South Australian Numbered Regulations South Australian Numbered RegulationsAfter Part 3 insert:
Part 3A—Transition to retirement
23A—Adjustments under section 26A
(1) Pursuant to
section 26A(9) of the Act, when a contributor for whom a draw down benefit has
been determined under that section retires, the contributor's entitlement
under section 27 of the Act will be subject to a reduction that takes effect
by reducing—
(a) the
number of the contributor's contribution points; and
(b) the
factor "M" in the formulae under section 27(2) of the Act,
to the extent necessary to take into account, to its full extent, the employer
funded component of the value of the draw down benefit determined for the
contributor.
(2) Pursuant to
section 26A(10) of the Act, when the employment of a contributor for whom a
draw down benefit has been determined under that section is terminated by the
contributor's death, an entitlement under section 32 of the Act will be
subject to a reduction that takes effect by reducing—
(a) the
number of the contributor's contribution points; and
(b) the
factor "M" in the formula under section 32 of the Act relevant to the
determination of the entitlement,
to the extent necessary to take into account, to its full extent, the employer
funded component of the value of the draw down benefit determined for the
contributor.
(3) If 2 or more
reductions are to be made under subregulation (1) or (2) in respect of a
contributor's entitlement because the Board has determined 2 or more draw down
benefits for the contributor, the Board may determine to apply the reductions
to the entitlement separately or in aggregate.
23B—Modification of section 26A(5)
Pursuant to section 26A(15) of the Act, subsection (5) of that section is
modified so as to allow a contributor who has—
(a)
retired from employment; or
(b)
reached the age of 65 years,
to commute an entitlement to a draw down payment so that investment of the
draw down benefit on account of which the payment is made is brought to an end
and the balance paid to the member.
23C—Adjustments under section 33A
(1) Pursuant to
section 33A(9)(b) of the Act, if the employment arrangements of a contributor
who is receiving a draw down benefit under that section alter so that there is
an increase in his or her salary, the contributions payable by the contributor
under section 23 of the Act will, despite section 33A(8) of the Act and any
provision of section 23 of the Act to the contrary, be fixed for a particular
financial year on the basis of the contributor's salary as on 31 March of the
year in which that financial year commences.
(2) Pursuant to
section 33A(10) of the Act, when a contributor to whom a draw down benefit has
been paid under that section retires, the contributor's entitlement under
section 34 of the Act will be subject to a reduction that takes effect by
reducing—
(a) the
number of the contributor's contribution points; and
(b) the
factors "n", "n 1 " and "n 2 " in the formula under section 34 of the Act
relevant to the determination of the entitlement (or such of those factors as
appear in the relevant formula),
to the extent necessary to take into account, to its full extent, the value of
the draw down benefit paid to the contributor.
(3) Pursuant to
section 33A(11) of the Act, when the employment of a contributor to whom a
draw down benefit has been paid under that section terminates on account of
invalidity, the contributor's entitlement under section 37 of the Act (if
any) will be adjusted in the following manner:
(a) in
the case of an entitlement under section 37(1) of the Act—the
entitlement will be subject to a reduction that takes effect by
reducing—
(i)
the number of the contributor's contribution points; and
(ii)
the factor "n" in the formula under subsection (2) of
that section,
to the extent necessary to take into account, to its full extent, the value of
the draw down benefit paid to the contributor;
(b) in
the case of an entitlement under paragraph (a) of section 37(3a) of the
Act—the entitlement will be reduced by an amount determined by applying
to the balance that would, but for this subregulation, have been payable to
the contributor under that paragraph the aggregate of the proportions of the
contributor's notional retirement benefit that have been paid to the
contributor as 1 or more draw down benefits;
(c) in
the case of an entitlement under paragraph (b) of section 37(3a) of the
Act—
(i)
the employee component payable under subparagraph (i) of
that paragraph will be reduced by an amount determined by applying to the
balance that would, but for this subregulation, have been payable to the
contributor under that subparagraph the aggregate of the proportions of the
contributor's notional retirement benefit that have been paid to the
contributor as 1 or more draw down benefits; and
(ii)
the employer component payable under subparagraph (ii) of
that paragraph will be subject to a reduction that takes effect by
reducing—
(A) the number of the contributor's
contribution points; and
(B) the factor "M" in the formula under
subparagraph (ii),
to the extent necessary to take into account the aggregate of the proportions
of the contributor's notional retirement benefit that have been paid to the
contributor as 1 or more draw down benefits.
