Newcastle Permanent Superannuation Plan · Newcastle Permanent Superannuation Plan ... This PDS is issued by the Trustee of the Plan, ... The Plan’s administrator is Mercer Outsourcing

Newcastle Permanent Superannuation PlanPension DivisionProduct Disclosure Statement (PDS) dated 27 July 2015

This Product Disclosure Statement (PDS) is only applicable to members of the Pension Division of the Newcastle Permanent Superannuation Plan ABN 57 170 878 804 (The Plan).This PDS is issued by the Trustee of the Plan, Mercer Superannuation (Australia) Limited (MSAL) ABN 79 004 717 533, Australian Financial Services Licence 235906, RSE Licence L0000819.The Plan’s administrator is Mercer Outsourcing (Australia) Pty Ltd ABN 83 068 908 912, Australian Financial Services Licence 411980.The Plan is distributed by Newcastle Permanent Building Society Limited (NPBS) ACN 087 651 992, Australian Financial Services Licence/Australian Credit Licence 238273.The Newcastle Permanent logo is a trademark of NPBS.

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PRODUCT DISCLOSURE STATEMENT FOR THENEWCASTLE PERMANENT SUPERANNUATIONPLAN

PENSION DIVISION27 July 2015

This Product Disclosure Statement (PDS) is only applicable to members of the Pension Division of theNewcastle Permanent Superannuation Plan ABN 57 170 878 804 (the Plan).

This PDS is issued by the Trustee of the Plan, Mercer Superannuation (Australia) Limited (MSAL) ABN 79 004 717 533,Australian Financial Services Licence #235906, RSE License #L0000819.

The Plan’s administrator is Mercer Outsourcing (Australia) Pty Ltd ABN 83 068 908 912, Australian Financial Services Licence #411980.The Plan is distributed by the Newcastle Permanent Building Society Limited ABN 96 087 651 992

(NPBS) Australian Financial Services Licence #238273.

1

ABOUT THIS PRODUCT DISCLOSURE STATEMENT (PDS)

This PDS provides an outline of the main features andbenefits of the Pension Division of the NewcastlePermanent Superannuation Plan (the Plan), including theinvestment options available to you. It should be readcarefully.The information contained in this PDS is generalinformation only and does not take into account yourindividual financial objectives, financial situation or needs.We recommend that you speak to a licensed, orappropriately authorised, financial adviser if you need helpin making an investment decision.Mercer Superannuation (Australia) Limited (MSAL) ABN 79004 717 533, Australian Financial Services Licence#235906, is· the Trustee of the Plan, ABN 57 170 878 804, and· the issuer of this PDS.MSAL is referred to as ‘Trustee’, ‘we’ or ‘us’ throughout thisPDS. MSAL is responsible for the contents of this PDS.

Distribution of the Plan is provided solely by the NewcastlePermanent Building Society Limited ABN 96 087 651 992(NPBS). NPBS also plays a role in the productdevelopment for the Plan but is not directly responsible forthe day-to-day Trusteeship or operation of the Plan. NeitherNPBS nor its employees or its agents are related to, norare they representatives of MSAL. When providing thedistribution and product development services NPBS, itsemployees and agents act in their own right and not asrepresentatives of MSAL. No representation is given,warranty made or responsibility taken by MSAL for anyfinancial services provided solely by NPBS or itsemployees or agents. Accordingly, MSAL does not acceptany liability or responsibility arising in any way (including fornegligence) for any financial services provided solely byNPBS, its employees or agents. This is in accordance withthe arrangement between MSAL and NPBS.The following service providers are named in this PDS andhave consented to being so named:

� the Plan’s administrator, Mercer Outsourcing (Australia)Pty Ltd ABN 83 068 908 912 Australian FinancialServices Licence #411980 (MOAPL),

� the Plan’s investment managers, Mercer Investments(Australia) Limited ABN 66 008 612 397 AustralianFinancial Services Licence #244385 (MIAL) andNewcastle Permanent Building Society Limited ABN 96087 651 992 Australian Financial Services Licence#238273 (NPBS), and

� the Plan’s distributor and provider of personal advice tomembers, Newcastle Permanent Building Society LimitedABN 96 087 651 992 (NPBS).

None of MOAPL, MIAL or NPBS are responsible for theissue of, or any statements in this PDS. Nor do any of themmake any recommendation or provide any opinionregarding the Plan or an investment in it.

The value of investments in the Plan’s investment optionsmay rise and fall from time to time. Neither the Trustee,MIAL, NPBS (except as detailed in the Investing yoursuper section of this PDS in relation to the Cash and TermDeposit investment options) guarantee the investmentperformance, earnings or return of capital invested in any ofthe investment options of the Plan made available tomembers through the Plan and described in this PDS.

The Trustee’s contact details are:Mercer Superannuation (Australia) LimitedABN 79 004 717 533GPO Box 4303Melbourne VIC 3001Tel: 1300 789 636Website: newcastlepermanent.superfacts.com

STAYING UP TO DATE

The information contained in this PDS is up to date at itspreparation. However, some of the information can changefrom time to time. For example, information about fees, theinvestment approach of a particular investment option orthe general product features of the Plan. If there is amaterial change, inaccurate statement or material omissionfrom this PDS we will inform you as required by the law.

For other changes and information (including theperformance of any investment option), you can obtain upto date information by either calling the Helpline on 1300789 636 from 8am to 7pm AEST Monday to Friday or byvisiting the Plan website atnewcastlepermanent.superfacts.com.

Generally the Plan website is available 24/7 but we reservethe right to carry out scheduled updates and systemmaintenance so that at times, the website may not beavailable and you should plan ahead accordingly.

We can send you a copy of the updated information onrequest free of charge.

IF YOU HAVE A PROBLEMThe Plan has a process in place for dealing with enquiriesand complaints. Additional help is available to membersthrough the Superannuation Complaints Tribunal. For moreinformation see ‘Enquiries and complaints procedures’ inthe Getting to know your pension section.

