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Wednesday, 19 April 1961

Mr STOKES (Maribyrnong) .- I appreciate the fact that previous speakers have referred to the anomalies that exist under the Defence Forces Retirement Benefits Act of 1948 and 1959 and that possibly those who follow me will also refer to those anomalies. It is quite true that there are anomalies and they have grown over a period of years. We trust that in due course full attention will be given to the representations that are being made to the Government on these points. The Parliamentary Draftsman himself has said that the 1948 legislation was one of the most complex pieces of legislation that he has drafted, and the 1959 act is only second to it in that regard. That indicates the complexities of the legislation that is to be amended by the bill before the House.

I rise principally to give some reasons for these amendments. They follow, in general lines, three series. The first refers to the members who, by virtue of the original act of 1948, were given the right to elect not to contribute to the fund which was established under that measure. Those people elected not to come into the fund and relied rather on the other Service benefits such as deferred pay or the gratuity payments provided in the various Service regulations. Under the original act, this right of election not to contribute for the benefits under the Defence Forces Retirement Benefits Act was held over until four months after the proclamation of the original act. After that, all those who had not elected to contract out were absorbed into the scheme and made their contributions.

However, by an amendment to the 1959 act which was consequent upon the findings of the Allison committee, the door was again opened to members who had contracted out to come into the scheme because it was felt that perhaps the position had not been fully explained or expressed to them, or that in many cases the men had not fully understood the purport of what the 1948 act was offering to them. Honorable members should realize that with naval personnel serving in ships outside Australia on various widespread stations it was difficult and not always possible to get across the message of what was to be done and what benefits were inherent in the making of these contributions. As a result, by 1960, there were still some 900 members of the services who had contracted out and still could, if given the opportunity, contract in. Advice to this effect having been given, the date for the closing of such applications was set at 14th April, 1960. But as, at about that time, most of our naval forces were distributed around the South Pacific area, it was necessary to extend the time for receipt of those applications. The time was extended to 14th August, 1960, largely by departmental action, and the purpose of part of the first series of amendments is to validate that extension.

It is interesting to note that of the approximately 900 who remained out prior to 1960, 175 members came into the scheme. The extension was granted because it was considered that no member should be refused the right to take up these benefits merely because of lack of information of their availability and perhaps because of the unwieldiness, in the circumstances, of the administrative machinery.

The first series of amendments also seeks to validate an extension to 14th June, 1960, in the cases of members who were already contributing to the fund and who had the right to elect not to contribute for the increased benefits.

The second series of amendments deals with officers who were serving in the forces prior to 1959. Under the original act, those officers were entitled to a gratuity equivalent to one and one-half times their own contributions to the fund. But, in 1959, following the Allison committee's recommendations in this regard, it was decided to make this gratuity a fixed monetary sum. When I say a fixed monetary sum, I mean a monetary sum which varied in accordance with certain factors but which was expressed, in fact, as a monetary sum and not as a rate of one and one-half times the amount of personal contributions. This was done in the 1959 act, but it was later discovered that approximately 74 officers, if they were compelled to accept the lump sum gratuity, would be getting a smaller sum than they would have received if they contributed at the old rate of contribution and received the one and one-half times benefit on retirement. So, the second series of amendments will preserve to them the right to the one and onehalf times formula in accordance with their particular rates of contribution prior to the 1959 act.

The third series of amendments deals again with the cases of members who are at present contributing for increased benefits but who retire on a pension prior to their due date of retirement. Under the 1959 act provision was made in these cases for a reduced pension to be paid, or, if the member cared to contribute a lump sum to the fund, he could then get the full pension. Tn addition to these contributions for normal pensions there is provision in the act to allow contributions for additional benefits such as a pension for the member's widow, and additional contributions for higher pensions as a result of promotion. If a man is promoted, he has the right to apply for an increased pension. There was no provision that these additional contributions were also to be covered by the provision whereby a member could obtain a reduced pension actuarially based or pay a lump sum for the full benefit. The second series of amendments does, in fact, extend to a member the right to cover himself for these additional benefits in the form of a pension, for the widow or an increased pension upon promotion.

The other amendments in this third series simply clarify the provision in the original legislation that the Defence Forces Retirement Benefits Board and the Commonwealth Actuary would take certain factors into account in arriving at their decision, lt is quite patent that the Actuary, when arriving at his decision, would take cognizance of the various factors applicable and place them before the board, which would then make its decision based on that information.

The other amendments are merely minor drafting amendments. As I see in the bill nothing but extensions of privileges to members of the services, which are in their interests and to their benefit, I commend the bill to the House.

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