National Provident Fund Restructuring Amendment Act 1997

1: Short Title and commencement
1: This Act may be cited as the National Provident Fund Restructuring Amendment Act 1997, and is part of the National Provident Fund Restructuring Act 1990 the principal Act
2: This Act comes into force on the day after the date on which this Act receives the Royal assent.
2: Interpretation
In this Act, unless the context otherwise requires,— Amalgamation proposal section 21 Appointed actuary Appointed day Gazette section 21 Defined benefit scheme Defined contribution scheme Pension Pension scheme section 17 Reserves section 50(4) Total credit
1: Amendments to principal Act
3: Interpretation
This section amended the definition of existing scheme section 2
4: New section inserted
This section inserted section 40A 1956 No 47 95D 1995 No 28 17
5: Payments to existing schemes
This section inserted sections 40B to 40D 1956 No 47 95C 1995 No 28 17
2: Alterations to existing schemes
Minimum contributions, pensions, and balances
6: Board may require minimum contributions
1: The Board may amend the trust deed for an existing scheme to require contributions made to the scheme by a member to be of a minimum amount specified by the Board from time to time.
2: The amendment applies only to contributions in respect of any period or periods commencing after the date of the amendment.
3: This section is subject to section 26
7: Board may set minimum pensions
1: The Board may amend the trust deed for an existing scheme to provide that—
a: No pension of less than an amount specified by the Board from time to time is payable from the scheme from a date specified by the Board; and
b: Where a pension would be less than that specified amount, the value of the pension entitlement, as determined by the appointed actuary, will be paid as a lump sum to the person entitled to the pension, who will cease to be a member or beneficiary of the scheme from the date of that payment.
2: The amendment applies only in relation to persons who become entitled to a pension on or after the date of the amendment (or who would have become so entitled were it not for the amendment authorised by this section).
3: This section is subject to section 26
8: Existing pensions below minimum level
1: The Board may amend the trust deed for an existing scheme to provide that members or beneficiaries who became entitled to a pension before the date of the amendment have the option, where their pension entitlement is less than an amount specified by the Board from time to time, of either continuing with their pension or having the value of their pension entitlement, as determined by the appointed actuary, paid to them as a lump sum and ceasing to be a member or beneficiary of the scheme from the date of payment.
2: This section is subject to section 26
9: Board may set minimum total credit in defined contribution schemes
1: The Board may amend the trust deed for a defined contribution scheme to provide that—
a: The total credit of a member may not be less than an amount specified by the Board from time to time; and
b: Where the total credit of a member is less than that specified amount, and the member's total credit is not increased to at least the specified amount within 6 months (or such longer period as may be determined by the Board in any one or more cases) of written notification by the Board to the member of the specified amount, the Board may pay the amount of that total credit to the member who will cease to be a member of the scheme from the date of that payment.
2: This section is subject to section 26 Missing persons
10: Board may amend trust deeds in relation to missing persons
1: The Board may amend the trust deed for an existing scheme to enable the Board—
a: To deduct the expenses of endeavouring to locate a missing person from a benefit or entitlement, or earnings credited to the person under the scheme, to which the person is entitled:
b: To allocate to any missing persons in the scheme—
i: Property of the scheme equivalent to their share in the scheme; and
ii: Future investment returns from that property received after the date of the allocation of that property:
c: To transfer missing persons in the scheme (and property of the scheme allocated to those persons) to any other existing scheme without the need to obtain consents from members or beneficiaries or any other person.
2: In this section and section 11 missing person
3: The expenses that may be deducted under an amendment to a trust deed made under this section are a reasonable amount to cover the costs incurred by the Board in endeavouring to locate the missing person, and confirming and satisfying the liability of the scheme to the person.
4: For the purposes of subsection (1)﻿(b)﻿(i)
a: The value of the liabilities (as determined by the appointed actuary) of the scheme to those persons:
b: Plus, in the case of a scheme with positive reserves or an actuarial surplus, an equitable share of the reserves or surplus (as determined by the Board after receiving advice from the appointed actuary):
c: Less, in the case of a scheme with negative reserves or an actuarial deficit, an equitable share of the reserves or deficit (as determined by the Board after receiving advice from the appointed actuary).
5: An applicable promise or guarantee of a particular or minimum earnings rate for an existing defined contribution scheme is subject, in the case of missing persons, to any power of the Board to deduct the expenses of endeavouring to locate missing persons.
6: This section does not limit the Board's power to charge other expenses against an existing scheme, member, or beneficiary.
