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SUPERANNUATION LEGISLATION AMENDMENT BILL 2010

2010

LEGISLATIVE ASSEMBLY OF THE
NORTHERN TERRITORY

TREASURER

SUPERANNUATION LEGISLATION AMENDMENT BILL 2010
SERIAL NO. 125

EXPLANATORY STATEMENT

GENERAL OUTLINE

This Superannuation Legislation Amendment Bill 2010 amends: the Superannuation Act; the Legislative Assembly Members’ Superannuation Fund Act; and the Northern Territory Government and Public Authorities’ Superannuation Scheme Rules.

The purpose of the Bill is to:

· remove the entrant medical provisions from the Northern Territory Government Death and Invalidity Scheme (NTGDIS);
· charge an account keeping fee for retained members of the Northern Territory Government and Public Authorities’ Superannuation Scheme (NTGPAS Scheme) (that is, former Northern Territory Public Sector (NTPS) employees who have chosen to leave their superannuation in the NTGPAS Scheme);
· allow active NTGPASS and Northern Territory Supplementary Superannuation Scheme (NTSSS) members to opt out of the schemes (without having to resign) when they reach preservation age (currently 55) so they can access transition to retirement; and
· consolidate the trustee functions of the NTGPASS, the Legislative Assembly Members Scheme (LAMS) and the Northern Territory Police Supplementary Benefits Scheme (NTPSBS) under one incorporated board of trustees called the Superannuation Trustee Board (the Trustee Board).


NOTES ON CLAUSES

PART 1 – PRELIMINARY MATTERS

Clause 1. Short title

This is a formal clause which provides for the citation of the Act. When passed, the Act may be referred to as the Superannuation Legislation Amendment Act 2010.

Clause 2. Commencement

Subclause (1) provides for the Act to commence on the day to be fixed by the Administrator by notice in the Government Gazette.

Part 2 – Amendment of Superannuation Act

Division 1 – Preliminary matters

Clause 3. Act amended

The Act being amended by this Part is the Superannuation Act.

Division 2 – NTGI Scheme

Clause 4. Section 45E amended (Definitions)

Clause 4 makes consequential amendments to section 45E definitions due to the abolition of the medical classification system by clause 6. Definitions are removed for the terms: entry date, medical condition, reduced benefit rate classification, and reduced benefit classification adjustment factor.

Clause 5. Section 45H amended (Membership of Scheme)

Clause 5 repeals section 45H(3) as a consequence of the abolition of the medical classification system by clause 6.

Section 45H(3) was designed solely to establish the entry date for the purpose of the medical classification system under Division 3 of Part 4, which determined whether or not a person was required to submit a medical declaration. The removal of the provision does not operate to affect the status of membership to the NTGDIS established under sections 45H(1) and (2).

Clause 6. Part 4, Division 3 repealed

Clause 6 abolishes the ‘Medical classification’ system of the NTGDIS by repealing Division 3 of Part 4 of the Superannuation Act.

To maximise efficiencies to be gained from this measure, Cabinet approved the scheme to be administered on this basis from 1 April 2010.

The medical classification system established by Division 3 of Part 4 was effective from 1 July 2007 and required all new NTPS permanent employees, Police Officers, Executive Contract Officers and Members of the Legislative Assembly to complete entry medical requirements in order to become eligible to full death and invalidity cover, unless the Commissioner of Superannuation (the Commissioner) accepted an existing medical classification or status from previous employment.

Other ‘choice of fund’ NTGDIS members who commenced employment prior to the establishment of the NTGDIS were not required to complete the entry medical requirements, however the Superannuation Act provided for their medical history to be retrospectively assessed if a benefit was claimed within the first ten years of service.

Benefits were reduced where entry medical requirements were not complied with or certified pre-existing medical conditions resulted in a claim within 10 years of becoming a member.

The effect of clause 6 is that from commencement, the medical classification system of medical declarations and reduced benefits based on the reduced benefit adjustment factor is abolished, subject to transitional provisions provided by clause 8 which includes a top-up benefit payment effective from 1 April 2010.

