Catholic Superannuation and Retirement Fund

Let’s Talk
Super Issue No.9 - November 2004

This issue:
Growth of Fund
Retirement Options
Access to Super
New Legislation
New Regional Office - Perth Perth’s Regional Manager, Albert, graduated from City
The Perth Regional University, England with a Bachelor of Science in 1979
Office commenced and commenced employment with an insurance
operations on company in London. He worked in London for 4 years
1 July 2004, when the before moving to Perth in 1984.
Catholic Schools
Albert has been involved in superannuation since 1984,
Superannuation Fund working for an actuarial consulting firm and two
(CSSF WA) merged with this Fund. insurance companies in Perth before joining the CSSF
The office is located within the premises of the Catholic (WA) in 1994 as the Senior Administrator.
Education Office of Western Australia, at 50 Ruislip
Street, Leederville. In 1997 Albert completed the Diploma in Superannuation
Management of the Association of Superannuation
The former employees of the Catholic Schools Funds of Australia (ASFA) and is a Fellow member of
Superannuation Fund (WA) are now the Fund's ASFA.
representatives in this office. They are:
We warmly welcome Albert and staff to CSRF and wish
- Albert Lim, Regional Manager them well in the servicing of the membership.
- Annie Bugden, Administrator
- Errol Thomson, Marketing Officer For more information on the functions of a
- Mark Duchesne, Member Services Officer Regional Office, please refer overleaf.

Growth of the Fund
Catholic Superannuation and Retirement Fund (CSRF)
is now a significant strength within the Australian
Retirement savings industry and one of the largest
corporate Superannuation Funds in Australia as a
result of the merger with the Catholic Schools
Superannuation Fund (WA) on 1 July 2004.
CSRF now has approximately
$1.9 billion under management on
behalf of 73,000 members.
Over the last ten years the Fund size has grown dramatically
(as evidenced by the graph) ensuring that the Fund remains
competitive in the pricing and availability of products and
services. For example, the Fund introduced Member
Investment Choice (MIC) in January 1999 with five portfolios
and the option of one choice every six months. Today,
members can elect any two of the six portfolios and make
weekly changes if they so wish.
The Fund introduced an Allocated Pension product in July
$million
provision of further investment choice options. Having 73,000
members, CSRF had significant bargaining power in the
recent insurance tender resulting in competitive insurance
arrangements at a lower cost.
With a larger fund, more products and services may be
introduced over time such as financial planning and an
interactive website. These facilities come at a significant cost
and decisions cannot be made lightly, however the
economies of scale that the CSRF exhibits, together with the
fact that it does not have to pay dividends to external
shareholders, means that these can be introduced at a
competitive cost to members.
The Board of Directors would like to take the opportunity
to thank you for your continued support of CSRF.
Fund Assets ($mil.)
1600
1400
1200
1000

2000 and now has approximately $50 million invested. 800

DID YOU 600
KNOW! A move to unitisation in November 2003 has assisted in the 400
Trustee Board switching of portfolio's and also members’ accounts have 200
elections for member become more in line with the movements of investment 0
representatives will markets. The Trustee is also currently investigating the 1994 1996 1998 2000 2002 2004
be held in 2005
Year (at 30 June)