7: This section is subject to section 26
11: Board may amend trust deeds to extinguish liabilities to missing persons
1: The Board may amend the trust deed for an existing scheme for the purpose of enabling the Board, subject to subsections (2) (3)
2: No liability may be extinguished under subsection (1)
a: Until the expiry of 2 years from the date of commencement of this Act; and
b: Unless the Board has used reasonable endeavours to find the current address of the missing person concerned.
3: If any person establishes to the satisfaction of the Board that a liability of an existing scheme to him or her has been extinguished during the previous 15 years on the ground that he or she was a missing person, the liability is reinstated as if it had never been extinguished.
4: This section is subject to section 26 4% minimum earnings rates
12: Board may amend trust deeds in relation to 4% minimum earnings rates
1: The Board may amend the trust deed for a defined contribution scheme to—
a: Remove the Board's obligation to apply on a per annum basis the minimum earnings rate that is required to be credited to a member's account and that is specified in the trust deed; and
b: Replace that obligation with an obligation to the effect that the average per annum earnings rate credited to a member's account over the specified period is no less than that minimum earnings rate.
2: In subsection (1)﻿(b) specified period
3: This section is subject to section 26 Charging of fees for additional administration
13: Board may amend trust deeds to enable charging of fees for significant additional administration
1: The Board may amend the trust deed for an existing scheme to enable the Board to charge the expenses of any significant additional administration (including legal and actuarial expenses) to an individual member or beneficiary, or group of members or beneficiaries, where—
a: That member or beneficiary, or those members or beneficiaries, have involved the Board in significant additional administration; and
b: It would be, in the Board's opinion, unfair or inequitable to impose the cost of that administration on all members of that scheme.
2: The amendment must require the Board, before charging the expense,—
a: To give written notice to each member or beneficiary concerned that it intends to charge the expense to that member or beneficiary; and
b: To give the member or beneficiary an opportunity to provide written submissions on the matter to the Board.
3: A notice under subsection (2)
4: An amendment under subsection (1)
5: An applicable promise or guarantee of a particular or minimum earnings rate for an existing defined contribution scheme is subject to any power of the Board to deduct expenses under this section.
6: This section is subject to section 26 Share of reserves on payment of benefit
14: Board may amend trust deeds to provide share of reserves on payment of benefit
1: The Board may amend the trust deed for a defined contribution scheme to provide that a share of any positive reserves of the scheme will be added to the total credit of a member of the scheme at the date of determination of the member's total credit for the purpose of paying 1 or more of the benefits payable under the scheme.
2: The Board may determine, at the time the amendment is made, the class or classes of benefit to which the amendment will apply.
3: The amendment must provide that the share of reserves to be added to the total credit will be calculated in the same manner as if the member had elected (under the provisions inserted into the trust deed under section 50
4: This section is subject to section 26 Miscellaneous provisions
15: Other amendments to trust deeds
1: The Board may amend the trust deed of an existing scheme if it is necessary or desirable to give effect to, or is consequential upon, amendments authorised by any of sections 6 to 14
2: This section is subject to section 26
16: Existing proceedings not affected
No amendment to a trust deed authorised by this Part limits or affects a judgment, order, or determination of a court in proceedings commenced before the amendment is made.
3: Restructuring of existing schemes
Transfer of pensioners to new pension schemes
17: Establishment of new pension schemes
1: The Board may establish by trust deed 1 or more schemes for the purpose of paying pensions arising from membership of such of the existing schemes as the Board may determine from time to time.
2: The trust deed for a pension scheme may contain different terms for different classes of beneficiaries.
3:
4: This section is subject to section 26 Section 17(3) repealed 1 December 2014 section 150 Financial Markets (Repeals and Amendments) Act 2013
18: Board authorised to amend existing schemes to provide for transfer to pension schemes
1: The Board may amend the trust deed for an existing scheme in order to—
a: Provide for the Board to transfer to a pension scheme any person receiving, or about to receive, a pension from the existing scheme, and the person's pension entitlement; and
b: Provide for the Board to transfer from the existing scheme to a pension scheme assets to meet the pension entitlements that are so transferred.
2: The Board must not transfer a person and his or her pension entitlement from an existing scheme to a pension scheme unless the Board is satisfied, after considering the advice of the appointed actuary, that—
a: The terms of that person's pension under the pension scheme are not materially and adversely different from the terms on which that person's pension would have been paid under the existing scheme; and
b: The transfer of assets from the existing scheme to the pension scheme is fair and equitable to that person, all members and beneficiaries of the existing scheme materially affected by the transfer, and all members and beneficiaries of the pension scheme.
