Legislative Assembly Members' Superannuation Contributions Act 2004

The Act defines several key terms that determine how contributions are calculated and to whom they are paid. “Member” is defined in section 3 by reference to section 5: a member of the Legislative Assembly who falls within the transitional or new-entrant categories. “Basic salary” and “additional salary” are defined in section 3 by cross-reference to the Assembly Members and Statutory Officers (Remuneration and Other Entitlements) Act 2006. Additional salary covers the extra remuneration paid for serving as Speaker, Minister, or Leader of the Opposition, or for other specified offices or functions under the Remuneration Act. This distinction matters because the contribution formula in section 6(2)(a) adds both basic and additional salary together, so members holding these roles attract a larger Territory contribution. “Complying superannuation fund” is defined in section 4 using a two-part test drawn from the Commonwealth Income Tax Assessment Act 1936: the fund must be a complying superannuation fund for the purposes of Part IX of that Act in the relevant income year, and it must be a “superannuation fund” within the meaning of section 6(1) of that Act. This definition is static (it does not reference later amendments to Commonwealth law explicitly) and requires ongoing compliance monitoring. “Contributions fund”, defined in section 3, is either the fund specified in the member’s choice notice (if one is in effect) or the default fund. “Default fund” is declared by the Minister under section 13 and must be a complying superannuation fund other than a self-managed superannuation fund (SMSF) as defined in section 10 of the Superannuation Industry (Supervision) Act 1993 (Cth). The prohibition on SMSFs reflects a policy decision to avoid the administrative burden of making contributions to funds controlled by the member directly. “Choice notice” is a written notice given under section 8 that selects a fund and can be varied or revoked under sections 10 and 11. “RSA” (retirement savings account) has the same meaning as in the Retirement Savings Accounts Act 1997 (Cth), providing an alternative to a superannuation fund proper. “Salary sacrifice” is not defined in detail beyond the power in section 14, but the Act sets a default cap of 50% of the relevant salary component, with regulations able to prescribe a different percentage. The Act also uses the term “Clerk” to mean the Clerk of the Legislative Assembly, who carries administrative duties such as notifying members of their right to choose a fund (section 12) and receiving choice notices. These concepts together create a self-contained but Commonwealth-dependent architecture for delivering superannuation contributions to a small, defined population.

The primary affected parties are members of the Northern Territory Legislative Assembly who fall within section 5: those first elected after the Act’s commencement (9 May 2005) and those re-elected after that date who previously had a pension entitlement under the Legislative Assembly Members’ Pensions Act 1979. This means the Act does not apply to members who were first elected before commencement and have not been re-elected, or to members who were re-elected but did not have a prior pension entitlement. The affected population is therefore small - at any given time, around 25 members - but the financial implications are ongoing because contributions accumulate over a member’s term and potentially beyond if rolled into a superannuation fund. The Clerk of the Legislative Assembly is directly affected by administrative duties under sections 8, 10, 11, and 12: the Clerk must receive choice notices, variations, and revocations, and must provide a written notice to each newly elected or re-elected member within 28 days informing them of their right to choose a fund and of the default fund arrangement. The Minister (presumably the Treasurer or equivalent) is responsible for declaring and maintaining a default fund under section 13, including ensuring that a default fund exists at all times and that it is not an SMSF. The Territory as a corporate entity bears the financial cost of the contributions, which are paid from public moneys under an appropriation established or increased by section 15. This means taxpayers ultimately fund the contributions. Superannuation funds and RSA providers are affected to the extent they accept contributions; they must be “complying” at the time of receipt, and evidence of willingness to accept contributions must accompany a choice notice under section 8(2)(d) or a variation under section 10(4)(b). The Commonwealth superannuation regulatory framework is indirectly affected because the Act relies on Commonwealth definitions and the SG shortfall test to set the minimum contribution level. The Act has no effect on employees of the Northern Territory government generally, nor on members of the public. Its narrow scope means the compliance burden is concentrated in the Legislative Assembly secretariat and the department administering the default fund.