Clause 7. Section 45N amended (NTGIS benefit)

Clause 7 makes consequential amendments as a result of the abolition of the medical classification system by clause 6.

Subclause (1) removes variable “A” from the NTGDIS formula provided by section 45N(1). Variable “A” is the reduced benefit adjustment factor which becomes inapplicable due to the abolition of the medical classification system by clause 6. The formula now reads: “B = 17.5% x S x Y x P”.

Subclauses (2)-(5) make minor amendments to punctuation in accordance with current drafting practice.

Subclause (6) removes the definition of variable “A” due to the abolition of the medical classification system by clause 6.

Clause 8. Part 6 inserted

Clause 8 inserts new Part 6 Division 1 as a consequence of the abolition of the medical classification system by clause 6. New Division 1 provides a top-up benefit to members who received a reduced benefit payment due to the medical classification system.

New sections 52(1) and (2) provide that where a member dies or becomes an invalid after 1 April 2010 and receives a reduced benefit due to a pre-existing medical condition, the member (or estate) is entitled to a top-up benefit payment.

For example, an employee has received a reduced benefit classification certificate because of a pre-existing heart condition. After the commencement date of Division 2 of Part 2 of the Bill, the employee’s reduced benefit classification certificate status will no longer apply. The result is that (after the commencement date) if the employee becomes an invalid or dies after 1 April 2010, the employee or their estate will be entitled to receive a top-up benefit in addition to the reduced benefit payment, which in total is the equivalent to the full NTGDIS benefit the member was otherwise entitled to receive.

Sections 45P and 45Q of the Superannuation Act (providing for reductions to the NTGDIS benefit if a workers’ compensation benefit is payable) applies to this total as if a single benefit had been paid.

New section 52(3) allows the top-up amount of benefit paid under section (2) to be paid to either the member or the member’s estate. This means that section 45X applies to a top-up benefit paid when a member dies, allowing this top-up benefit to be paid, without grant of probate:
· towards the deceased member’s funeral;
· to dependants of the deceased; and/or
· if there are no dependants, to any other person whom the Commissioner is satisfied was an intended beneficiary of the deceased.

New section 52(4) makes it clear that if a member died or became an invalid before 1 April 2010 and received a reduced benefit due to the existing medical classification system under Division 3 of Part 4 of the Superannuation Act, no top-up additional benefit is payable to the member or their estate.

Division 3 – NTGPAS Scheme

Clause 9. Section 3 amended

Subclause (1) inserts a new paragraph (c) under the definition of “eligible employee” in section 3(1). This amendment ensures that an NTPS employee who has opted out of the NTGPAS Scheme by exercising the option of taking a benefit under the NTGPAS Scheme Rules while remaining a permanent employee, ceases to be an “eligible employee” under the NTGPAS Scheme.

The effect is that an NTPS employee who chooses to opt out of NTGPASS is no longer entitled to receive an employer-funded benefit from NTGPASS. The employee will move to choice of fund superannuation arrangements whereby superannuation guarantee will be paid to their nominated superannuation fund each payday. As the employee is in choice of superannuation fund arrangements they automatically become a member of the NTGDIS.

New NTGPASS rule 6A inserted by clause 30 of the Bill mirrors the amendment to section 3 by providing that a person who elects to take a benefit upon reaching preservation age under NTGPASS rule 6A(1) or under clause 6(4) of the NTSSS Instrument is deemed to no longer be an eligible employee. Amendments to the NTSSS instrument are executed by the Treasurer.

Subclause (2) makes minor amendments consistent with current drafting practices.

Clause 10. Section 37 amended

Clause 10 inserts new section 37(6), which provides that the Rules are a statutory instrument for section 57A of the Interpretation Act. As such, amendments to the Rules by this Bill, once enacted, may in turn be amended by the Rules made under the Superannuation Act.

