What it does
The Superannuation (Financial Assistance Funding) Levy Act 1993 establishes the statutory mechanism to raise revenue from the superannuation industry to reimburse the Commonwealth for financial assistance granted under Part 23 of the Superannuation Industry (Supervision) Act 1993 (SIS Act). Its sole object, stated in section 3, is to impose levies on superannuation funds and approved deposit funds to fund that assistance where a fund has suffered loss as a result of fraudulent conduct or theft. The levy is not a discretionary tax; it is triggered only when the Minister makes a determination under Part 23 of the SIS Act to grant financial assistance to a particular fund. Once such a determination is made, the regulations may impose a levy or levies on every other fund that is not the assisted fund and not another fund that received a similar determination in the same financial year (section 6(1)(a) and (b)). If multiple determinations are made in a single financial year, the regulations may impose a single levy that collectively recoups the total assistance, but must specify each assisted fund and the proportion of the levy attributable to each (section 6(1A) and (1B)). The amount of revenue raised by a levy must not exceed the amount needed to recoup the Commonwealth for the financial assistance granted (section 7(1)). However, a further statutory cap applies: the total amounts payable under all levies imposed in a financial year must not exceed 0.05 per cent of the aggregate value at the end of the previous financial year of all assets of the funds on which the levies are imposed (section 7(2)). In addition, the rate applicable to an individual fund (the “applicable rate” in section 8) must not exceed 0.0005 (0.05 per cent) of that fund’s asset value (section 8(2)). The Act thus provides a tightly constrained funding model: it recoups actual outlays, subject to industry-wide and fund-level caps, and can only be activated by a ministerial determination under Part 23 of the SIS Act.