1.4 History of the industry


Superannuation in Papua New Guinea started as a pension scheme on 8 June 1962, under the Papua and New Guinea Retirement Benefits Act 1960. This was set up for officers of the Public Service including teachers (other than married female officers who were not the head of a family). In 1980 superannuation became available to staff in the private sector via the National Provident Fund, and in 1982 compulsory superannuation was introduced. 

Compulsory superannuation has ensured almost universal coverage for employees. 


NASFUND The Papua and New Guinea Retirement Benefits Act 1960 was introduced. This was a pension scheme set up for officers of the Public Service. This did not include female officers who were married but not the head of a family. When women married, they were expected to resign from the Public Service.
Nambawan Super The Public Officers Superannuation Fund (POSF) was established by the Public Officers Superannuation Fund Ordinance 1971 (POSF Ordinance). This replaced the Papua and New Guinea Retirement Benefits Act 1960 and provided pensions for officers of the Public Service.
Comrade Trustee Services Ltd (CTSL)

Papua New Guinea gained independence from Australia. After independence, the Public Officers Superannuation Fund Act Chapter 66 replaced the Public Officers Superannuation Fund Ordinance 1971 (POSF Ordinance).

The Defence Force Retirement Benefits Act introduced the Defence Force Retirement Benefits fund, which was a pension fund providing retirement benefits to members and their dependents upon discharge from the Defence Force or in the event of medical discharge and or death.

AON Master Trust PNG Kina subfund The National Provident Fund Act 1982 established the National Provident Fund, providing compulsory superannuation to employees of companies with more than 20 employees. Employers were required to contribute 7% and employees 5% of wages.
1988 The Public Officers Superannuation Fund (Amendment) Act 1988 allowed married women to continue to contribute to the Public Officers Superannuation Fund (POSF).
1990 The Public Officers Superannuation Fund Act 1990 (POSF Act 1990) replaced all previous Public Service superannuation legislation and merged the Retirement Benefit Fund with the Public Officers Superannuation Fund. This Act made superannuation compulsory for all officers and employees of the Public Service without any discrimination.
Late 1990's Concerns were raised about the National Provident Fund’s financial liabilities given its exposure to poor performing investments as well as several allegations of fraud and mis-management.
2002

The National Provident Fund (Financial Reconstruction) Act 2000 was introduced, to reduce the NPF losses. This Act also introduced an annual grant to the fund of one million kina. The National Provident Fund “wrote down” assets by approximately 18%.

The financial industry was restructured. The Superannuation (General Provision) Act 2000 (SGP Act) brought the superannuation industry under the regulation of the PNG Central Bank.

The Public Officers Superannuation Fund was authorised to operate as a superannuation fund under this legislation.

2003

The National Provident Fund was renamed the National Superannuation Fund (NASFUND).

The Superannuation (General Provision) (Amendment) Act 2002 and Superannuation Regulation 2002 made further changes to superannuation law, such as introducing a complaints process and retirement counselling.
2003 The Defence Force Retirements Benefits fund became Comrade Trustee Services Ltd (CTSL).
2007

The PNG government implemented the following recommendations of the Joint Superannuation Task Force, to improve and strengthen the effectiveness of the prudential regulation and administration of the superannuation industry:

  • The minimum numbers of employs required to make superannuation contributions mandatory changed 20 to 15
  • It became a legal requirement for employers to provide to the regulator, together with their contributions to superannuation funds, the names of employees and the amounts being contributed in respect of each
  • It became easier for employees to withdraw part of their superannuation contributions in order to finance purchasing of principal homes.

The Public Officers Superannuation Fund (POSF) was re-named Nambawan Super Fund.

1.4.1 Superannuation (General Provision) contributions (SGP) 

The Superannuation (General Provision) Act 2000 requires eligible employers and employees to contribute compulsory superannuation contributions into an authorised superannuation fund (ASF). 

Since 2008, mandatory contribution rates have been:

  • 8.4% of salary from the employer, plus
  • 6% of salary from the member.

Who is currently exempt from receiving SGP contributions?

Employers and employees are not required to contribute SGP contributions if:

  • the employer employs fewer than 15 people
  • the employees are involved in primary production and employed by an employer who is in the business of growing or processing of cocoa, copra, oil palm, rubber, tea or coffee. These are called “exempted employees”.


1.4.2 Voluntary superannuation contributions

Employers and employees can make contributions above the mandated minimums required by legislation into their authorised superannuation fund. These are called voluntary superannuation contributions.

Employers and employees who are not required to pay superannuation contributions under the mandated system can contribute to a Voluntary Superannuation Fund. These are discussed later in this chapter.


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