Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Superannuation Legislation Amendment (Superannuation Safety and Other Measures) Bill 2006

 

 

 

 

 

 

Superannuation Legislation Amendment (Superannuation Safety and Other Measures) Act 2006

 

No. 112, 2006

 

 

 

 

 

An Act to amend the law relating to superannuation, and for other purposes

   

   



Contents

1............ Short title............................................................................................ 1

2............ Commencement.................................................................................. 2

3............ Schedule(s).......................................................................................... 3

Schedule 1—Amendments relating to the CSS Board and the PSS Board                 4

Superannuation Act 1976                                                                                           4

Superannuation Act 1990                                                                                           7

Superannuation Act 2005                                                                                           7

Schedule 2—Amendments relating to negative interest rates for the CSS                8

Superannuation Act 1976                                                                                           8

Schedule 3—Validation of certain benefits under the Superannuation Act 1976    12

 



 

 

Superannuation Legislation Amendment (Superannuation Safety and Other Measures) Act 2006

No. 112, 2006

 

 

 

An Act to amend the law relating to superannuation, and for other purposes

[ Assented to 23 October 2006 ]

The Parliament of Australia enacts:

1   Short title

                   This Act may be cited as the Superannuation Legislation Amendment (Superannuation Safety and Other Measures) Act 2006 .

2   Commencement

             (1)  Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.

 

Commencement information

Column 1

Column 2

Column 3

Provision(s)

Commencement

Date/Details

1.  Sections 1 to 3 and anything in this Act not elsewhere covered by this table

The day on which this Act receives the Royal Assent.

23 October 2006

2.  Schedule 1

The day on which this Act receives the Royal Assent.

23 October 2006

3.  Schedule 2, items 1 to 25

Either:

(a) if this Act receives the Royal Assent on 1 July in a year—the day on which this Act receives the Royal Assent; or

(b) otherwise—on the 1 July that next follows the day on which this Act receives the Royal Assent.

1 July 2007

(paragraph (b) applies)

4.  Schedule 2, items 26 and 27

Immediately after the provision(s) covered by table item 3.

1 July 2007

5.  Schedule 2, items 28 and 29

Either:

(a) if this Act receives the Royal Assent on 1 July in a year—the day on which this Act receives the Royal Assent; or

(b) otherwise—on the 1 July that next follows the day on which this Act receives the Royal Assent.

1 July 2007

(paragraph (b) applies)

6.  Schedule 3

The day on which this Act receives the Royal Assent.

23 October 2006

Note:          This table relates only to the provisions of this Act as originally passed by the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.

             (2)  Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act.

3   Schedule(s)

                   Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.



 

Schedule 1 Amendments relating to the CSS Board and the PSS Board

   

Superannuation Act 1976

1  Section 27E

Insert:

SIS fitness and propriety standard means a standard prescribed under Part 3 of the Superannuation Industry (Supervision) Act 1993 relating to fitness and propriety for trustees of funds (within the meaning of that Act) and RSE licensees (within the meaning of that Act).

2  After subsection 27F(1A)

Insert:

          (1B)  A person is not eligible for appointment as one of the members referred to in paragraph (1)(b) if the person’s appointment would result in a contravention of a SIS fitness and propriety standard.

3  Paragraph 27H(1)(b)

Omit “or from Australia”.

4  Application of amendment—paragraph 27H(1)(b) of the Superannuation Act 1976

The amendment of paragraph 27H(1)(b) of the Superannuation Act 1976 made by this Schedule applies to an appointment made after the commencement of this item.

5  After subsection 27H(1B)

Insert:

          (1C)  A person is not eligible for appointment to act as an appointed member if the person’s appointment would result in a contravention of a SIS fitness and propriety standard.

6  Subsection 27M(3)

After “terminate”, insert “, under subsection (1) or (2),”.

7  At the end of section 27M

Add:

             (6)  If the continuation in office of an appointed member would contravene a SIS fitness and propriety standard, the Minister may terminate the appointment of the member.

             (7)  Subsections (1) and (2) do not limit subsection (6).

8  After subsection 27N(4)

Insert:

          (4A)  A member may, by writing signed by the member, appoint another member as his or her proxy to attend and vote on his or her behalf at a meeting of the Board at which the first-mentioned member is not present.