Clause 11. Section 50A amended

Subclause (1) replaces the existing section 50A heading ‘Power to charge fees for service’ with a new heading ‘Commissioner may charge fees’.

Subclause (2) inserts new subsection 50(A)(4) which provides that the Commissioner is authorised to charge adherents to the NTGPAS Scheme, an account keeping fee to be recovered from their accumulation account. Adherents are defined in section 3 and are those members who are no longer “eligible employees” but who have an accumulation account in the NTGPAS Scheme, for example, former NTPS employees who have claimed their employer-funded benefit and have chosen to retain part or all of their benefit in the NTGPAS Scheme (retained members),

Clause 12. Section 3 amended

Subclause (1) removes “Investment Board” from the definitions section 3(1) due to its replacement by the new Superannuation Trustee Board. The new Trustee Board assumes the functions, duties and powers formerly undertaken and exercised by the old Investment Board.

Subclause (2) inserts new “Trustee Board” into the definitions section 3(1). Trustee Board is defined as the new Superannuation Trustee Board established by section 11 of the Superannuation Act.

Subclause (3) makes a consequential amendment to the definition of “Board” by replacing the reference to “Investment Board” with “Trustee Board”.


Clause 13. Section 6 amended

Subclause (1) replaces the old “Investment” Board in s 6(1)(a) of the Superannuation Act with the new “Trustee” Board as the body responsible for directing the Commissioner to manage the investment of the Northern Territory Government and Public Authorities Employees’ Superannuation Fund (NTGPAES Fund).

Subclause (2) makes a minor consequential amendment consistent with current drafting practice.

Subclause (3) inserts new section 6(1)(ba) into the Superannuation Act which provides that the functions and powers of the Commissioner include, with the approval of the Minister, the administration of any other superannuation scheme.

The function provided by new section 6(1)(ba) is additional to amended section 6(1)(a), which allows the Commissioner, at the direction of the new Superannuation Trustee Board, to undertake and manage the investments of the NTGPAES Fund.

Section 6(1)(b) provides that the Commissioner is responsible for the administration of the NTGPAS Scheme. Section 38(2) also provides that the Commissioner will maintain and manage the NTGPAES Fund on behalf of the Superannuation Trustee Board.

Clause 14. Section 7 amended

Clause 14 replaces existing section 7(1) of the Superannuation Act.

Paragraph (a) of new section 7(1) provides that the Commissioner may delegate powers and functions provided to the Commissioner under the Superannuation Act, including those directed by the Trustee Board under section 12 of the Superannuation Act.

Paragraph (b) of new section 7(1) provides that the Commissioner may also delegate any power delegated to the Commissioner under new section 12(a) of the Legislative Assembly Members’ Superannuation Fund Act (LAMS Act) as amended by clause 24 of the Bill, which includes the functions of managing the LAMS Fund and administering the LAMS Scheme.

The Commissioner remains responsible for making appropriate delegations within proper accountability structures.


Clause 15. Section 11 replaced

Clause 15 removes the old Superannuation Investment Board and replaces it with the new incorporated Superannuation Trustee Board by repealing and replacing section 11 of the Superannuation Act.

Existing sections 11(2) and 11(3), which provided for the membership of the old Investment Board, are replaced by new section 11A. The membership criteria remains the same as that applying to the old Investment Board.

New section 11(1) establishes the new Trustee Board.

New section 11(2) provides that the new Trustee Board is a body corporate with the usual corporate characteristics.

New section 11(3) provides that the existence of the common seal affixed to a document creates a judicial presumption that the seal was duly affixed. The Regulations, made under s 51 of the Superannuation Act, will provide the manner in which the seal is to be kept and used.

New section 11A(1) provides for the composition of the new Trustee Board membership, specifying that the Trustee Board must comprise a Chair and 2 Territory residents who are all appointed by the Minister.

