Governors' Pensions Act 1976

The Act directly affects four primary groups. First, the Governor of South Australia while in office: the existence of the pension affects the total compensation package of the office, potentially influencing recruitment and retention decisions. The Act creates an incentive for a Governor to serve at least four years and six months (excluding long recreational absences) to qualify as a “former Governor” eligible for a personal pension. If a Governor resigns earlier without incapacity, no pension is available. Second, former Governors who have met the service threshold or left due to incapacity receive a lifelong indexed pension capped at 30 per cent of final salary, with no requirement to have contributed to the cost. Third, the spouses and domestic partners of deceased Governors and deceased former Governors receive a survivorship pension capped at 75 per cent of the deceased’s pension (if the deceased was a former Governor) or 22.5 per cent of the deceased Governor’s salary (if the Governor died in office). These benefits accrue to the survivor for life, regardless of remarriage or new relationships, as the Act does not impose any termination condition. Fourth, the Treasurer of South Australia is the decision-maker: the Treasurer has discretion to make an Order, to determine the pension amount within the statutory caps, to consider other pensions or retiring allowances paid to the recipient (s 4(3)), and to direct that CPI adjustments not apply in a given period. The Treasurer’s discretion is not fettered by any criteria beyond the caps and the consideration of other pensions, creating a risk of political or personal influence over individual pension awards. Fifth, all South Australian taxpayers are affected indirectly: the pension is paid from the Consolidated Account (s 6), meaning general state revenue funds the payments. No separate fund or actuarial reserve exists. The Act imposes no contribution obligation on the Governor or any other party, so the full cost falls on current and future taxpayers. Sixth, the Family Relationships Act 1975 and the Relationships Register Act 2016 are engaged because declarations or registration are preconditions for a domestic partner to qualify; the relevant registrar and courts are indirectly affected by the necessity to make or recognise such declarations or registrations before death.

The Act imposes a power and a duty on the Treasurer, and confers rights on eligible persons. Under s 3(1), the Treasurer may by Order published in the Gazette provide for and authorise payment of an annual pension for life to a former Governor, or to a surviving spouse or domestic partner of a deceased former Governor or of a deceased Governor. The word “may” indicates discretion: the Treasurer is not compelled to grant a pension in every eligible case, though the circumstances in which a Treasurer would refuse are not stated. The amount of the pension must not exceed the s 4 caps: 30 per cent of the former Governor’s final salary for a personal pension; 75 per cent of the former Governor’s pension for a survivor; or 22.5 per cent of the deceased Governor’s salary for a survivor of a Governor who died in office. Within those caps, the Treasurer may set any amount. The Treasurer also has the right under s 4(3) to “have regard to any other pension or retiring allowance paid or payable” to the recipient in respect of any remunerative activity undertaken before becoming Governor. This means the Treasurer can reduce the statutory pension if the recipient already receives another government pension from prior service (e.g., a parliamentary pension or military pension). The duty to adjust pensions under s 5A(1) is mandatory: “The Treasurer must adjust the amount of the pensions” from the first payment in each adjustment period, applying the CPI variation for Adelaide. However, s 5A(3) gives the Treasurer a power to direct that indexation not apply in a particular period to avoid a reduction in pensions. The right to a pension for the recipient is contingent on an Order being made and on satisfaction of the eligibility definitions. The pension is payable fortnightly and accrues due from day to day (s 5(2)). The recipient has no right to commute the pension to a lump sum, nor to assign or bequeath it (the Act is silent on assignability, so the general law applies). The former Governor or estate has a right under s 3(2) to receive an amount sufficient to defray Commonwealth tax liabilities arising from superannuation entitlements under this Act, but only if the Treasurer chooses to pay it (“The Treasurer may also pay”). This provision, inserted in 2001, acknowledges that the pension may be taxed as superannuation income and allows the Treasurer to gross up the payment to cover the tax, but it is discretionary.

The Act contains no penalty provisions, no criminal offences, and no civil penalties. There is no provision for recovery of overpayments, suspension, or forfeiture of a pension. The only enforcement mechanism is the requirement that the Order be published in the Gazette (s 3(1)), which gives it legal effect and makes it subject to judicial review under general administrative law principles. If the Treasurer exceeds the statutory caps in s 4, the Order would likely be ultra vires and voidable. If the Treasurer fails to adjust pensions under s 5A(1) without issuing a direction under s 5A(3), a recipient could seek mandamus to compel compliance. The Act does not create a statutory cause of action for non-payment; the right to payment arises from the Order itself, so enforcement would be by action on the Order as a debt due from the Crown. The Appropriation under s 6 provides the legal authority for payment, but does not confer a private right. In practice, non-payment is unlikely given the small number of recipients and the political sensitivity of a Governor’s pension. The Act also does not provide for review of the Treasurer’s discretion to refuse a pension, to set a lower amount, or to consider other pensions. Any such refusal or reduction would be challengeable only on conventional grounds such as unreasonableness, procedural unfairness, or improper purpose. The transitional provision in the Statutes Amendment (Domestic Partners) Act 2006 states that domestic partner amendments apply only if the death occurs after commencement (1 June 2007). This limits the pool of eligible survivors for earlier deaths.