          (4B)  A person appointed as the proxy of a member is not entitled to vote on behalf of the member on a proposed decision unless:

                     (a)  the instrument of proxy appointment sets out the terms of the proposed decision; and

                     (b)  the instrument of proxy appointment indicates whether the member is in favour of, or against, the proposed decision; and

                     (c)  the person votes on the proposed decision in accordance with that indication.

9  After subsection 27N(5)

Insert:

          (5A)  In determining whether a quorum is present, if a person is attending both as a member and as a proxy representative of one or more other members, count the person:

                     (a)  once for the person’s attendance as a member; and

                     (b)  once for each proxy held by the person.

          (5B)  At a meeting, at least 2 members must be present.

10  Subsection 27N(6)

Omit “present at the meeting”, substitute “voting, whether personally or by proxy”.

11  After subsection 27N(7)

Insert:

          (7A)  If a member votes by proxy at a meeting of the Board, the record of that meeting must note that the vote was by proxy.

12  At the end of section 27N

Add:

Note:          See also section 33B of the Acts Interpretation Act 1901 (participation in meetings by telephone etc.).

13  After subsection 27P(4)

Insert:

          (4A)  A disclosure under subsection (4) may be made:

                     (a)  by the member personally; or

                     (b)  on behalf of the member by a person who is attending the meeting as the proxy representative of the member.

14  Paragraphs 27P(5)(b) and (6)(b)

After “take part”, insert “, either personally or by proxy,”.

15  After paragraph 27Q(1)(a)

Insert:

                    (aa)  a member of the staff of the Board; or

16  Subparagraph 27Q(3)(a)(ii)

Omit “(1)(b)”, substitute “(1)(aa), (b)”.

17  Paragraph 27Q(3)(c)

Omit “(1)(c)”, substitute “(1)(aa), (c)”.

18  Paragraph 163AB(1)(a)

Omit “the SIS Act”, substitute “any other Act”.

19  At the end of subsection 163AB(3)

Add “unless doing so would breach Chapter 7 of the Corporations Act 2001 ”.

Superannuation Act 1990

20  After paragraph 28A(1)(a)

Insert:

                    (aa)  a member of the staff of the Board; or

21  Subparagraph 28A(2)(a)(ii)

Omit “(1)(b)”, substitute “(1)(aa), (b)”.

22  Paragraph 28A(2)(c)

Omit “(1)(c)”, substitute “(1)(aa), (c)”.

23  Subparagraph 42A(1)(a)(ii)

Omit “the SIS Act”, substitute “any other Act”.

24  At the end of subsection 42A(3)

Add “unless doing so would breach Chapter 7 of the Corporations Act 2001 ”.

25  Paragraph 43(1)(d)

Omit “the Act”, substitute “this Act”.

Superannuation Act 2005

26  After paragraph 28(1)(a)

Insert:

                    (aa)  a member of the staff of the Board; or

27  Paragraph 28(2)(b)

Omit “(1)(b)”, substitute “(1)(aa), (b)”.

28  Subsection 28(4)

Omit “(1)(c)”, substitute “(1)(aa), (c)”.



 

Schedule 2 Amendments relating to negative interest rates for the CSS

   

Superannuation Act 1976

1  Subsection 3(1) (definition of accumulated basic contributions )

Omit “interest that is payable in respect of those contributions”, substitute “interest on those contributions”.

2  Subsection 3(1) (definition of accumulated supplementary contributions )

Omit “interest that is payable in respect of those contributions”, substitute “interest on those contributions”.

3  Subsection 3(1)

Insert:

amount includes a nil amount.

4  Subsection 3(1)

Insert:

interest includes negative or zero interest, and accruing , when used in relation to interest, has a corresponding meaning.

5  Subsection 3(1)

Insert:

notional interest includes negative or zero notional interest.

6  Subsection 3(1)

Insert:

plus has a meaning affected by subsection (9).

7  Subsection 3(1)

Insert:

sum has a meaning affected by subsection (9).

8  Subsection 3(1)

Insert:

total has a meaning affected by subsection (9).

9  At the end of section 3

Add:

             (9)  If:

                     (a)  a provision of this Act involves the calculation of a sum (whether the expression “sum”, “total”, “plus” or any other expression is used); and

                     (b)  the calculation involves negative interest or negative notional interest; and

                     (c)  apart from this subsection, the sum would be less than zero;

the sum is taken to be zero.

