Multiple PSS memberships

Non-concurrent memberships

If you have Defined Benefit equity preserved in PSS, you may choose (or be required) to re-join PSS, if you re-enter eligible employment.

If you re-join PSS, your preserved benefit must be converted into a Preserved Benefit Multiple (PBM), which forms part of your Accrued Benefit Multiple (ABM) for your new membership. Any funded components transferred from a previous membership will be credited to your new membership. They will grow in line with fund earnings. Your total benefit will be impacted by your average salary growth and your ongoing ABM.

How PBM is calculated

Your PBM is calculated by dividing your preserved Defined Benefit at the date you re-joined PSS by the commencing Super Salary of your new membership.

We may need to calculate your PBM differently if this formula produces an inequitable result. If this is the case, we’ll write to you and let you know.

How Super Salary is calculated

Your super salary is your basic salary plus any recognised allowances—these might include things like higher or additional duties. Allowances not recognised include things like overtime, accommodation, travel and bonus or performance pay. For more information about your Super Salary, visit our website, or contact your payroll section.

Impact on your benefit

When you combine non-concurrent memberships, your preserved benefit becomes part of your new membership, meaning that your preserved benefit will no longer exist as a standalone benefit. Your funded components will be credited to your new membership where they will grow in line with fund earnings. Your total Defined Benefit including your Employer Component is reflected in your increased ABM, as a result of the PBM, and will therefore grow in line with average salary growth.

Why is my PBM less than my old ABM?

Generally, if your Super Salary is higher on re-joining PSS than your Final Average Salary (FAS) was when you exited, your PBM will be less than your old ABM. This is because your equity will be divided by a larger number (your higher Super Salary), creating a smaller PBM. If this is the case, you will not be at a disadvantage because your PBM (which is included in your new ABM) will be multiplied by your new higher Super Salary to calculate your total benefit.

Your PBM may also be lower than your ABM if the equity in your preserved benefit has decreased since you exited. This could be due to partial withdrawals or negative fund earnings.

PBM calculations before 1 July 1995

Under the PSS Trust Deed, if you re-joined PSS before 1 July 1995 your PBM must be calculated 12 months after your re-join date. For example, a member who ceased eligible employment then re-joined PSS on 15 June 1993 would have their PBM calculated on 15 June 1994.

Do my non-concurrent memberships need to be combined?

Yes, they do. It’s mandatory for us to combine non-concurrent memberships together. This is because the PSS Trust Deed requires your preserved membership to be converted to a PBM and combined with your new membership.

Concurrent memberships

If you contribute to more than one PSS membership at the same time, and one of them ceases (i.e. you leave one of your employment arrangements), you can generally choose to either leave the ceased membership as a standalone preserved benefit, claim it (if eligible), or combine it with your other concurrent membership. However, if the membership you are ceasing has been active for less than three months you will need to combine your memberships.

Note: You won’t be able to combine your concurrent memberships if doing so would cause you to exceed your Maximum Benefit Limit.

Once your concurrent memberships are combined, your ceased membership is converted into a Membership Transfer Multiple (MTM) which forms part of the ABM for your ongoing membership.

How is the MTM calculated?

Your MTM is calculated by dividing your total Defined Benefit (i.e. FAS x ABM) for your ceasing membership by your average salary for your ongoing membership. These calculations are both done based on figures from the day that your membership ceases.

Am I eligible to combine my concurrent memberships using a MTM?

You must have ceased contributing to at least one of your concurrent memberships in order to make an election to combine. This is because the election to combine is regarded as a benefit option only available on ceasing employment under the Trust Deed.

Electing to combine memberships

If you are ceasing one of your memberships, and considering combining it with a concurrent membership, you should call or email us to request a comparison estimate so you can see the effect this will have on your benefit. Your MTM will always be the same, no matter what date you request your comparison estimate.

Note: You will only have one opportunity to make an election to combine your memberships using a MTM.

We will send you an election form with your comparison estimate. If you want to go ahead with combining your memberships, you need to complete the election form and return it to us within 90 days. Alternatively, when you stop working for your employer and cease your membership, you can select ‘Combine with a concurrent period of membership’ as your benefit option when you complete your benefit application.

Is my election to combine memberships binding?

Yes, when you elect to combine your concurrent memberships you’re making a formal election under the provisions of the Superannuation Act 1990. This election is binding and can’t be cancelled or withdrawn. CSC may, at its absolute discretion, agree to change an election in certain exceptional circumstances, provided the proposed change is permitted in the PSS Trust Deed.

Not making an election

If you have been provided with a comparison estimate and don’t make an election to combine within 90 days of the estimate, your memberships will remain separate. You will be unable to ask for your memberships to be combined using a MTM in future, but you may still have an opportunity to combine your memberships using a different method at a later date.

Combining concurrent memberships at a later date

If the ceased membership is kept separate from the ongoing membership, you may be eligible to preserve it. If you preserve the ceased membership, and later cease and preserve your ongoing membership, you will have two separate preserved memberships.

The PSS Trust Deed states that if, on 1 July of any year, a member has two preserved memberships they may elect to combine those memberships by simply adding the preserved components together.

If you would like to make an election to have your preserved memberships combined on 1 July, you will need to advise us in writing. Your memberships will be combined effective 1 July before your request is made. For example: if you request your memberships to be combined on 30 April 2019, your memberships will be combined with effect from 1 July 2018. For your request to be valid, both memberships must be preserved on the effective date.

Effect of combining memberships

You may find that there is a difference between your total individual benefits, and your combined benefit. This is because your final benefit is dependent on factors such as fund earnings and salary growth.

However, the total benefit amount is not the only matter that you should consider when deciding whether to combine your concurrent memberships. You should also think about:

• how you want to claim your final benefit
• whether you might re-join PSS at a later date
• whether you want to vary your investment options

Casual and per diem members

If you are a casual or per diem employee, your membership is not considered to have ceased until:

• no contributions have been made for more than 26 consecutive fortnights; or
• you make a declaration that you have no plans to be re-employed by an eligible employer within a year (26 fortnights) of ceasing your casual employment.