BlueScope Steel Superannuation Fund - Defined Contribution Division AD&S Category - IBR
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BlueScope Steel Superannuation Fund Defined Contribution Division AD&S Category – IBR The information in this document forms part of the BlueScope Superannuation Fund Product Disclosure Statement Defined Contribution Division AD&S Category dated 10 July 2015
What’s inside
Contents Contact us:
Call SuperConnect on 1300 130 434
Monday to Friday 8.30am – 5.30pm (AEST)
2 How super works 2
Email a Service Representative at bstlbsr@russellsuper.com
3 Benefits of investing with
BlueScope Steel Super 4 Write to: BlueScope Steel Superannuation Fund,
Locked Bag A4010
5 How we invest your money 11 Sydney South, NSW, 1235
Visit the website at www.bluescopesteelsuper.com.au
6 Fees and costs 16
7 How super is taxed 19 Note
The information in the Product Disclosure Statement is correct
8 Insurance in your super 21 at the time of publication of each of the documents comprising
the PDS. Changes to Government legislation or superannuation
rules after this date may affect its accuracy. If there is a material
change to any of the information in either document, the Trustee
will issue an updated document. However, if the change is not
materially adverse to members, the Trustee may instead provide
the updated information to members via the website or by the
newsletter, SuperTalk.
A paper copy of this information will be sent to any member,
free of charge, on request.
Defined Contribution Division AD&S Category – IBR BlueScope Steel Superannuation Fund 12 How super works
The following information is incorporated into section two of the PDS:
Contributions to super
Deposits into superannuation are called ‘contributions’. There are various types of contributions that can be made to your account on
a regular or ad hoc basis.
Types of contributions
Concessional Concessional (before-tax) contributions are those made from your pay before income tax is calculated
(before-tax) contributions and deducted. This lowers your taxable income and may have income tax advantages, depending on
include superannuation your circumstances. You should be aware of the following rules about making before-tax contributions:
guarantee, employer
B efore-tax contributions are taxed concessionally up to a government limit. Excess concessional
and salary sacrifice
contributions contributions will be taxed at your marginal rate plus the Medicare levy with a 15% tax offset.
A ny before-tax contributions you make in excess of the limit will also count towards your after-tax
contributions limit for that financial year.
C
ontributions tax is deducted from all before-tax contributions made to your account. If the Fund
does not have your tax file number (TFN), all before-tax contributions will be taxed at the top
marginal income tax rate plus Medicare levy.
F rom age 65 you must be working on at least a part-time basis (i.e. you have worked for at least
40 hours in a period of not more than 30 consecutive days in the current financial year) to make
voluntary before-tax contributions.
Non-concessional Non-concessional (after-tax) contributions are made from your pay after income tax has been
(after-tax) contributions deducted (or from your personal savings). You should be aware of the following rules about making
after-tax contributions:
B ecause you have already paid income tax on these contributions, there is no contributions tax
payable. However, if you exceed your non-concessional contribution limit, excess contributions
will be taxed at the top marginal rate plus Medicare levy.
If you are under age 65, you do not need to be employed to make after-tax contributions.
From age 65, you can continue to make after-tax contributions until you turn 75, provided you
are working on at least a part-time basis.
You cannot make non-concessional contributions unless BlueScope Steel Super has your TFN.
Government If your total income is below the relevant threshold and you make after-tax contributions, the
co-contributions Government will match them with a co-contribution. If you are eligible to receive co-contributions,
the Government will provide the contribution directly to your account.
Transfers from other You can transfer money from other superannuation funds to your account at any time. By
superannuation funds consolidating your super into one account, you can avoid paying multiple account keeping fees and
you’ll only receive one set of paperwork. Please return a completed Rollover Form and the required
identification documents and we will contact the other superannuation fund on your behalf.
2 BlueScope Steel Superannuation Fund Defined Contribution Division AD&S Category – IBRHow Super Works
Withdrawals from super When can you withdraw your super?
Most, if not all, of your super is ‘preserved’ (i.e. inaccessible)
2
Preservation and ‘preservation age’ until you meet one of the following criteria:
Superannuation is a long-term investment designed to help ■■ you retire on or after your ‘preservation age’;
fund for your retirement, which is why the Government has ■■ you cease employment at or after age 60;
“preservation” laws in place to ensure the money is generally
■■ you reach age 65;
not accessed before you reach your “preservation age” or
■■ you become permanently incapacitated;
permanently retire.
■■ you become terminally ill*; or
By restricting when you can withdraw your super, the
■■ you qualify for release on the grounds of severe financial
Government believes it can help you safeguard it for when you
hardship or on compassionate grounds.
will need it most – when you are no longer working and may
not have a regular income. In return, the Government grants * A terminal medical condition exists if two registered medical practitioners (one
of whom is a specialist practising in the area related to the illness or injury)
tax concessions in relation to your superannuation. have certified that you suffer from an illness or have incurred an injury that is
Your preservation age depends on the year you were born. likely to result in death within a period of not more than 12 months. No tax will
be withheld from the lump sum benefit paid, even if you are under age 60.
Date of birth Preservation age No preservation applies to death benefits (i.e. your benefits
are paid to your dependants or Legal Personal Representative
Before 1 July 1960 55
if you die before your preservation age).
From 1 July 1960 to 30 June 1961 56
What if you resign and leave the Company?
From 1 July 1961 to 30 June 1962 57 Your superannuation must be ‘preserved’ in a complying
superannuation fund until you meet one of the criteria for
From 1 July 1962 to 30 June 1963 58
withdrawal given above.