10  Subsection 7A(1)

Omit “together with the amount of any interest that is payable in respect of the amount”, substitute “plus interest on the amount”.

11  Paragraphs 7A(2)(d), (e) and (f)

Omit “together with the amount of any interest that is payable in respect of the amount”, substitute “plus interest on the amount”.

12  Subsections 7A(3) and (4)

Omit “together with the amount of any interest that is payable in respect of the amount”, substitute “plus interest on the amount”.

13  Subsection 62B(4) (definition of GBB )

Omit “together with”, substitute “plus”.

14  Subsection 110SE(4) (definition of GBB )

Omit “together with”, substitute “plus”.

15  Subparagraph 145(7)(d)(i)

Omit “interest that is payable in respect of that excess”, substitute “interest on that excess”.

16  After subsection 145(7)

Insert:

          (7A)  An amount paid under subparagraph (7)(d)(i) in respect of a particular excess must not be less than the amount of the excess.

17  Subparagraph 145(8)(a)(i)

After “equal to the amount”, insert “(the principal amount )”.

18  Subparagraph 145(8)(a)(i)

Omit “interest that is payable in respect of that amount”, substitute “interest on the principal amount”.

19  After subsection 145(8)

Insert:

          (8A)  An amount paid into the Superannuation Fund under subparagraph (8)(a)(i) in respect of a particular principal amount must not be less than the principal amount.

20  Subparagraph 145(9)(a)(i)

After “equal to the amount”, insert “(the principal amount )”.

21  Subparagraph 145(9)(a)(i)

Omit “interest that is payable in respect of that amount”, substitute “interest on the principal amount”.

22  After subsection 145(9)

Insert:

          (9A)  An amount paid into the Superannuation Fund under subparagraph (9)(a)(i) in respect of a particular principal amount must not be less than the principal amount.

23  Paragraph 146MC(1)(a)

Omit “together with”, substitute “plus”.

24  Subsection 154A(1)

Omit “interest is payable in respect of an amount, the interest must be calculated, and is payable,”, substitute “interest is to be calculated on an amount, that interest must be calculated”.

25  Section 156A

Before “If:”, insert “(1)”.

26  Subsection 156A(1)

Omit “interest in respect of the amount”, substitute “interest on the amount”.

27  At the end of section 156A

Add:

             (2)  An amount paid under subsection (1) in respect of a particular paragraph (1)(a) amount must not be less than the paragraph (1)(a) amount.

28  Transitional—subsections 154A(1) and (1A) of the Superannuation Act 1976

The amendments made by this Schedule do not affect the continuity of any determination made under subsection 154A(1) or (1A) of the Superannuation Act 1976 before the commencement of this item.

29  Transitional—zero interest

To avoid doubt, the amendments made by this Schedule do not imply that:

                     (a)  zero interest could not have been determined under subsection 154A(1) of the Superannuation Act 1976 before the commencement of this item; or

                     (b)  zero notional interest could not have been determined under subsection 154A(1A) of the Superannuation Act 1976 before the commencement of this item.



 

Schedule 3 Validation of certain benefits under the Superannuation Act 1976

   

1  Validation of certain pensions

Scope

(1)        This item applies if:

                     (a)  during the period:

                              (i)  beginning on 1 July 1995; and

                             (ii)  ending immediately before the commencement of this item;

                            a pension commenced to be paid to a person; and

                     (b)  throughout a period (the interim period ):

                              (i)  beginning when the pension commenced to be paid to the person; and

                             (ii)  ending at or before the commencement of this item;

                            the following conditions were satisfied:

                            (iii)  the pension purported to be a benefit, or a part of a benefit, payable to the person under the Superannuation Act 1976 ;

                            (iv)  the pension was not payable;

                             (v)  the pension breached section 111A of the Superannuation Act 1976 (whether or not it also breached anything else).

Recovery of overpayment

(2)        The total amount of the pension paid to the person during the interim period:

                     (a)  is a debt due and payable to the Board; and

                     (b)  may be recovered by the Board in a court of competent jurisdiction.

(3)        An amount recoverable under subitem (2) is not recoverable under subsection 156(4) or (5) of the Superannuation Act 1976 .