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HERE’S WHAT YOU NEED TO DO:

In order to invest in the Pension Division of thePlan you will need to send to the Trustee:· a completed and signed Application form

(which accompanies this PDS)· a completed ATO Tax file number

declaration form (if applicable), and· a completed Rollover form if you are

transferring your super from another superfund

Once your completed Application form, yourminimum investment and the requireddocumentation (as described above) arereceived and accepted by the Trustee, you willbecome a member of the Pension Division ofthe Plan.

When applying to become a member of thePension Division of the Plan you will need tomake some decisions about your super.

Make sure you read all the information in thisPDS, then follow the steps to complete theApplication form which accompanies this PDS.

Once you’ve completed, signed and datedthe Application form (and any otherrelevant forms), return the forms to us at:The Plan AdministratorNewcastle Permanent Superannuation PlanGPO BOX 4303MELBOURNE VIC 3000If you’re unsure of your decisions, werecommend that you see a licensed, orappropriately authorised, financial adviser.

Getting to know your pension Page 5

See how your pension worksRead the Getting to know your pension section to see how youraccount works. Then fill out the appropriate details in Steps 1, 2, 3,5, 6, 7 and 10 (remember to sign Step 10 if applicable) and signStep 11 of the Application form. Also, don’t forget to complete, signand return the appropriate form(s) as detailed in Step 3 of theApplication form.

How we invest you super Page 25

Choose how to invest your superRead the Investing your super section which explains yourinvestment option choices. Read the Getting to know yourpension section for more details and the information below aboutwhat happens if you don’t choose an investment option. Then fillout Step 4 of the Application form which accompanies this PDS tomake your investment choices.

Beneficiaries Page 45

Who’ll get your super if you die?If you die while a member of the Plan, who would you like yoursuper to go to? You can make a Benefit Direction Request on firstjoining the Pension Division of the Plan and before your pensioncommences. If you don’t want to do this, you can make a bindingdeath benefit nomination* or a non-binding nomination (at anytime). Read the Beneficiaries section which explains your optionsthen fill out Step 8 of the Application form.* If you choose to make a binding death benefit nomination, you willneed to complete and return a Binding Death Benefit Nominationform. You can complete and return that form with your Applicationform or at any later time separately.

Tax and social security Page 49

See how tax affects your pensionRead the Tax and social security section for more informationabout how tax affects your pension.

IF YOU DON’T CHOOSE AN INVESTMENT OPTIONIf you don’t choose an investment option when you complete the Application form, we’ll have to place your super in the‘default’ option which may not be the most suitable choice for your particular circumstances. The default option is theConservative (Enhanced Indexed) investment option.

You can change this at anytime, by completing and returning a Changing your investment options in the NewcastlePermanent Superannuation Plan - Pension Division form. This form is available from the Plan’s website at:newcastlepermanent.superfacts.com or by calling the Plan’s Superannuation Helpline on 1300 789 636 to obtain a copy.The Plan’s Superannuation Helpline can also assist if you need more information about changing your investment optionsafter joining the Plan.

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STAYING IN TOUCH

As a member of the Plan you’ll receive:· a welcome letter confirming your choices in the Plan· confirmation of any investments made· an annual report, via the website, to bring you up to

speed on investment performance and what’shappened to the Plan over the year. You can request ahard copy of the annual report to be sent to you free ofcharge by calling the Helpline on 1300 789 636

· quarterly member statements showing changes to youraccount

· regular news articles and investment updates to keepyou informed

· notification of all material changes or the occurrence ofsignificant events

· access to a wealth of information and interactiveplanning tools on the Plan website.

We may provide certain member communications(including member statements and significant eventnotices) that are permitted by law to you electronically,either by:· sending them to you by email (which may include a link

to a website from where they can be downloaded)where we have an email address for you including anyemail address provided by you or any other person onyour behalf; and/or

· making them available to you on a website from wherethey can be downloaded.

IF YOU NEED HELP WITH YOUR DECISIONS· why not get advice from a licensed, or appropriately

authorised, financial adviser· visit our website

newcastlepermanent.superfacts.com for helpful toolsand further information. You can:- monitor payments from your account- get up to date information on investment options- learn from our wealth education experts.

IF YOU NEED HELP UNDERSTANDING YOURPENSION

Call the Helpline

1300 789 636Visit our website

newcastlepermanent.superfacts.comWrite to us

The Plan AdministratorNewcastle Permanent Superannuation PlanGPO Box 4303MELBOURNE VIC 3001

LET US KNOW IF YOUR DETAILS CHANGEIt’s very important that you always let us know when youraddress details change. We can only send you informationabout the Plan and your super if we have your currentpostal or email address.If you have changed, or at any time in the future changeyour postal or email address, please update your contactinformation immediately so we can keep you informedabout your pension.You can update your details via our websitenewcastlepermanent.superfacts.com (after you sign into your member account) or by calling the Helpline on 1300789 636.

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Getting to know your pension 5

GETTING TO KNOW YOUR PENSION

IN THIS SECTION YOU’LL FIND OUT:· About the Plan page 6

· Your Pension Options - at a glance page 6

· Your Pension Options - in detail page 7

· Your account page 7

· Adding to your pension page 8

· Your pension payments page 8

· Minimum and maximum pension payments page 8

· Pension or Lump sum payment? page 9

· Withdrawals from your account page 9

· What happens if you die? page 10

· The benefits of being a member of the Plan page 10

· Risks associated with being a member of the Plan page 11

· Fees and other costs page 12

· Enquiries and complaints procedures page 20

· Other things you should know page 20

· Cooling off page 23

6 Getting to know your pension

ABOUT THE PLANIT’S RUN BY A TRUSTEEThe Plan is a Registrable Superannuation Entity (RSE) which is run by the Trustee, Mercer Superannuation (Australia)Limited (MSAL), the holder of a RSE licence.

The Trustee issues this PDS and interests to members in the Plan, appoints the investment managers for each of theinvestment options referred to in this PDS, and also appoints other service providers.

The Trustee is not related to and is completely separate from NPBS. The Plan’s assets are kept separate from NPBS’sassets. This means the Plan’s assets can’t be used to pay any debts of NPBS.

