Welcome to the third edition of CEO Online

In this edition I'll bring you up-to-date with:

Investment performance

It's been good first year for your fund in 2005/06 with strong returns for all four pre-mixed options. Although audited figures are not yet finalised, the Trustee Choice Fund is estimated to have returned 14.3% per annum after tax and fees, well above its long-term target return of 7% per annum.

The other three pre-mixed options also performed well. The Aggressive investment option returned 16.1% per annum; the Balanced (50/50) investment option returned 10.2% per annum and the Conservative investment option, 7.6% per annum - all after tax and fees. This performance means all four pre-mixed options exceeded their medium- to long-term investment objectives in the first year with the highest returns achieved by options with the greatest exposure to equities.

Remember that past performance is not an indication of future performance. Returns are volatile and it is impossible to predict if they will go up or down.

Find out more about investment performance .

Australian Reward Investment Alliance (ARIA) starts work for you

On 1 July 2006, your new Trustee, Australian Reward Investment Alliance (ARIA), started work when the Public Sector Superannuation Scheme (PSS) and Commonwealth Superannuation Scheme (CSS) Boards merged. ARIA provides a simplified, sustainable and more effective governance structure to meet your needs in the future. The superannuation environment in Australia has changed substantially in recent years with financial services reform, increased regulation and Choice of Fund. The old structure, with one board for the PSS and one for the CSS, created unnecessary duplications that in the long-term we knew would make providing super arrangements for Australian government employees unsustainable. Merging the two Boards into one Trustee and creating a single investment Trust to manage the investments of all three individual schemes - PSSap, PSS and CSS - means we can continue to meet all our members' needs in the future. ARIA will provide new cost efficiencies and greater economies of scale by managing the PSSap fund through a single investment trust, which will have a positive effect on your benefit in the long-term. There is no change to the underlying investment scheme, and your entitlements and benefits will remain the same. ARIA provides a better administrative structure and over time you will notice improved services and communications to help you better manage you super confidently.

The name Australian Reward Investment Alliance came from extensive consultations with you, our members, and all our other stakeholders. We decided to choose a name that reflected your work and our role:

Australian - we work for Australian Government employees who work for the Australian community

Reward - we believe our members work hard for the Australian community as public servants and we think they deserve to be rewarded with world-class superannuation arrangements

Investment - our core activity is to manage the investment of Funds for our members

Alliance - we bring world-class partners together in the best interests of members.

You can learn more about ARIA at www.aria.gov.au

Changes proposed in 2006 Budget

The 2006 Federal Government Budget proposed some far-reaching changes to the current tax arrangements applying to benefits on taxed superannuation funds, such as the PSSap. Currently these changes are in the proposal stage, but if they become law they will take effect from 1 July 2007 and apply to members over 60. The changes include:

The Government is also looking at proposals to change the way you may draw down your superannuation pension.

Please note these are only proposals at this stage and the Government is seeking advice on the changes, which have a proposed implementation date of 1 July 2007.

For more information go to the full story

Your annual member statement is coming soon

Keep an eye out for your 2005/06 Annual Member statement, which is coming soon. Distribution is scheduled to commence in September. If we have your current postal address we will be able to post it direct to you. Otherwise it will be sent via your employer.

If you haven't provided us yet with your current address and you'd like the convenience of important information being sent to you directly then you can provide or update your details by:

I look forward to reporting to you soon

Steve Gibbs

August 2006

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