New section 11A(2) provides that at least one member of the new Superannuation Trustee Board must be a member of a union and that the union must be wholly or substantially comprised of “public employees”. The term “public employees” has a generic meaning and encompasses the employment sectors of members of the schemes to be overseen by the new Trustee Board.

Clause 16. Section 12 amended

Subclauses (1) and (2) make consequential amendments by replacing the name “Investment Board” with the new “Trustee Board” established by Clause 15.

Subclause (3) provides that the new corporate Trustee Board entity is the trustee of the NTGPAES Fund established under section 38 of the Superannuation Act.

Subclause (4) incorporates important new powers and functions from the LAMS Act into the powers and functions of the new Trustee Board by inserting new section 12(1)(ba) into the Superannuation Act.

New section 12(1)(ba) provides that the new Trustee Board is conferred with power to perform functions and exercise power under the LAMS Act.

These major functions provided under section 11 of the LAMS Act as amended are to:
· hold the LAMS Fund as trustee,
· manage the LAMS Fund; and
· administer the LAMS Scheme.

The Trustee Board may delegate any of its powers and functions under the LAMS Act to the Commissioner under section 12(a) of the LAMS Act as amended by clause 24.

The Trustee Board may also exercise its functions with the assistance of staff provided by the Commissioner under section 5 of the LAMS Act. Section 7(1)(b) of the Superannuation Act as amended by clause 14 of the Bill provides that the Commissioner may further delegate (as appropriate) the power delegated to the Commissioner by section 12(a) of the LAMS Act.

New section 12(1)(bb) provides that the functions and powers of the Trustee Board extend, with the approval of the Minister, to exercise powers and perform functions in relation to any other superannuation fund or scheme. The Commissioner, with the approval of the Minister, may administer any such superannuation scheme and manage the fund of any such scheme on behalf of, and as directed by, its trustees (as provided in section 6(1)(ba) of the Superannuation Act, inserted by clause 13 of the Bill).

The new Trustee Board is therefore able to manage and administer other schemes such as the Northern Territory Police Supplementary Benefits Fund established by the NTPSBS Trust Deed. Amendments to the NTPSBS Trust Deed must be agreed and executed by the NTPSBS trustees and the Treasurer.

Clause 17. Section 24 amended

Clause 17 ensures that as a consequence of the extended functions and powers conferred on the new Trustee Board by the Bill (for example, under new section 11 of the LAMS Act), protection of the members of the Trustee Board extends to actions done under any Act in their capacity as a member.

New section 11 of the LAMS Act, as amended by clause 24 of the Bill, and corresponding new sections 12(1)(ba) and 12(1)(bb) of the Superannuation Act as amended by clause 16 of the Bill, confer functions and powers on the new Trustee Board.

Clause 18. Section 38 amended

Subclauses (1) and (3) replace the reference to the old “Investment Board” with the new “Trustee Board”.

Subclause (2) inserts new section 38(1A) which provides that the NTGPAES Fund is vested in the new Trustee Board. The Fund consists of the assets the subject of the trust, including investments such as units in unit trusts.

The timing for the transitional vesting is provided by new section 56(b) inserted by clause 19 of the Bill which provides that the NTGPAES Fund vests in the Trustee Board at the “restructure time” which is the commencement of Division 4 of Part 2 of the Bill.

Clause 19. Part 6, Division 2 inserted

Clause 18 inserts new transitional provisions sections 53-59 into the Superannuation Act.

New section 53 provides that the object of Division 2 of Part 6 is to give effect to the transition from the old Investment Board to the new Trustee Board made by Part 2, Division 4 of the Bill, which effects a mere change in trustee to consolidate the trustee functions.

New section 54 provides definitions for terms used in Division 2: asset, liability, old board, restructure time and transferred asset or liability.

New section 55 ensures a smooth transition of chairmanship and membership from the old Investment Board through to the new Trustee Board. The continuation of tenure of chairmanship and membership is in keeping with the continuation of the trust status, that is, the same fund is held for the same beneficiaries by a trustee board composed of the same chairman and board members as the old Investment Board’s, notwithstanding the new Trustee Board’s corporate reconstitution and expanded role.