From 1 July 1963 to 30 June 1964 59
Temporary residents
On or after 1 July 1964 60 If you are a temporary resident of Australia (excluding New
Zealand citizens) additional restrictions on withdrawing your
superannuation apply to you as well as different tax rates on
withdrawal of your benefits. If you hold a temporary visa, we
recommend that you seek financial advice on termination of
employment and/or departure from Australia. If you do not claim
your benefit within 6 months of the later of your visa ceasing
and your departure from Australia, the Trustee may be required
to pay it to the Australian Taxation Office (ATO). If this happens,
you will need to contact the ATO to access your benefit. If your
visa has ceased, you can instruct the Fund to pay your benefit
prior to it being required to be paid to the ATO. The taxable
component of the benefit would be taxed at 35%.
Defined Contribution Division AD&S Category – IBR BlueScope Steel Superannuation Fund 33 Benefits of investing with
BlueScope Steel Super
The following information is incorporated into section Your defined wage consists of the sum of:
three of the PDS: ■■ your rate of pay for your weekly ordinary hours of work; and
This section is designed to provide more information about ■■ any further inclusions as determined by BlueScope from time
the significant features of your membership of BlueScope to time.
Steel Super and the benefits you are able to access. Each quarter the Company will ensure that these contributions
are no less than 9.5% of your Ordinary Time Earnings (OTE) up
Your benefit in the Fund to the quarterly Superannuation Guarantee Maximum Earnings
Your superannuation benefit equals your account balance. For Base. OTE is what you earn for your ‘ordinary hours of work’,
example, if your account balance is $35,000, then this is the and in addition to your normal salary, may also include (but is
amount of your benefit (known as your leaving service benefit). not limited to) over-award payments, commissions, incentive
bonuses, shift allowances and paid leave.
If you are entitled to an insured death or total and permanent
disablement (TPD) benefit, this amount will be paid in addition Member contributions
to your account balance. Making your own contributions (Additional Voluntary
Contributions or AVCs) to super is one way to help ensure that,
by the time you retire, you have saved enough money to enjoy
Contributions to your account the retirement lifestyle you want.
There are various types of contributions that can be made There are two types of AVCs:
to your account on a regular or ad hoc basis. Contributions to
your account include: 1. AVCs made directly from your regular pay. They can be made
■■ Company contributions, that is contributions made on your
from your before-tax or after-tax earnings; and
behalf by BlueScope; 2. AVCs in the form of occasional lump-sum payments. You
■■ Your contributions in the form of additional voluntary
can make them via cheque or you could decide to contribute
contributions (AVCs); all or part of your bonus, overtime payments or other
allowances.
■■ Rollovers; and
■■ Government co-contributions (if you are eligible). There is no contribution fee on AVCs.
All contributions are credited to your account upon receipt by Government co-contribution
the Fund as either a “concessional contribution” (before-tax) The Government co-contribution is a contribution by the
or a “non-concessional” (after-tax) contribution. BlueScope Government to match some personal non-concessional
forwards all contributions to your Fund in accordance (after-tax) contributions made to the Fund. Depending on
with your pay cycle and superannuation legislation. your level of income you may be eligible for the Government
co-contribution. For the 2015/16 financial year, the upper
Company contributions income limit is $50,454 p.a. and the lower income limit
All employers in Australia must contribute to a superannuation is $35,454 p.a. The maximum co-contribution is available
fund on behalf of their employees. BlueScope will contribute to members whose relevant income is less than the lower
at least 9.5% per year of your defined wage to your super. income limit.
The maximum Government co-contribution from 1 July 2012
and for the 2015/16 financial year is $500. Refer to the Australian
Taxation Office website at www.ato.gov.au for more information
about eligibility for the Government co-contribution.
4 BlueScope Steel Superannuation Fund Defined Contribution Division AD&S Category – IBRBenefits of investing with BlueScope
Transfers from other super funds For more information about ‘splittable’ contributions refer to the
If you have superannuation savings in other funds, you may Australian Taxation Office (ATO) website at www.ato.gov.au/super.
3
want to roll over those accounts into the BlueScope Steel Your Annual Benefit Statement will include details of your
Superannuation Fund. Having more than one super account contributions for each financial year.
is not only confusing, but it may also make it hard for you to
see just how much super you’ve got. By having just one super The benefits of contributions splitting will vary, depending on
account: your personal circumstances. We recommend that you seek
advice, based on your own situation, before making a decision
■■ you’ll know exactly how much super you have in total; to split your contributions. Once you split your contributions with
■■ you’ll know you have no lost super lying around; your spouse, these become the property of your spouse and
■■ it’s easier to manage your overall investment strategy; and cannot be transferred back to you.
■■ you may save on fees with one super account and one set Contributions that you split with your spouse will still count
of fees. towards your own contribution limits.
All you need to do is complete the Rollover Form (available from To split contributions made in a financial year you must
the website or by calling SuperConnect) and provide the required complete a Contributions Splitting Application Form available on
identification documents. You will be issued with a rollover the Fund’s website or by calling SuperConnect and return it to
confirmation letter once the transaction is complete. the Fund by 1 June in the following year.
In order to process a rollover, your previous fund may need to
know the legal name of your new fund, which is BlueScope Leave without pay
Steel Superannuation Fund (ABN 42 459 430 081). They might
If you take leave without pay from BlueScope, you can make
also require a ‘Compliance Letter’. You can download a copy
additional voluntary contributions (AVCs) during the period of
of the letter from the Fund website under Publications or call
leave. Your company contributions will be suspended during
SuperConnect to request one to be sent to you.
this period. This means that if you are making basic member
contributions these will be treated as AVCs – the Company will
Making contributions not make matching contributions.
to your account Choice of Fund
You can make contributions via cheque or you could decide to
contribute all or part of your bonus, overtime payments or other Choice of Fund is legislation that permits future employer
allowances. contributions to be directed to a fund of your choosing.
