Summary
of 2003-2004
report to members of the Police Superannuation Scheme
Police Superannuation Board
The Police Superannuation Board is responsible for the administration
of the Police Superannuation Scheme. Funds SA is responsible for the
management and investment of the Police Scheme.
Police Superannuation Scheme
Police Superannuation Fund
The market value of the Police Superannuation Fund as at 30 June
2004 was $266.8 million compared to $228.1 million as at 30 June 2003.
Funds SA is responsible for the management and investment of the assets
of the Police Superannuation Fund. The increase in the market value
of the Fund resulted from strong returns from world share markets
over the past financial year.
Investment return
For the 2003-2004 financial year, Funds SA achieved investment returns,
on a money-weighted basis (net of investment fees and the Board’s
administration costs), of 17.9 per cent for the Pension Scheme and
Lump Sum Scheme divisions.
The following table shows the investment returns (after fees) achieved
by Funds SA over the past five years.
| INVESTMENT RETURNS |
| SCHEME |
2000 |
2001 |
2002 |
2003 |
2004 |
5 years annualised |
| PENSION |
16.8% |
3.1% |
-5.3% |
-0.8% |
17.9% |
5.9% |
| LUMP SUM |
16.8% |
3.0% |
-5.4% |
-0.4% |
17.9% |
5.9% |
Fund crediting rates
As the Pension and Lump Sum schemes provide defined benefits upon
retirement, invalidity and death, these benefits are not affected
by crediting rates. Fund crediting rates affect benefits payable to
members who resign prior to age 50 and elect to take a cash withdrawal
benefit equal to the balance of their member contribution account.
Fund crediting rates also affect voluntary contribution and roll over
accounts.
Member contribution accounts
The crediting rate policy for member contribution accounts is based
on the average of the net rates of return (money-weighted return net
of investment fees and the Board’s administration costs) over the
previous three years.
The Board declared end-of-year crediting rates, for the Pension and
Lump Sum scheme divisions, of 3.9 per cent and 4 per cent respectively
to be applied to member contribution accounts as at 30 June 2004.
| MEMBERS CONTRIBUTION ACCOUNT CREDTING RATES |
| SCHEME |
2000 |
2001 |
2002 |
2003 |
2004 |
5 years annualised |
| PENSION |
13.0% |
9.8% |
4.9% |
-1.0% |
3.9% |
6.0% |
| LUMP SUM |
12.9% |
9.9% |
4.8% |
-1.0% |
4.0% |
6.0% |
Voluntary contribution and roll-over accounts
The crediting rate policies for voluntary contribution and roll-over
accounts are based on the net rates of return (money-weighted return
net of investment fees and the Board’s administration costs), as advised
by Funds SA, as at 30 June each year.
The Board declared end-of-year crediting rates, for the Pension
and Lump Sum scheme divisions, of 17.9 per cent to be applied to voluntary
contribution and roll-over accounts as at 30 June 2004.
| EVOLUNTARY CONTRIBUTION ACCOUNTS AND ROLL-OVER ACCOUNTS
CREDITING RATES |
| SCHEME |
2002 |
2003 |
2004 |
|
| PENSION |
-5.3% |
-0.8% |
17.9% |
|
| LUMP SUM |
-5.4% |
-0.4% |
17.9% |
|
Membership
The Police Superannuation Scheme is closed to new police officers
and as at 30 June 2004 had a total of 2,591 contributors, 177 preserved
members and 1,134 pensioners. There was a total of 74 exits (71 contributors
and three preserved members) during 2003-2004.
Employer contribution
During 2003-2004, a total of $23.4 million ($23.4 million in 2002-2003)
was deposited into the Police Employer Account to meet the Government’s
proportion of benefit payments. For the year ended 30 June 2004, the
Government transferred a further $32.5 million to the Police Employer
Account for funding of future liabilities in respect of the Police
Superannuation Scheme. As at 30 June 2004, the balance of the Police
Employer Account stood at $228.7 million, compared with $173.1 million
as at 30 June 2003.
Benefit payments
During 2003-2004, the pension and lump sum benefits paid to members,
spouses and children totalled $39.9 million ($38.5 million 2002-2003).
The Government’s prescribed proportion of benefit payments during
2003-2004 was $31 million ($28.5 million 2002-2003). The Fund’s prescribed
proportion of benefit payments during 2003-2004 was $8.9 million ($10
million 2002-2003).
During 2003-2004, a total of $1 million ($1.1 million in 2002-2003)
was paid by the Fund to the 17 members who resigned and elected to
take a cash withdrawal benefit (a refund of personal member contributions
plus accrued interest).
Merry Christmas
The Police Superannuation Board and staff of the Police Superannuation
Office wish all serving and retired members and their families a merry
Christmas and a happy New Year.