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 Catholic Superannuation and Retirement Fund
CSRF Regional Offices
The CSRF is a self administered fund. Some of the
efficiencies generated by in house administration have
helped create the 'Regional Office Structure'.
! Regional offices have been
established in Brisbane,
Canberra, Perth, Port
Macquarie and
Townsville to provide
efficient personalised
service to members
wherever they may be.
Perth
! No group of members are denied access to fund staff
because of isolation.
! Regional office staff are readily available for seminars,
workplace presentations, one-on-one and small group
interviews either in the office or at the workplace.
! Regional staff are partners with members in their
education on retirement issues.
News from the Government
Removal of Age Limit/Work test
From 1 July 2004, anyone under the age of 65 can
Contribute to super regardless of how many hours they work.
The work contribution rules for super fund members aged
between 65 and 74 have also been simplified. Previously,
members aged between 65 and 74 had to satisfy a 10 hour per
week test. However, under the reforms introduced by the
Federal Government those members will be able to make
contributions for the whole of the financial year provided that
they work at least 40 hours in a consecutive period of 30 days
in that financial year.
However, you should also note that there have also been
changes to the compulsory cashing of benefits. Members aged
between 65 and 74 years may only keep their super in their
fund if they have worked at least 240 hours in the most recent
financial year.
Members aged 75 years or over on 1 July 2004 must cash in
their super if they have not continued to work at least 30 hours
a week since 1 July 2004.
Surcharge Reduction
The surcharge tax is an extra tax on employer
and Personal deductible superannuation
contributions for those with an adjusted taxable income of
more than $94,691 (for the 2003-2004 financial year). The
DID YOU maximum surcharge rate for 2003-2004 is 14.5% and will be
KNOW! reduced to:
Subject to underwriting
by the insurer a member
can have up to a maximum
! 12.5% for 2004-2005 (phasing in from earnings of $99,710);
of 10 units of Death & TPD ! 10% for 2005-2006.
insurance cover
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! For the cost of a local call, members can access up to
date details on their accounts including daily balances,
contributions history, insurance benefits and
investment choice options.
! Regional staff can liaise with Employers in
regard to contribution remittances and
associated member information.
! Regional offices conduct all general
Townsville
administrative functions.
Brisbane !CSRF exists soley to
Port Macquarie maximise the retirement
Sydney
Canberra benefits of its members
while taking into
consideration the associated
portfolio risks.
! Take advantage of the Regional Office concept by
phoning 1300 658 776 to discuss details of your
account or to arrange a visit by our
highly qualified professional staff.
Government Co-Contribution
From 1 July 2004, the Federal Government will
provide a co-contribution of $1.50 for each $1.00
of after-tax contributions made by employees
earning $28,000 or less a year (assessable
incomes plus reportable fringe benefits).
The maximum co-contribution of $1,500 is reduced by 5 cents
for each dollar of income over $28,000 cutting out at $58,000.
Previously the maximum co-contribution of $1,000 applied to
incomes up to $27,500 and phased out at $40,000.
The requirement that an individual must be eligible to receive
superannuation guarantee payments in order to qualify for a co-
contribution has been replaced with a requirement that at least
10% of your income must be earned from eligible employment.
The Australian Taxation Office (ATO) will work out if you are
eligible for a co-contribution using information supplied by your
super fund and your tax return. This means that in order to
receive a co-contribution, you must lodge a tax return. If you are
eligible, the co-contribution will be paid directly into your super
account, where it generally must remain until your preservation
age. Please note, because of the above process, this may not
happen for some time after the end of the financial year.
If you are 71 years of age or more at the end of the financial
year, you will no longer be eligible for a Government Co-
Contribution.
 Catholic Superannuation and Retirement Fund
Options on Leaving your Employer due
to Resignation or Retirement
On resignation (provided you are under 65 years old or are under 75 years
and still satisfying the work test) you have the option of leaving your super
in CSRF. As a competitive, proven performer over two decades and secure
super fund, the CSRF offers the additional advantages:
! If as an existing member you then decide to work outside the Catholic
System, and provided your new employer is agreeable, as evidenced by
their signing a “Deed of Admission” to the CSRF, the Fund can accept
superannuation guarantee contributions from the new employer.
! If you decide not to return to work, the Fund will accept after tax
contributions for members (lump sum) up to age 65.
! If you are eligible to contribute to super, you can elect to rollover monies
into the CSRF from other super funds, to increase your retained benefit
balance.
! Partial withdrawals are available on any unrestricted non-preserved
amounts.
! On retirement after preservation age, you may rollover monies from the
