Important D&D reminder
June 6, 2003
26 June options deadline closing fast
All (non-SSS) members should long since have received their D&D options form from the Department. If you did not receive it at your home address, then you should contact the Department and ask for a form to be faxed and/or posted to you immediately. You must return this form by no later than c.o.b. Thursday 26 June.
If you are in First State Super (FSS), then you only need to decide whether or not you want to salary sacrifice for your D&D contributions. If you do not return your option form, then the Department will assume you do not want to salary sacrifice, in which case they will automatically begin deducting the full D&D contribution from your post-tax wages.
If you are a permanent member and you are in the State Authorities Super Scheme (SASS), then you not only need to decide whether or not you want to salary sacrifice for your D&D contributions, but also whether you want to opt for full D&D cover, half D&D cover/half ABC , or no D&D cover/ABC only. SASS members who have not yet read the Union’s 5 page notice explaining your there options are encouraged to do so. An abridged copy can be found on this website (see “D&D Options – SASS members” dated 29 April 2003), and a full copy can be faxed to your Station (again) on request.
Like FSS members, if SASS members don’t return their options form then the Department will assume you do not want to salary sacrifice and will automatically deduct the full D&D contribution from your post-tax wages. Further, if you don’t have ABC then you’ll be deemed to have opted for full D&D cover. However, if you do have ABC and you do not respond by 26 June then the Department will assume that you have opted for no D&D cover. Remember – you will not be able to change your D&D options after the 26 June deadline.
The Union has been advised that by last Wednesday, 4 June, the number of members’ D&D option forms returned to the Department were as follows:
Total no. of option forms expected (perm & retained, SASS & FSS) = 5234
Total no. of option forms received (perm & retained, SASS & FSS) = 1456
Option forms returned as a percentage of the total = 27%
Returns broken down:
FSS Retained = 746 (743 opting to salary sacrifice, 3 opting not to)
FSS Permanent = 554 (550 opting to salary sacrifice, 4 opting not to)
SASS Permanent = 156 (broken down as follows)
- Full D&D @ 1.5% = 132 (130 opting to salary sacrifice, 2 opting not to)
- Half D&D @ 0.5% = 21 (17 opting to salary sacrifice, 4 opting not to)
- No D&D = 3
On these figures, almost 50% of FSS permanent firefighters have already replied. However, only 25% of retained firefighters have replied to date and of the roughly 750 permanent SASS members, the figure is as low as 20%. All members are encouraged to return their options form asap – don’t leave it until the last minute.
The Union has previously faxed advisory notices to all members’ stations and/or workplaces, and all of those notices can still be found elsewhere on this website . Further to those notices, following below are our answers to some of the more common (additional) questions which members have asked over the last 6 to 8 weeks. As always, please feel free to contact the Union Office if you have any further queries.
Friday 6th June, 2003
D&D QUESTIONS WHICH CONCERN ALL MEMBERS
Are all of the D&D benefits offset by NSWFB contributions to my super account?
No, only the death or TPI (on-duty) pensions require an offset comprising the NSWFB employer contributions (but not your own contributions) towards your super account. In other words, none of the lump sum D&D benefits require this offset. Members who qualify for off-duty death or TPI, or PPI (both on and off-duty) will receive the relevant D&D lump sum payment plus all of their current superannuation entitlements.
Do I still have to contribute if I’m over 60?
Yes. Member contributions will remain compulsory for firefighters whilst ever they remain employed by the NSWFB, regardless of age. Whilst the D&D Award’s PPI cover cuts out at 60, the off-duty lump sum benefits for death or TPI continue (at a diminishing rate) until age 65. The on-duty death and TPI option does not, however, have any age cap – which means that even an 80 year old firefighter could qualify for the D&D pension. Not that we would encourage that, though. It is long-standing FBEU policy that all firefighters should retire at age 60 years or, in the case of SSS permanents (only), by the time of their next scheduled wage increase.
Why isn’t the $250,000 lump sum payment for off-duty death or TPI indexed?
There are only two amounts in the Award which are not indexed. The first is the $250,000 lump sum benefit and the second is retained member contributions. We plan (and anticipate) that in 3 years’ time when the Award comes up for renewal, the Union will argue to adjust the $250,000 lump sum and the Government will argue to adjust retained contributions. We believe both can reasonably be expected to happen.
How do I know if the Department has received my nomination form?
You don’t – yet. Many members have expressed concern that there is no way of knowing if their D&D election form got through to the Department or not. The Union has since taken this up with management and is waiting for their response.
D&D QUESTIONS WHICH CONCERN PERMANENT MEMBERS ONLY
If I’m in SASS and I elect to take the 0.5% (PPI only) D&D option, will I still be able to salary sacrifice for my 0.5% D&D contribution?
Is the on-duty PPI benefit reduced by any time you spend on rehab, like the off-duty benefit?
No. The amount of the on-duty PPI lump sum benefit is solely determined by your salary and your age. It follows that the amount of time spent (or not spent) in rehabilitation and retraining has no bearing whatsoever on this benefit.
D&D QUESTIONS WHICH CONCERN RETAINED MEMBERS ONLY
How are my “actual retained earnings” calculated?
The D&D Award’s “actual retained earnings” system is used to arrive an average of one year’s salary, which then determines the amount of certain PPI benefits.
For example, a 40 year old member who earned $5,000 as a retained firefighter in the preceding 12 months might, over the preceding 5 years, have averaged more:
Income last year = $5,000
2nd last year = $7,000
3rd last year = $6,000
4th last year = $5,000
5th last year = $7,000
(average over last 5 years = $30,000/5 years = $6,000).
In the above example, the retained firefighter’s “average annual remuneration received … over the preceding twelve months” would be $5,000 whilst “the average annual remuneration received …. over either the preceding five years” would be $6,000. This particular firefighter’s “actual retained earnings” would therefore be $6,000 for the purposes of calculating D&D Award lump sum benefits.
Why do retained members who are already in one of the old defined benefit schemes (eg, SSS, LGSS, etc.) have to contribute?
Retained members in SSS and LGSS are not entitled to either the Death or TPI pensions under this Award because they would already receive such a pension from their primary super fund. The Union set out to achieve equity in terms of D&D benefits for all members – permanent and retained. It was, we argued, grossly unfair that two firefighters on a branch could be killed, yet the widow of one (being a SSS permanent firefighter ) would receive a pension for life whereas the widow of the other (being either a permanent or retained FSS member) could receive nothing. Given that our demand was for equity, it would have been wrong to allow retained members who, by virtue of their primary employment, were already in one of the “old” defined benefit schemes to draw what would effectively be two SSS pensions in the event of death or TPI. If that was allowed to happen, then we would have delivered reverse inequities whereby the permanent’s widow received only the one pension whilst the retained member’s widow received two.
Retained members in SSS and LGSS will, however, remain entitled to the off-duty $250,000 Death and TPI benefit and to both the on-duty and off-duty PPI lump sum benefits (all of which will be paid in addition to their defined benefit pension).