Members have the right to choose a complying superannuation fund or an RSA by giving a choice notice to the Clerk under sections 7 and 8. The choice must be in writing, specify the fund name and contact details, include evidence that the fund will accept contributions, and specify a start date not earlier than the date the notice is given. Only one fund may be chosen at a time. Members may vary their choice notice under section 10, but only in two ways: to change the fund to another complying superannuation fund or RSA, or to delay the start date of the original choice notice (if it has not already taken effect). A variation again requires evidence of the new fund’s willingness to accept contributions. Members may revoke their choice notice entirely under section 11, which returns the member to the default fund arrangement. Revocations must be in writing and cannot take effect before the date of the notice. The territory’s duty to contribute is set out in section 6(1): it must make a monthly contribution to the member’s contributions fund. The amount is calculated under section 6(2) and (3) and cannot be reduced by salary sacrifice. The contribution must cease if, under the Superannuation Industry (Supervision) Act 1993 (Cth), the fund is not permitted to receive contributions (section 6(4)). The Clerk has a duty under section 12 to give a written notice to a member within 28 days after the member is elected or re-elected, containing a statement of the right to choose, a statement about the default fund, and any other prescribed information. The Minister has a duty under section 13(4) to declare a default fund as soon as practicable after the Act’s commencement, and under section 13(7) to make a new declaration immediately after revoking an existing one, ensuring continuity. Members also have the right to salary sacrifice up to 50% of basic salary, additional salary, or the sum of both, as provided by section 14. The regulations may prescribe a different percentage and may provide the mechanics for salary sacrifice. The member has no duty to choose a fund; if no choice is made, contributions are paid into the default fund. The Territory cannot compel a member to choose a particular fund, and the member’s right to change funds is unconstrained except by the requirement that the new fund be a complying superannuation fund or RSA at the time of the change. These rights and duties create a minimal compliance framework; the only significant administrative burden falls on the Clerk and the Minister, while members enjoy optional participation in fund selection.

The Act contains no penalty provisions. No fines, criminal offences, or civil penalties are prescribed for non-compliance by any party. This absence is notable: a member who fails to choose a fund simply defaults; the Clerk who fails to notify the member within 28 days (section 12) faces no statutory penalty; a Minister who delays declaring a default fund appears to breach a statutory duty but with no enforcement mechanism specified. The only indirect enforcement arises from the link to the Commonwealth superannuation guarantee regime. Under section 6(2)(b), the Territory’s contribution must be at least the amount necessary to avoid a superannuation guarantee shortfall under the Superannuation Guarantee (Administration) Act 1992 (Cth). If the Territory fails to contribute enough, it becomes liable for the superannuation guarantee charge (a tax) under Commonwealth law. That charge is the primary enforcement lever: it creates a financial cost to the Territory for underpayment. However, the Act does not itself replicate any of the Commonwealth’s enforcement machinery. There is no provision for member-initiated complaints to a tribunal, no power for the Clerk to compel compliance, and no oversight body designated to audit contribution payments. Disputes about contribution amounts or fund eligibility would likely be resolved through administrative law (judicial review) or contract-based claims against the Territory, but the Act does not create a statutory cause of action. The prohibition on paying contributions to a fund that, under the SIS Act, cannot receive them (section 6(4)) is enforced by the Territory’s own duty to withhold payment; there is no penalty for paying in breach. The salary sacrifice provisions in section 14 are permissive and carry no enforcement mechanism. In effect, the Act relies on administrative processes within the Territory government and the Commonwealth’s SG charge as the sole real penalty for non-compliance. This light enforcement approach reflects the small, closed population and the fact that contributions are paid from consolidated revenue, so the Territory is both the payer and the enforcer, with its own incentive to avoid SG charges.