YOUR PENSION OPTIONS - AT A GLANCEAllocated Pension Transition to Retirement

Allocated Pension

Starting a pensionYou can start an Allocated Pension if youhave a super payout that is unrestrictednon-preserved.

You can use your super to start a Transitionto Retirement Allocated Pension even if youare still working provided you have reachedyour preservation age.

Minimum Investment An initial investment of at least $10,000is required.

An initial investment of at least $10,000 isrequired.

Pension Term Your pension does not have a fixed term, it will last as long as you have money in youraccount.*

Pension PaymentsYou can choose how much you receiveeach year, subject to the minimumamount set by the Government.

You can choose how much you receiveeach year, subject to the minimum andmaximum amounts set by the Government.

Frequency of payment

You can choose to receive payments monthly, quarterly, half-yearly or annually. Youmust receive at least one pension payment a year.The pension payment will be made on the 5th, 10th, 15th, 20th or 25th day of themonth.

Lump sum withdrawals

You can make lump sum withdrawals atany time subject to receiving pensionpayments of at least the minimumamount in a financial year.The minimum lump sum you canwithdraw is $5,000 (or your accountbalance if less than this).

Lump sum withdrawals can only be made inlimited circumstances (see “Withdrawals fromyour account” later in this section for details).

Tax on pension payments You may receive concessional tax treatment – see the Tax & social security section ofthis PDS for details.

* Your pension may cease earlier due to legislative requirements.


YOUR PENSION OPTIONS – IN DETAILThe Plan provides you with two pension options:· an Allocated Pension, or· a Transition to Retirement Allocated Pension.Depending on your circumstances you may be able tochoose to invest in both.The minimum amount that must be initially invested to openan account in the Plan is $10,000.

ALLOCATED PENSION

You can join the Pension Division of the Plan andcommence an Allocated Pension provided you have asuperannuation fund payment that consists of anunrestricted non-preserved amount. Note if you aresuffering a terminal medical condition, you may not beeligible to join the Pension Division of the Plan. Note youmust also be either an Australian or New Zealand citizen ora permanent resident to commence an Allocated Pension.Temporary residents are generally not permitted tocommence a pension under government legislation unlessthe Trustee is satisfied that you are permanentlyincapacitated.

You must generally:· have reached your ‘preservation age’, retired from work

and do not intend to work 10 hours or more per weekever again

· be aged 60 or more and have resigned or retired fromyour employer after reaching age 60

· be aged 65 or more· have satisfied the Trustee that you are permanently

incapacitated*· otherwise have an unrestricted non-preserved benefit

* as specified under superannuation law and permitted under the TrustDeed.

If you are a member of the Superannuation Division of thePlan and you have met one of the requirements set outabove and you have an unrestricted non preserved accountbalance of at least $10,000, then you may transfer thispayout to the Pension Division and start a pension.

Your preservation age depends on your date of birth:

Date of birth Preservation age

Before 1 July 1960 55

Between 1 July 1960 and 30 June 1961 56




After 30 June 1964 60

TRANSITION TO RETIREMENT ALLOCATEDPENSIONYou can join the Pension Division of the Plan andcommence a Transition to Retirement Allocated Pensionprovided you have reached your preservation age(described earlier). Note you must also be either anAustralian or New Zealand citizen or a permanent residentto commence a Transition to Retirement Allocated Pension.Temporary residents are generally not permitted tocommence a Transition to Retirement Allocated Pensionunless the Trustee is satisfied that you are permanentlyincapacitated.

All you have to do is transfer all, or part of your superaccount from your super fund or the SuperannuationDivision of the Plan (your non-pension super account) tothe Transition to Retirement Allocated Pension. You cantransfer any preserved or restricted non-preserved amountsas well as unrestricted non-preserved amounts to theTransition to Retirement Allocated Pension – check withyour super fund about any conditions that apply to thetransfer of these amounts. You and your employer cancontinue to pay contributions to your non-pension superaccount.

Your payout from your non-pension super account will beadjusted to take account of the amount you elect to transferto your Transition to Retirement Allocated Pension account.

You don’t have to have ceased employment and have leftyour super plan to commence a Transition to RetirementAllocated Pension. A Transition to Retirement AllocatedPension gives you the option of accessing your super andcommencing a pension while you continue working full-timeor part-time and continue to accrue benefits in your non-pension super account.

However, there are only limited circumstances in which youcan make lump sum withdrawals from your pension. (See“Withdrawals from your account” for details.)

YOUR ACCOUNTOn joining the Pension Division of the Plan an account isopened for you. An investment is made to an account inyour name in the Plan. The money is invested according toyour choice from one or a combination of the investmentoptions (or is invested in the default option, Conservative(Enhanced Indexed), if you have not made a valid choice)and your account is allocated with the applicableinvestment earnings according to the investmentperformance of the investment option that applies (whichmay be positive or negative) or, in respect of Cash andTerm Deposit investment options, the Cash crediting rate,the Term Deposit crediting rate or the Term Deposit breakcrediting rate (as applicable). Your pension payments, anylump sum withdrawals, fees, expenses and taxes are alsodeducted from your account.

If you have multiple rollovers from different sources it maybe in your best interest to first combine them in theSuperannuation Division of the Plan or anothersuperannuation fund before transferring to the Plan.

A licensed, or appropriately authorised, financial advisercan advise you on this.


YOUR PENSION OPTIONS – IN DETAIL (CONTINUED)Your account balance comprises:

Your initial investmentAn investment is made by you and allocated to anaccount for you in the Plan

LessYour pension payments, any lump sum withdrawals,fees, expenses and any taxes

PlusInvestment returns*

* Investment returns can be positive or negative. In thecase of the Cash and the Term Deposit investmentoption, the crediting rate or break crediting rate (asapplicable) will not be negative, noting that thisguarantee is directly linked to the security and financialstability of NPBS . See the Investing your supersection for more details.

