Document ID: chunk:federal_register_of_legislation:F2018L01627:reg:5:p1
Version: federal_register_of_legislation:F2018L01627
Segment Type: reg
Provision Reference: reg 5 (pt 1/2)
Character Range: 2209–4835

5  Schedules
  Each instrument that is specified in a Schedule to this instrument is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this instrument has effect according to its terms.
  6 Pension valuation factor — indexation of income stream
  If the indexation factor for a person's defined benefit income stream for a relevant year is worked out in accordance with section 7 or 8, the pension valuation factor that applies to the person for that year is the pension valuation factor mentioned in Schedule 2 for:
 (a) the age of the person on the person's next birthday following the beginning of the relevant year; and
 (b) the indexation factor for the person's income stream.
  7 Indexation factor — non-discretionary indexation of income stream
 (1) For section 6, if, under the governing rules of the fund paying a person's defined benefit income stream, the income stream is indexed in a non‑discretionary way, the indexation factor for the income stream is worked out in accordance with this section.
 (2) If the income stream is indexed by reference to movements in salary, the indexation factor is taken to be a rate of at least 4% but less than 5%.
 (3) If the income stream is indexed by reference to movements in a price index published by the Australian Statistician, the indexation factor is taken to be a rate of at least 2.5% but less than 3%.
 (4) If the income stream is indexed in accordance with a rate set by the governing rules, the indexation factor is taken to be the range of rates set out in Schedule 2 that includes that rate.
 (5) If the income stream is indexed by more than 8%, the indexation factor is taken to be a rate of 8%.
 (6) For this section, an income stream is indexed in a non‑discretionary way if it is indexed otherwise than as described in subsection 8(1).
  8 Indexation factor — discretionary indexation of income stream
 (1) For section 6, if, under the governing rules of the fund paying a person's defined benefit income stream, the income stream is indexed by discretionary determination of trustees of the fund, the indexation factor for the income stream is worked out in accordance with this section.
 (2) Unless subsection (4) applies, the indexation factor is the average of the indexation factors determined for the person's income stream for the 5 years immediately preceding the relevant year.
 (3) The average of the indexation factors is the sum of the indexation factors determined for the person's income stream, or for a class of income streams that includes the person's income stream, for