Options for CSS members who work for Telstra

On Friday 25th August the Government announced its intention to sell $8 billion of Telstra shares to institutional and retail investors in October and November 2006 and place its remaining Telstra shareholding in the Future Fund.

As a result the Commonwealth's shareholding in Telstra will fall below 50%.

When the Australian Government ceases majority ownership of a business, contributory membership of its employer-financed super arrangements also ceases.

This means that Telstra employees who are members of the CSS will have to cease their CSS membership. The date on which this will occur has not yet been set, but your employer will advise you when it is.

In the meantime, it is important you take time to understand your options.

For those who will be under age 55 at the date their CSS membership ceases, options are:

• Preserve (defer) your entire benefit in the CSS. The deferred pension benefit can then be paid from preservation age, even if you remain employed by Telstra, however any lump sum benefit payable at that time must be rolled over to a complying fund.

OR

• Take a lump sum benefit of 3.5 times your accumulated basic contributions, plus any accumulated supplementary contributions, which must be rolled over to a complying fund.

OR

• Take a Delayed Updated Pension (DUP) which can be paid when you retire from the workforce after reaching age 55.

For those who will be over age 55 at the time CSS membership ceases, options are:

• Take a maximum pension – this is a standard CPI indexed pension plus additional non-indexed pension payable from the date your CSS membership ceases (any refund of excess contributions must be rolled over to a complying fund).

OR

• Take a standard CPI indexed pension plus a lump sum refund of your accumulated member contributions. The standard CPI indexed pension will be payable from the date your CSS membership ceases and the lump sum must be rolled over to a complying fund.

OR

• Postpone the receipt of all or part of your benefit. The postponed benefit can then be paid when you retire from the workforce.

OR

• For ex Provident Account members who are over age 60 at the date membership ceases – take a lump sum of 3 times accumulated basic contributions, plus any accumulated supplementary contributions, which must be rolled over to a complying fund.

We are working with Telstra to ensure you have the information you need about your CSS benefit options.

We also recommend you seek independent financial advice when considering your options.

Benefit application form for Telstra members

A benefit application form designed specifically for Telstra employees who are ceasing CSS membership as a result of the Commonwealth’s shareholding in Telstra falling below 50% is now available.

This form should be completed by all Telstra employees whose CSS membership will cease in these circumstances.

If you would like more information about your options with the CSS

To assist you, we have set up a dedicated email service

Telstra enquiry email service

Or you can call us on 1300 000 277, but please be patient because our phone lines might be busy during this time.

We are working with Telstra to provide information sessions in as many locations a possible. When finalised, a schedule will be posted on this webpage.

If you are seeking financial advice

A practical guide to getting personal financial advice