New section 55(1) provides that the existing chair of the old Investment Board immediately before the commencement of Part 2, Division 4 (the “restructure time”) becomes the Chair of the new Trustee Board for a period corresponding to the remainder of their appointment to the old Investment Board.

New section 55(2) provides that each existing member of the old Investment Board immediately before the “restructure time” becomes a member of the new Trustee Board for a period corresponding to the remainder of their appointment to the old Investment Board.

The qualifying criteria under section 11A for persons to be selected as members also remains the same as existing section 11 of the Act. For example, proposed section 11A(2) provides that at least one of the members must be the member of a union the membership of which is wholly or substantially public employees.

New section 56 provides for the seamless transition and substitution from the old Investment Board to the new Trustee Board of:
· the NTGPAES Fund;
· liabilities;
· placement as a party in legal proceedings; and
· placement in agreements and documents relating to “transferred assets or liabilities” (context permitting).

New section 56 paragraph (a) provides that upon commencement of the amendments to the Superannuation Act made by Division 4 of Part 2 of the Bill, the Fund vests in the new Trustee Board. The Fund consists of the assets the subject of the trust, including investments of the Fund such as units in unit trusts and the assets in the Fund vest in the new Trustee Board by operation of this section 56(a) and section 38(1A) provided in clause 18 of the Bill.

New section 56 paragraph (b) provides that at restructure time (defined as the commencement of the Part 2, Division 4), each liability of the old Investment Board becomes a liability of the new Trustee Board.

New section 56 paragraph (c) substitutes the new Trustee Board as a party to any proceedings which the old Investment Board is a party.

New section 56 paragraph (d) provides that any reference to the old Investment Board is to be taken as referencing the new Trustee Board in agreements and documents relating to assets transferred by the vesting of the Fund in the new Trustee Board or any liability transferred under paragraph (b), if the context permits.

New section 57(1) provides that proceedings in relation to a “transferred asset or liability” cannot be brought by or against the old Investment Board after the restructure time and that any proceedings that could have been commenced by or against the old Investment Board may be brought by or against the new Trustee Board instead.

New section 57(2) provides that remedies in relation to a “transferred asset or liability” that would have been available to or against the old board or its members after “restructure time” are now available to or against the new Trustee Board.

New section 58 provides for the completion of change of trusteeship

Section 58(1) provides that the members of the old board, the new Trustee Board and the Commissioner must:
· facilitate the transfer of the NTGPAES Fund under sections 56 and 57; and
· otherwise give effect to the change of trustee made by the Bill.

Section 58(2) provides that the Commissioner must cooperate with a “registrar” by providing the necessary information ‘to record and register the documents’ implementing the transfer of the Fund and transition to the new Trustee Board.

Section 58(3) defines “registrar” as ‘a person authorised or required by a law of any jurisdiction to record and give effect to the registration of documents relating to transactions affecting a transferred asset or liability.’

New section 59 provides a comprehensive exemption from taxes and charges, including state taxes.

Section 59(1) specifies that no “tax or charge”, as defined in section 59(4), is chargeable in relation to anything occurring as a result of the operation of Part VI of the Bill.

Section 59(2) provides that no “foreign tax or charge” as defined in section 59(4), applies so far as the legislative power of the Legislative Assembly permits.

Section 59(3) provides that should a foreign tax or charge be payable in respect of a “relevant act”, as defined by section (1), then a standing appropriation is created for it to be paid from the Central Holding Authority.

Section 59(4) defines “foreign tax or charge” to include taxes and charges of a foreign jurisdiction (including Australian States) and “tax or charge” to include ‘a tax, duty, levy, fee or charge of any kind, including a fee or charge for a service.’

New section 60 provides for the continuation of ongoing matters and supplements section 8 of the Interpretation Act.

