Governance of Australian Government Superannuation Schemes Act 2011

• CSC itself as the trustee and administrator of all covered Commonwealth superannuation schemes.
• Current and former Commonwealth employees who are members or beneficiaries of the CSS, PSS, PSSAP, 1922 scheme or PNG scheme.
• Current and former Australian Defence Force members who are members or beneficiaries of the DFRB, DFRDB, DFSPB, MSB, ADF Super or ADF Cover.
• The Board of CSC including its nine directors, who bear personal liability for accounting failures (s 29) and are subject to conflict of interest disclosure obligations (s 22).
• The nominating bodies: the President of the Australian Council of Trade Unions and the Chief of the Defence Force each nominate two directors.
• The Minister who appoints all directors, receives annual reports and financial statements, and may issue Ministerial instruments about CSC's payment functions.
• The Auditor-General who must audit and report on CSC's annual financial statements.
• The Parliament, which receives annual reports and financial statements tabled within 15 sitting days of the last document being received by the Minister (s 30(4)).

Board obligations:

• Ensure CSC performs its functions in a proper, efficient and effective manner (s 10).
• Keep minutes of meetings (s 25).
• Disclose conflicts of interest at meetings (s 22); board members with conflicts must not be present for deliberation or voting without Ministerial or Board direction.
• Comply with s 19 of the PGPA Act (duty to keep the Minister informed) except for provisions excluded by s 6.

CSC financial obligations:

• Pay all money received for each superannuation fund into a separate bank account (s 28).
• Keep proper accounting records for the transactions and affairs of each superannuation fund (s 29(1)).
• Take reasonable steps to ensure payments are correctly made and properly authorised, and that adequate control is maintained over fund assets and liabilities (s 29(2)).
• Prepare and provide annual reports and financial statements to the Minister, audited by the Auditor-General, within the prescribed period after each financial year, or in any case within six months (s 30).

Director obligations:

• A director commits an offence (s 29(3)) if they cause a requirement to maintain proper accounts and records to be breached, or fail to take reasonable steps to comply. Penalty: imprisonment for 6 months or 30 penalty units, or both.

CSC military scheme obligations:

• Must have regard to the unique nature of military service when performing functions under any military scheme Act or instrument (s 8(3)).

CSC powers (s 8(4)): Has power to do all things necessary or convenient for the performance of its functions.

Board powers (s 10(2)): Has power to do all things necessary or convenient for the performance of its function.

Making payments and receiving receipts on behalf of the Commonwealth (ss 29A, 29B): CSC may, on behalf of the Commonwealth, make payments under Acts administered by CSC (including the Same-Sex Relationships (Equal Treatment in Commonwealth Laws - Superannuation) Act 2008: s 29A(b)), and receive payments and other amounts payable to the Commonwealth under those Acts.

Ministerial instruments on payments (s 29D): The Minister may, by legislative instrument, provide in relation to CSC's performance of its payment functions (after consulting the Board). This power does not extend to overriding CSC's obligations as trustee under Commonwealth law.

CSC Special Account (ss 29E-29G): Established as a special account under the PGPA Act. Amounts may be debited to meet CSC's operating costs, director remuneration, review panel member remuneration, and account management expenses.

Staff and consultants (ss 26-27): CSC may employ staff and engage consultants on Board-determined terms.

Sub-delegations (s 36): CSC may sub-delegate functions and powers where authorised under Acts administered by CSC.

Chair's role: The Chair presides at Board meetings (s 20), grants leave to other directors (s 15), and nominates a director to preside in the Chair's absence (s 20(2)(a)).

The Act contains one criminal offence provision:

Section 29(3): A director commits an offence if they cause a requirement to maintain proper accounts and records to be breached, or fail to take reasonable steps to comply with or secure compliance with the requirement. Penalty: 6 months imprisonment or 30 penalty units, or both.

In addition, the PGPA Act provides that the Minister may terminate a director's appointment for failure to comply with duties of officials under that Act (s 17(4) of this Act, read with s 30 of the PGPA Act).

A director's appointment automatically terminates if the director becomes a disqualified person under Part 15 of the Superannuation Industry (Supervision) Act 1993 (s 17(1)).

The Superannuation Industry (Supervision) Act 1993 (SIS Act) applies to CSC as trustee and imposes obligations including the sole purpose test, equal representation requirements, trustee duties, and prohibited transactions rules.

Board meetings:

• Held as necessary for performance of the Board's function (s 19(1)).
• Chair may convene at any time; must convene within 30 days of a written request from another director (s 19(2)).
• Quorum: 6 directors, but for matters concerning only the military schemes, the quorum must include a director nominated by the Chief of the Defence Force (s 21).
• Decisions by agreement of 6 directors (s 23).
• Decisions without meetings: allowed if Board has determined this is permissible, 6 directors indicate agreement, and all directors are informed (or reasonable efforts made to inform all directors): s 24.

Director appointments:

• Minister appoints by written instrument on a part-time basis (s 12(1)).
• ACTU President nominates 2 directors; CDF nominates 2 directors; Minister chooses the remaining 4 plus the Chair (s 11(2)).
• Terms of up to 3 years; maximum continuous service 9 years (ss 13(1), (2)).
• Chair appointment requires Board agreement (s 12(5)).

Annual reporting (s 30):

• By prescribed date (or, if none, as soon as practicable) after the end of each financial year, CSC must provide annual reports and financial statements to the Minister.
• Financial statements must be submitted to and audited by the Auditor-General before delivery to the Minister.
• Minister tables copies in each House within 15 sitting days of receipt.
• If not completed within 6 months of year end, interim report and financial statements required within 14 days of that deadline.