superfund to the CSRF Allocated Pension Plan (APP). The APP has a
competitive fee structure, flexibility, Centrelink friendly income test
treatment, same proven performance and many tax advantages.
! However, resignation from your employer may present issues of
personal risk management which must be dealt with in a very timely
fashion:
- Certain benefits such as sick leave, life insurance and temporary
salary continuance (TSC) cover can be lost when you leave your
workplace.
- TSC cover will cease on resignation when you leave your workplace.
- Your death and Total and Permanent Disablement (TPD) cover will
continue for the 60 days following your resignation, however the TPD
will be restricted to total disability arising from accidents only.
WHY CONSIDER AN ALLOCATED PENSION
FOR YOUR SUPER WHEN YOU RETIRE?
An allocated pension is an investment account in your super fund to
provide a tax advantaged income stream i.e. pension in retirement. In an
allocated pension plan earnings and capital gains are not subject to
any tax, unlike investments held outside the superannuation system where
tax is applied at the individual's marginal tax rate. Your allocated pension
account allows you to be invested in the asset classes of your choice
(shares, property, bonds and cash). In most cases the allocated pension
offers advantages over cashing out your super, paying any lump sum tax
due and then having to manage your own investments, which will be
subjected to capital gains tax to fund your retirement.
Some advantages are:
Allocated pensions are flexible. The pensioner must take at least one
payment per year and can choose his/her level of income between
government set limits (called a maximum and a minimum) based on age
and account balance. As the pensioner's income needs change with
time, the pension income can change with them.
Allocated pensions are flexible and THEY ALLOW A CHANGE OF
MIND! Unlike many other retirement income streams, an allocated
pension can be totally or partially commuted or cashed out at any
time should the pensioner have a change of heart. The commutation
is treated in the same manner as if you cashed out of the super system
at retirement. The remaining tax-free components are returned and
lump sum tax paid if applicable.
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There is no loss of capital on premature death. The pension can be
paid as a lump sum to beneficiaries or be reversionary and thus
continue to the spouse.
Allocated pensions have tax advantages, as within the allocated
pension fund, earnings from income or capital gains are not
taxable. This would be in contrast to a self-funded retiree's income
stream from a term deposit, shares or property, which would be subject
to tax at the individual's marginal rate with capital gains tax where
applicable.
Should you have a considerable amount in super when you retire, if you
cashed out you may be required to pay a large amount of lump sum
tax. An allocated pension can defer, reduce and can often
eliminate the need to pay this tax. Tax on a pay-as-you-earn basis is
only due on the assessable part of the pension. This is the amount of
the pension payment minus the deductible amount* (tax free).
Furthermore there is a rebate of 15% for the assessable amount, which
will often eliminate any tax due. (The rebate is available on the
assessable amount other than the proportion that exceeds the person's
lump sum RBL, that is $619,223 for the 04/05 financial year.)
* The deductible amount is the sum of the tax-free super components (post tax
components called Undeducted components plus any Invalidity component plus any
Capital gains tax exempt components from say the sale of a business) divided by the
person's statistical life expectancy at the commencement of the pension. The
deductible amount is constant through the life of the pension and returns this tax-free
element over the life of the pension.
Allocated pensions are designed to spread the retirement savings over
the remaining life of the pensioner, as set out in Government tables.
An allocated pension is counted against the Centrelink Assets test. For
Income Test purposes the treatment is generous as the deductible
amount for Centrelink purposes is the entire account balance divided by
the life expectancy. (e.g. For an account balance of $200,000 and a life
expectancy of 20 years the deductible amount would be $10,000.
Should a $12,500 income stream be chosen in that year then only
$2,500 of income would be counted for Income Test purposes.)
Depending on the outcome from the Centrelink Income and Assets
tests it may be possible to receive some Centrelink pension in addition
to the Allocated pension stream. It is advisable for individuals to consult
Centrelink Financial Service Officers to discuss applicability of
Centrelink benefits.
The CSRF provides a low cost Allocated Pension Plan
with no entry or exit penalty fees, no commissions to
financial planners and the same investment choices
you had available when your money was
accumulating in your CSRF super account.
If you change your investment options in the Allocated Pension, a
switching fee of $30 applies on each occasion.
Also, if you leave the pension plan a $35
processing fee applies. You have only to call
Head Office or any Regional Office on
1300 658 776 for an obligation-free
appointment or discussion. It is advised
however, that members seek independent advice
from a reputable financial planner should more
than general or fund-specific advice be warranted.
 Catholic Superannuation and Retirement Fund