The Act expressly interacts with several other South Australian statutes. Section 2 defines “salary” by reference to s 73 of the Constitution Act 1934, meaning the Governor’s salary is set under that Act and the pension caps automatically adjust if the Constitution Act is amended. The definition of “domestic partner” relies on the Family Relationships Act 1975 and the Relationships Register Act 2016. A person claiming as a domestic partner must either have been declared as such under the Family Relationships Act as at the date of death, or have been in a registered relationship under the Relationships Register Act as at that date. The definition of “registered relationship” expressly includes a corresponding law registered relationship under the Relationships Register Act 2016. This means if a Governor or former Governor had a relationship registered in another Australian jurisdiction that is recognised under South Australian law, the partner may qualify. The Act also interacts with Commonwealth taxation law via s 3(2), which allows the Treasurer to pay an amount sufficient to defray any tax liability (including interest) under Commonwealth law arising because of superannuation entitlements under this Act. This provision was inserted to address potential tax liabilities that could otherwise reduce the net benefit of the pension. The Act does not interact with the Superannuation Industry (Supervision) Act 1993 (Cth) or other superannuation regulation, because the pension is not a superannuation fund but a direct payment from the Consolidated Account; it is treated as superannuation only for tax purposes. The Act does not interact with the Public Sector (Honesty and Accountability) Act 1995 or similar integrity legislation, but the Governor is a public officer so general conflict-of-interest rules may apply. The Act is also independent of the Government Financing Authority Act 1982; the Consolidated Account is the general state bank account under the Public Finance and Audit Act 1987. No interaction with workers’ compensation or social security laws is mentioned, but a pension under this Act would likely be treated as income for Centrelink purposes.

The Act received assent on 1 July 1976 and commenced on the same day. The 1981 amendment (No 64 of 1981) inserted the definition of “furlough” and amended the definition of “former Governor” to clarify the service calculation. The 2001 amendments were significant. The Statutes Amendment (Indexation of Superannuation Pensions) Act 2001 (No 40 of 2001) inserted s 5A (adjustment of pensions) and deleted s 4(2), which had previously provided for a different cap formula. Indexation commenced on 1 January 2002. The Statutes Amendment (Governor’s Remuneration) Act 2001 (No 51 of 2001) redesignated s 3 as s 3(1), inserted s 3(2) (power to pay tax liabilities), amended the s 4(1) caps, and substituted s 6 to refer to the Consolidated Account. This amendment commenced on 5 November 2001. The Statutes Amendment (Domestic Partners) Act 2006 (No 43 of 2006) amended the long title, inserted the definition of “domestic partner”, substituted the definition of “spouse”, amended s 3(1) and s 4(1) and (3) to include domestic partners, and added a transitional provision (clause 120) providing that the domestic partner amendments apply only if the death of the Governor or former Governor occurs after the commencement of the amendment (1 June 2007). The Statutes Amendment (Registered Relationships) Act 2017 (No 13 of 2017) substituted the definition of “domestic partner” and inserted the definition of “registered relationship” to incorporate the Relationships Register Act 2016, commencing 1 August 2017. No other amendments have been made. The Act has been reprinted several times: Reprint No 1 on 15 August 1991, Reprint No 2 on 5 November 2001, Reprint No 3 on 1 January 2002, and an unauthorised version current from 1 June 2007. The legislative history notes that references to other legislation may be obsolete, indicating that the Act has not been comprehensively updated to reflect cross-references.

The Act makes no reference to any litigation, and there are no noted court cases directly under this Act in the legislative history. Given the small number of potential recipients (only former Governors of South Australia and their surviving spouses or domestic partners), litigation is unlikely. The Act’s caps are clear and the Treasurer’s discretion is broad, which reduces the grounds for challenge. Any challenge would likely be based on administrative law principles rather than on the Act itself. The 2006 transitional provision was designed to avoid retrospective claims, which might otherwise have generated disputes about partnership status. The absence of litigation history suggests the Act has operated without judicial controversy.

