Introduction of legislation proposing retrospective changes to default superannuation salary

On 3 August 2022 the Government introduced the Public Sector Superannuation Salary Legislation Amendment Bill 2022 (the Bill) into the Senate.

If passed by the Parliament, the legislation will retrospectively remove the value of rent-free housing from the default superannuation salary for the Commonwealth Superannuation Scheme (CSS) by repealing paragraph 5(e) of the Superannuation (CSS) Salary Regulations 1978 (formerly known as the Superannuation (Salary) Regulations) with effect from 1 July 1986.

The proposed retrospective repeal would flow through to default superannuation salary for the Public Sector Superannuation Scheme (PSS) and the Public Sector Superannuation Accumulation Plan (PSSAP). It would also affect current and former Commonwealth employees who are members of non‑Commonwealth choice funds, if their superannuation salary was set by reference to the PSS or PSSAP default superannuation salary.

The Bill proposes a limited exclusion from the repeal that would apply to current and former Commonwealth employees for whom the inclusion of the value of rent-free housing in their superannuation salary was intended and contributions were made on that basis.

The Bill, Explanatory Memorandum and the Second Reading Speech can be viewed on the Australian Parliament House website.

CSC is unable to comment on the proposed legislation as it is subject to parliamentary processes.