If you want to change your payroll deductions contact your Payroll Generally, when you commence employment with a company
Department. To contribute lump-sum AVCs call SuperConnect or they will have what’s called a default fund. As a new employee
download the relevant form from the Fund’s website. you will automatically become a member of this default fund,
with your employer contributions directed to this fund, unless
Contributions splitting you choose otherwise. Under choice of fund legislation, you may
Government legislation allows you to split some superannuation be able to direct your future super contributions to another fund.
contributions made to your account with your spouse. You Contact your HR Representative for more information.
can split what are called ‘splittable contributions’ made during Before making a choice you should review your current benefits
the previous financial year up to the lesser of 85% of your in BlueScope Steel Super, as some of your employer funded
concessional (before-tax and Company) contributions and the benefits will not be available in another fund. We recommend
concessional contribution limit. Restrictions apply if your spouse that in addition to reviewing the benefits available in BlueScope
is over his/her preservation age. Steel Super you also speak to a licensed financial adviser.
Amounts received by the Fund that cannot be split include
non-concessional contributions, employer termination payments
and rollovers from a previous superannuation fund. If you
intend to leave the Fund you will be able to split any splittable
contributions before you exit. Once your benefit has been rolled
over to another fund, you will lose the ability to split contributions
made to the Fund.
Defined Contribution Division AD&S Category – IBR BlueScope Steel Superannuation Fund 5If BlueScope Steel Super is your default fund set up by your
employer, your contributions will automatically be directed to
Portability
your account, provided you have made an investment choice. Portability is legislation that deals with the transfer of existing
If you do not wish to have your contributions paid to this super balances to another fund. You are able to transfer some
account you will need to complete the Choice of Fund Form or all of your current (accrued) benefit to another fund. However,
issued by your employer. Contact your HR Representative for if you have not elected Choice of Fund and your employer
more information. When the completed form and required continues to contribute to your account:
documentation is received, your contributions will be made ■■ you must maintain a minimum balance of $2,000 in your
to your chosen fund as soon as practicable. account; and
Choice of Fund and Portability are not directly related. If you ■■ we may refuse your transfer if you have made a similar
would like to elect Choice of Fund for your future contributions transfer within the past 12 months.
and transfer your current balance to your chosen fund, you
Before making this decision you should review your current
should refer to the Portability section.
benefits in BlueScope Steel Super and speak to a licensed
Note that: financial adviser.
■■ If you choose to direct your future contributions to another To transfer your current benefit you will need to complete a
fund, your existing account balance will be transferred to the Transfer of Accrued Benefits Form which is available online
Retained Benefits Division (RBD). Your account will be debited at www.bluescopesteelsuper.com.au.
with the administration charge applicable to the Retained
Benefits Division. Your TPD cover will cease immediately
but your existing death cover will continue (you can elect to Member services to help you
terminate this cover at any time). Insurance premiums at the
rate applicable to RBD members will be deducted from your
make the most of your super
account. Your spouse can either open a new Spouse Account Visit the website at
or maintain an existing Spouse Account; www.bluescopesteelsuper.com.au
■■ If you choose to direct your future contributions to another super The Fund’s website houses a wealth of useful information.
fund and decide to transfer your existing account balance out It gives you access to your account details and investment
of the Fund, your death and TPD insurance cover will cease choices, which you can update and change at any time.
immediately. An existing Spouse Account can remain in place You can also explore the latest news about superannuation
(subject to satisfying continuing eligibility requirements) but no on the home page, access education campaigns and other
new Spouse Account can be opened; and Fund communications and take advantage of the Fund’s
superannuation and insurance calculators.
■■ If you later decide to rejoin the Fund, in accordance with
the choice of fund legislation, you will have to provide health Call the SuperConnect helpline on 1300 130 434
evidence that is acceptable to the insurer to obtain death and You can call SuperConnect (with your member number and PIN
TPD insurance cover. ready) to have your superannuation questions answered. You
can also request copies of past annual reports and newsletters
and the rules of the Fund. SuperConnect is open Monday
to Friday, 8.30am to 5.30pm (Eastern Standard Time). Our
interactive voice response system is available between 6am
and 2am (Eastern Standard Time) seven days a week.
6 BlueScope Steel Superannuation Fund Defined Contribution Division AD&S Category – IBRBenefits of investing with BlueScope
Attend the education seminars
As a member of the BlueScope Steel Superannuation Fund you
Fund management – in
members’ best interests
3
have the opportunity to attend financial education seminars
run by Russell Financial Solutions (RFS). Each year education
seminars are held at major BlueScope worksites. The Trustee
Total Risk Management Pty Limited (TRM), ABN 62 008 644
These education seminars are your chance to learn more about
353, is the Trustee of the Fund and is responsible for its
the latest developments in the superannuation industry and
overall operation. The Trustee has directors who have extensive
how they may impact your superannuation benefit. Attending a
experience in all facets of superannuation management. In
seminar puts you in a position to learn more about how you can
fulfilling its obligations, the Trustee has appointed Russell
make the most of your investment in superannuation and get the
Investment Management Limited to provide advice on the
best possible value from the products and services available to
investment strategy of the Fund and Russell Employee Benefits
you through the Fund.
Pty Ltd to manage the day to day administration of the Fund.
Topics covered at these seminars typically include:
The Fund’s assets are controlled by TRM, which is a subsidiary
■■ retirement planning; company of Russell Employee Benefits Pty Ltd. The assets
■■ issues to consider when it’s time to receive a benefit; of BlueScope Steel Superannuation Fund are held separately
■■ personal savings plans; and from the assets of BlueScope and any of the Russell group of
■■ balancing immediate financial needs with the importance companies.
of saving for your financial needs later in life. The Trustee has provided the regulator (APRA) with a bank
guarantee in the sum of $5 million. This guarantee is a
Access to financial advice
minimum capital requirement for TRM and provides comfort in
If you need more information than what is provided to you
the event of any default in relation to the operation of the Fund.
through the Fund’s communications, you can call SuperConnect
A copy of the guarantee is available on request.
and speak with a Service Representative who can give you
limited advice by: The Policy Committee
■■ answering questions about your benefit entitlements; and BlueScope Steel Super also has a Policy Committee with four
■■ providing you with limited personal guidance about members. Two members are company-appointed, and two are
superannuation and retirement issues. member-elected.
