Shire to pick up tab
YARRIAMBIACK Shire is facing a $400,000 to $500,000 payout to top up the defined benefit superannuation shortfall.
Chief executive officer Ray Campling said there was not an absolute figure for Yarriambiack to pay, but council would possibly take out a loan to make the payment.
He said Yarriambiack Shire would speak with the Municipal Association of Victoria and nearby municipalities about taking out a loan.
The Local Authorities Superannuation Fund, known as Vision Super for the last 10 years, was established in 1947, with the defined benefit scheme set up in 1982.
The scheme was compulsory for all councils until it was closed to new members in 1993, however councils were required to continue funding benefits for staff who were members.
The shortfall has been defined as $453 million as of December 2011, and is attributed to lower than expected market investment returns, reduction in expected future earning rates, salaries rising in excess of actual assumptions and increased longevity of pensioners.
On June 24 2011 councils also topped up the fund, with Yarriambiack paying $402,149.79 towards the total. Mr Campling said the previous call may have been as far back as 1997.
Mr Campling said it was frustrating as the money would impact on services and projects they could otherwise be providing for Yarriambiack residents.
Yarriambiack is one of Victoria’s 79 councils who will pick up the tab, with the difference to be paid by July 2013.