The Act is heavily interwoven with Commonwealth superannuation and tax legislation, and to a lesser extent with Northern Territory remuneration law. Section 4 defines “complying superannuation fund” by reference to Part IX of the Income Tax Assessment Act 1936 (Cth) and section 6(1) of that Act. This means that changes to those Commonwealth provisions directly affect which funds qualify under the NT Act. The definition does not incorporate the Income Tax Assessment Act 1997 (Cth), so practitioners must refer back to the 1936 Act. Section 6(2)(b) incorporates the concept of “superannuation guarantee shortfall” from the Superannuation Guarantee (Administration) Act 1992 (Cth), which in turn references the SG rate and ordinary time earnings. The NT Act’s contribution formula accordingly tracks the Commonwealth SG rate, so an increase in that rate (from 9% to 9.5% in 2013, then to 10% in 2021, and eventually to 12%) automatically lifts the Territory’s minimum contribution. Section 6(4) prohibits contributions if the fund is not permitted to receive them under the Superannuation Industry (Supervision) Act 1993 (Cth), including regulations. The definition of “RSA” in section 3 references the Retirement Savings Accounts Act 1997 (Cth). The Act also cross-references the Assembly Members and Statutory Officers (Remuneration and Other Entitlements) Act 2006 (NT) for the definitions of basic salary and additional salary. This means changes to that Remuneration Act - for example, adjustments to the salary base for the Speaker or Ministers - flow through to the contribution calculation. The Act does not expressly interact with the Superannuation (State Public Sector) Deed or any NT public sector super scheme; it operates as a standalone regime for elected members. Importantly, the Act does not incorporate the Commonwealth’s choice-of-fund rules under the Superannuation Guarantee (Administration) Act 1992, instead creating its own choice framework (sections 7-11) which is simpler and tailored to the small member population. Section 15 provides that contributions are paid from “public moneys of the Territory” and an appropriation is established or increased to that extent. This provision was amended by the Financial Management Amendment Act 2009 to align with the Financial Management Act (NT). The Act does not interact with the Fair Work Act or industrial relations legislation because members are not employees. The salary sacrifice provision (section 14) may interact with Commonwealth fringe benefits tax law if the arrangement is structured as a salary sacrifice for superannuation contributions - typically such contributions are concessional for income tax purposes but not fringe benefits. The regulations under section 16 could prescribe additional interactions, but none are currently specified in the Act.

The Act received assent on 21 December 2004 and commenced on 9 May 2005 (Gazette S15, 9 May 2005). Since then, four amending instruments have been enacted. The Assembly Members and Statutory Officers (Remuneration and Other Entitlements) Act 2006 (NT Act No. 7, 2006) amended section 3 to replace references to the earlier remuneration legislation with the new 2006 Act, reflecting a consolidation of parliamentary remuneration law. The Financial Management Amendment Act 2009 (NT Act No. 15, 2009) amended section 15, the appropriation provision, to align with the Territory’s financial management framework. The most substantial amendment was the Legislative Assembly Members’ Superannuation Contributions Amendment Act 2015 (NT Act No. 30, 2015), which received assent on 18 December 2015 but did not commence until 12 February 2020 - a delay of over four years, likely due to administrative or policy reasons. This amendment made six changes: it amended section 3 (including the definition of ‘choice notice’); rewrote section 7 to clarify that the chosen fund must be a complying superannuation fund or an RSA at the time of choice; amended section 9 to provide that the choice remains in effect until the contribution for the month in which the member ceases to be a member is paid; amended section 10 to limit variations to changing the fund or delaying the start date; amended section 12 to change the Clerk’s notification period from ‘as soon as practicable’ to a fixed 28 days; and amended section 13 to prohibit self-managed superannuation funds from being declared as the default fund, while also requiring the Minister to make a new declaration immediately after revoking an existing one. The Statute Law Revision Act 2020 (NT Act No. 26, 2020) commenced on 20 November 2020 and made minor amendment to section 5 regarding transitional members. Additionally, general amendments of a formal nature (not listed in the table of amendments) were made by the Interpretation Legislation Amendment Act 2018 (NT Act No. 22, 2018) to sections 1, 3, and 5. The Act has not been amended since 2020. This amendment history shows that the Act has been stable, with refinements largely focused on tightening the choice framework and preventing undesirable fund types (SMSFs) from being the default.