The Policy Committee:
Adviser Referral Program
■■ provides strategic guidance to the Trustee;
If you need financial advice, the Fund offers you the Adviser
Referral Program managed by RFS. You can call SuperConnect ■■ represents members’ interests; and
to be put through to an RFS representative who can appraise ■■ monitors service providers.
your personal needs and refer you to a financial adviser.
Members who are employees of BlueScope can nominate and
RFS has selected third party advisers to participate in our vote for member representatives every three years. Member-
Adviser Referral Program on the basis of their experience, elected representatives must resign from their positions every
their educational qualifications and skill sets. They are familiar three years but remain eligible for re-election.
with the BlueScope Steel Superannuation Fund and the Fund’s
If you have any concerns or suggestions about the Fund
investment process. The advisers who participate in the program
or member services, you should feel free to approach a
are monitored by RFS on a yearly basis.
representative of the Policy Committee. The Fund’s website lists
The first consultation with an adviser will be provided at no cost all Policy Committee members and their contact details.
to you. After this initial introduction, any ongoing relationship
and services are entirely up to you and your adviser on a fee Fund reserves
for service basis. Please ensure that you receive a copy of your The Fund maintains an insurance reserve. The purpose of this
adviser’s Financial Services Guide (FSG) which will outline their reserve is to pay any uninsured benefits to members arising
basis for charging fees and the range of services they can provide. from when the Fund was self-insured prior to 1 July 2002.
Neither RFS, BlueScope, nor the Fund receives any commissions The level of the reserve is monitored by the Fund’s actuary.
or fees for referring you to a financial adviser.
Defined Contribution Division AD&S Category – IBR BlueScope Steel Superannuation Fund 7Protecting your privacy Contact details
If you need to contact the Trustee, address your enquiry to:
Russell provides a range of services to the Fund. In providing
those services, Russell may collect personal information directly The Privacy Officer
from you or from your employer. It may also be collected Russell Investment Group
from a medical practitioner if you make a disablement claim. Level 29, 135 King Street
In relation to that information please note as follows. Sydney NSW 2001
Access
Subject to certain conditions, you can gain access to your
Other products available
personal information that Russell has collected and where through the Fund
appropriate, request the Fund to correct any incorrect or out
of date information. Spouse Account – establishing savings for your
spouse
Purposes of collection You can establish superannuation savings for your spouse with
The information is collected for the primary purpose of assisting the Fund in the Spouse Account Division. Your ‘spouse’ includes
with the provision of services to you as a member of the Fund a person (of the same or different sex) who is living with you on
and to comply with legislative requirements. This may include a genuine domestic basis in a relationship as a couple or with
a range of related secondary purposes, including the provision whom you are in a relationship that is registered under State or
of general education about superannuation and retirement Territory law. The Trustee is required to determine whether your
issues and information about other benefits available to you spouse, if not legally married to you, meets this definition.
as a current or former member of the Fund. Making contributions to a spouse account during your working
years means you and your spouse will both have super savings
Disclosure from which to draw an income when you retire. You may also be
Your information may be disclosed by Russell to a number able to benefit from potential tax savings.
of other parties, including advisers, insurers, regulators and
courts. Information may be provided to your employer if the In addition, the Government currently offers a tax rebate of up
Trustee considers this necessary or appropriate for the proper to $540 p.a. to members who contribute to a spouse account,
management of BlueScope Steel Super. In some situations, provided their spouse earns less than $13,800 a year and is an
the law may require the provision of information to your spouse Australian resident for tax purposes.
or former spouse. Personal information is accessed by Tech Please refer to the Fund’s Spouse Account Product Disclosure
Mahindra Ltd, an entity based in India that provides some Statement for more information. If, under choice of fund or
administration services. portability legislation, you decide to leave the Fund, your spouse
can retain his/her Spouse Account.
The law
Federal legislation covering superannuation and taxation
matters requires certain minimum information to be collected
to provide services to you as a member of the Fund.
Consequences of non-provision
If you choose not to provide information, the consequences
are typically changes or reductions to benefit entitlements or
tax concessions. It may also mean that the Fund is unable to
process your instructions.
More information is detailed in the Trustee’s Privacy Policy
which can be obtained by calling SuperConnect. Alternatively,
you can access a copy via the Fund’s website.
8 BlueScope Steel Superannuation Fund Defined Contribution Division AD&S Category – IBRBenefits of investing with BlueScope
Retained Benefits Division – keeping your super Purchasing a pension
with the Fund If you are at least age 55 or have qualified for a total and
3
If you leave the Company, there’s no need to leave the Fund. permanent disablement benefit, you may be eligible to purchase
If you leave BlueScope before you retire, you have the option to a pension. The Fund does not offer pensions, but pension
keep your benefit in the Retained Benefits Division (RBD) of the products are available through various financial institutions.
Fund or transfer to another complying superannuation fund. As a BlueScope Steel Super member you are able to purchase
The RBD provides former employees of BlueScope the Russell iQ Retirement from the Russell SuperSolution Master
opportunity to keep their super with the Fund and continue Trust, subject to satisfying the relevant eligibility criteria.
to enjoy the many benefits of membership. For more information about the Russell iQ Retirement or an
application form refer to the Product Disclosure Statement
If your benefit is $2,000 or more available on the Fund’s website or call SuperConnect.
