Commonwealth Consolidated Acts

FUTURE FUND ACT 2006 - SCHEDULE 3

Note:   See section   13.

1   Simplified outline

    The following is a simplified outline of this Schedule:

2   Designated actuary

  (1)   For the purposes of this Act, the designated actuary is an actuary specified in a written determination made by the nominated Minister under this subclause.

Note:   For variation and revocation, see subsection   33(3) of the Acts Interpretation Act 1901 .

  (2)   A determination under subclause   (1) is not a legislative instrument.

  (3)   As soon as practicable after a determination is made under subclause   (1), the Chair must cause a copy of the determination to be published on the internet.

3   Target asset level declarations

  (1)   The designated actuary may give the responsible Ministers:

  (a)   a written declaration stating that a specified amount is the target asset level for a specified financial year; and

  (b)   a written statement setting out the designated actuary's reasons for specifying the target asset level.

  (2)   A declaration under subclause   (1) is to be known as a target asset level declaration for the financial year concerned.

  (3)   2 or more target asset level declarations may be set out in the same document.

  (4)   A target asset level declaration for a particular financial year may be given before or during the financial year.

  (5)   A target asset level for a particular financial year must not be specified in a target asset level declaration unless the designated actuary is satisfied that:

  (a)   if the balance of the Fund, as at the start of the financial year, were equal to the target asset level for the financial year;

the balance of the Fund would (based on the designated actuary's best estimate) be expected to offset:

  (b)   the present value of projected unfunded superannuation liabilities in respect of services rendered before the start of the financial year.

  (6)   A target asset level declaration for a particular financial year remains in force until whichever is the earliest of the following:

  (a)   the end of the financial year;

  (b)   the occurrence of an event specified in the declaration;

  (c)   if the declaration is revoked--the time when the declaration is revoked.

  (7)   The designated actuary must take all reasonable steps to ensure that:

  (a)   the first target asset level declaration is given as soon as practicable after the commencement of this clause; and

  (b)   if a target asset level declaration for a particular financial year ceases to be in force before the end of the financial year--a new target asset level declaration for the financial year is given as soon as practicable afterwards; and

  (c)   not more than one target asset level declaration for the same financial year is in force at the same time; and

  (d)   not more than 5 target asset level declarations for different financial years are in force at the same time.

  (8)   A target asset level declaration may be revoked, but not varied, in accordance with subsection   33(3) of the Acts Interpretation Act 1901 .

  (9)   A target asset level declaration is not a legislative instrument.

  (10)   As soon as practicable after receiving:

  (a)   a target asset level declaration; and

  (b)   a statement setting out the designated actuary's reasons for specifying the target asset level;

the nominated Minister must cause:

  (c)   a copy of the declaration; and

  (d)   a copy of the statement;

to be published on the internet.

  (11)   If a target asset level declaration ceases to be in force, the cessation does not affect:

  (a)   the crediting of an amount to the Fund Account; or

  (b)   the transfer of a financial asset to the Board; or

  (c)   the debiting of an amount from the Fund Account;

before the cessation.

4   Reliance on projections when making target asset level declarations etc.

    In making a target asset level declaration, the designated actuary may:

  (a)   rely on, or have regard to, the projections, findings, estimates, opinions or conclusions of any other actuaries who have conducted, or are conducting, actuarial reviews of:

  (i)   a scheme under which superannuation benefits are payable; or

  (ii)   a South Australian railways arrangement; or

  (iii)   a Tasmanian railways arrangement; and

  (b)   make such assumptions and estimates as the designated actuary considers reasonable; and

  (c)   have regard to such other matters as the designated actuary considers relevant.

•   An initial amount of $18 billion must be credited to the Fund Account.

•   The responsible Ministers may determine that additional amounts are to be credited to the Fund Account, so long as the additional amounts do not result in the balance of the Fund exceeding the target asset level.

•   The responsible Ministers may transfer Commonwealth - owned financial assets to the Fund.

•   Amounts may be debited from the Fund Account in accordance with the purposes of the Fund Account.

•   The main purpose of the Fund Account is to discharge unfunded superannuation liabilities from whichever is the earlier of:

  (a)   the time when the balance of the Fund is greater than or equal to the target asset level;

  (b)   1   July 2020.

•   Amounts may be transferred from the Future Fund to the Future Drought Fund, the DisabilityCare Australia Fund, the Disaster Ready Fund, the Housing Australia Future Fund, the Medical Research Future Fund or the Aboriginal and Torres Strait Islander Land and Sea Future Fund.

•   The designated actuary is an actuary specified in a determination made by the nominated Minister.

•   The target asset level is specified in a declaration (a target asset level declaration ) given by the designated actuary.

•   The target asset level represents the amount that is expected to offset the present value of projected unfunded superannuation liabilities.