3: Subsection (1) section 26
19: Provisions applying to new pension schemes
The provisions set out in Schedule 1 Amalgamation of 2 or more existing schemes
20: Board may submit proposal for amalgamation of schemes
1: The Board may submit to the Minister—
a: A draft amalgamation proposal for the amalgamation of 2 or more existing schemes; and
b: The proposed trust deed for the new scheme that will result from the amalgamation; and
c: A certificate by the Board stating that, in its opinion, subsections (3) (4)
2: The Board must supply to the Minister such additional information relating to a draft amalgamation proposal as the Minister may require at any time.
3: Each draft amalgamation proposal must—
a: Provide for the Board to be the trustee of the new scheme that will result from the amalgamation; and
b: Except to the extent (if any) otherwise agreed in writing by the Board and the Minister, specify or provide for each of the following matters:
i: The establishment of a new scheme that is to exist on and after the appointed day in place of the existing schemes to be amalgamated under the amalgamation proposal:
ii: The transfer on the appointed day of all members and beneficiaries from the existing schemes to be amalgamated under the proposal, to the new scheme:
iii: The transfer on the appointed day of all assets and liabilities of the existing schemes to be amalgamated under the proposal, to the new scheme:
iv: If considered appropriate by the Board, the continuation on and after the appointed day, in respect of all or particular members or beneficiaries of an existing scheme, of 1 or more specific terms of that scheme indefinitely or for a specified period:
v: Such matters, if any, as are required by regulations; and
c: Include such other matters (if any) relating to the amalgamation as the Board and the Minister agree should be included in the proposal.
4: In preparing a draft amalgamation proposal, the Board must ensure that, as far as practicable, the trust deed for the new scheme to be established as a result of the amalgamation proposal—
a: Has terms that are not materially and adversely different from the terms in the trust deeds for the existing schemes concerned in so far as those terms affect any member or beneficiary of those schemes.
b:
5: Subsection (4) subsection (3) Section 20(4)﻿(b) repealed 1 December 2014 section 150 Financial Markets (Repeals and Amendments) Act 2013
21: Approval of proposal by Minister
1: The Minister may, by notice section 20
2: Section 26
3: The notice must—
a: Identify the draft amalgamation proposal approved, but need not incorporate it in the notice; and
b: State the appointed day for that proposal.
4: A notice under this section is secondary legislation ( see Part 3 The following table is small in size and has 3 columns that are grouped under the heading Legislation Act 2019 requirements for secondary legislation made under this section. Legislation Act 2019 requirements for secondary legislation made under this section Publication PCO must publish it on the legislation website and notify it in the Gazette LA19 s 69(1)﻿(c) Presentation The Minister must present it to the House of Representatives LA19 s 114 cl 32(1)﻿(a) Disallowance It may be disallowed by the House of Representatives LA19 ss 115 116 This note is not part of the Act. Section 21(1) amended 28 October 2021 section 3 Secondary Legislation Act 2021 Section 21(4) replaced 28 October 2021 section 3 Secondary Legislation Act 2021
22: Amendment of proposal
1: The Minister may, by notice section 21
2: Section 26
3: The Board must submit to the Minister a certificate confirming that, in its opinion, the amendment to the amalgamation proposal does not contravene section 20(3) (4)
4: The notice must—
a: Identify the amendment approved, but need not incorporate it in the notice; and
b: State the day on and from which the amendment has effect, which may be the appointed day or any later day.
5: A notice under this section is secondary legislation ( see Part 3 The following table is small in size and has 3 columns that are grouped under the heading Legislation Act 2019 requirements for secondary legislation made under this section. Legislation Act 2019 requirements for secondary legislation made under this section Publication PCO must publish it on the legislation website and notify it in the Gazette LA19 s 69(1)﻿(c) Presentation The Minister must present it to the House of Representatives LA19 s 114 cl 32(1)﻿(a) Disallowance It may be disallowed by the House of Representatives LA19 ss 115 116 This note is not part of the Act. Section 22(1) amended 28 October 2021 section 3 Secondary Legislation Act 2021 Section 22(5) replaced 28 October 2021 section 3 Secondary Legislation Act 2021
23: Implementation of proposal
1: The Board must arrange for the implementation of an amalgamation proposal, or of an amendment of a proposal, as soon as practicable after the proposal or amendment has been approved by the Minister
2: Any documents executed, and all other arrangements made, for the purpose of implementing an amalgamation proposal, become effective as at the appointed day for that proposal.
