Updated 19 May 2006
The Police Superannuation Scheme (PSS) closed to new members on 1 April 1988. The scheme was established for members of the New South Wales Police Service.
All members contribute 6% of their annual salary of office. In addition, a large part of the benefits payable from PSS are financed by the employer.
Periods of time where contributions are not payable, such as ordinary leave without pay that exceeds 3 months, do not count as service for benefit accrual purposes.
PSS provides a range of benefits payable on:
The amount of the benefit depends on your length of service, with the maximum benefit payable after 30 years service.
The maximum pension entitlement is 72.75% of your salary of office at retirement. The maximum lump sum is 7.95 times your salary of office.
| Example: Normal Retirement |
|---|
| If you retired at age 60 after 30 years service, on an annual salary of office of $50,000, you would be entitled to a pension of $36,375 (72.75% of $50,000) indexed annually. If you elected to take the retirement benefit as a lump sum instead of a pension, the lump sum would be $397,500 (7.95 x $50,000). |
The amount of your benefit depends on your length of service and age at retirement. The closer you are to age 60, the higher the benefit for each year of service*. The maximum early retirement benefit is payable after 30 years service.
The maximum pension payable at age 55 (exactly) is 58.20% of your salary of office at retirement. The maximum lump sum is 7.58 times your salary of office.
| Example: Early Voluntary Retirement |
|---|
| If you retired on your 55th birthday after 30 years service, on an annual salary of office of $50,000, you would be entitled to a pension of $29,100 (58.20% of $50,000) indexed annually. If you elected to take the retirement benefit as a lump sum instead of a pension, the lump sum would be $379,000 (7.58 x $50,000). |
* Please note that in accordance with scheme legislation the period from the date of your scheme entry to your next birthday after that date does not count as service for the purpose of determining the lump sum multiple.
The General Benefit is based on the member's length of service at retirement and is:
The hurt on duty retirement benefit is a pension of 72.75% of salary, irrespective of length of service. This pension may be increased depending on the member's capacity to undertake alternative employment and the degree of risk they were exposed to in the Police Service.
A spouse or de facto partner benefit is also payable on the death of a scheme member who elected to receive a pension benefit (a same sex partner may qualify for this benefit). A pension may also be payable for a child.
Pensions are adjusted each year in line with the movement in the Consumer Price (All Groups Sydney) Index. A phasing-in formula applies in the first year after pension payments begin.
If you exit from the Police Service after 30 June 1997, PSS is required to pay Commonwealth tax on your employer's contributions for your benefits that have accrued since 1 July 1988. Your benefits will be reduced to offset this tax (except on death). However, reduced income tax payable by you when you receive your benefits compensates for the reduction. The amounts shown in the annual statements we send you each year are calculated after the benefit reduction has been applied.
In addition to the above benefits provided by PSS, members are also entitled to a benefit called the Basic Benefit. It is fully paid for by your employer and accrues at the rate of up to 3% of final average salary for each year of service from 1 April 1988. The Basic Benefit is generally payable when you have retired from the workforce after reaching the Commonwealth preservation age (55-60). Earlier payment is available in certain circumstances.
Every year, PSS members are provided with an annual statement. This statement contains details about your contributions made for the year, your scheme benefits and an Annual Report Highlights booklet including investment return information.
If you have a contributions surcharge tax debt, the balance of your debt account and changes to it during the year to 30 June will be shown on your annual statement.
You can make additional contributions to FSS, a totally separate accumulation scheme.
FSS offers a choice of five investment strategies and allows members to tailor their savings program to their personal circumstances. It also offers competitive investment returns and a low fee structure.
An application form to top up your super and more detailed information on the investment choices is available from the FSS web site or by calling Customer Service on 1300 650 873.
Since December 1997, PSS members have been able to make contributions on behalf of their spouse (including a de facto partner of the opposite sex) as after-tax contributions.
Spouse contributions are payable to FSS only (ie. they cannot be made to PSS). Contributions are paid into an account opened in your spouse's name, and your spouse then becomes a member of FSS. A tax rebate can be claimed for contributions where the spouse earns below $13,800 pa.
To make spouse contributions you need to complete a form which is available for printing from the First State Super web site or by calling Customer Service.
Salary sacrifice is available to most PSS members.
Salary sacrifice allows you to make before-tax contributions to a superannuation fund. This means you sacrifice part of your salary by not having it paid to you in cash. The sacrificed amount is paid as an employer contribution to a superannuation fund and, as such, it does not attract income tax. It is subject to the superannuation contributions tax when it is received by the fund and benefit tax at the time of payment.
Salary sacrifice contributions may be made into FSS or another complying superannuation fund agreed with your employer. Most employees can salary sacrifice up to 30% of their salary to a superannuation fund. You will find more information about salary sacrifice on the FSS and State Super web sites.
