Federal Register of Legislation - Australian Government

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SLI 2011 No. 148 Regulations as made
These Regulations amend the Retirement Savings Accounts Regulations 1997 to allow retirement savings accounts providers to recognise forfeiture orders issued under Commonwealth, State and Territory legislation.
Administered by: Treasury
Made 04 Aug 2011
Registered 05 Aug 2011
Tabled HR 18 Aug 2011
Tabled Senate 18 Aug 2011
Date of repeal 09 Aug 2013
Repealed by Treasury (Spent and Redundant Instruments) Repeal Regulation 2013

EXPLANATORY STATEMENT

 

Select Legislative Instrument 2011 No. 148

 

Subject -              Retirement Savings Accounts Act 1997

 

              Retirement Savings Accounts Amendment Regulations 2011 (No. 2)

 

Subsection 200(1) of the Retirement Savings Accounts Act 1997 (RSA Act) provides, in part, that the Governor-General may make regulations prescribing matters required or permitted by the RSA Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the RSA Act.

 

The Retirement Savings Accounts Regulations 1997 (the RSA Regulations), inter alia, specify the circumstances under which the benefits of an RSA holder can be paid out of the RSA.

 

The purpose of the Regulations is to amend the RSA Regulations to allow trustees to recognise forfeiture orders made under a law of the Commonwealth, a State or a Territory.

 

Certain operating standards in the RSA Regulations relating to the payment and cashing of benefits specify the circumstances in which the benefits of an RSA holder can be paid out of the RSA.  The purpose of these operating standards is to preserve benefits in an RSA for retirement.  However, these operating standards prevent RSA providers from recognising forfeiture orders issued under State or Territory legislation that seek to recover the proceeds of crime. 

 

The Regulations amend these operating standards to include an exception that allows RSA providers to recognise a forfeiture order issued under Commonwealth, State or Territory proceeds of crime legislation.

 

An overview of the Regulations is set out in the Attachment

 

The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003.

 

The Regulations commence on the day after they are registered on the Federal Register of Legislative Instruments.

 

Stakeholders were invited to provide input into these Regulations during a four week public consultation period.

 

                                                                  Authority:  Subsection 200(1) of the

                                                                                                  Retirement Savings

                                                                                                  Accounts Act 1997

 

 


ATTACHMENT

 

RSA Regulations 3.05, 4.20 and 4.26 are operating standards relating to the payment and cashing of benefits of an RSA holder.  Regulation 3.05 provides that the RSA provider must ensure that the benefits of an RSA holder are maintained until the benefits are cashed as benefits, rolled over or transferred pursuant to a payment split.  Regulation 4.20 provides that an RSA holder’s benefits may only be paid in particular ways, including being cashed out or rolled over.  Regulation 4.26 provides that an RSA holder’s benefits must not be cashed in favour of a person other than the RSA holder or the RSA holder’s legal personal representative except in prescribed circumstances.

 

The Regulations create an exception to these operating standards.  The exception provides that the operating standards do not apply if a court makes a forfeiture order (however called) forfeiting part or all of the member’s benefits to the Commonwealth, a State or a Territory.  This exception allows the proceeds of crime to be recovered from RSAs.  The Regulations include tables specifying the Commonwealth, State and Territory proceeds of crime legislation and relevant provisions under which a forfeiture order may be made and, therefore, to which the exception would apply.

 

The exception is limited to forfeiture orders because these recover profits from a crime for which a person has been convicted and require the court to make a finding that the person’s superannuation is the proceeds of crime.  It does not allow other court orders to be imposed on superannuation that may impose a fine or recover amounts not directly linked to a crime because this would result in the loss of superannuation savings genuinely contributed for retirement income purposes.