When you leave BlueScope your benefit will automatically
be transferred to the Retained Benefits Division (RBD) of the
BlueScope Steel Superannuation Fund. If your benefit is $2,000 What you need to know about
or more you are eligible to remain a member of the RBD for
as long as you choose. As a member of the RBD, the RBD fee
benefit payment processing
arrangements will apply, including investment fees based on your Benefit payments are processed as quickly as possible after
investment option(s) and an administration fee of 0.70% p.a. of all required information has been received by the Fund.
your account balance, capped at a maximum administration fee Processing times will vary, depending on when we receive all
of $2,000 per Fund year. The administration fee is deducted the required documentation and final contributions. If you have
from your account balance on the last day of each month. For ceased employment with BlueScope or have lodged a combined
the first two months after your benefit is moved to the RBD, you choice of fund and portability request, the Fund will require
will not have to pay the administration fee. This means that the your employer to confirm that the final contributions have been
administration fee will not apply in the month that you transfer in paid to the Fund on your behalf and, if applicable, your date of
or in the following calendar month. termination of employment.
You have the opportunity to request a partial payment of your
If your benefit is less than $2,000 benefit (subject to any minimum account balance restrictions),
If your benefit is less than $2,000 and you do not provide pending receipt of all of the necessary documentation and
payment instructions within 90 days of leaving BlueScope, contributions or you may be happy to wait until the benefit can
your benefit will be transferred from the RBD to the nominated be paid in full.
Eligible Rollover Fund (ERF):
Once the Fund has received all the required documentation,
Colonial SuperTrace as advised on the Benefit Payment Application Form, we will be
Locked Bag 5429 able to process your benefit payment. The Fund cannot take any
Parramatta NSW 2124 action prior to this. Processing times will vary on a case by case
Telephone: 1300 788 750 basis, but benefits are generally paid within 3 business days
after we have determined that all requirements have been met.
A benefit transferred to the ERF continues to be subject to the
preservation guidelines.
Transfers to the ERF are processed twice a year. Once your
benefit is paid to the ERF it cannot be transferred back to the
Fund unless you are re-employed by BlueScope.
You should check the investment strategy of the ERF to ensure
that it is suited to your personal circumstances.
Defined Contribution Division AD&S Category – IBR BlueScope Steel Superannuation Fund 9During the time your benefit is being processed, your benefit Providing proof of identity
will remain invested in your chosen investment option(s). This The security of your super entitlements in BlueScope Steel
means that the amount of your benefit will vary (up and down), Super is a key priority for the Trustee. BlueScope Steel Super
depending on how it is invested and movement in the value has procedures in place to manage risks associated with fraud
of the underlying investments. It is important to be aware that and other illegal activities. At times, these procedures may
in most cases you can change how your benefit is invested cause inconvenience to you. Please remember that they are
right up to the date of payment from the Fund, if you wish to being applied to protect your entitlements. In addition, under
change your exposure to investment risk (remembering that an the Anti-Money Laundering and Counter-Terrorism Financing
investment switch generally takes 3 business days to process). Act 2006, superannuation funds are required to have an anti-
If some or all of your benefit remains in the Retained Benefits money laundering and counter-terrorism financing program in
Division, there will be no change to the way your benefit is place. A key element of this program is customer identification
invested – it will continue to be invested in the investment and verification procedures. Typically, you will be required to
option(s) applicable to your account on the day your benefit provide proof of your identity before you withdraw benefits from
is transferred to the RBD. BlueScope Steel Super or commence an income stream. As a
result, some requested transactions cannot proceed until we
For more information about benefit payment processing, receive and verify the necessary identification documents.
please call SuperConnect.
The Trustee does not accept liability for any loss you may incur
as a result of circumstances such as a delay in payment of a
benefit or commencement of an income stream where the delay
arises from our need to comply with legislative requirements.
We may be required to request additional customer identification
or related information from you at other times.
If we cannot obtain the requisite information from you, we may
be unable to process your requested transaction. The Trustee
must also report specified matters to the regulator, AUSTRAC,
and this may include the provision of personal information about
you. If this happens, the Trustee is not permitted to advise you
that such a report has been made.
10 BlueScope Steel Superannuation Fund Defined Contribution Division AD&S Category – IBRHow we invest your money
5 How we invest your money
The following information is incorporated into section five
of the PDS:
Investment choice
You can choose an investment strategy that is right for you.
5
You can invest your current benefit and future contributions
Investment objective in up to two of the four different investment options – A, B,
The investment objective of the Fund is to maximise investment C and D. You will be notified of any change in the available
earnings and retirement benefits for members within acceptable investment options.
risk parameters.
To make an investment choice, you need to nominate the
The investment strategy set by the Trustee: percentage of your current benefit and/or future contributions
■■ takes a long-term approach; that you want invested in your chosen option(s).
■■ reduces risk by spreading the assets over a number of While you can only choose up to two investment options, you
investments and investment managers; and can vary the percentages that apply to your current benefit and
■■ allows the use of futures and derivatives if their use is your future contributions. For example, you may choose to invest
consistent with the underlying investment strategy. 50% of your current benefit in Option A and the remainder
in Option B, and then choose to invest 70% of your future
Investment returns applied to members’ accounts will vary contributions in Option A and the remainder in Option B.
from year to year and, like all investments, may be positive or
If you choose to invest in different proportions in two options,
negative. It is also possible that earnings may grow at less than
your allocation will be applied once only and will not be
the rate of inflation over a particular period of time.
rebalanced to maintain the weighting.
Investment managers Please note that investment options are not capital guaranteed.
Consequently, the value of the investment may rise or fall.
The Fund’s investment strategy is set by your Trustee and
managed by Russell Investment Management Limited (Russell). Switching
The investment strategy is built around a long-term planning You can change your investment option at any time. The Fund
time-frame and a strategic allocation of assets diversifying offers daily investment switching. Switches are generally free
across asset classes including shares, property, fixed interest of charge*. The switch will generally take effect three business
and cash. days after the request has been received by the Fund.
Russell’s investment strategy also diversifies across multiple To change your investment option either:
investment managers selected on the basis of their specialist
■■ go online at bluescopesteelsuper.com.au; or
skills, experience and capabilities. These managers are integral
■■ call SuperConnect on 1300 130 434 to speak to a Service
to the Fund’s investment strategy.