Section 60(1) provides that anything done by or in relation to the old board that is currently on foot or not completed remains in effect as if it were done by or in relation to the new Trustee Board.

Section 60(2) provides that directions given to the Commissioner by the old board remain in effect as if the directions were given by the new Trustee Board, for example any delegation made by the old board to the Commissioner.

Clause 20. Further amendments

Clause 20 provides that the amendments made by Schedule 1, which consists of consequential substitution of terms, modernising of language and minor changes to punctuation, are of effect as part of the Bill.

Part 2 – Amendment of LEGISLATIVE ASSEMBLY MEMBERS’ SUPERANNUATION FUND ACT

Clause 21. Act amended

Clause 21 provides that the Act being amended by Part of the Bill is the Legislative Assembly Members’ Superannuation Fund Act (LAMS Act).

Clause 22. Section 3 amended

Subclause (1) makes a minor amendment to section 3 to reflect current drafting practice.

Subclause (2) removes the existing terms “Trust” and “Trustee” from the definitions section 3 as a consequence of the change of trustee effected by the repeal and replacement of Division 2 of Part II by clause 24.

Subclause (3) inserts new definitions “Scheme” and “Trustee Board” into section 3.

“Scheme” is defined as the scheme established by the LAMS Act, and “Trustee Board” is the newly established Superannuation Trustee Board which replaces the old Legislative Assembly Members’ Superannuation Trustee as the body charged with the responsibility for the administration and management of the Legislative Assembly Members’ Superannuation Fund established under section 4 of the LAMS Act.

Clause 23. Section 4 amended

Subclause (1) substitutes references to “Trust” with “Trustee Board”.

Subclause (2) makes a minor amendment to reflect current drafting practice.

Subclause (3) replaces existing section 4(6) of the LAMS Act, which provided for the vesting and management of the Fund in and by the old LAMS Trust, with new section 4(6).

New section 4(6) provides that the LAMS Fund vests in the new Trustee Board.

Clause 24. Part II, Division 2 replaced

Clause 24 repeals and replaces Division 2 of Part II of the LAMS Act. Existing Division 2 established the old Legislative Assembly Members’ Superannuation Trust. New Division 2 provides that the new Trustee Board is the trustee of the LAMS Fund.

The new Trustee Board’s practices and procedures provided by Division 4 of Part II of the Superannuation Act apply to the Trustee Board in the exercise of all its functions, including as trustee of the LAMS Fund.

New section 11 of the LAMS Act provides for the functions of the new Trustee Board established by section 11 of the Superannuation Act as amended by Clause 14 of the Bill.

The functions of the new Trustee Board are to:
· hold the LAMS Fund as trustee for the members;
· manage the fund; and
· administer the scheme.

These functions may be delegated under new section 12 of the LAMS Act as amended.

New section 12 of the LAMS Act provides that the Trustee Board may delegate any of its powers and functions under the LAMS Act to the Commissioner as established by the Superannuation Act, or to a member of the Board. The Commissioner may further delegate (as appropriate) this power to another person under new section 7(1)(b) of the Superannuation Act as amended by clause 14 of the Bill.

Clause 25. Section 26 replaced

New section 26 modernises the language used and does not affect the substantive provision.

Clause 26. Part VI inserted

Clause 26 inserts new Part VI ‘Transitional matters for Superannuation Legislation Amendment Act 2010’ into the LAMS Act.

New section 30 provides that the object of Part VI is to give effect to the change in trusteeship made by Part 3 of the Bill. The status of the LAMS Fund as a complying superannuation fund for income tax and superannuation purposes is not affected by the mere change in trusteeship for the purpose of consolidating the trustee functions. The LAMS Trust, LAMS Scheme and LAMS Fund continue with only a transition in trusteeship from the old trust to the new Trustee Board.

New section 31 provides for definitions used in new Part VI: asset, liability, old Trust, old trustee, restructure time, right, and transferred asset or liability.

