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Statement on superannuation



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4. AUSTRALIA,.^

MINISTER FOR FINANCE

PRESS RELEASE

EMBARGO NO: 63/84

Statement by the Minister for Finance, the Hon J S Dawkins MP and the ACTU Delegation to the Government on matters concerning superannuation for Australian Government Employees..

This week in Canberra from 16 to 19 October Mr J S Dawkins MP met with an ACTU delegation to consider a range of matters concerning the Superannuation Fund Investment Trust (SFIT) and the Commonwealth Superannuation Scheme. These included

the recommendations of the Joint Working Party on SFIT, amendments of a technical nature to the Superannuation Acts and matters of concern to both sides on the future of the Scheme.

The Trust.

In the course of the meetings agreement was reached on the future operation of the Trust. An important new provision will see with the passage of legislation, expansion of the Trust to five members, two of whom will be full-time. The

contributors' representation will comprise one full-time and two part-time members. The Trust will have significantly enhanced investment powers designed to enable it to achieve maximum return on its investments. It was also agreed that

the Trust should move to full market valuation of all its assets for the purpose of assessing and distributing investment earnings. Equalisation arrangements will prevent excessive year by year fluctuations in earning rates. While both parties agreed that these changes will enable the Trust

to improve its financial performance, they reiterated their expressed view that the integrity of the Fund is assured. Consideration will be given to changing the name of the Trust to emphasise its role as investor of funds provided solely by

employee contributors.

The Superannuation Scheme.

Both sides brought to notice concerns about the operations and the future of the scheme. In response to representations from the ACTU the Minister gave an assurance that this

Government on return to office intended to maintain the indexed pension as a principal feature of the scheme and would examine means of extending superannuation coverage to those Commonwealth employees who are currently denied it. In addition the Minister agreed to meet with the ACTU early in

the New Year following the election to consider further a number of aspects of the scheme of concern to contributors and the Government.

This consideration would be against the background of the Accord which provides "that the Australian Government employment sector will not be a pacesetter in establishing wage rates and cost related conditions beyond conditions

comparable in other public sector employment and in the private sector."

The aspects to be discussed include;

. provisions covering vesting;

. alternative benefit configurations;

. rates of contributions;

. necessary changes in the light of developments in occupational superannuation such as the Building Unions Superannuation Scheme;

. invalidity provisions of the scheme.

The Minister and the ACTU agreed to commence work immediately on a review of some aspects of the administration of the invalidity provisions.

It was agreed not to proceed with Government proposals in relation to the benefits accrual rate though there will be continuing discussions on superannuation arrangements for permanent part-time employees under the Public Service Act.

Under the present invalidity retirement system, the Commissioner for Superannuation must examine and note any pre-existing medical condition of contributors, to determine benefits. Aspects of this system have now been considerably

streamlined ensuring greater certainty in relation to contributors entitlements.

In relation to former Provident Account contributors, the Commissioner for Superannuation proposed arrangements which will expedite the issue of Benefit Classification Certificates.

Both sides agreed that the four day meeting had been productive in the resolution of a range of issues which have been of concern for a number of years.

Canberra 19 October 1984.