Superannuation Act 1976

This section applies if:

at the operative time, standard pension is not payable in respect of the original interest; and

the original interest is not an entitlement to associate deferred benefits.

The following amounts are reduced in respect of the original interest:

the accumulated basic contributions are reduced by the sum of:

the basic contributions component; and

the interest accruing on that component after the operative time;

the accumulated supplementary contributions are reduced by the sum of:

the supplementary contributions component; and

the interest accruing on that component after the operative time;

the accumulated employer contributions are reduced by the sum of:

the employer contributions component; and

the interest accruing on that component after the operative time;

any benefit under section 110SN is reduced by the sum of:

the section 110SL component; and

the interest accruing on that component after the operative time;

any benefit under section 130D is reduced by the sum of:

the section 130B component; and

the interest accruing on that component after the operative time.

If, after the operative time, salary‑based pension (the original pension) becomes payable to the member spouse in respect of the original interest, then the annual rate of the original pension is reduced to the amount worked out using the formula:

If the member spouse dies without becoming entitled to salary‑based pension, then subsection (3) will nevertheless result in an indirect reduction of any spouse’s pension that becomes payable to a surviving spouse. This happens because the amount of the spouse’s pension is based on the amount of invalidity pension (salary‑based pension) that would have become payable to the member spouse at the time of death.

If, before the original pension becomes payable, the original interest has been split more than once (that is to say, section 146MB has applied more than once), then, in applying the formula in subsection (3), the reduction factor is to be replaced by the number calculated using the following steps, based on the chronological order of the operative times (starting with the earliest):

calculate a factor (the interim factor) using the steps in paragraphs (a) to (c) of the definition of reduction factor in subsection (6);

calculate a factor (the interim factor) for the next split (the current split), using the formula:

calculate a factor for each remaining split (if any), using the formula in paragraph (b);

add together the factors calculated under paragraphs (a) to (c).

A reduction under subsection (3) is to be disregarded in calculating the amount of any non‑standard pension that later becomes payable.

For example, the reduction will be disregarded in calculating the amount of orphan pension payable in respect of a child of the member spouse after the member spouse’s death.

In this section:

if the age in full years is 65 or more—1; or

if the age in full years is less than 65—1 reduced by 0.02 per year from 64 years to 60 years, and then by 0.03 per year from 59 years to 31 years.

calculate a number (the service factor), by reference to the member spouse’s period of contributory service before the operative time, by adding:

for service that occurred within the first 20 years:

0.02 for each full year; and

0.02/365 for each left‑over day; and

for service that occurred within the next 10 years:

0.01 for each full year; and

0.01/365 for each left‑over day; and

for service that occurred within the next 10 years:

0.0025 for each full year; and

0.0025/365 for each left‑over day;

if the original pension is age retirement pension or early retirement pension, multiply the service factor by the age factor (based on the member spouse’s age in full years at the time when the original pension became payable);

multiply the number worked out under paragraphs (a) and (b) by the transfer factor.