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Background The Parliamentary Superannuation Fund (PSF) is a defined benefit pension scheme that was established under the provisions of the now repealed Parliamentary Superannuation Act 1973 (1973 Act). The PSF was closed to new members in November 1985, but remained open to parliamentarians who, having been first elected before that date, were subsequently re-elected to Parliament after a period out of office. The 1999 reforms closed the PSF to re-elected parliamentarians and therefore no longer allows parliamentarians to re-enter the scheme. In accordance with the provisions of the Retirement Benefits (Parliamentary Superannuation Trustee Arrangements and Miscellaneous Amendments) Act 2002, the PSF became a subfund of the RBF with effect from 1 January 2003. Trustee Prior to 1 January 2003, the Parliamentary Superannuation and Retiring Benefits Trust (PSRB Trust) was the trustee of the PSF. The PSRB Trust comprised the Speaker of the House of Assembly, the President of the Legislative Council and the Secretary, Department of Treasury and Finance. The 1973 Act provided that the PSRB Trust was responsible for the investment and management of the PSF. The RBF Board became the trustee of the PSF as from 1 January 2003. Scheme Design The PSF scheme rules are now established in Part 3 of the Retirement Benefits (Parliamentary Superannuation) Regulations 2002. A PSF member contributes at the rate of 12 per cent of his or her parliamentary salary. A member may elect to cease making contributions at age 65 and, under Commonwealth law, all contributions must cease at age 70. Where no contributions are made, the final benefit is reduced accordingly. All current active PSF members have an entitlement to a pension benefit, as each has been a Member of Parliament for more than 15 years. A member who has contributed for 20 years or more is entitled to a maximum pension benefit of 70 per cent of the ratio of the total parliamentary salary received by the member during his or her period as a Member of Parliament to the total basic salary that would have been received during the member’s parliamentary service. Either 50 per cent or 100 per cent of a contributor’s pension or widow’s pension may be commuted to a lump sum in accordance with conversion factors specified in the legislation. Pensions are indexed twice a year (1 January and 1 July) in accordance with increases in the national CPI. This method of indexation is the same as that which applies to pensions paid to RBF defined benefit scheme pensioners. Membership Membership of the PSF scheme is outlined in Table 9. Table 9 Membership of PSF scheme
Funding The PSF is classed as a partially funded scheme, with the employer share of the benefits being met by the Treasurer on an emerging cost basis. The scheme rules provide for the Treasurer to meet the proportion of pension and lump sum benefits specified in the legislation or subsequently recommended by the State Actuary. Following a recommendation from the Actuary, as from 30 June 2003 the Treasurer will meet 73 per cent of all current and future benefits. These proportions are shown in Table 10. Table 10 Employer funding of PSF scheme
Liabilities The assets and liabilities of the PSF scheme since 1995 are outlined in Table 11. There were no actuarial reviews of the PSF scheme for the years ended 30 June 1996 and 30 June 1997. Table 11 Liabilities of the PSF scheme
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