DATE OF ISSUE: 31 JULY 1997
EARLY RELEASE OF SUPERANNUATION BENEFITS
Purpose
The purpose of this Departmental Instruction (DI) is to inform on the role of State Offices in providing a letter to certain income support recipients under the new arrangements for the early release of their superannuation benefits.
Table of Contents
Purpose
BACKGROUND
Superannuation not normally available before pension age
Funds to decide on hardship from 1 July 1997
DVA to provide evidence of receipt of income support
CONDITIONS OF EARLY RELEASE OF SUPERANNUATION BENEFITS
General conditions
Income support payments which qualify for financial hardship
Income support periods which qualification for financial hardship
ACTION REQUIRED BY STATE OFFICES
Provide a letter to applicants with DVA qualification
Provide a letter to DVA applicants with some DSS payments
Advise applicants of impact on entitlement
Operational life of letters only 21 days for some applicants
Follow up action on applicants
No delegations necessary
No appeal
Publicity
CONTACTS OFFICERS
State offices
National Office
ATTACHMENT A: Standard letters under 'IS Misc'
BACKGROUND
Superannuation not normally available before pension age Certain superannuation and retirement savings account (RSA) benefits are generally required to be preserved in the superannuation system until retirement on or after age 55. Preservation is aimed at meeting retirement income and national savings objectives. However, subject to a superannuation fund's or RSA provider's own governing rules, early release of 'preserved' benefits is permitted under the Superannuation Industry (supervision) Regulations and Retirement Savings Account (RSA) Regulations in certain restricted circumstances, such as severe financial hardship.
Funds to decide on hardship from 1 July 1997
From 1 July 1997, the trustees or superannuation funds and RSA providers will administer an objective test to determine severe financial hardship.
DVA to provide evidence of receipt of income support
As part of the objective test for severe financial hardship, applicants must provide a letter from the Departments of Veterans' Affairs (DVA) and/or the Department of Social Security (DSS), stating that they have been in receipt of specified Commonwealth income support payments for the specified periods, depending on their age.
CONDITIONS OF EARLY RELEASE OF SUPERANNUATION BENEFITS
General conditions
Trustees of superannuation funds and RSA providers may release benefits to members on the basis of severe financial hardship under certain conditions. One of these conditions is that members must provide their superannuation fund with a letter from DVA or DSS, confirming that they have been, or are, receiving specified Commonwealth income support payments for the specified periods, depending on age. The same age requirements will apply to male and female applicants. It will not be necessary for a person to be on the maximum rate of the particular pension for the period (is, part service pension or ISS is sufficient).
Income support payments which qualify for financial hardship
Section 23 of the Social Security Act defines the groups of income support payments that qualify as Commonwealth income support payments. These groups of payments are:
- a social security benefit
- a social security pension
- a service pension, or
- an income support supplement.
CONDITIONS OF EARLY RELEASE OF SUPERANNUATION BENEFITS,
Income support periods which qualification for financial hardship
The following table shows the periods of income support necessary to qualify for financial hardship. Note that these are age dependent.
Age |
Qualification |
Below 55 years, 39 weeks |
|
Age 55 years 39 weeks and over |
Note: Persons over the age of 55 years and retired will still be able to access their superannuation without the requirement of being in financial hardship. |
Persons below the age of 55 years and 39 weeks must be in receipt of a Commonwealth income support payment at the date of issue of the letter. The period of time a person is in receipt of benefits before turning age 55 years does not count for the purposes of the early release of benefits after they turn 55 years and 39 weeks.
ACTION REQUIRED BY STATE OFFICES
Provide a letter to applicants with DVA qualification
The only role for DVA in facilitating an application for early release of superannuation benefits will be to provide a letter to the applicant, specifying whether they have been in receipt of income support from DVA for the requisite period of time. It is not necessary to specify the exact length or period/s of receipt of income support. Standard letters have been prepared for both age groups. The following letters for release of superannuation benefits on hardship grounds are in the index in: the Standard letter system on the shared drive under: IS Misc
Statement for early release of superannuation
Description |
Template Name |
Applicants aged less than 55 years and 39 weeks, income support payment requirements met |
EARLY SUPER Under 55y 39w Eligible |
Applicants aged less than 55 years and 39 weeks, income support payment requirements not met |
EARLY SUPER Under 55y 39w Not eligible |
Applicants aged 55 years and 39 weeks or more, income support payment requirements met |
EARLY SUPER 55y 39w plus Eligible |
Applicants aged 55 years and 39 weeks or more, income support payment requirements not met |
EARLY SUPER 55y 39w plus Not eligible |
Copies of these letters are at Attachment A.
