The original Trust Deed that establishes a superannuation trust should include a Power of Termination to allow the trusts of the scheme to be terminated under certain conditions and for the associated Trust Estate to be wound-up.
If the terms of the trust allows the Trust Estate to be transferred to the Trust Estate of another fund, then a “successor fund transfer” is an alternative means of terminating the trusts of the scheme and winding-up the associated Trust Estate.
APRA has published a Superannuation Circular No. III.A.6. – Winding-up a Superannuation Fund
At paragraph 20 the following is stated:
A copy of the Circular can be found here. The “equal representation” provisions were included in the Superannuation Industry (Supervision) Act 1993 following the Robert Maxwell Pension Funds Scandal in the United Kingdom when Maxwell and two of his sons misappropriated £454 million from his employees’ pension funds.
APRA has published a Superannuation Circular No. III.A.2. – Trustee Arrangements – Superannuation Funds other than Public Offer Funds, which provides details of the “equal representation rule” including the related “voting rule” SIS Regulation 4.08 which requires at least two-thirds of all Directors to vote on a resolution.
A copy of the Circular can be found here. Paragraph 70 confirms that a vacancy for a Member-elected Representative must be filled within 90 days.Policy Committees
In the case of Public Offer funds where there is an independent trustee, such as the funds operated by the major banks and insurance companies different “equal representation” provisions apply.
APRA has published a Superannuation Circular No. III.A.3. – Trustee Arrangements – Public Offer Funds, which provides details of the “equal representation” provisions for Public Offer Funds which will typically have sub-plans for members transferred from corporate funds.
A copy of the Circular can be found here. At paragraph 36 the following is stated:
“Where there is an independent trustee, policy committees may be required or requested to be established. A policy committee is a body that advises and informs the trustee about matters of concern relating to the fund which have been raised by members or employer-sponsors of the fund. It generally provides the main avenue for members and employer-sponsors to monitor the management of the fund (e sub-plan).”
Where the sub-plan has more than 50 members it is mandatory to establish a policy committee. Refer to SIS Regulation 3.05. SIS Regulation 3.06 can be found here.
At paragraph 37 the following is stated:
The functions of a policy committee include:
SIS Regulation 3.06 can be found here.
At paragraph 40 the following is stated making reference to SIS Regulation 3.05:
The relevant sections of the SIS Act are Sections 10,58 and 92 and the relevant sections of the SIS Regulations are Regulations 3.05, 3.06 and 3.07.
This tab updated on 1 January 2016