For the Cash and Term Deposit investment options,the Cash crediting rate, the Term Deposit crediting rateand the Term Deposit break crediting rate (asapplicable) are declared monthly by the Trustee, basedon information provided by NPBS. For all otherinvestment options, the unit prices are calculated anddeclared on a daily basis by the Trustee (net ofinvestment management fees and any performancefees deducted by the Trustee).

EqualsYour account balance.

The member statement regularly issued by the Trusteeshows how your account balance has changedthroughout the previous period.

ADDING TO YOUR PENSIONOnce your pension commences you cannot make anyadditional contributions or superannuation fund paymentsto your Allocated Pension or Transition to RetirementAllocated Pension account. If you wish to invest anadditional superannuation fund payment, a new accountwill be established in your name for the amount transferred.

There is no restriction on the timing or frequency with whichsubsequent investments can be made after your initialinvestment.

However, you must start each new allocated pension ortransition to retirement pension with a minimum amount of$10,000. Each investment will give rise to a new andseparate pension. Subsequent investments are notaggregated in the one pension account. Further, for eachsubsequent investment you will need to complete anApplication form from the PDS for the Pension Division ofthe Plan current at that time.

YOUR PENSION PAYMENTSPension payments may start as soon as your investmenthas been received and processed by the PlanAdministrator and your membership in the Plan has beenconfirmed in writing. Generally payments from your accountmust be made in accordance with the following rules:For Allocated Pensions:· at least one pension payment must be made each year· pension payments in a financial year must at least equal

the minimum amount set down by the Government· if a pension commences after 31 May in a financial year

no minimum payment is required in that financial year(although you may request a pension payment for thisperiod).

For Transition to Retirement Allocated Pensions:· at least one pension payment must be made each year· pension payments in a financial year must at least equal

the minimum amount set down by the Government· pension payments in a financial year must not be

greater than the maximum amount set down by theGovernment

· if a pension commences after 31 May in a financial yearno minimum payment is required in that financial year(although you may request a pension payment for thisperiod)

· any pension payments must first be taken from anyunrestricted non-preserved amount you transferred toyour Transition to Retirement Allocated Pensionaccount until this amount is exhausted, then from anyrestricted non-preserved amount and finally from anypreserved amount.

The unrestricted non-preserved amount (if any) is thepart of your super that is payable in cash at any time.Preserved and restricted non-preserved amounts mustbe kept in a super fund or other approved arrangement andare only accessible in cash when you satisfy a “condition ofrelease”. See earlier in this PDS for the “conditions ofrelease”.

MINIMUM AND MAXIMUM PENSIONPAYMENTSThe Trustee will generally pay you a pension from youraccount until the earlier of your death and when youraccount balance is exhausted (in some cases it may benecessary to terminate your pension earlier than this whererequired by law). The amount of the pension will be at alevel agreed between the Trustee and yourself from time totime in accordance with the following:· Allocated Pension - your annual pension payments

must at least equal the minimum level set by theGovernment (please refer to the table below). Nomaximum applies to your allocated pension.

· Transition to Retirement Allocated Pension – yourannual pension payments must at least equal theminimum level (see the table below) and must be nomore than the maximum level set by the Government.The maximum pension amount you may receive in anyfinancial year is calculated as 10% of your accountbalance at the previous 1 July, or at the commencementof your pension if this is after the last 1 July.


YOUR PENSION OPTIONS – IN DETAIL (CONTINUED)Your annual pension payment will be calculated based onyour age and your account balance on commencement ofyour pension and at 1 July each year. The PlanAdministrator will advise you annually of the minimumpension payment required (and the maximum pensionpayment allowed if you have chosen a transition toretirement allocated pension) on your benefit statement oronline after you log into your account atnewcastlepermanent.superfacts.com.If you don’t nominate your pension payment level for thefinancial year, your pension payments will be equal to thedollar value of your pension payments in the previous year(as nominated by you), unless the Trustee has to adjustyour pension payments so that it meets the minimum (ormaximum if applicable) payment required.

You may change the amount of your pension payments (forthe remainder of the financial year you are receivingpayments or as a one-off) provided the amount you specifyis at least the minimum level required (and, if applicable, upto the maximum amount allowed). If you want to do this,you will need to complete and return a Request to vary yourPension Payment in the Newcastle PermanentSuperannuation Plan – Pension Division form. You canobtain a copy of this form by visiting the Plan’s website at:newcastlepermanent.superfacts.com or by calling thePlan’s Superannuation Helpline on 1300 789 626.The Trustee has the right to alter the amount of yourpayments where necessary to comply with superannuationlaw.The minimum pension amount you may receive in anyfinancial year is calculated as your account balance at 1July multiplied by the minimum percentage set out in thetable below. If the pension commences part way through ayear, the minimum payment will be based on your accountbalance at commencement and will be pro-ratedaccordingly. The minimum annual pension amount mustbe rounded to the nearest $10.

MINIMUM PENSION FACTOR TABLEThe table below shows the minimum percentage thatapplies for the financial year commencing 1 July 2014. Thismeans that if your pension commences in that year, yourminimum pension payment will be calculated based on theminimum percentage.

Age *Percent of

account balance ^

Under 65 4

65 – 74 5

75 – 79 6

80 – 84 7

85 – 89 9

90 – 94 11

95+ 14

* Age is your age as at the start of the financial year or when youstart a pension in the case of the first year

^ In the year in which your pension commences, the minimumpayment is based on the number of days remaining in the financialyear. No minimum payment is required if the pension commencesafter 31 May in that financial year.

PENSION OR LUMP SUMPAYMENT?Under the legislation governing pensions you can elect,before a payment is made, that a particular payment is tobe treated as a lump sum payment rather than a pensionpayment. If you choose a lump sum, the payment will thenbe taxed as a lump sum and not a pension payment.Taking a payment as a pension or a lump sum could havetaxation implications and may also have implications forany social security payments you may be entitled to. TheTrustee recommends that you speak to a licensed, orappropriately authorised, financial adviser to find out howthis decision might impact on you.The Trustee will treat all payments as pension paymentsunless you elect otherwise (when allowed by law) or whenthe law requires that a payment be treated as a lump sum.