(4) If 2 or more
reductions are to be made under subregulation (2) or (3)(a) in
respect of a contributor's entitlement because the Board has determined 2 or
more draw down benefits for the contributor, the Board may determine to apply
the reductions to the entitlement separately or in aggregate.
(5) Pursuant to
section 33A(12) of the Act, when the employment of a contributor to whom a
draw down benefit has been paid under that section terminates on account of
the contributor's death, an entitlement under section 38 of the Act will be
adjusted in accordance with the following:
(a) for
the purposes of subsection (4) of section 38 of the Act, in
calculating the amount of a pension to which a contributor would have been
entitled if circumstances specified in paragraph (b) or (c) of that subsection
applied, the amount of each draw down benefit paid to the contributor as an
indexed pension (if any) is to be added to the amount that would, but for this
paragraph, have been determined under the relevant provision to be the amount
of the pension;
(b) in
the case of an entitlement under section 38(6)(a) or (b) of the Act—the
entitlement will be reduced by an amount determined by applying to the balance
that would, but for this subregulation, have been payable to the contributor
under the relevant paragraph the aggregate of the proportions of the
contributor's notional retirement benefit that have been paid to the
contributor as 1 or more draw down benefits;
(c) in
the case of an entitlement under subsection (7) of section 38 of the
Act—
(i)
the employee component payable under paragraph (a)
of that subsection will be reduced by an amount determined by applying to the
balance that would, but for this subregulation, have been payable to the
contributor under that paragraph the aggregate of the proportions of the
contributor's notional retirement benefit that have been paid to the
contributor as 1 or more draw down benefits; and
(ii)
the employer component payable under paragraph (b)
of that subsection will be subject to a reduction that takes effect by
reducing—
(A) the number of the contributor's
contribution points; and
(B) the factor "M" in the formulae under
paragraph (b),
to the extent necessary to take into account the aggregate of the proportions
of the contributor's notional retirement benefit that have been paid to the
contributor as 1 or more draw down benefits.
(6) In this
regulation—
"notional retirement benefit"—a contributor's notional
retirement benefit is the amount that would be payable to the contributor
under section 34 of the Act if the contributor had retired from employment
immediately before the date on which the Board determined that he or she was
entitled to a draw down benefit (expressed as an amount per fortnight).
23D—Application for benefit in respect of rollover account
(1) Pursuant to
section 33A(15) of the Act, a contributor who has a rollover account by virtue
of the operation of section 47B of the Act may, in conjunction with an
application under section 33A(1) of the Act, apply for a benefit with respect
to the rollover account (after taking into account the operation of
subregulation (2)).
(2) The following
provisions apply in relation to an application by a contributor for a benefit
in respect of a rollover account:
(a) the
Board will determine a benefit (a "rollover draw down benefit ) on the basis
of the contributor's application and on the basis that the maximum rollover
draw down benefit to which the contributor is entitled will be a percentage of
the balance of the contributor's rollover account equal to the percentage that
the draw down benefit determined by the Board in respect of the contributor's
associated application under section 33A(1) of the Act bears to the total
benefit that would have been payable had the contributor retired from
employment;
(b) the
Board will then, according to an election made by the contributor as part of
his or her application, invest (on behalf of and in the name of the
contributor) the rollover draw down benefit—
(i)
with the Superannuation Funds Management Corporation of
South Australia; or
(ii)
with another entity that will provide a non-commutable
income stream for the contributor while the contributor continues to be
employed in the workforce,
so that the contributor receives (and only receives) a payment in the form
of a pension or an annuity (a "rollover draw down payment") on account of the
benefit;
(c) the
investment of a rollover draw down benefit under paragraph (b)(i) will be
on terms and conditions determined by the Board;
(d) an
entitlement to a rollover draw down payment is not commutable until the
contributor retires from employment or reaches the age of 65 years;
(e) the
determination of a benefit under this regulation must take into account the
operation of any provision under Part 5A of the Act.
23E—Certain provisions do not apply
Pursuant to section 59 of the Act, sections 28A, 28B, 35, 39A and 39B of
the Act do not apply in respect of a contributor for whom a draw down benefit
has been determined under section 26A or 33A of the Act.