South Australian Consolidated Acts South Australian Consolidated Acts (1) A contributor may
apply to the Board for the benefit of this section if—
(a) the
contributor has reached—
(i)
the age of 55 years; and
(ii)
his or her preservation age; and
(b) the
contributor has entered into an arrangement with his or her employer—
(i)
to reduce his or her hours of work; or
(ii)
to alter his or her duties,
or both, with the effect that there is a reduction in the contributor's
salary; and
(c) the
purpose for establishing the arrangement referred to in paragraph (b)
relates to the proposed retirement of the contributor in due course (including
by allowing the contributor to scale down his or her work in the lead-up to
retirement).
(2) The Board may
require that an application under subsection (1)—
(a) be
made in such manner as the Board thinks fit; and
(b) be
accompanied by such information or other material specified by the Board to
assist the Board to be satisfied as to the matters set out in
paragraphs (b) and (c) of that subsection.
(3) If the Board is
satisfied that a valid application has been made under subsection (1),
the contributor will be entitled to a pension (a "draw down benefit ) on the
basis of the contributor's application and on the basis that the maximum draw
down benefit to which the contributor is entitled will be determined by
the Board as follows:
Where—
"B" is the maximum draw down benefit (expressed as an amount per fortnight)
"RP" is the amount that would be payable under section 34 if the
contributor had retired from employment immediately before the date of the
determination (expressed as an amount per fortnight)
"FS" is the contributor's actual salary immediately before the commencement of
the arrangement envisaged by subsection (1)(b)
"NS" is the contributor's actual salary on the commencement of the arrangement
envisaged by subsection (1)(b).
(4) A draw down
benefit may not be commuted until the contributor retires from employment.
(5) If a contributor
who has retired from employment applies for the commutation of a draw down
benefit within 6 months after the commencement of the payment of the draw
down benefit, the benefit may be commuted in accordance with the regulations
as if it were a pension.
(6) If a contributor
who has retired from employment applies for the commutation of a draw down
benefit after the expiration of the period that applies under
subsection (5), the terms and conditions of the commutation of the
benefit will be as determined by the regulations.
(7) A draw down
benefit will be indexed as if it were a pension under this Act.
(8) When the Board has
determined a draw down benefit—
(a) the
contributions payable by the contributor under section 23 will (despite
any provision made by section 23 to the contrary)—
(i)
be fixed on the basis of the contributor's salary under
the arrangement established with his or her employer (for so long as the
arrangement continues); and
(ii)
as so fixed, be payable in respect of this salary from
the first full pay period after the Board's determination of the draw down
benefit; and
(iii)
be at the contributor's standard contribution rate under
that section; and
(b) the
contributor's contribution points will accrue, from the date of the
determination until the cessation of the relevant arrangement (unless the
contributor ceases to make the contributions envisaged by paragraph (a)),
at a rate for each contribution month determined as follows:
Where—
"CP" is a proportion of 1 contribution point
"AS" is the contributor's actual salary under the relevant arrangement (as
adjusted from time to time)
"FSA" is the contributor's actual salary immediately before the commencement
of the relevant arrangement, adjusted from time to time to take into account
any changes to the salary that would have occurred had the contributor not
entered into the relevant arrangement but rather continued to be entitled to
that salary.
(9) If the employment
arrangements of a contributor who is receiving a draw down benefit under this
section alter so that there is an alteration in his or her salary—
(a) in
the case of a reduction in salary—the contributor may apply to the Board
for a further benefit in accordance with the provisions of this section and
this section will then apply to the application and with respect to the
relevant arrangement—
(i)
as if FS under subsection (3) is the contributor's
actual salary immediately before the relevant reduction in salary; and
(ii)
as if NS under subsection (3) is the contributor's
actual salary immediately after the relevant reduction in salary; and
(iii)
by applying such other modifications as may be necessary
for the purpose or as may be prescribed; and
(b) in
the case of an increase in salary—the draw down benefit will continue as
if the increase had not occurred, subject to any adjustments made on account
of the benefit, including as to contributions and the accrual of
contribution points, as may be prescribed by the regulations.
(10) When a
contributor retires from employment (and is thus entitled to a benefit under
section 34), the contributor's entitlement under section 34 will be
adjusted in the manner prescribed by the regulations to take into account the
draw down benefit provided under this section (and that section will then have
effect accordingly).
(11) If a
contributor's employment terminates on account of invalidity in circumstances
that give rise to an entitlement under section 37, the entitlement under
that section will be adjusted in the manner prescribed by the regulations to
take into account the fact that the contributor had elected to receive a draw
down benefit under this section (and that section will then have effect
accordingly).
(12) If a
contributor's employment is terminated by the contributor's death, any
entitlement under section 38 will be adjusted in the manner prescribed by
the regulations to take into account the fact that the contributor had elected
to receive a draw down benefit under this section (and that section will then
have effect accordingly).
(13) The determination
of a benefit under this section must take into account the operation of any
provision under Part 5A.
(14) Despite a
preceding subsection, if a contributor who has been receiving a draw down
benefit returns to a level of employment that is at least equal to the level
that applied immediately before the contributor commenced the arrangement
referred to in subsection (1)(b) (the "original level of employment ),
the payment of the draw down benefit will be suspended for so long as his or
her level of employment is at least equal to the original level of employment
(and any adjustments in connection with the operation of this section
prescribed by the regulations will apply).
(15) A contributor who
has a rollover account by virtue of the operation of section 47B may, if
authorised to do so under the regulations, in conjunction with an application
under subsection (1), apply for any benefit that would be payable with
respect to that account as if the contributor had resigned from employment
and, in such a case—
(a) the
benefit must be invested in accordance with the regulations; and
(b) the
investment may be redeemed when the contributor retires from employment under
this Act.
(16) The Governor may,
by regulation, declare that any provision of this section is modified in
prescribed circumstances (and the regulation will have effect according to its
terms).