WHEN YOUR PENSION IS PAIDYou may elect to receive payments monthly, quarterly, half-yearly or annually. The pension payment will be made onthe 5th, 10th, 15th, 20th or 25th day of the month.

If the payment day falls on a weekend or a public holiday,your pension payment will be made on the business dayprior. Before making a pension payment, we require 10business days to establish your account.

If you do not provide your pension amount frequency uponjoining the Plan, the default payment will be one annualpayment equal to at least the minimum amount of pensionthat must be taken each financial year and will be made on15 June.

METHOD OF PAYMENTYour pension payments will be made by a direct credit toyour bank, building society or credit union account.

CHANGING YOUR PENSION PAYMENTOPTIONSYou can change your pension payment details at anytime(subject to Government rules). If you want to do this, youwill need to complete and return a Request to vary yourPension Payment in the Newcastle PermanentSuperannuation Plan – Pension Division form. You canobtain a copy of this form by visiting the Plan’s website at:newcastlepermanent.superfacts.com or by calling thePlan’s Superannuation Helpline on 1300 789 626.You can also make a commutation request online (after yousign in to your member account atnewcastlepermanent.superfacts.com using yourpersonal log-in details). There are no withdrawal fees.

WITHDRAWALS FROM YOURACCOUNTALLOCATED PENSIONYou can withdraw all or part of your account balance as acash payment or transfer it to another complying super fundat any time.You can receive your lump sum payment as a cheque orelectronic funds transfer payable to you, transferred to yourbank or financial institution or rolled over to a complyingsuperannuation fund, approved deposit fund, a deferredannuity, an immediate annuity (subject to eligibilityconditions) or Retirement Savings Account (RSA).


The minimum amount you can withdraw is $5,000, unlessyou withdraw your entire account balance. A withdrawal ofless than $5,000 is allowed to make payments as follows:· to pay a superannuation surcharge debt· to give effect to a family law payment split· to pay an excess contributions tax assessment· to pay an assessment in relation to the additional 15%

tax applying to concessional contributions of individualswith relevant incomes over $300,000.

TRANSITION TO RETIREMENT ALLOCATEDPENSION

Lump sum withdrawals are generally only allowed in thefollowing circumstances:· to cash any unrestricted non-preserved component of

your account. The minimum amount you can cash ofyour unrestricted non-preserved component is $5,000

· to pay a superannuation surcharge debt· to give effect to a family law payment split· to pay an excess contributions tax assessment· to pay an assessment in relation to the additional 15%

tax applying to concessional contributions of individualswith relevant incomes over $300,000.

You can also transfer the balance of your pension accountback into your non-pension super account or roll it over toanother pension product that has the same restrictions onwhen you can make lump sum withdrawals.When you satisfy a condition of release (as describedearlier in this PDS) or if you are suffering a terminal medicalcondition (and provide the required evidence), then theserestrictions no longer apply and your Transition toRetirement Allocated Pension will be converted to anAllocated Pension. You can then make lump sumwithdrawals at any time as described above under“Allocated Pension”. Your Transition to RetirementAllocated Pension will be converted to an AllocatedPension at age 65.

OTHER INFORMATIONIf you make a withdrawal as set out above:· the proportion of your ongoing pension payments that

are taxable, and tax-free if any, will not change

· your Annual Tax offset amount (see the Tax and socialsecurity section for further details) may be affected

· your minimum (and, if applicable, maximum) pensionlimits will change in future financial years, but not in thecurrent year

· the amount you have withdrawn will be split betweentaxable, and tax-free if any, in the same proportion asyour account.

· the amount you have withdrawn may be subject to tax ifit is withdrawn before age 60

· we will deduct any tax required at the time of paymentbut you may be required to pay additional tax or beentitled to a refund when your next annual tax return isprocessed by the Australian Tax Office.

To comply with the Government’s minimum annual pensionpayment requirements and/or taxation laws, we may beobliged to treat part of your withdrawals and/or transfersfrom your account as your minimum pension payment. Theexact amount will depend on your circumstances and theamounts already paid to you during that financial year.

You should consult a licensed, or appropriately authorised,financial adviser before you decide to withdraw any part ofyour pension.Generally you will cease to be a member when all benefitsto which you are entitled have been paid, transferred out ofthe Plan or otherwise applied in respect of you inaccordance with the Trust Deed. For example, yourmembership will cease when your account balance isexhausted. See the Getting to know your Pensionsection for further details.

As well as being able to adjust your regular pensionpayments from time to time (explained earlier), if eligible,you can withdraw money from your account by simplycompleting and returning a Request for Partial/FullCommutation (Withdrawal) form. You can obtain a form bycalling the Helpline on 1300 789 636. Alternatively, you canmake a commutation request online (after you sign in toyour member account atnewcastlepermanent.superfacts.com using yourpersonal log-in details). There are no withdrawal fees.

Commutation is a complex issue. You should consult alicensed, or appropriately authorised, financial adviserbefore you decide to withdraw any part of your pension.

WHAT HAPPENS IF YOU DIE?You can nominate how your account balance is paid onyour death. If you wish, the remaining account balance willbe paid as either an income stream or a lump sumpayment. For more information see the Nominating yourbeneficiaries section later in this PDS.

THE BENEFITS OF BEING AMEMBER OF THE PLANREGULAR INCOME STREAMThe Pension Division provides you with the option tochoose from two different income streams - either anAllocated Pension or a Transition to Retirement AllocatedPension.

Both types of pensions give you the option to choose:· how much income you want to receive each year

(subject to the minimum and maximum (if applicable)limits set down by the Government),

· how often you want to receive your pension,· your preferred payment date from a range of specific

dates,· to vary your pension amount at anytime (subject to the

minimum and maximum (if applicable) limits set downby the Government), and

· to make lump sum withdrawals at anytime (subject topreservation requirements and maintaining a minimumaccount balance of $5,000).


FLEXIBILITY AND CHOICEWhatever your investment timeframe, the Plan can giveyou life-long flexibility over your investments.

