Premier & Cabinet

Type:
Department of Premier and Cabinet Circular
Identifier:
C1992-12
Status:
Archived

C1992-12 Superannuation Guarantee Charge Legislation (SGC), Interim Changes to SES Superannuation Arrangements

Detailed Outline

The following information applies to superannuation arrangements for SES officers only. It does not apply to officers on other remuneration packages or on salaries above Grade 12. Separate advice will be issued regarding employees outside of the SES. 

The Commonwealth Parliament has passed legislation which will have a major effect on superannuation arrangements in Australia (the superannuation guarantee charge legislation). Employers are required to contribute in each year a minimum percentage of employee earnings towards employee superannuation. This mandatory employer contribution is capped at the level applicable to earnings of $80,000pa. This figure of $80,000 will be indexed against average weekly earnings in future years.

The Commonwealth legislation operates retrospectively, with the requirement for minimum employer contributions to commence from 1st July 1992. From that date until 31st December 1992, the minimum contribution is 4%. The minimum employer contribution will rise progressively in future years to 9% by the year 2002. The scheduled increase to 5% on 1st January 1993 could be deferred to 1st July 1993, if either chamber of the Commonwealth Parliament so requires.

SES officers now fund the employer contributions to superannuation from the "pretax" portion of their remuneration packages. Under previous SES policy there was no minimum amount of a remuneration package which an SES officer was required to allocate to superannuation. The minimum amount allocated to superannuation will now be the minimum employer contribution required under the Commonwealth legislation.

At present no changes are required to the current superannuation arrangements for SES officers who belong to one of the contributory schemes (SASS, SSF or the Police Scheme). These schemes are being reviewed to ensure they meet the requirements of the SGC legislation for all members.

Special arrangements are necessary for other SES officers (ie. those not in the SSF, SASS or Police schemes). These officers will now be required to contribute the minimum SGC employer contributions to PSESS from the "pre-tax" portion of their packages. This minimum is 4% of the cash component of the package for the period 1st July 1992 to 31st December 1992, and is expected to be 5% of the cash component for the period 1st January 1993 to 30th June 1993. Under the current

Commonwealth legislation the minimum rate is to rise to 6% on 1stJuly 1995. As stated above, the maximum mandatory employer contribution is that applicable to earnings of $80,000 pa. Those SES officers with a cash component above this amount need only contribute as for that figure.

Members of PSESS have the option of taking out death and disability cover through the scheme (via the GIO). These death and disability premiums are counted towards the mandatory employer contribution for SGC purposes provided they are paid out of pre-tax remuneration.

Agencies should now examine each SES package within their agency for SES officers covered only by PSESS, and for SES officers who are not members of any contributory scheme, to identify those who are not currently meeting the minimum employer contribution level. Agencies will then need to make the necessary arrangements for those officers to meet these minimum employer contributions through PSESS. It is possible that some individual SES officers will experience financial difficulties as a result of these new superannuation requirements. While there is no alternative to compliance with the legislation, it may be possible to limit the degree of difficulty in other ways. The agency should discuss such cases involving financial hardship with Ms P Rutledge, Director, SES Unit, Premier's Department, Phone 228 5511.

For enquiries regarding PSESS contributions and membership, please contact Tony Lobb, PSESS Secretariat, on 262 6877.

H C Eagleton
Acting Director-General

Contact Officer: John Slidziunas
Telephone: 2285491
Branch: SES Unit
Date: 9th October, 1992

Overview

Compliance

Not Mandatory

AR Details

Date Issued
Jun 13, 2014
Review Date
Jun 13, 2024
Replaces
Replaced By

Contacts

Contact
Contact us
Phone
02 9228 5555
Publishing Entity
Department of Premier and Cabinet
Issuing Entity
Department of Premier and Cabinet