Representative who can help you.
Russell does not take into account labour standards or
* If you make more than 5 switches in a financial year any further switches will
environmental, social or ethical considerations in its decision attract a fee. Refer to Section 6 of this document for details.
to engage underlying investment managers to manage the
investments of Russell funds. (Russell has consented to the
inclusion of this statement.)
The Trustee does not take into account labour standards or
environmental, social or ethical considerations when it decides
how the assets of the Fund are to be invested.
Defined Contribution Division AD&S Category – IBR BlueScope Steel Superannuation Fund 11Investment in units Hedging
Your investment in the Fund is in an accumulation-style account. The Fund has exposure to international investments of various
Your accumulation account is invested in units, which means types. The investment returns to Australian investors with
that at any given time, your superannuation benefit is expressed international share investments are subject to currency risk.
as a particular number of units at a given unit price. Every This is because the value, in Australian dollars, of a foreign
contribution made to your account is converted into units on investment can change regardless of the return on that
the day it is processed by the Fund. The number of units you investment in foreign currency terms.
receive depends on the prevailing unit price. Each investment The investment manager manages the currency risk in the Fund’s
choice has its own unit price, which is calculated and set each international investments by ‘hedging’ some or all of the impact of
business day. changes in foreign currency exchange rates. It does so by using
Unit prices are updated daily (based on the most recently derivatives to largely eliminate the impact that changes in currency
available valuations of the underlying investments) and rise exchange rates would have on the overall investment performance
and fall depending on investment returns. The value of your of the Fund’s international investments. If an investment is
benefit varies according to changes in the unit price(s) of your ‘unhedged’, its investment return is impacted by movements in
chosen investment option(s). The declared unit prices are net of the Australian dollar ($A). A rise in the $A has a negative impact
estimated tax on investment earnings (including such allowance on the returns of unhedged international investments (and a fall in
as the Trustee considers appropriate for any deferred tax that the $A has a positive impact on unhedged international investment
has accrued) and investment fees. returns). If an investment is fully ‘hedged’, changes in the price
of the $A do not impact the value of shares held in the Fund in
Blending foreign currencies.
Investing your super across more than one investment option
International investments expose the investor to currency
allows you to create your own particular investment mix with
fluctuations. BlueScope Steel Super uses hedging to reduce
different weightings across the underlying asset sectors. This
this exposure.
is called ‘blending’. As an investor, you will be able to exercise
greater control over the mix of assets in your investment Suspension of transacting
portfolio. During periods of extreme movements in the market the Fund
Some of the Fund’s options are diversified across various may suspend transaction processing consistent with the unit
asset classes and some options are predominantly invested pricing policy that applies to the Fund. Russell has an experienced
in one asset class. When making investment decisions you unit pricing committee that oversees all unit pricing issues,
should consider whether your overall investment in the Fund is including implementation of the unit pricing policy. A suspension
adequately diversified taking into consideration your personal in the processing of transactions is designed to prevent some
circumstances, including investments you hold outside of members from inappropriately benefiting from ‘market timing’
BlueScope Steel Super. to the disadvantage of other members.
The Fund monitors movements in the market on a daily basis.
If there is a movement of more than a specified percentage,
processing of transactions may be suspended. The main
transaction types that are suspended in these periods are
allocation of contributions received to members’ accounts,
investment switches, cash benefit payments and rollovers
to other funds. Any contributions that cannot be allocated
to members are held in a bank account in the Fund’s name,
as required by legislation, and the interest earned on this
account is used to benefit all members.
12 BlueScope Steel Superannuation Fund Defined Contribution Division AD&S Category – IBRHow we invest your money
Any suspension generally lasts no more than one day after
which unit prices are calculated based on movement in the
5
relevant benchmark index, until such time as the market
stabilises. The unit pricing committee may decide to continue
processing of transactions, notwithstanding market volatility,
if it considers this is the best approach to take.
Investment performance
You can access up to date information on the investment returns
of each investment option through the Fund’s website. You can
also see your nominated investment options and find out exactly
how much super you have on the day you log in. The SuperTalk
newsletter also provides you with regular updates on the Fund’s
recent quarterly returns and longer term performance.
Defined Contribution Division AD&S Category – IBR BlueScope Steel Superannuation Fund 13Accumulation Options and investment objectives
Option A Option B
Investment return objective:Expect to earn a return after costs and Investment return objective:To earn a return after expected costs and
tax, over a one year period, consistent with the benchmark (also after tax, exceeding CPI* by 2.5% per annum, measured over rolling 5 year
costs and tax). periods.
Suitability:Suitable for investors seeking cash-like returns, who have Suitability:Suitable for investors who do not have a long investment
a short investment horizon. horizon and whose most important consideration is having a low chance
of a negative return over this horizon.
Minimum investment timeframe:Less than 12 months.
Minimum investment timeframe:Be prepared to stay invested in this
Benchmark:UBSA Bank Bill Index option for at least 3 years before it meets its objectives.
Investment strategy:The option is predominantly exposed to assets Investment strategy:The option is typically exposed to a diversified
such as bank deposits, money market instruments (including but not portfolio mix of growth investments around 40% and defensive
limited to bank bills and certificates of deposit). investments around 60%^. The option may be exposed to derivatives.
Estimated Investment fee:0.02% p.a. Estimated Investment fee:0.36% p.a.
Risk level**: Risk level**:
Short-term risk is the risk that your super savings will be reduced by Short-term risk is the risk that your super savings will be reduced by
volatility of investment markets. volatility of investment markets.
Long-term risk is the risk that a member’s superannuation savings will Long-term risk is the risk that a member’s superannuation savings will
not significantly outperform inflation over a member’s superannuation not significantly outperform inflation over a member’s superannuation
accumulation lifetime. accumulation lifetime.
