Not so super

By Matt Pulford
Assembly Senior Media Officer

Posted in News

More than 1,000 retired Uniting Church ministers have had their retirement incomes slashed by Federal Government superannuation changes that came into force on 1 January.

Changes to the tax treatment of defined benefit super schemes mean more than 80% of retired members in the Uniting Church Beneficiary Fund are losing thousands of dollars a year, principally because it will now be harder for them to receive the Age Pension.

The scale of lost income varies with initial feedback suggesting most losses in a range of $5,000 to $8,500 and some as high as $10,000 a year.

Retired ministers, and in many cases their widows, are struggling to adjust to their change in circumstances, with the Uniting Church Beneficiary Fund fielding reports of financial hardship.

The wife of one late minister describes herself as “being forced into a survival situation again” at the age of 76. Other former ministers are reportedly considering selling out of retirement villages they live in.

The changes are bad news, too, for ministers in defined benefit schemes who are close to retirement – they won’t be able to rely on the age pension to top up their income, something some might have been expecting.

As of 30 September 2015, there were 637 Uniting Church ministers contributing to Beneficiary Fund defined benefit schemes.

Collateral damage

Uniting Church ministers are the only clergy in Australia caught up by the changes, which the Federal Government brought in to improve the fairness and sustainability of the pension system.

“As far as we can tell, we are the only mainstream church that operates a defined benefit superannuation scheme for our clergy, so Uniting Church ministers are uniquely affected,” says the Chair of the Assembly’s Employer Committee, Bruce Binnie.

“I believe that the effect on Uniting Church ministers is an unintended consequence of the Government’s legislation.

“So we are appealing to Social Services Minister Christian Porter to review the legislation and exempt ministers from its effects,” says Bruce.

Advocacy efforts

Outgoing Assembly General Secretary Rev Terence Corkin wrote to the Social Services Minister in November 2015, asking him to review the legislation in light of the potential for significant reductions in income and quality of life for Uniting Church ministers.

Mr Porter responded just before Christmas but made no commitment to review the legislation.

Bruce Binnie is coordinating the Uniting Church’s response and is hoping to win an exemption for retired ministers.

“Members of military superannuation schemes have been exempted from effects of the legislation,” he says.

“Given the relatively small number of members in our scheme and their circumstances I’m hopeful that the Minister will be able to find some way of relieving the impost that has been placed on pensioner members of the Beneficiary Fund.”

Uniting Church ministers and/or their families who have been affected by the changes are being urged to contact their local Federal Member of Parliament to voice their concerns.

Assembly General Secretary Colleen Geyer says the Assembly will continue its dialogue with Minister Porter in the hope of improving the situation for Uniting Church ministers who have been unfairly disadvantaged.

Uniting Church Beneficiary Fund

The Beneficiary Fund operates three defined benefit schemes – two that closed to new members in 2004 and a third that opened two years ago.

“The members who are most affected belong to the first two schemes, particularly those with long periods of service and whose pensions are based on a ministerial stipend that was much lower at the time,” says Bruce.

Defined benefits schemes are regarded as more generous than regular “accumulation” super schemes. Rather than a lump sum or an annuity limited by contributions, defined benefit members usually get a guaranteed lifetime pension that’s a percentage of their final salary. Many older schemes also offer “reversionary” pensions, which transfer to a spouse or partner after a member’s death and to other dependants after their death. With Australians living longer, the costs of the public sector defined benefit schemes have come under particular scrutiny in recent years.


If you are a Beneficiary Fund member experiencing hardship as a result of the Federal Government superannuation changes, please call the Mercer Super Trust Helpline on 1800 682 535 or Centrelink on 132 300.

Copies of correspondence between the Assembly General Secretary and Minister Porter are available online. The letter to Minister Porter is here. His response is here.

Journalist Noel Towell covered the issue in the Canberra Times on Monday 18 January.


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