You can choose from one or a combination of nineprofessionally managed investment options availablethrough the Plan. Each option has a different investmentprofile, allowing you to choose the type of investments thatbest suit your investment needs, investment timeframesand personal investment preferences. You are able tochange your investment choice if your circumstanceschange at any time. See the Investing your super sectionof this PDS for more information.

TAX CONCESSIONS

The Federal Government actively encourages Australiansto save for their retirement, and one of the ways it does thisis by granting tax concessions to money invested inregulated superannuation funds such as the Plan. Toobtain the maximum taxation savings, we recommend youspeak to a licensed, or appropriately authorised, financialadviser. More information on taxation can be found in theTax and social security section of this PDS.

DIVERSIFICATION

By spreading your investments across different assetclasses, countries and investment managers you canbalance the investment risks and returns according to whatyou are comfortable with. This is called diversification.

The Plan offeres nine investment options, and the ability tochoose one or more of these, to help you diversify yourinvestments

RISKS ASSOCIATED WITHBEING A MEMBER OF THEPLANINVESTMENT RISKS

As with any investment there is always a degree of risk tobeing a member of the Plan. You need to be aware that thevalue of your super in the Plan may rise or fall. There is therisk that if you leave the Plan, you may get back less thanthe amount of the initial investment paid in by or in respectof you, because of taxes, expenses, low or negativeinvestment earnings or failure of an underlying investmentmanager. See the Investing your super section of thisPDS for further details about the investment risks that mayimpact on your super.

OTHER RISKS

There is also the possibility that the Trustee may amendthe Plan’s Trust Deed or the Plan could be wound up atsome point in the future. Any of these events may affectthe value of your account balance or super benefit. We willkeep you informed if any of these things were to happen.

A change in the laws that govern super may also impact onyour ability to access your money in the future or affect thetax effectiveness of your super savings. We will keep youinformed about any material changes of law which mayaffect your super. You should discuss any changes with alicensed, or appropriately authorised, financial adviser.

As a member of the Plan you will incur certain fees andcharges depending on the investment options you select.There is a risk that these fees and charges may increasefrom time to time which may affect your account balance.You’ll be provided with 30 days written notice of any suchincreases or of the introduction of any new fees or charges.

The pension you can draw from your account balance in ayear is subject to a minimum (and if applicable, amaximum) level as described above. This product may notprovide a pension for the rest of your life. The pension willcease on the earlier of your death or when your accountbalance is exhausted.


FEES AND OTHER COSTS

This section sets out the fees and costs applying to a member of the Plan.

DID YOU KNOW?Small differences in both investment performance and fees and costs can have a substantial impact on your long termreturns.

For example, total annual fees and costs of 2% of your account balance rather than 1% could reduce your final returnby up to 20% over a 30 year period (for example, reduce it from $100,000 to $80,000).

You should consider whether features such as superior investment performance or the provision of better memberservices justify higher fees and costs.

Your employer may be able to negotiate to pay lower administration fees*. Ask the fund or your financial adviser.

TO FIND OUT MOREIf you would like to find out more, or see the impact of the fees based on your own circumstances, the AustralianSecurities and Investments Commission (ASIC) website (www.moneysmart.gov.au) has a superannuation calculatorto help you check out different fee options.

* Please note, this sentence is a prescribed disclaimer and does not apply to the Plan.

The table below shows fees and other costs that you may be charged in the Plan. These fees and other costs may bededucted from your account balance, from the returns on your investment or from the assets of the Plan as a whole.Other fees, such as activity fees, advice fees for personal advice, may also be charged, but these will depend on the natureof the activity chosen by you.See ‘GST’ later in this section of the PDS for an explanation of the impact of GST on the fees and charges described in thisPDS. Taxes are set out in the Tax and social security section of this PDS.You should read all the information about fees and other costs because it is important to understand their impact on yourinvestment in the Plan.The fees and costs for each investment option offered by the Plan are set out in the ‘Fees and other costs table’ below andthe ‘Breakdown of fees and other costs table’ included in the ‘Additional Explanation of Fees and Costs’ section of thisPDS.See ‘Defined fees’ in the “Additional Explanation of Fees and Costs” section of this PDS for definitions of the fees referredto in the table below.

FEES AND OTHER COSTS TABLEType of Fee or Cost(See Note 1)

Amount How and when paid

Investment fee

The amount you pay forspecific investment optionsis shown in the ‘Breakdownof fees and other costs table’included in the “AdditionalExplanation of Fees andCosts” section of this PDS.

The following investment fees are charged:· an estimated investment management fee (which

depends on the investment option you choose)from 0.00% pa to 1.04% pa of your accountbalance

For the Moderate Growth (Enhanced Indexed)investment optionAn estimated investment management fee range of0.29% pa to 0.35% pa of your account balance.

The investment management feewhere applicable is calculatedand deducted daily (from therelevant investment option) whenunit prices are determined, andis reflected in the value of youraccount balance.


Fees and other costs table (Continued)

Administration fee

The amount you pay forspecific investment options isshown in the ‘Breakdown offees and other costs table’included in the ‘AdditionalExplanation of Fees andCosts’ section of this PDS.

An administration fee of 0.45% pa of your accountbalance is charged.

For the Moderate Growth (Enhanced Indexed)investment optionAn administration fee of 0.45% pa of your accountbalance is charged.

The administration fee iscalculated based on the averageof your account balance at thebeginning of the quarter and theend of the quarter (or date ofwithdrawal if applicable) and isdeducted quarterly (on the lastday of the quarter) or upon fullwithdrawal from the Plan (at thetime of withdrawal) from youraccount.

Buy-sell spread

For details of the buy-sellspreads applicable to aparticular investment option,please refer to theinformation under the‘Transactional andOperational Costs’ headingin the ‘Additional Explanationof Fees and Costs’ section ofthis PDS.

An estimated buy-sell spread is charged (whichdepends on the investment options you areswitching) from 0.00% to 0.50%.

For the Moderate Growth (Enhanced Indexed)investment optionAn estimated buy-sell spread of 0.25% of theamount switched is charged.