Contribution and Payment Rules

Who can Contribute to Super (i.e. Personal Super Contributions)?
1) From 1 July 2004 a person will no longer need to be working to contribute to super if aged under 65. The work test has been removed.
2) For members aged between 65 and 74 the work test for personal super contributions is that the member must have already worked at least 40
hours in a period of not more than 30 consecutive days during the financial year of the contribution, in order to contribute to super in that
financial year.
Employer contributions: For remittance of employer contributions please refer to the table below.

TABLE 1: CONTRIBUTING TO SUPER

Award
Age SG Employer Member’s Personal
Employer Voluntary Employer Contributions
Group Contributions Contributions
Contributions
65 - 69 Yes Yes Only if he/she has worked at least 40 hours Only if he/she has already
in a 30 consecutive day period in the worked at least 40 hours in a 30
financial year. consecutive day period in the
financial year.
70 - 74 No Yes No Only if he/she has worked at
least 40 hours in a 30 consecutive
day period in the financial year.
75+ No Yes No No

What are the New Compulsory Cashout Rules?

Please note that the contribution and cashing out rules have changed from 1 July 2004. A fund may have to cash out accrued benefits even though
contributions might still be being accepted under various rules or award agreements.

o For members aged 65 to 74, benefits may be retained in the Fund where the member has worked at least 240 hours in the most recent financial
year.
o For members aged 75 already on 1 July 2004, the old rule has been grandfathered so that as long as the member is working at least 30
hours/week then they may leave their money in super. If over age 75 only contributions made by an employer under a certified industrial
agreement can go into the member's account and can only remain there whilst the member works the 30 hours/week every week.
o Members who turn 75 after 1 July 2004 must cash their money out of super, except for the post 65 employer financed benefits, if they are still
having such award contributions made to their account. Thus only contributions made under a certified industrial agreement can go into an over
75's account and even these must be cashed out if the member ceases working at least 30 hours/week.

TABLE 2: COMPULSORY CASHING OUT OF SUPER

Age
If aged 65 to 74
If aged 75 already on 30 June 2004
If turned 75 after 30 June 2004 (or
over 75 years and fail the 30 hours
each week test)
Does everything other than Post-65 Mandated Contributions have to come out?
No, not if the member has worked at least 240 hours during the previous financial year. If
the work test here is not satisfied then all benefits accrued prior to 65 and voluntary (both
employer and personal) benefits accrued after 65 must be paid.
No, not if they are still working 30 hours each week.
Yes, everything other than the post-65 employer mandated contributions must come out.
If the member ceases working the 30 hours each week, or the employer mandated
contributions are no longer paid or liable to be paid, then even the employer mandated
contributions must come out.

DISCLAIMER
This Newsletter has been produced by SCS Super Pty Limited (ACN 064 712 607), the Trustee of the Catholic Superannuation and Retirement Fund.
It does not take into account your personal objectives, financial situation or needs. As a result, before acting on any information contained in the
Newsletter you should consider its appropriateness, having regard to your own situation. The Newsletter is not intended to be financial advice,
therefore you should consider obtaining independent financial advice before making any decisions about your benefits in the Fund.

Sydney (Head Office): Brisbane: Canberra: Perth: Port Macquarie: Townsville:

PO Box 656 GPO Box 3329 GPO Box 1506 PO Box 147 PO Box 1119 PO Box 1736
Burwood NSW 1805 Brisbane QLD 4001 Canberra ACT 2601 Leederville WA 6903 Port Macquarie NSW 2444 Townsville QLD 4810
Tel: (02) 9715 0000 Tel: (07) 3211 7344 Tel: (02) 6201 9881 Tel: (08) 9212 9367 Tel: (02) 6583 8100 Tel: (07) 4772 7922
Fax: (02) 9715 0090 Fax: (07) 3211 9633 Fax: (02) 6248 5416 Fax: (08) 9212 9380 Fax: (02) 6583 4300 Fax: (07) 4772 7658
Catholic Superannuation and Retirement Fund
CSRF has agreed to publish the Australian Securities and Investments Commission’s
newsletter on “Illegal Access to Super”. It appears below and overleaf.

DID YOU
KNOW!
Weekly Investment
Portfolio unit prices
are available on the
Fund’s wesbsite

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 Catholic Superannuation and Retirement Fund

How long to Retirement?

Are you aware that there are 1,040 fortnightly pays if you work for 40 years.
If you work for 25 years there are 650 fortnightly pays for you to save up for your retirement.

If you have 10 years to go until your retirement there are 260 fortnights left to accumulate your super savings.

HOW MUCH HAVE YOU SAVED TO DATE AND HOW LONG HAVE YOU GOT UNTIL RETIREMENT?

1400
1170
1200 1040
No. of Fortnightly Pays

1000 910
780
800 650
600
520
390
400 260
130
200
DID YOU
KNOW? 0
5 10 15 20 25 30 35 40 45
Post tax member
super contributions No. of Years to Retirement
are not subject the 15%
contributions tax

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