Provide a letter to DVA applicants with some DSS payments
If applicants have a history of income support from DVA and DSS,
- obtain permission of the applicant for a request to DSS to confirm their income support history
- check their income support history with DSS. This should be done by fax as per current procedures for arranging cut-offs and transfers of payments between departments.
- if the combined history meets the hardship qualifications for their age, provide them with the appropriate letter from the Standard letters above. Conversely, DSS may need to confirm payment periods with DVA.
Advise applicants of impact on entitlement
The standard letters advise applicants that their entitlement to income support may be affected if superannuation benefits are released. However, where possible, staff should also personally advise applicants to check their continuing entitlement to income support payments, and that the money they receive may be subject to the income and assets tests.
ACTION REQUIRED BY STATE OFFICES
Operational life of letters only 21 days for some applicants For applicants under 55 years and 39 weeks of age, the letter has an operating life of 21 days from the date of the letter. This is so a trustee or RSA provider can assume that they are still in receipt of Commonwealth income support payments for this period. If 21 days has elapsed, the trustee or RSA provider cannot assume they are still in receipt of the income support payment. Accordingly, another letter may be required. The letters for applicants 55 years 39 weeks and over have no expiry date and can be used at any time. This is because these persons do not need to be currently in receipt of the specified Commonwealth income support payments to satisfy financial hardship.
Follow up action on applicants
- Place a record of the letter sent on the pensioners file
- Keep a cumulative record of the numbers of each type of letter sent.
No delegations necessary
No delegation is required by a DVA officer to provide applicants with the letter. The letter may be issued by any DVA officer.
No appeal
The information provided to the applicant is not subject to appeal.
Publicity
As this is not a DVA or DSS initiative, no active publicity is necessary. The ISC will provide any necessary publicity through the superannuation trustees.
CONTACTS OFFICERS
State offices
The following State Office contacts have been provided to the ISC to forward to the for the superannuation fund trustees and RSA providers, to pass on to applicants requiring a letter to verify their income support payments.
State/Region |
Contact |
Telephone |
NSW |
Barbara Colquhoun |
02 9213 7048 |
VIC postcodes 3334 to 3799 |
Team 1 |
03 9284 6897 |
VIC postcodes 3185 to 3210 and 3800 to 3999 |
Team 2 |
03 9284 6891 |
VIC postcodes 3100 to 3184 |
Team 3 |
03 9284 6873 |
VIC postcodes 3000 to 3099 and 3211 to 3333 |
Team 4 |
03 9284 6871 |
QLD |
Ian Campbell |
07 3223 8653 |
SA |
Barbara Wozniak |
08 8290 0516 |
WA |
Linda Ryan |
08 9366 8504 |
TAS |
Philip Beattie |
03 6 2216 6821 |
National Office Any questions about the early release of superannuation should be directed to:
John Bruce Assistant Director C-C-BA-10 06-289 6441
Annette Smith Policy Officer C-C-BA-04 06-289 6776
R J HAY
A/G BRANCH HEAD
INCOME SUPPORT
July 1997
ATTACHMENT A: Standard letters under 'IS Misc'
Standard letter system
IS Misc Template:
EARLY SUPER
Under 55y 39w Eligible
{Customer's name}
{Customer's address}
Dear {Title} {Name}
RELEASE OF SUPERANNUATION BENEFITS ON HARDSHIP GROUNDS - INCOME SUPPORT REQUIREMENTS MET
I am writing in response to your request for a letter in support of your application for release of superannuation benefits on grounds of financial hardship.
Superannuation benefits may be released on grounds of financial hardship to a person aged less than 55 years and 39 weeks where:
(a) the person is in receipt of one of certain types of Social Security or Veterans' Affairs income support payments, and has continuously been in receipt of such a payment for at least the past 52 weeks. These types of income support include the age service pension and invalidity service pension;
(b) the rules of the superannuation fund or retirement savings account permit release; and
(c) superannuation benefits have not been released on grounds of financial hardship in the previous 12 months.
Any enquiries on conditions (b) and (c) should be made to your superannuation fund trustee or retirement savings account provider.