Risk level for the time invested Risk level for the time invested
Length: Short Long Length: Short Long
Risk: Very low Very high Risk: Medium to high Medium to high
Estimated number of negative annual returns over any 20-year period: Estimated number of negative annual returns over any 20-year period:
Less than 0.5 Approximately 3 to 4
Asset allocation ranges#: Asset allocation ranges#:
Enhanced cash 18% 22%
Cash 0% 100%
Fixed Income 37% 43%
0 10 20 30 40 50 60 70 80 90 100
Property 0% 4%
International Equities 15% 23%
Australian Equities 17% 21%
0 10 20 30 40 50 60
* CPI stands for Consumer Price Index, which is used as a measure of inflation.
^ Please refer to the asset allocation ranges for details of the parameters surrounding the investment strategy.
** The risk level is not a complete assessment of all forms of investment risk, for instance it does not detail what the size of a negative return could be, nor the potential for a positive return to be
less than the return an investor may require to meet their objectives.
# The actual asset allocation may temporarily fall outside the ranges stated above in certain circumstances, such as asset transitions or extreme market movements.
14 BlueScope Steel Superannuation Fund Defined Contribution Division AD&S Category – IBRHow we invest your money
Option C Option D
Investment return objective:To earn a return after expected costs and Investment return objective:To earn a return after expected costs and
tax, exceeding CPI* by 3.5% per annum, measured over rolling 5 year tax, exceeding CPI* by 4.0% per annum, measured over rolling 5 year
periods. periods.
5
Suitability:Suitable for investors who are seeking to build wealth over Suitability:Suitable for investors who are seeking to build wealth over
the medium to long term and are willing to accept the possibility of the long term and are willing to accept the possibility of negative returns
negative returns over the shorter term. over the shorter term.
Minimum investment timeframe:Be prepared to stay invested in this Minimum investment timeframe:Be prepared to stay invested in this
option for at least 5 years before it meets its objectives. option for at least 7 years before it meets its objectives.
Investment strategy:The option is typically exposed to a diversified Investment strategy:The option is typically exposed to a diversified
portfolio mix of growth investments around 70% and defensive portfolio mix of growth investments around 90% and defensive
investments around 30%^. The option may be exposed to derivatives. investments around 10%^. The option may be exposed to derivatives.
Estimated Investment fee:0.45% p.a. Estimated Investment fee:0.45% p.a.
Risk level**: Risk level**:
Short-term risk is the risk that your super savings will be reduced by Short-term risk is the risk that your super savings will be reduced by
volatility of investment markets. volatility of investment markets.
Long-term risk is the risk that a member’s superannuation savings will Long-term risk is the risk that a member’s superannuation savings will
not significantly outperform inflation over a member’s superannuation not significantly outperform inflation over a member’s superannuation
accumulation lifetime. accumulation lifetime.
Risk level for the time invested Risk level for the time invested
Length: Short Long Length: Short Long
Risk: High Low Risk: High Low
Estimated number of negative annual returns over any 20-year period: Estimated number of negative annual returns over any 20-year period:
Approximately 4 to 5 Approximately 5 to 6
Asset allocation ranges#: Asset allocation ranges#:
Enhanced cash 10.5% 14.5% Enhanced cash 2% 6%
Fixed Income 14.5% 20.5% Fixed Income 3% 9%
Property 6% 10% Property 6% 10%
International Equities 28% 36% International Equities 37% 45%
Australian Equities 28% 32% Australian Equities 39% 43%
0 5 10 15 20 25 30 35 40 45 0 5 10 15 20 25 30 35 40 45 50
* CPI stands for Consumer Price Index, which is used as a measure of inflation.
^ Please refer to the asset allocation ranges for details of the parameters surrounding the investment strategy.
** The risk level is not a complete assessment of all forms of investment risk, for instance it does not detail what the size of a negative return could be, nor the potential for a positive return to be
less than the return an investor may require to meet their objectives.
# The actual asset allocation may temporarily fall outside the ranges stated above in certain circumstances, such as asset transitions or extreme market movements.
Defined Contribution Division AD&S Category – IBR BlueScope Steel Superannuation Fund 156 Fees and Costs
The following information is incorporated into section six of the PDS:
The table below outlines the fees that apply to your account.
Type of fee Amount How and when paid
Investment fee Option A: 0.02% p.a. Investment fees are deducted from the investment returns before the unit price is
Option B: 0.36% p.a. for each option. They are not deducted from your account.
Option C: 0.45% p.a.
Option D: 0.45% p.a.
Administration fee 1.2% p.a. The administration fee is charged as a contribution fee. It is deducted from basic
member and company contributions. It does not apply to rollovers or AVCs.
Buy-sell spread Nil for your first 5 investment You can make 5 investment switches per financial year without being charged
switches in one financial year; a buy-sell spread. The fee applies on the 6th and any subsequent switches that
0.20% of the switched amount you make and is deducted from your account at the time of the switch.
on any subsequent switches.
Switching fee Nil Not applicable
Exit fee Nil Not applicable
Advice fees Nil Not applicable
Other fees and $250 per request Family Law fees are payable for information requests. You can read more
costs about these fees in the ‘Additional Explanation of Fees and costs’ section.
Indirect cost ratio Operational Risk Reserve These costs are deducted from investment returns before the unit price
(ICR) (ORR) # cost of 0.13% p.a. of is declared and are not deducted from your account.
your account balance.
# The Trusteeis required by law to establish an Operational Risk Reserve equal to 0.25% of assets. To spread the impact on investment performance, the ORR
is deducted monthly up to a maximum of 0.13% or 13 basis points per year. We estimate that the target reserve will be reached approximately at the end of September 2015.