Buy-sell spreads are applied atthe time the contribution orrollover is received by the Plan orwhen a switch is made within thePlan and not at the time of makinga withdrawal.

Switching fee

Nil (not including the Term Deposit investmentoption – see below).

For the Term Deposit investment option only:A switch fee of $30 is generally charged for eachamount moved into and out of this option – see“Switching fee” later in this section for completedetails. Further, any switch out of this option priorto maturity will result in a reduced Term Depositcrediting rate. See the Investing your supersection of this PDS for more information.

Not applicable

For the Term Deposit investmentoption only, the switching fee isdeducted proportionately fromyour non Term Deposit investmentoptions that you have chosen foryour future cashflows at the timeof the switch.

Exit fee

Nil. Not applicable.

Advice fees

Relating to all membersinvesting in a particularinvestment option.

Nil. Not applicable.

Other fees and costs2

Nil. Nil.

Indirect cost ratio

The amount you pay forspecific investment options isshown in the ‘Breakdown offees and other costs table’included in the ‘AdditionalExplanation of Fees andCosts’ section of this PDS.

An indirect cost ratio (which depends on theinvestment option you choose) from 0 – 0.20%per annum of your account balance.For the Moderate Growth (EnhancedIndexed) investment option

The indirect cost ratio is 0.0% - 0.03% pa of youraccount balance.

Generally calculated and deducteddaily (from the underlyinginvestment vehicles or the relevantinvestment option) when unitprices are determined and aretherefore reflected in the value ofyour account balance.

1 For more information about how GST impacts fees refer to the ‘GST’ in the ‘Additional explanation of fees and costs’ later in this section of this PDS.

2. Other fees and costs that apply are NPBS adviser fees (which are negotiable). See ‘NPBS adviser fees’ later in this section of the PDS for moreinformation.


EXAMPLE OF ANNUAL FEES AND COSTS FOR THE MODERATEGROWTH (ENHANCED INDEXED) INVESTMENT OPTIONThis table gives an example of how the fees and costs in the Moderate Growth (Enhanced Indexed) investment option inthe Plan can affect your superannuation investment over a 1 year period. You should use this table to compare thissuperannuation product with other superannuation products.

Example – Moderate Growth (EnhancedIndexed) Balance of $50,000

Investment fees 0.35% For every $50,000 you have in the Moderate Growth (Enhanced Indexed)investment option you will be charged $175 each year.

PLUSAdministration fees 0.45% And, you will be charged $225 each year

PLUSIndirect costsfor Moderate Growth(Enhanced Indexed)

0.03% And, indirect costs of $15 will be deducted from your investment.

EQUALSCost of Moderate Growth (EnhancedIndexed)

If your balance was $50,000, then for that year you will be charged fees of$415* for the Moderate Growth (Enhanced Indexed) investment option.

* Additional fees may apply.A buy/sell fee applies to rollovers and when switching to the Moderate Growth (Enhanced Indexed) investment option. See “Transactional and operationalcosts” later in this section of this PDS for more information.NPBS adviser fees may apply – see ‘NPBS adviser fees’ later in this section of this PDS for more information.


ADDITIONAL EXPLANATION OF FEES AND COSTSBreakdown of fees and other costs tableThe table below provides a breakdown of the administration fee, the investment management fee range, the performance feerange and the indirect cost ratio range for each investment option.

The administration fee is charged to cover the costs of general administration and management of the Plan. For all investmentoptions other than the Term Deposit investment option, the administration fee is calculated quarterly and then deductedproportionately from these investment options. For the Term Deposit investment option, the administration fee is calculatedquarterly and then deducted proportionately from the other investment options in which your account is invested. If you leavethe Plan, a pro-rata amount is calculated and deducted for the partial quarter.

Investment management fees are the fees payable to cover the costs of investing and managing members’ superannuationmoney. This fee effectively covers the costs charged by the underlying investment managers for each investment option. Theindirect cost ratio is described in more detail below.

For all investment options except the Cash and Term Deposit investment options, investment management fees are passed onto members by way of an adjustment to the unit price for the applicable investment option.The assets in the Cash and Term Deposit investment options are invested in interest bearing deposit accounts with NPBS.There are no fees on these accounts.

Investmentoption

Administrationfee

(% pa)

Estimatedinvestment management

fee range (% pa)

Estimated Indirect costratio range

(% pa)

Fixed Interest Options

Cash 0.45 0.00 0.00

Term Deposit 0.45 0.00 0.00

Diversified Options

Conservative (EnhancedIndexed) 0.45 0.25 - 0.31 0.00 – 0.03

Moderate Conservative(Enhanced Indexed) 0.45 0.27 – 0.33 0.00 – 0.03

Moderate Growth (EnhancedIndexed) 0.45 0.29 – 0.35 0.00 – 0.03

Diversified Shares(Indexed) 0.45 0.31 – 0.37 0.00 – 0.03

Conservative (Active) 0.45 0.68 – 0.88 0.00 – 0.10

Moderate Growth (Active) 0.45 0.77 – 0.99 0.00 – 0.10

Assertive (Active) 0.45 0.81 – 1.04 0.00 – 0.20


ADDITIONAL EXPLANATION OF FEES AND COSTS (CONTINUED)INDIRECT COST RATIOThe assets of the Plan are invested in a number ofways including through underlying investmentvehicles.Indirect costs (including but not limited toperformance fees charged by external investmenttrusts or managers) incurred by the underlyinginvestment vehicles that the assets of the Plan areinvested through have the effect of reducing thevalue of the affected investment options and willtherefore reduce the investment returns of therelevant investment options. The indirect costsincurred by the underlying investment vehicles will,to the extent that they are known to, or able to bereasonably estimated by, the Trustee be includedin the indirect cost ratio set out in the 'Fees andother costs' table (see 'Defined Fees' later in thissection for a definition of ‘Indirect costs’ and'Indirect cost ratio').The indirect cost ratio varies from year to yearreflecting the indirect costs incurred by underlyinginvestment vehicles.As the actual indirect cost ratio is not known untilafter the end of the financial year, it is not possibleto provide a precise figure for the indirect cost ratioapplicable to the investment options. However, setout in the 'Breakdown of fees and other costs' tableis the estimated range of the indirect cost ratio thatis expected to apply to the investment options.The actual indirect cost ratio may exceed theestimated ranges set out in the 'Breakdown ofcosts' table where there are unexpected costsincurred by the underlying investment vehicles in aparticular year.

