Who is impacted?
If you were employed in the public service prior to 2009 and retired after December 2015 your superannuation benefit will have a portion of unpaid Employer Contributions.
Progress is being made on Unpaid Public Service Employer Contributions
Nambawan Super has received more than K360 million in payments from the State for Pre-2009 Unpaid Public Service Employer Contributions for former members who have exited the Fund. These payments mean that former Public Servants who exited the Fund from December 2015 to March 2019 have now been funded.
The State’s 2019 Budget committed K150 million to be paid to Nambawan Super in 2019. If this commitment is met, the State will clear their backlog of Unpaid Public Service Contributions.
Nambawan Super continues to work closely with the State to settle the backlog of affected members. The Board and Management Team are committed to resolving the Unpaid Public Service Employer Contribution issue in full. We understand that Public Servants who are still members of the Fund want to retire with certainty having faithfully served the State.
More than 4,000 members have already come forward to receive their final superannuation benefit. Nambawan Super has funds for many members who are yet to come forward and claim funds that are now available.
If you were employed in the public service prior to 2009 and retired after December 2015, and did not receive your full superannuation benefit, or are a family member of someone who falls into this category, please call 1599 or visit the Nambawan Super branch in your province to determine if your final benefit is now available.
History and how members ended up with unpaid employer contributions
Prior to 2002 the State (government departments and agencies) was not required by law to remit employer contributions to an Authorised Superannuation Fund. It was legal practice to calculate superannuation entitlements as public servants retired.
Legislative changes that commenced on 1 January 2003 directed that State departments and agencies to pay super contributions to an Approved Super Fund during the term of a public servant’s employment.
The Bank of Papua New Guinea allowed the State 6-years to gradually increase from paying no employer contributions, to paying the 8.4% required under the Superannuation General Provisions Act.
- 2003 – 2004 the State paid 2.1%
- 2005 – 2006 the State paid 4.2%
- 2007 – 2008 the State paid 6.3%
- From 2009 the State paid 8.4%
Since 2009 the State has paid all of its Employer Contributions to Nambawan Super and these funds are credited to individual member accounts.
When the change in legislation came into effect, NSL worked closely with the State to ensure that former public servants, with unpaid employer contributions accrued prior to the new Act taking effect, received their full benefit when they exited Nambawan Super. This includes all funds that were unpaid from prior to 2002 and the portion of superannuation that was unpaid from 2003 – 2008.
When the Unpaid Public Service employer contributions became of wide interest
The pre-2009 Unpaid Pubic Service Employer Contributions became of wider public interest in 2016. In December 2015 Nambawan Super made the hard decision to no longer pay Unpaid Public Service Employer Contributions upfront on behalf of the State when Public Servants retired.
Prior to December 2015 Nambawan Super paid out all owed super benefits to Public Service employees, including Unpaid Employer Contributions, and then invoiced the State for payment. However, during 2014 and 2015 the State failed to consistently pay its invoices.
Nambawan Super stopped paying out Unpaid Public Service Employer Contributions to protect the wider membership from an issue that is only relevant to a portion of the membership. It was, and continues to be, a hard decision to make as Nambawan Super understands the impact it has for public servants with an Unpaid Employer Contributions who have to wait to receive their full entitlements.
Court action in 2017 and 2018 has guaranteed the safety and security of all Nambawan Super members’ funded contributions – whether they are from the private, not-for-profit or public sector – by confirming that it is the State’s obligation to pay the Unpaid Employer Contributions.
Process for payment of Unpaid Employer Contributions
Unpaid Public Service Employer Contributions will be paid out to affected, exited members (or beneficiaries of late members) with accrued interest and less tax, once the funds are paid in full by the State.
When Nambawan Super receives any amounts for Unpaid Public Service Employer Contributions from the State, we pay out members in the order that they have been waiting, with those waiting the longest to be paid first.
This means, when you retire you must lodge to receive your funded superannuation payments to then be in line to receive your Unpaid Employer Contribution, once it is funded by the State.
While you wait
When members exit the fund, it is important to ensure you keep your contact information with the Fund up to date. It is also quicker to process your second super payment if you keep your nominated bank account active until funds are made available.
If you have any queries please call 1599.