The Act has no reported litigation history. No court or tribunal decisions are referenced in the source text, and given the narrow population (at most 25 members at any time) and the mechanical nature of the contribution formula, litigation is highly improbable. The Act does not create any private cause of action, nor does it designate a specific forum for dispute resolution. Any legal challenge would likely proceed by way of judicial review in the Supreme Court of the Northern Territory under the Administrative Decisions (Judicial Review) Act 1989 (NT) or the common law, if a member disputed the calculation of contributions, the validity of a default fund declaration, or the Clerk’s refusal to accept a choice notice. Potential grounds include jurisdictional error (e.g., the Minister declaring a default fund that is not a complying superannuation fund at the time), failure to exercise a statutory duty (e.g., failure to declare a default fund), or misinterpretation of the cross-referenced Commonwealth definitions. Salary sacrifice disputes could arise if a member claims the Territory exceeded the 50% cap or if regulations alter the percentage. Given the executive character of the payments and the minister’s discretion under section 13, the likelihood of successful challenge is low. The absence of any penalty provisions also reduces the incentive for litigation; a member who is unhappy with the default fund can simply choose another fund. The only real financial risk to a member is if the Territory fails to contribute, but even then the remedy lies in the Commonwealth SG charge rather than the NT Act. The lack of litigation may also reflect the small pool of potential claimants and the fact that members have direct access to the Minister and Clerk for informal resolution. There is no indication in the Act of any review body such as the NT Civil and Administrative Tribunal or a superannuation complaints tribunal; the Commonwealth Superannuation Complaints Tribunal does not have jurisdiction over Territory government contributions. Consequently, the Act operates largely without judicial oversight, and the risk of contested litigation is negligible.

Several features of the Act can trap practitioners unfamiliar with its peculiarities. First, the definition of “complying superannuation fund” in section 4 uses the Income Tax Assessment Act 1936 (Cth), not the 1997 Act. This means changes to the 1997 Act do not automatically update the definition. The fund must also be a “superannuation fund” under section 6(1) of the 1936 Act - a provision that has been substantively redrafted over time but remains in force alongside the 1997 Act. Second, the contribution formula in section 6(2) is the greater of 9% of the sum of basic plus additional salary (ignoring any salary sacrifice reduction) and the minimum amount to avoid an SG shortfall. Because the SG rate has been above 9% since 2013, the contribution is effectively the SG minimum. However, the SG minimum is calculated on “ordinary time earnings” under the Commonwealth Act, whereas the NT Act uses “basic salary” plus “additional salary” as defined by the NT Remuneration Act. These amounts may not be identical; for example, additional salary for a Speaker may not be “ordinary time earnings” under SG rules. This could lead to either a higher or lower contribution than the SG charge would require. Third, section 6(3) states that any reduction due to salary sacrifice is disregarded when calculating the contribution. This means a member’s salary sacrifice into super does not reduce the Territory’s contribution. The effect is that a member sacrificing 50% of salary still attracts the full Territory contribution on the pre-sacrifice amount. Fourth, the default fund cannot be an SMSF (section 13(2)), but the member’s chosen fund can be any complying superannuation fund or RSA (section 7(2)), including an SMSF? The section 7(2) does not explicitly prohibit SMSFs, but the definition of “complying superannuation fund” in section 4 may include SMSFs if they meet the ITAA 1936 test. So a member could choose an SMSF, but the default fund cannot. Fifth, the choice notice cannot take effect earlier than the date it is given (section 8(2)(b)). This means there is no backdating. A member who delays choosing loses contributions that could have been directed to a preferred fund; those contributions will go to the default fund instead. Sixth, the Clerk’s 28-day notification duty under section 12 is triggered “within 28 days after a member is elected or re-elected.” The word “elected” is ambiguous: does it mean the date of election (polling day) or the date the member takes office? The section does not specify, and this could lead to disputes. Seventh, section 6(4) prohibits paying contributions to a fund that the SIS Act does not permit to receive them. This is a trap for the Territory: if the fund later ceases to be permitted, payments must stop immediately, even if the member has not yet chosen a new fund. Eighth, the Act does not provide for member contributions - only Territory contributions. So a member who wants to add personal contributions must do so outside the Act, which may have different tax treatment. Ninth, the salary sacrifice cap is currently 50% under section 14(3), but regulations can prescribe a different percentage. If regulations are made, the operative percentage changes without amending the Act itself. Tenth, the Act does not require the member to be a member of the chosen fund; it only requires that the fund will accept contributions. The member may have no account or membership interest in the fund, which could cause practical issues with the fund’s own acceptance policies.