New section 32 paragraph (a) provides that at “restructure time” (defined as the commencement of the amendments to the LAMS Act made by Part 3 of the Bill), the LAMS Fund vests in the new Trustee Board.

The LAMS Fund consists of the assets the subject of the trust, including investments of the Fund such as units in unit trusts and the assets in the LAMS Fund vest in the new Trustee Board by operation of this new section 32 paragraph (a) and section 4(6) of the LAMS Act as amended by subclause 23(3).

New section 32 paragraph (b) provides that at restructure time all liabilities of the old Trust become liabilities of the new Trustee Board. Paragraph (c) substitutes the new Trustee Board as a party to any proceedings which the old Trust is a party.

Paragraph (d) provides that, context permitting, any reference to the old Trust is to be taken as referencing the new Trustee Board in agreements and documents relating to assets transferred by the vesting of the LAMS Fund in the new Trustee Board or any liability transferred under paragraph (b).

New section 33(1) provides that proceedings in relation to a “transferred asset or liability” cannot be brought by or against the old Trust after the restructure time and that any proceedings that could have been commenced by or against the old Trust may be brought by or against the new Trustee Board instead.

New section 33(2) provides that remedies in relation to a “transferred asset or liability” that would have been available to or against the old Trust after “restructure time” are now available to or against the new Trustee Board.

New section 34 provides for the completion of change of trusteeship.

Section 34(1) provides that the members of the old Trust, the new Trustee Board and the Commissioner must:
· facilitate the transfer of the LAMS Fund under sections 32 and 33; and
· must otherwise give effect to the change of trustee made by the Bill.

Section 34(2) provides that the Commissioner must cooperate with a “registrar” by providing the necessary information ‘to record and register the documents’ implementing the transfer of the Fund and transition to the new Trustee Board.

Section 34(3) defines “registrar” as a person authorised or required by a law of any jurisdiction to record or give effect to the registration of documents relating to transactions affecting a transferred asset or liability.

New section 35 provides a comprehensive exemption from taxes and charges including state taxes.

Section 35(1) specifies that no “tax or charge”, as defined in section 35(4), is chargeable in relation to anything occurring as a result of the operation of Part VI of the Bill.

Section 35(2) provides that no “foreign tax or charge” as defined in section 35(4), applies ‘so far as the legislative power of the Legislative Assembly permits.’

Section 35(3) provides that should a foreign tax or charge be payable in respect of a “relevant act” (as defined by section (1)), then a standing appropriation is created for it to be paid from the Central Holding Authority.

Section 35(4) defines “foreign tax or charge” to include taxes and charges of a foreign jurisdiction (including Australian states) and “tax or charge” to include ‘a tax, duty, levy, fee, or charge of any kind, including a fee or charge for a service.’

New section 36 provides for the continuation of ongoing matters and supplements section 8 of the Interpretation Act.

Section 36(1) provides that anything done by or in relation to the old Trust that is currently on foot and not completed remains in effect as if it were done by or in relation to the new Trustee Board.

Section 36(2) provides that directions given to the Commissioner by the old Trust remain in effect as if the directions were given by the new Trustee Board, for example any delegations made by the old Trust to the Commissioner.

Clause 27. Act further amended

Clause 27 provides that amendments made by Schedule 2, which consists of consequential substitution of terms, modernising of language and minor changes to punctuation, has effect as part of the Bill.

PART 4 – AMENDMENT OF NORTHERN TERRITORY GOVERNMENT AND PUBLIC AUTHORITIES’ SUPERANNUATION SCHEME RULES

Clause 28. Rules amended

The Rules being amended by this Part is the Northern Territory Government and Public Authorities’ Superannuation Scheme Rules (the Rules).

Clause 29. Rule 1 amended

Subclause (1) makes a minor amendment to reflect current drafting style.

Subclause (2) inserts a new definition “NTSSS instrument” into rule 1 ‘Definitions’.

Subclauses (3), (4), (5) and (6) make minor amendments to punctuation to reflect current drafting practice.

