UNCLASSIFIED

Hi Peter,

 

Staff email as promised,

 

Regards

Jill

 

 

Dr Jill Charker Chief Executive Officer ComSuper GPO Box 2252 CANBERRA   ACT  2601 T: 02 6272 9501 E:  [email address] comsuper.gov.au

 

 

 

 

 

UNCLASSIFIED

Hi everyone,

 

As you will be aware, the Government today released the reports of the Commission of Audit (CoA).  These can be found here:  www.ncoa.gov.au

 

It is important to bear in mind that the role of the CoA was to provide recommendations to Government.  There is, then, a set of decisions for Government as to which or any of the CoA’s recommendations, it might decide to pursue.  I expect that the May Budget will give us more clarity about that.

 

The recommendations from the CoA are wide-ranging and touch virtually every aspect of Government or the APS.

 

There are two main recommendations from the CoA which are particularly relevant to ComSuper.

 

One of the recommendations of the CoA report was to close the Military Superannuation and Benefits Scheme (MSBS) to new members, and replace this with an accumulation scheme for new Australian Defence Force personnel.  The intention of this recommendation was to try to limit the creation of future additional unfunded liability for the Commonwealth through this scheme (which is still open to new members).  The CoA also recommended that Government should move to a “funded” model for existing APS DB schemes, where the employer contribution is paid to the superannuation trustee (CSC), rather than retained in consolidated revenue (similar to the arrangement currently in place for PSSap).

 

As you will appreciate, this is a recommendation only and will require a decision by Government if it is to proceed.  Clearly there are operational implications for ComSuper in the event of the MSBS being closed and new ADF members moving to an accumulation plan.  However, we have ongoing strong relationships with Defence, CSC and Finance and I am confident that we can work through implementation issues of any such decision.

 

A second recommendation of the CoA report was a proposed merger between ComSuper and the Commonwealth Superannuation Corporation (CSC), our trustee organisation.

 

At this point, this proposed merger is a recommendation by the CoA.  I expect the Government has been considering the proposal but I believe that firm decisions have not yet been made.  The proposal, if it were implemented, would effectively be a Machinery of Government change (such as those frequently experienced by other Government agencies and departments).  The proposal is consistent with other actions and announcements to streamline administration arrangements (i.e., to cut ‘red tape’) and look to improve efficiency and minimise potential duplication across government.

 

A large number of specific changes would need to be made to be able to proceed with this particular proposal, such as changes to both ComSuper’s and CSC’s enabling legislation.  These changes would likely take some time to be made and to take effect.  The specific governance and organisational arrangements of the proposed merger would also need to be addressed and carefully thought through.

 

I know you’re aware that we have been working closely with CSC over the past few years on joint projects, and on implementing new products.  This joint work has been helpful in our understanding of each other’s business priorities and operating environments.  Over the past year or so, we have also refined our areas of respective responsibility.  I have been meeting very regularly with CSC’s CEO, Peter Carrigy-Ryan, and also with the Chair of the Trustee Board, Tony Hyams.  If any proposal around a merger is developed further, I am confident we would continue to work together productively to best achieve the Government’s aims.

 

In the event the Government decides to accept the CoA’s proposal for a merger, I would be working very closely with Peter Carrigy-Ryan to identify the range of issues that needs to be discussed and determined.  In particular, I would look to establish some kind of steering committee or similar arrangement, comprised of executives from both organisations, to oversee the analysis and actions that would be necessary to ensure such a process were as smooth as possible.

 

At this point, however, we need to recognise that this proposal, as well as the MSBS proposal, is simply a recommendation, and we need to understand whether Government will choose to accept these particular recommendations or not.  I will, of course, keep you closely informed of this work, and will provide opportunity to contribute input in the event that this issue progresses further.

 

Please do not hesitate to discuss this matter with your Branch Head, and/or members of the Workplace Relations Committee, if you wish.

 

Regards

 

Jill

 

 

Dr Jill Charker Chief Executive Officer ComSuper GPO Box 2252 CANBERRA   ACT  2601 T: 02 6272 9501 E:  [email address] comsuper.gov.au

 

 

UNCLASSIFIED

UNCLASSIFIED