Administration fee
Additional Explanation of An administration fee is a fee that relates to the administration
Fees and Costs or operation of a superannuation entity and includes costs
incurred by the trustee, or the trustees, of the entity that:
Build up of Operational Risk Reserve (ORR) (a) relate to the administration or operation of the fund; and
Legislative amendments have been made which impose new
obligations on all superannuation fund trustees from 1 July 2013 to (b) are not otherwise charged as an investment fee, a buy-sell
maintain and manage financial resources to cover operational risks. spread, a switching fee, an exit fee, an activity fee, an advice
fee or an insurance fee.
To comply with these requirements, the Trustee is building up a
single segregated reserve within BlueScope Steel Superannuation In BlueScope Steel Super, these costs are recovered from
Fund, known as the Operational Risk Reserve (ORR). The ORR members by way of a contribution fee.
is expected to initially be funded over a three-year period (in line
with APRA’s prudential standard) partially by amounts deducted
from the investment returns and not directly from Member’s
account balances.
We estimate that the ORR target will be reached approximately at
the end of September 2015. This is dependant on the movement
of the investment market. We will communicate to all affected
members when this occurs.
16 BlueScope Steel Superannuation Fund Defined Contribution Division AD&S Category – IBRFees and Costs
Investment fee Investment option Performance fee over 12 months
An investment fee is a fee that relates to the investment of the
to 30 June 2014
6
assets of a superannuation entity and includes:
Option A Nil
(a) fees in payment for the exercise of care and expertise in the
investment of those assets (including performance fees); and Option B 0.001% p.a.
(b) costs incurred by the trustee, or the trustees, of the entity that: Option C 0.001% p.a.
(i) relate to the investment of assets of the entity; and Option D 0.001% p.a.
(ii) are not otherwise charged as an administration fee, a
buy-sell spread, a switching fee, an exit fee, an activity Please note, however, that past performance is not a reliable
fee, an advice fee or an insurance fee. indicator of future performance and it is impossible to accurately
The investment fee stated for each investment option is an forecast the performance fees that will be payable. The Trustee
estimate of the fee applicable to that option. Each option’s reviews the estimated performance fees every 12 months.
investment fee is influenced by changes to the investment As a general rule, a performance fee will not be payable unless
managers and/or the asset classes within the funds in which the underlying manager/fund has achieved a return in excess of
the option’s assets are invested and rebate levels applying to the relevant hurdle rate, and unless any past under-performance
the Fund. For this reason, the investment fee cannot be stated has been recovered. Please note that for options that have
as an exact percentage. exposure to performance fees, a performance fee may be
The estimated fee of each option is the average of the investment payable to an underlying manager/fund that has satisfied its
fees of each asset class, weighted in proportion to the benchmark individual performance fee criteria even at times when the option
allocations of the asset classes in which the option invests. The as a whole has under-performed its benchmark.
estimated fees shown are net of the assumed manager rebates
applicable to the Fund. Daily unit prices are net of the investment Buy-sell spread
fee applied to each investment option. A buy-sell spread is a fee to recover transaction costs incurred
by the trustee, or the trustees, of a superannuation entity.
Performance fees
The assets of each of the Fund’s investment options are Switching fee
invested by Russell Investment Management Limited in A switching fee is a fee to recover the costs of switching all or
underlying Russell funds. The assets of these underlying funds part of a member’s interest in a superannuation entity from one
are managed by investment managers appointed by Russell class of beneficial interest in the entity to another.
Investment Management Limited.
Exit fee
Performance fees provide an incentive for the underlying An exit fee is a fee to recover the costs of disposing of all or
managers/funds to achieve superior performance. Performance part of members’ interests in a superannuation entity.
fees may be charged by the underlying managers/funds to
which the Fund’s investment options are exposed. Where an Activity fee
option is exposed to an underlying manager/fund that charges A fee is an activity fee if:
a performance fee, that performance fee has been estimated (a) the fee relates to costs incurred by the trustee, or the trustees,
with reference to the performance of the underlying manager/ of a superannuation entity that are directly related to an activity
fund over the 12 months to 30 June 2014, and included in that of the trustee, or the trustees:
option’s estimated investment fee.
(i) that is engaged in at the request, or with the consent,
of a member; or
(ii) that relates to a member and is required by law; and
(b) those costs are not otherwise charged as an administration fee,
an investment fee, a buy-sell spread, a switching fee, an exit fee,
an advice fee or an insurance fee.
Defined Contribution Division AD&S Category – IBR BlueScope Steel Superannuation Fund 17Advice fee Indirect Cost Ratio (ICR)
A fee is an advice fee if: The Indirect cost ratio (ICR) for a MySuper product or an
(a) the fee relates directly to costs incurred by the trustee, investment option offered by a superannuation entity, is the
or the trustees, of a superannuation entity because of the ratio of the total of indirect costs for the MySuper product
provision of financial product advice to a member by: or investment option, to the total average net assets of the
(i) a trustee of the entity; or superannuation entity attributed to the MySuper product or
investment option.
(ii) another person acting as an employee of, or under an
arrangement with, a trustee or trustees of the entity; and
(b) those costs are not otherwise charged as an administration
fee, an investment fee, a switching fee, an exit fee, an
activity fee or an insurance fee.
Insurance fee
A fee is an insurance fee if:
(a) the fee relates directly to either or both of the following:
(i) insurance premiums paid by the trustee, or the trustees,
of a superannuation entity in relation to a member or
members of the entity;
(ii) costs incurred by the trustee, or the trustees, of a
superannuation entity in relation to the provision of
insurance for a member or members of the entity; and
(b) the fee does not relate to any part of a premium paid or
cost incurred in relation to a life policy or a contract of
insurance that relates to a benefit to the member that is
based on the performance of an investment rather than
the realisation of a risk; and
(c) the premiums and costs to which the fee relates are not
otherwise charged as an administration fee, an investment
fee, a switching fee, an exit fee, an activity fee or an
advice fee.
18 BlueScope Steel Superannuation Fund Defined Contribution Division AD&S Category – IBRYou can also read