3: Any documents executed, and all other arrangements made, for the purpose of implementing an amendment to an amalgamation proposal become effective as at the day stated under section 22(4)﻿(b) Section 23(1) amended 28 October 2021 section 3 Secondary Legislation Act 2021
24: Effect of implementation of amalgamation proposal
The provisions set out in Schedule 2
4: Miscellaneous provisions
Procedural safeguards
25: Members to be notified of trust deed amendments and restructuring
1: The Board must send to each member of an existing scheme in respect of which—
a: An amendment to a trust deed is proposed under Part 2 3
b: An amalgamation proposal is proposed under Part 3 and for whom it has a current address, a notice that explains the amendment or proposal, including a summary of the main differences (if any) between the terms of the trust deed for the existing scheme and the terms of the trust deed as proposed to be amended or for the new scheme, as the case may be.
2: The notice must be sent at least 28 days before the amendment or proposal is submitted to the Minister under section 26
26: Trust deed amendments and restructuring to be approved by Minister
1: This section applies to—
a: An amendment to a trust deed prepared under Part 2 3
b: A trust deed for a new scheme prepared under Part 3
c: An amalgamation proposal under Part 3
d: An amendment to an amalgamation proposal under Part 3
2: No amendment, deed, or proposal to which this section applies has effect until it has been approved by the Minister.
3: The Minister must not give approval under subsection (2)
a: The Board has supplied to the Minister a certificate stating that, in its opinion, and where appropriate after taking into account the advice of the appointed actuary, the terms of the amendment, deed, or proposal are fair and equitable to the members and beneficiaries of the relevant scheme or schemes taken as a whole; and
b: The Minister is satisfied that the terms of the amendment, deed, or proposal are fair and equitable to the members and beneficiaries of the relevant scheme or schemes taken as a whole; and
c: The Minister is satisfied that the requirements of the section or sections under which the amendment, deed, or proposal is being made have been complied with.
4: The fair and equitable requirement in subsection (3)﻿(a) (b)
5: The Minister must not approve an amendment to an amalgamation proposal made after the appointed day unless the Minister is satisfied that the amendment is necessary for the purpose of correcting an error in the amalgamation proposal as approved under section 21 Miscellaneous provisions
27: Consents not required
1: No consents from a member or beneficiary of an existing scheme, or from any other person or organisation, are required in relation to the making of amendments to a trust deed under Part 2 3
2: No consents from a member or beneficiary of an existing scheme, or from any other person or organisation, are required in relation to an amalgamation proposal or the transfer of a member or beneficiary from an existing scheme to another scheme as provided for in this Act.
3: This section applies notwithstanding any Section 27(3) amended 1 December 2014 section 150 Financial Markets (Repeals and Amendments) Act 2013
28: Powers may be exercised from time to time
A power given to the Board under this Act to do any act or thing is capable of being exercised from time to time, as occasion may require. 1924 No 11 s 25(g)
29: Certificates given by Board
A certificate required by this Act to be given by the Board to the Minister on a matter on which the Board must obtain the advice of the appointed actuary must be accompanied by a copy of the appointed actuary's advice.
30: Act to prevail over other laws
1: This Act has effect notwithstanding any provision of the principal Act
2: A provision included in a trust deed or in an amalgamation proposal under this Act has effect, and may be implemented at any time by the Board, notwithstanding any provision of the principal Act Section 30(1) amended 1 December 2014 section 150 Financial Markets (Repeals and Amendments) Act 2013 Section 30(2) amended 1 December 2014 section 150 Financial Markets (Repeals and Amendments) Act 2013
31: Regulations
1: The Governor-General may from time to time, by Order in Council, make regulations for all or any of the following purposes:
a: Providing for the transfer of pensioners to a new pension scheme under Part 3
b: Providing for the amalgamation of existing schemes under Part 3
c: Providing for such other matters as are contemplated by or necessary for giving full effect to this Act, and for its due administration.
2: Regulations under this section are secondary legislation ( see Part 3 The following table is small in size and has 3 columns that are grouped under the heading Legislation Act 2019 requirements for secondary legislation made under this section. Legislation Act 2019 requirements for secondary legislation made under this section Publication PCO must publish it on the legislation website and notify it in the Gazette LA19 s 69(1)﻿(c) Presentation The Minister must present it to the House of Representatives LA19 s 114 cl 32(1)﻿(a) Disallowance It may be disallowed by the House of Representatives LA19 ss 115 116 This note is not part of the Act. Section 31(2) inserted 28 October 2021 section 3 Secondary Legislation Act 2021
32: Consequential amendment to Income Tax Act 1994
Section 32 repealed 1 April 2005 section YA 2 Income Tax Act 2004