New Scheme Specific Factors Approved for Judges and Governors-General

19 March, 2013

As some of our subscribers are aware there has been a lot of publicity recently about Judges pensions.

Judges pensions, unlike most other public sector defined benefit pensions, can only be split in the payment phase. That is, you cannot split the underlying interest. This has the consequence that the former spouse of a judge must wait until the judge retires before they start receiving a percentage of their pension (they were percentage only interests) even if they have already satisfied a condition of release. This also has the consequence that if the judge was to die before the former spouse the pension payments would cease, including the part split to the former spouse. As they separated from the judge they would no longer be eligible to receive a reversionary pension. This meant that the former spouses of judges were effectively engaged in a high stakes lottery, with their retirement security as the wager.

Fortunately after lobbying parliament in its wisdom passed the Judges and Governors-General Legislation Amendment (Family Law) Act 2012 which now provides for splitting the underlying interest of the Judges and the Governors-General superannuation. The legislative changes became effective on 15 March 2013. As part of the change there has been a suite of statutory instruments issued to provide for scheme specific factors for valuing the Judge’s Pension. It has also been removed from the list of percentage only interests.

It should be remembered however that this change only applies to judges who are under the federal scheme. State judicial pension schemes are not effected by the amendments.

Leave a Reply

Your email address will not be published. Required fields are marked *