Document ID: chunk:federal_register_of_legislation:F2024C00321:reg:55:p81
Version: federal_register_of_legislation:F2024C00321
Segment Type: reg
Provision Reference: reg 55 (pt 81/83)
Character Range: 609446–612301

Benefit Accrual Multiple (see Divisions 2 and 3 of Part 5) is reduced in respect of the original interest by the Reduction Multiple, which is calculated by multiplying the Benefit Accrual Multiple immediately before the operative time by the separation factor.

Note:
  The reduction multiple is not to be taken into account when determining if the maximum benefit limit applies to the member spouse. (See Divisions 6 and 7 of Part 5.)

Reduction of maximum benefits on cessation of membership
16.4.4 Where a reduction is made under Rule 16.4.3 in relation to a member spouse, when he/she ceases membership his/her maximum benefit at that time will be calculated in accordance with the following steps:

Step 1  Identify the original reduction multiple that applied to the person at the operative time.
Step 2  Calculate the maximum benefit lump sum that would be payable apart from this rule not taking the reduction multiple into account.
Step 3  Divide the amount calculated at step 2 by the person's average salary to produce a multiple.
Step 4  Calculate a revised reduction multiple by applying the separation factor to the multiple calculated at step 3.
Step 5  Compare the two reduction multiples.
Step 6  Recalculate the maximum benefit by using the lesser of the reduction multiples.

Reduction of unfunded preserved benefit where member spouse is a preserved benefit member
16.4.5 At the operative time the unfunded preserved benefit is reduced in respect of the original interest by the unfunded component.

Reduction not to affect later non‑standard pension
16.4.6 A reduction under this Part is to be disregarded in calculating the amount of any non‑standard pension that later becomes payable.

Note:
  For example, the reduction will be disregarded in calculating the amount of pension payable in respect of a child of the member spouse after the member spouse's death where there is no pension payable to an eligible spouse (see Rules 7.1.4, 7.3.2 and 7.3.7).

Division 5

Operative time during growth phase — reduction where original interest is entitlement to associate preserved benefit
16.5.1 This Division applies if:
         (a) at the operative time, standard pension is not payable in respect of the original interest; and
         (b) the original interest is an entitlement to associate preserved benefit.
16.5.2 The following amounts are reduced in respect of the original interest from the operative time:
         (a) the funded component is reduced by the funded component of the later separation amount; and
         (b) the unfunded component is reduced by the unfunded component of the later separation amount.

Division 6

Operative time during payment phase — reduction of pension
16.6.1 If, at the operative time, standard pension is payable in respect of the original interest, the annual rate of that pension