Several provisions create traps for the unwary. The definition of “former Governor” requires that the person cease to hold office after serving “for a period (excluding periods of furlough) of not less than four years and six months”. Furlough is defined as absence for recreational purposes for a continuous period of more than one month. This means that if a Governor takes recreational leave exceeding one month at a stretch, that time does not count toward the 4.5 year qualifying period. However, shorter breaks do count. Governors who take long holidays may need to serve longer in calendar terms to reach the required 4.5 years of actual service. A Governor who resigns before 4.5 years for reasons other than incapacity receives no pension at all. The s 4(3) power allows the Treasurer to reduce the pension by taking into account “any other pension or retiring allowance” from prior remunerative activity. A former Governor who was previously a judge, MP, or military officer with a separate pension could see their Governor’s pension cut, perhaps substantially, though the Treasurer is not obliged to do so. The indexation provisions contain a subtle trap: if the CPI falls (deflation), s 5A(3) allows the Treasurer to direct that indexation not apply “to avoid a reduction in pensions”, meaning the pension may remain static rather than drop. But if the Treasurer does not issue such a direction, the pension would decrease in nominal terms. In periods of low inflation, the real value of the pension may erode more than anticipated if the Treasurer skips adjustments. For survivors, the requirement that a domestic partner must have been declared under the Family Relationships Act or in a registered relationship “as at the date of death” is critical. A person who becomes a domestic partner after the death cannot qualify. The transitional provision for the 2006 domestic partner amendments also means that if a Governor died before 1 June 2007, no domestic partner claim is possible, even if the relationship would have qualified under the current definitions. The Act does not provide for the pension to be indexed in the absence of an Order; the Treasurer’s discretion to decide the commencement date under s 5(1) means the pension can begin after death or retirement, and any gap before the Order means no pension accrues for that period. The s 3(2) tax payment is discretionary; a former Governor cannot demand it. Finally, the Act appropriates from the Consolidated Account, not from a dedicated fund, so the pension is vulnerable to future legislative amendment or repeal, though the Act contains no provision allowing reduction of pensions already granted. The High Court might imply a contractual right once an Order is made, but the Act is silent on that issue.

Compliance obligations under the Act rest almost entirely with the Treasurer of South Australia, not with the recipient. The Treasurer’s primary duty is to decide whether to make an Order under s 3(1) and to determine the pension amount within the caps. The decision should be recorded in an Order published in the Gazette. The Treasurer must consider s 4(3) regarding other pensions if relevant, and should document that consideration to avoid later challenge. The Treasurer must calculate the pension amount using the salary defined under the Constitution Act 1934. For a former Governor, the cap is 30 per cent of that salary. For a survivor of a deceased former Governor, the cap is 75 per cent of the pension the deceased was receiving immediately before death. For a survivor of a deceased Governor, the cap is 22.5 per cent of the deceased’s salary. The Treasurer must adjust pensions under s 5A(1) at the first payment in each April and October adjustment period, using the percentage variation in the Adelaide CPI between the specified quarters. If the period of payment is less than six months, the adjustment is reduced proportionally (s 5A(2)). If the CPI would cause a reduction, the Treasurer may issue a direction under s 5A(3) that indexation not apply in that period, but must ensure that the next adjustment catches up by using the variation from the period when indexation last applied (s 5A(4)). The Treasurer should maintain a spreadsheet or actuarial record of each pension, the salary base, the CPI variations, and any directions made. The Treasurer must ensure that each pension is paid fortnightly, accruing from day to day (s 5(2)). For a survivor claiming as a domestic partner, the Treasurer must verify that the person meets the definition: either a declaration under the Family Relationships Act as at date of death, or a registered relationship under the Relationships Register Act as at death. The Treasurer should request documentary evidence, such as a declaration order or a certificate of registration. For a survivor claiming as a spouse, a marriage certificate is sufficient. The Treasurer must also confirm the date of death of the Governor or former Governor to determine eligibility for domestic partner claims under the transitional provision (only for deaths after 1 June 2007). If the Treasurer decides to pay a tax top-up under s 3(2), the amount must be calculated to defray the Commonwealth tax liability arising from superannuation entitlements under the Act, including interest. The Treasurer may need to obtain a tax assessment or estimate. There is no requirement for the recipient to make any compliance filings under this Act, but the recipient should be aware that the pension is taxable income under Commonwealth law and must be declared in their personal tax return. The recipient should also be prepared to provide evidence of domestic partner status or prior pensions upon request. The State’s financial officers should ensure that the appropriation under s 6 is sufficient and that payments are correctly recorded.