Subclause (7) replaces paragraph (b) of the definition of “former member” in rule 1 with a new paragraph (b) which states that a former member includes ‘a transferee as defined in rule 13C(1)’.

Rule 13C(1) is amended by clause 31 of the Bill and includes persons who have transferred money into the NTGPAES Fund under clauses 6(3) or 6(4) of the NTSSS instrument or under the NTPSBS trust deed. This includes people who have ceased to be employed and are under 55 years of age or have reached preservation age and have elected to take a benefit so that they can transition to retirement.

Clause 30. Rule 6A inserted

Clause 30 inserts new rule 6A into the Rules. New rule 6A allows active NTGPASS and NTSSS members to opt out of the schemes without having to resign when they reach preservation age (currently 55) so they can transition to retirement.

New subrule 6A(1) allows a member who has attained “preservation age” (as defined in subrule 6A(5)) to elect to take a benefit.

New subrule 6A(2) provides that a member who has elected to take a benefit under clause 6(4) of the NTSSS instrument is deemed to have made an election under subrule 6A(1) and must therefore take a NTGPASS benefit under new rule 6A.

New subrule 6A(3) provides that the benefit either elected to be taken under subrule (1) or deemed to be taken under subrule (2) is comprised of the amount credited to the member’s accumulation account, plus the accrued employer component, less the amount in the member’s surcharge debt account, if any. Cashing restrictions apply to benefits taken under new rule 6A as mentioned in the note at the end of the rule.

According to the definition of “eligible employee” inserted by clause 9 of the Bill, once a person has opted to take a benefit under the NTGPAS Scheme Rules or under clause 6(4) of the NTSSS instrument while remaining a permanent employee, the person ceases to be an “eligible employee” under the NTGPAS Scheme and thereby becomes eligible to NTGDIS.

New subrule 6A(4) makes it clear that a member who has opted out of the NTGPAS Scheme ceases to be an “eligible employee” and will therefore be ineligible for future Territory-funded NTGPAS Scheme and NTSSS benefits.

Despite no longer being an “eligible employee” members can choose to:
· transition to retirement by taking a pension through the NTGPAS Scheme;
· retain their benefit in the NTGPAS Scheme Fund;
· rollover their benefit to another superannuation fund; or
· any other option or combination of options available to the member (including doing nothing and remaining in the NTGPAS Scheme).

New subrule 6A(5) provides that the definition for the term “preservation age” is contained in regulation 6.01(2) of the Superannuation Industry (Supervision) Regulations 1994 (Cth), which at the time of writing is a range from 55 years of age (for a person born before 1 July 1960) to 60 years of age (for a person born after 30 June 1964.

Clause 31. Rule 13C replaced

Clause 31 replaces existing rule 13C ‘Payments from NTSSS’ with new rule 13C ‘Payments from NTSSS or NTPSBS’.

New Rule 13C applies where an amount is paid into the NTGPAES Fund under clauses 6(3) or 6(4) of the NTSSS instrument or under the NTPSBS trust deed (as opposed to being paid directly to the person or rolled over to another superannuation fund on their behalf), the Commissioner is to pay that amount into the person’s NTGPAES Fund accumulation account. If the person does not have an accumulation account, the Commissioner must establish an accumulation account in the NTGPAES Fund for that person.

The situations referred to under clauses 6(3) and 6(4) of the NTSSS allowing an amount to be transferred into the NTGPAES Fund include:
· where a person resigns before reaching 55 years of age; and
· where a person reaches preservation age and elects to opt out so that they can transition to retirement.

As noted after rule 13C(4), when an amount is transferred to a person’s NTGPAES Fund accumulation account in these circumstances, the transferee becomes a “former member” for the purposes of the Rules, and as such may continue to make contributions to their accumulation account.

Clause 32. Further amendments

Clause 32 provides that amendments made by Schedule 3, which consists of consequential substitution of terms, modernising of language and minor changes to punctuation, are of effect as part of the Bill.

 

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