Substitute payment

(4)        There is payable to the person a benefit equal to the total amount of pension that would have been payable to the person during the interim period if the pension had not breached whichever of the following provisions is or are applicable:

                     (a)  section 111A of the Superannuation Act 1976 ;

                     (b)  section 110TB of the Superannuation Act 1976 ;

                     (c)  the Superannuation Industry (Supervision) Act 1993 ;

                     (d)  the Superannuation (CSS) Former Eligible Employees Regulations.

Set-off

(5)        The amount payable by the person under subitem (2) may be recovered by deduction from the amount payable to the person under subitem (4).

Payments do not breach section 111A of the Superannuation Act 1976 etc.

(6)        The payment under subitem (4) is taken not to breach any of the following provisions:

                     (a)  section 111A of the Superannuation Act 1976 ;

                     (b)  section 110TB of the Superannuation Act 1976 ;

                     (c)  the Superannuation Industry (Supervision) Act 1993 ;

                     (d)  the Superannuation (CSS) Former Eligible Employees Regulations.

(7)        If the interim period ended at the commencement of this item, the continuing payment of the pension after the commencement of this item is taken not to breach any of the following provisions:

                     (a)  section 111A of the Superannuation Act 1976 ;

                     (b)  section 110TB of the Superannuation Act 1976 ;

                     (c)  the Superannuation Industry (Supervision) Act 1993 ;

                     (d)  the Superannuation (CSS) Former Eligible Employees Regulations.

(8)        If:

                     (a)  the interim period ended before the commencement of this item; and

                     (b)  before the commencement of this item, the person became entitled to periodic payments under section 33 of the Financial Management and Accountability Act 1997 in substitution for the pension;

the payment of the pension after the commencement of this item is taken not to breach any of the following provisions:

                     (c)  section 111A of the Superannuation Act 1976 ;

                     (d)  section 110TB of the Superannuation Act 1976 ;

                     (e)  the Superannuation Industry (Supervision) Act 1993 ;

                      (f)  the Superannuation (CSS) Former Eligible Employees Regulations.

Substitute payment taken to be a payment of pension

(9)        The payment under subitem (4) is taken to be a payment of pension payable under the Superannuation Act 1976 .

2  Validation of certain lump sums

Scope

(1)        This item applies if:

                     (a)  during the period:

                              (i)  beginning on 1 July 1995; and

                             (ii)  ending immediately before the commencement of this item;

                            a lump sum was paid to a person; and

                     (b)  the lump sum purported to be a benefit, or a part of a benefit, payable to the person under the Superannuation Act 1976 ; and

                     (c)  the lump sum was not payable; and

                     (d)  the lump sum breached section 111A of the Superannuation Act 1976 (whether or not it also breached anything else).

Recovery of overpayment

(2)        The amount of the lump sum:

                     (a)  is a debt due and payable to the Board; and

                     (b)  may be recovered by the Board in a court of competent jurisdiction.

(3)        An amount recoverable under subitem (2) is not recoverable under subsection 156(4) or (5) of the Superannuation Act 1976 .

Substitute payment

(4)        There is payable to the person a benefit equal to the lump sum that would have been payable to the person if the lump sum had not breached whichever of the following provisions is or are applicable:

                     (a)  section 111A of the Superannuation Act 1976 ;

                     (b)  section 110TB of the Superannuation Act 1976 ;

                     (c)  section 139AA of the Superannuation Act 1976;

                     (d)  the Superannuation Industry (Supervision) Act 1993 ;

                     (e)  the Superannuation (CSS) Former Eligible Employees Regulations.

Set-off

(5)        The amount payable by the person under subitem (2) may be recovered by deduction from the amount payable to the person under subitem (4).

Payment does not breach section 111A of the Superannuation Act 1976 etc.

(6)        The payment under subitem (4) is taken not to breach any of the following provisions:

                     (a)  section 111A of the Superannuation Act 1976 ;

                     (b)  section 110TB of the Superannuation Act 1976 ;

                     (c)  section 139AA of the Superannuation Act 1976;

                     (d)  the Superannuation Industry (Supervision) Act 1993 ;

                     (e)  the Superannuation (CSS) Former Eligible Employees Regulations.

Substitute payment taken to be a benefit under the Superannuation Act 1976

(7)        The payment under subitem (4) is taken to be a benefit payable under the Superannuation Act 1976 .



 

 [ Minister’s second reading speech made in—

House of Representatives on 23 June 2005

Senate on 18 August 2005 ]

(112/05)