'Adequately funded' is an irrelevancy here at present. The government
legislates a level of contribution by the employer and encourages the employee
to contribute. (If I sling $1000 into my current scheme at financial year's
end, the federal government matches it). The fact that I'm already drawing a
pension has no bearing on the fact that I have a second fund running for any
work I do now, retired or not. Any company that neglected to make
Superannuation contributions for an employee would be discovered quickly and
punished severely. The Superannuation funds are totally separate entities,
third parties who communicate with the employee or retiree in a similar way to
a bank - statements and an annual report. They are stringently regulated.
I derive my pension from a fund for Government employees which is a non-profit
organisation similar in constitution to a credit union. Most major industry
funds are like this. Contributions are drawn from post-tax income so my pension
is now untaxed on the grounds that it's already been taxed in some sense. It is
invisible to the tax office. That is a major benefit, especially when I earn
income over and above my super' pension.
Unfortunately, unlike the UK old age pension, our OAP is means tested so I have
some balancing to do to ensure I qualify for a useful range of benefits when I
turn 65.
Andrew Fildes
afildes@xxxxxxxxxxxxx
On 20/01/2012, at 8:48 PM, Piers Hemy wrote:
> The employing corporation ALWAYS has access to pension funds in the sense
> that the employer contributions are (obviously) the responsibility of the
> employer! But I think it's more subtle than that - since pension fund
> contributions represent a drain on tax revenue (taxable profits are reduced
> by the amount contributed to the pension scheme) it is in the government's
> interest to control how much goes into the pension scheme, to ensure that
> the scheme is not over-funded as a way of avoiding tax on profits. I
> distinctly recall that for all of the latter half of the 1980s there were
> zero employer contributions to my then employer's pension scheme, based on
> actuarial computations that the scheme was adequately funded. A problem
> arises when external factors reduce the scheme's income from investments AND
> at the same time reduce the employer's profits from which contributions are
> to be made to make up the suddenly-arisen shortfall.
--
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