Public Governance, Performance and Accountability Act 2013 (Cth): CSC is a corporate Commonwealth entity subject to the PGPA Act. Section 6 carves out certain PGPA Act provisions that would otherwise interfere with CSC's management and investment of superannuation fund money: the duty to govern the entity (s 15(2)), some parts of the duty to keep the Minister informed (s 19(1)(c), (d), (e)), budget estimates (s 36), investment obligations (s 59), and the Ministerial reporting obligation under s 72. This carve-out reflects CSC's trustee obligations to fund members, which must be insulated from political direction on investment decisions.

Superannuation Industry (Supervision) Act 1993 (Cth) (SIS Act): CSC as trustee is subject to SIS Act obligations including the sole purpose test, trustee conduct standards, disclosure and reporting obligations, and prohibited transactions. The SIS fitness and propriety standard governs director eligibility throughout this Act.

Each Act administered by CSC: The governing legislation for each scheme (Superannuation Act 1976, Superannuation Act 1990, Superannuation Act 2005, Military Superannuation and Benefits Act 1991, Australian Defence Force Superannuation Act 2015, etc.) is the primary source of obligations for each scheme. CSC's functions under each Act are functions under that Act, not under this Act (s 8(2)).

Long Service Leave (Commonwealth Employees) Act 1976: CSC is treated as a public authority of the Commonwealth for long service leave purposes (s 37).

ACT Trustee Act 1925 (as applied under s 31): The ACT Trustee Act applies to directors performing functions, except to the extent inconsistent with Commonwealth law.

Child Support (Registration and Collection) Act 1988 (Cth): CSC's trustee functions intersect with child support deduction notices. As confirmed in Carmody v Superannuation Complaints Tribunal [2020] FCA 291, the definition of "trustee" and CSC's payment functions under ss 3, 4, 5 and 29A of this Act are relevant when the Child Support Agency serves notices on CSC.

Same-Sex Relationships (Equal Treatment in Commonwealth Laws - Superannuation) Act 2008: Section 29A(b) explicitly authorises CSC to make payments under that Act on behalf of the Commonwealth.

CSC acts under the administered Act, not this Act: Section 8(2) states that when CSC performs a function under an Act administered by CSC, it is performing the function under the relevant Act, not under this Act. This has practical consequences: a scheme member challenging a CSC decision about entitlements should be looking at the relevant scheme Act (e.g. the Military Superannuation and Benefits Act 1991), not at this Act.

PGPA Act carve-out is not complete: Section 6 carves out specific PGPA provisions from applying to CSC's fund management activities. The balance of the PGPA Act continues to apply to CSC as a corporate Commonwealth entity. The carve-out exists to protect investment decisions from ministerial direction, not to exempt CSC from accountability generally.

Director conflict of interest disclosure in fund matters only: Section 22 applies only "to the extent that the Board does a thing relating to CSC's management and investment of money that forms part of a superannuation fund administered by CSC." For other Board matters, the conflict of interest obligations derive from the PGPA Act's s 29 rules.

Military scheme quorum requirement is self-assessed: Under s 21(4), the Chair determines whether a matter concerns only the military schemes. This determination is not a legislative instrument (s 21(5)), meaning it cannot be directly challenged in administrative review proceedings on that basis alone.

The 6-month annual reporting deadline has teeth: Under s 30(5), if the Board has not complied with the annual reporting obligation within 6 months, CSC must give the Minister interim reports within 14 days. Failure to meet the 6-month deadline triggers mandatory reporting of a less complete set of accounts.

Director appointment cannot be delegated: The ACTU President and CDF nomination rights are personal and cannot be substituted by a delegate. For acting appointments in a nominated director's absence, the relevant nominating authority must also nominate the acting person (ss 18(5), (6)).

ADF member dispute about invalidity benefit: A former ADF member disputes CSC's determination that they are not entitled to invalidity benefits under the Military Superannuation and Benefits Scheme. Under s 8(2), the relevant obligations arise under the Military Superannuation and Benefits Act 1991, not this Act. The member would challenge the decision under the complaint or appeal mechanisms in the relevant scheme legislation. In the Campbell v Superannuation Complaints Tribunal line of cases, the Federal Court examined CSC's decision-making about MSBS invalidity benefits - with CSC acting as trustee under the Military Superannuation and Benefits Act 1991.

Child support notices served on CSC: CSC receives a notice from the Child Support Agency requiring periodic deductions from a current ADF member's pension entitlements. Under ss 29A(a) and 3, CSC acts as trustee and administrator of the relevant military scheme. In Carmody v Superannuation Complaints Tribunal [2020] FCA 291, the Court examined whether CSC (as trustee under this Act's framework) was an "employer" for child support notice purposes, with ss 3, 4, 5 and 29A directly cited.

Annual financial statements process: Before the prescribed reporting date, CSC must prepare annual reports covering all schemes administered and financial statements for each fund. The financial statements go to the Auditor-General for audit. The Auditor-General's report covers whether accounts are proper, whether statements agree with accounts, and whether all transactions (including investments) were made in accordance with this Act, the relevant scheme Acts, and the governing deeds. The Minister then tables all documents in Parliament within 15 sitting days.

Director with a conflict of interest: A director is an adviser to a fund manager that is being considered for a mandate to manage assets in the PSSAP Fund. Under s 22, the director must disclose the interest at a Board meeting as soon as the relevant facts are known. Unless the Minister or Board directs otherwise, the director must absent themselves from deliberation and voting on the matter. The disclosure and outcome are recorded in the minutes. This is in addition to, not instead of, the s 29 PGPA Act duties (s 22(8)).