Superannuation and the new award

The agreement bringing in the new award holds the prospect for improvements for members of the older superannuation schemes, writes JOHN DIXON and ROD BROWN.

The new award commits the Department of Education and Training to supporting legislative change which would enable members of the State Super Scheme (SSS -- the "old" scheme) and the State Authorities Superannuation Scheme (SASS -- the "middle" scheme) to salary sacrifice their compulsory employee contributions into superannuation. These employee contributions currently come from after-tax income.

Some teachers elect to have additional contributions made to superannuation through salary sacrifice. Salary sacrifice is a tax-effective way to make additional superannuation contributions. Those members who are able to make top-up contributions to superannuation will still continue to be able to use this facility.

The superannuation focus of the new agreement with the Department supports the ability to salary sacrifice those superannuation contributions that members must make to their superannuation fund.

Federation commenced negotiations with the Department in 2004 regarding salary sacrifice of compulsory employee superannuation contributions. These negotiations have extended to the Public Employment Office in the Premier's Department and NSW Treasury and have been supported by Unions NSW.

The Department's agreement is a first step. Legislation will need to be carried through the State Parliament to implement the proposed changes. It is not anticipated that this will happen before the middle of 2006.

Federation continues to pursue the extension of salary sacrifice to members who are currently unable to access this facility.

This agreement is the first for many years to specifically address superannuation. The union will continue to pursue improvements to superannuation for members and work with other unions to lift the minimum provision for superannuation and the disability provisions in the event of a break-down in health.

Prime Minister John Howard's industrial relations legislation removes superannuation as an allowable item under awards. This reflects his long-held opposition to industry superannuation and his reluctant acceptance of the Superannuation Guarantee. Federation will need to pursue legislative change or look at the nature of agreements with employers in order to pursue further superannuation improvements for members.

John Dixon is the Assistant General Secretary (Communications and Administration) and Rod Brown is a Welfare Officer.

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December 2005 contents