”.

Subsection 117(1):

NOTES

1. On the day on which Superannuation Act 1976 is amended by this Act, the heading to that section is altered by adding at the end “or MSB Act”.section 117 of the

[Minister’s second reading speech made in—

House of Representatives on 4 November 1992

Senate on 10 November 1992]