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Defence Force Retirement and Death Benefits Amendment (Fair Indexation) Bill 2010

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7027

2010-2011

 

The Parliament of the

Commonwealth of Australia

 

THE SENATE

 

 

 

 

Defence Force Retirement and Death Benefits Amendment (Fair Indexation) Bill 2010

 

 

(1)     Title, page 1 (line 2), after “ 1973 ”, insert “ and the Defence Forces Retirement Benefits Act 1948 ”.

[also amend Defence Forces Retirement Benefits Act 1948]

(2)     Clause 2, page 2 (table item 2), omit “Schedule 1”, substitute “Schedules 1 and 2”.

[also amend Defence Forces Retirement Benefits Act 1948]

(3)     Clause 3, page 2 (line 11), after “members”, insert “and Defence Forces Retirement Benefits Scheme members”.

[also amend Defence Forces Retirement Benefits Act 1948]

(4)     Page 6 (after line 15), at the end of the bill, add:

 

Schedule 2 Amendment of the Defence Forces Retirement Benefits Act 1948

   

1  Section 83

Insert:

LCI means Pensioner and Beneficiary Living Cost Index.

2  Section 83

Insert:

LCI number , in relation to a quarter, means the All Groups Pensioner and Beneficiary Living Cost Index number that is the weighted average of the 8 capital cities and is published by the Statistician in respect of that quarter.

3  Section 83

Insert:

VEA means Veterans’ Entitlements Act 1986 .

4  Subsection 84(1)

After “in this section”, insert “and section 84AA”.

5  Subsection 84(2)

Omit “The”, substitute “Subject to section 84AA, the”.

6  After section 84

Insert:

84AA   Additional increase in certain pensions

             (1)  The section applies in relation to a pensioner who is 55 or older.

             (2)  In relation to a pensioner to whom this section applies, the prescribed percentage for a prescribed half-year, ascertained in accordance with subsection 84(3), is taken to be increased in accordance with this section.

             (3)  If the prescribed percentage for a prescribed half-year is less than the percentage for the prescribed half-year worked out using the pension MBR method in section 84AB, the prescribed percentage is taken to be the percentage worked out using the pension MBR method.

             (4)  If, after applying subsection (3), the prescribed percentage for the prescribed half-year is less than the percentage for the prescribed half-year worked out using the LCI method in section 84AC, the prescribed percentage is taken to be the percentage worked out using the LCI method.

84AB   Percentage increase using the pension MBR method

             (1)  The percentage worked out in relation to a prescribed half-year using the pension MBR method is the percentage that represents A — B expressed as a percentage of B,

                   where:

A is the single pension rate MBR amount (see item 1A of the table in section 59A of the VEA) applicable on the adjustment day prior to the first day of the prescribed half year; and

B is the single pension rate MBR amount (see item 1A of the table in section 59A of the VEA) applicable on the day before that adjustment day

worked out to 3 decimal places.

Note:          Changes in the single pension rate MBR amount reflect changes in Male Total Average Weekly Earnings (MTAWE).

Rounding

             (2)  If a percentage worked out under subsection (1) would, if it were worked out to 4 decimal places, end in a number that is greater than 4, that percentage is to be increased by 0.001.

Publication of substituted amounts

             (3)  If at any time (whether before or after the commencement of this section), the Australian Statistician publishes an amount in substitution for a particular amount previously published by the Australian Statistician, the publication of the later amount is to be disregarded for the purposes of this section.

Interpretation

             (4)  In this section:

adjustment day means:

                     (a)  20 March; or

                     (b)  20 September.

84AC   Percentage increase using the LCI method

             (1)  The percentage worked out in relation to a prescribed half-year using the LCI method is the percentage that represents A — B expressed as a percentage of B,

                   where:

A is the LCI number in respect of the first quarter of the most recent half-year; and

B is the highest LCI number in respect of the first quarter of any half-year earlier that the most recent half-year

worked out to 3 decimal places.

Rounding

             (2)  If a percentage worked out under subsection (1) would, if it were worked out to 4 decimal places, end in a number that is greater than 4, that percentage is to be increased by 0.001.

Publication of substituted living cost index numbers

             (3)  Subject to subsection (4), if at any time (whether before or after the commencement of this section) the Australian Statistician publishes a living cost index number for a quarter in substitution for a living cost index number previously published by the Australian Statistician for that quarter, the publication of the later living cost index number is to be disregarded for the purposes of this section.

Change to reference base

             (4)  If at any time (whether before or after the commencement of this section) the Australian Statistician changes the reference base for the Pensioner and Beneficiary Living Cost Index, regard is to be had, for the purposes of applying this section after the change takes place, only to living cost index numbers published in terms of the new reference base.

Interpretation

             (5)  In this section:

most recent half-year means the half-year immediately preceding the prescribed half-year.

[also amend Defence Forces Retirement Benefits Act 1948]