Compliance under the Act is straightforward but requires attention to several procedural steps. For the Clerk of the Legislative Assembly, the first duty upon a member’s election or re-election is to provide a written notice under section 12 within 28 days. The notice must inform the member of the right to choose a complying superannuation fund or RSA, state that if no choice is made contributions will be paid into the default fund, and include any other information prescribed by regulation (none currently prescribed). The Clerk must also maintain records of any choice notices received, variations, and revocations, and must ensure that the fund details and acceptance evidence are included. If a choice notice is incomplete (e.g., missing evidence of fund acceptance), the Clerk should return it for correction, though the Act is silent on this. The Clerk should also keep a register of the default fund current at any time, as declared by the Minister. For the Territory (the payer), the calculation of contributions under section 6 must be performed monthly. The payer must obtain the member’s basic salary and additional salary amounts from the department that administers the Remuneration Act. The contribution is the greater of 9% of the sum of those amounts (disregarding any salary sacrifice reduction) and the minimum amount to avoid an SG shortfall. The SG shortfall amount is calculated under Commonwealth law and requires knowledge of the member’s ordinary time earnings (which may differ from the NT salary definitions - a trap). The payer should consult the Commonwealth Superannuation Guarantee (Administration) Act 1992 to determine the SG percentage in force and apply it to the member’s salary base as defined for SG purposes. The contributions must be made to the member’s contributions fund: either the fund chosen by the member (if a valid choice notice is on file) or the current default fund. The payer must stop contributions if the fund becomes prohibited under section 6(4). Contributions must be paid monthly; there is no provision for lump-sum annual payments. The appropriation under section 15 is automatically established by the Act, so no special appropriation is needed beyond the normal budget process. For the member, compliance is voluntary: the member may choose a fund, vary it, revoke it, or do nothing. If the member chooses a fund, the choice notice must be given to the Clerk in writing, specifying the fund name and contact details, and must be accompanied by evidence that the fund will accept contributions. The member must ensure the fund is a complying superannuation fund (under the ITAA 1936 test) or an RSA at the time of choice. The member should also keep a copy of the notice for their records. Salary sacrifice requires the member to enter into an arrangement with the Territory (likely a written agreement) that complies with section 14. The member must not exceed the prescribed percentage (currently 50% of basic salary, additional salary, or the sum). The Act does not prescribe the form of the salary sacrifice arrangement, so the member should seek confirmation from the Territory that the arrangement is valid. For the Minister, the duty is to declare a default fund under section 13 as soon as practicable after commencement, and to maintain a default fund at all times. The default fund must be a complying superannuation fund that is not an SMSF. The Minister should issue a written declaration specifying the fund and its effective date, and ensure that if the declaration is revoked, a new declaration takes effect immediately. There is no requirement to consult members or publish the declaration, but the Clerk should be informed to direct default contributions correctly. For fund providers, compliance is limited to accepting contributions when contacted by the Territory and confirming in writing that they will accept contributions (for the purpose of evidence accompanying a choice notice). They must remain a complying superannuation fund or RSA; if they cease to comply, the Territory must cease contributions. No further reporting or obligations arise under the Act. Overall, the compliance burden is low, but subtle differences between NT definitions and Commonwealth definitions create the main risk of error.