The basic benefit, AEC & SANCS

Generally, members of SSS are also automatically members of the State Authorities Non-contributory Superannuation (SANCS) Scheme. The employer-funded basic benefit and where applicable the Additional Employer Contribution (AEC) and Superannuation Guarantee (SG) shortfall amounts are payable from this scheme. In addition, any co-contributions or Low Income Superannuation Contributions (LISC) from the Commonwealth Government in respect of a member are payable from the SANCS Scheme.

The basic benefit

As a contributory member of SSS, you will also be entitled to receive a 3% non-contributory defined superannuation benefit (known as the basic benefit) for all service since 1 April 1988.

The basic benefit is payable in addition to your SSS pension. It is paid for by your employer and accrues at the rate of up to 3%* of either your final average salary or your final salary for each year of service from 1 April 1988, or your employment commencement date (if later).

For the purpose of the basic benefit, your final salary is your actual salary on the date you cease employment and is used to calculate your basic benefit if you die before you retire or take invalidity retirement before age 55. In other circumstances, your final average salary would be used, that is, the average of your salaries at the date of ceasing employment and at the previous two annual review days.

Generally, a period of leave without pay of more than 5 days will not count as service for the accrual of your basic benefit.

Please refer to STC Fact Sheet 10: Basic benefit for more information.

*Due to tax payable by the fund on employer contributions since 1 July 1988, the basic benefit paid is about 2.55% per year of service.

Additional employer contribution

The Additional Employer Contribution (AEC) account is an accumulation style superannuation benefit which employers make contributions into each month for eligible employees. If you are an eligible employee, your employer will contribute the equivalent of 0.25% of your salary for the 2013–14 financial year and 0.5% of your salary for the 2014–15 and later financial years. This rate may change should the Superannuation Guarantee rate change. Only SSS members whose employment after 30 June 2013 was subject to NSW Public Sector Wages Policy are eligible to receive AECs.

Each monthly contribution is allocated to a member’s AEC account with contribution tax of 15% being deducted. The contributions accumulate in the AEC account and are adjusted for investment earnings each month, with the balance of the account  payable as a lump sum benefit at exit. If a benefit is deferred the AEC account is rolled into the basic benefit account and will, from that time, form part of the deferred basic benefit account.

For further information on the AEC refer to STC Fact Sheet 20: SANCS Additional Employer Contributions (AEC) account.