This letter confirms that you are currently in receipt of a relevant Commonwealth income support payment, and that you have continuously been in receipt of such a payment for the past 52 weeks.
As the intention of this letter is to reflect your current circumstances, it is only valid for a period of 21 days from the date of this letter. You need to provide the original of this letter to your superannuation fund trustee or retirement savings account provider to request release of superannuation benefits on hardship grounds.
The release of superannuation benefits may affect your income support payment, so you may wish to discuss this matter with a Departmental Officer before you apply to access your superannuation. You can speak to a Departmental Officer on the telephone number at the top of this letter. If you decide to access your superannuation, you should advise the Department when the money has been released.
Yours sincerely
{Name of person issuing the letter}
{Date}
Standard letter system
IS Misc Template:
EARLY SUPER Under 55y 39w Not eligible
{Customer's name}
{Customer's address}
Dear {Title} {Name}
RELEASE OF SUPERANNUATION BENEFITS ON HARDSHIP GROUNDS - INCOME SUPPORT REQUIREMENTS NOT MET
I am writing in response to your request for a letter in support of your application for release of superannuation benefits on grounds of financial hardship.
Superannuation benefits may be released on grounds of financial hardship to a person aged less than 55 years and 39 weeks where:
· the person is in receipt of one of certain types of Social Security or Veterans' Affairs income support payments, and has continuously been in receipt of such a payment for at least the past 52 weeks. These types of income support payments include the age service pension and invalidity service pension.
According to our records you have not received such a payment continuously for the past 52 weeks. This means that you do not meet the income support payment requirements for release of superannuation benefits on grounds of financial hardship.
If you wish to obtain information on whether you may be able to access your superannuation on other grounds, you should contact your superannuation fund trustee or retirement savings account provider.
Yours sincerely
{Name of person issuing the letter}
{Date}
Standard letter system
IS Misc Template:
EARLY SUPER 55y 39w plus Eligible
{Customer's name}
{Customer's address}
Dear {Title} {Name}
RELEASE OF SUPERANNUATION BENEFITS ON HARDSHIP GROUNDS - INCOME SUPPORT REQUIREMENTS MET
I am writing in response to your request for a letter in support of your application for release of superannuation benefits on grounds of financial hardship.
Superannuation benefits may be released on grounds of financial hardship to a person aged 55 years and 39 weeks or more where:
(a) the person has received a relevant Social Security or Veterans' Affairs income support payment for a total cumulative period of at least 39 weeks after reaching the age of 55. These income support payments include the age service pension and the invalidity support pension;
(b) the person is not employed; and
(c) the rules of the superannuation fund or retirement savings account permit release.
Any enquiries on conditions (b) and (c) should be made to your superannuation fund trustee or retirement savings account provider.
This letter confirms that you have received a relevant Commonwealth income support payment for a total cumulative period of at least 39 weeks after reaching the age of 55.
You need to provide the original of this letter to your superannuation fund trustee or retirement savings account provider to request release of benefits on hardship grounds.
The release of superannuation benefits may affect your income support payment, so you may wish to discuss this matter with a Departmental Officer before you apply to access your superannuation. You can speak to a Departmental Officer on the above phone number. If you decide to access your superannuation, you should advise the Department when the money has been released.
Yours sincerely
{Name of person issuing the letter}
{Date}
Standard letter system
IS Misc Template:
EARLY SUPER 55y 39w plus Not eligible
{Customer's name}
{Customer's address}
Dear {Title} {Name}
RELEASE OF SUPERANNUATION BENEFITS ON HARDSHIP GROUNDS - INCOME SUPPORT REQUIREMENTS NOT MET
I am writing in response to your request for a letter in support of your application for release of superannuation benefits on grounds of financial hardship.
Superannuation benefits may be released on grounds of financial hardship to a person aged 55 years and 39 weeks or more where:
· the person has received a relevant Social Security or Veterans' Affairs income support payment for a total cumulative period of at least 39 weeks after reaching the age of 55. These income support payments incldue the age service pension and the invalidity service pension.
According to our records you have not received such a payment for a total cumulative period of at least 39 weeks after reaching the age of 55. This means that you do not meet the income support payment requirements for release of superannuation benefits on grounds of financial hardship.
If you wish to obtain information on whether you may be able to access your superannuation on other grounds, you should contact your superannuation fund trustee or retirement savings account provider.
Yours sincerely
{Name of person issuing the letter}
{Date}