The actual indirect cost ratio of a particularinvestment option may be lower than or exceed theestimated range set out in the table aboveespecially where the amount of the costs incurredby the underlying investment vehicle in a particularyear are significantly different to what wasexpected.

You will be advised of the actual indirect cost ratiothat applied for each investment option in the plan’sannual report.Performance FeesThe trustee does not directly charge nor incur anyperformance fees and accordingly there are noperformance fees included in the investment feescharged to you by the trustee.Where an external investment trust or manager thatis used to invest the assets of an investmentoption, charges a performance fee, these fees arereflected in the unit price of the underlyinginvestment vehicle and accordingly form part of theindirect cost ratio of the relevant investment option(refer to ‘Indirect cost ratio’ above).

External investment trusts or managers that chargea performance fee will generally only apply thosefees when performance is greater than an agreedtarget. Accordingly, performance fees will generallyonly arise when higher returns, relative to aspecified target for a particular manager, areachieved.

TRANSACTION AND OPERATIONALCOSTSSwitching feeNo switching fee applies (not including the TermDeposit investment option – see below).

For the Term Deposit investment option only, aswitching fee of $30 will be charged when:

· any amount is moved into this option,· any amount is moved out of this option prior to

maturity, or· only part of the maturity value is moved out of

this option at maturity.Note a switch fee will not be charged if the whole ofthe maturity value is moved out of this option atmaturity.Buy/sell spreadsFor the investment options available through thePlan other than the Cash and Term Depositinvestment options, the entry price of units maydiffer from the exit price of those units. Thedifference between the entry and exit pricerepresents an allowance for transactional andoperational costs i.e. expenses and other feeswhich would be incurred in buying or selling part orall of the underlying investments of eachinvestment option. This is also commonly referredto as the buy/sell spread. Any buy/sell spread isadditional to the cost you incur as detailed in the“Fees and other costs” table. No part of thebuy/sell spread is paid to the Trustee.

Buy/sell spreads are only applied at the time arollover is paid into the Plan or switches effectedwithin the Plan and not at the time of making awithdrawal from the Plan.

Details of what, if any, estimated transactional andoperational costs are applicable to a particularinvestment option are set out in the following table.These transactional and operational costs (referredto as estimated buy/sell spreads in the table below)can vary from time to time.


FEE INCREASES AND NEW FEESFees may increase without members’ consent, atany time, in the event of changes in the Plan’sbenefit design, Government regulations or taxes,increases charged by external suppliers, changesin the default investment option or a reduction inthe number of members participating in or the sizeof the Plan. The Trustee also has the power underthe Plan’s Trust Deed to introduce new fees. If theTrustee determines to increase a fee or introduce anew fee, you will be given 30 days’ notice.

MAXIMUM FEESThe Trust Deed of the Plan allows for contributionfees of up to 5% of each rollover, withdrawal feesof up to 5% of each amount withdrawn, switch feesof up to 3% of the amount switched andmanagement costs of up to 5% per annum of thevalue of the Plan.

FEES - UP TO DATE INFORMATIONThe fees set out in this PDS are up to date at thetime of its preparation.However, the investment management feescomponent of the management costs may changeat any time due to changes in the composition ofthe investment managers used within theinvestment options and/or changes in the feescharged by the investment managers used withinthe investment options. You will be given 30 days’notice of any increases to the range of investmentmanagement fees.In the future you can obtain up to date informationregarding the current investment management feesfor each investment option by calling the Plan’sSuperannuation Helpline on 1300 789 636 orwriting to us at:The Plan AdministratorNewcastle Permanent Superannuation PlanGPO Box 4303Melbourne VIC 3001

NPBS ADVISER FEESYou can have the ability to have adviser fees forany personal superannuation advisory services*provided to you by the licensed advisers of theNewcastle Permanent Building Society (NPBSadvisers) deducted from your super accountbalance. These fees can take the form of a one-offadviser fee for ad hoc services or an ongoingadviser fee for regular advice. If you and yourNPBS adviser agree to the payment of a one-offadviser fee it can be any dollar amount up to amaximum of $5,000, subject to a combined limit of2.5% of your account balance.Where this one-off adviser fee applies, an amountequal to the negotiated fee will be deducted by theTrustee from your account in the Plan* when yourmembership has been accepted by the Trustee andremitted to NPBS.If you and your NPBS adviser agree to an ongoingfee for ongoing advice, you and your NPBS advisercan negotiate an on-going adviser fee of any dollaramount up to a maximum of $5,000 per annum,subject to a combined limit of 2.5% per annum ofyour account balance.This agreement will remain valid for two years. Anyon-going services provided to you after the twoyear period will require a new agreement with yourNPBS adviser.Where this on-going adviser fee applies, an amountequal to a quarter of the negotiated annual fee willbe deducted by the Trustee, from your account inthe Plan* quarterly, and remitted to NPBS.* If any part of your account is invested in the TermDeposit investment option, you need to considerthe available funds invested in your non-TermDeposit options to ensure that the deduction of anyNPBS adviser fees do not cause a break triggerevent. See “What is a break trigger event?” in theInvesting your super section of this PDS for moreinformation.If you wish to agree to the payment of NPBSadviser fees to your NPBS adviser, complete therelevant part of Step 10 of the Application formembership of the Pension Division form.If you and your NPBS adviser wish to vary theamount of any on-going adviser fee, you mustnotify the Trustee in writing by completing theappropriate form available from the Plan’s websiteat: newcastlepermanent.superfacts.com or you cancall the Plan’s Superannuation Helpline on 1300789 636. Any change to the on-going adviser feededucted from your super account will only takeeffect after the appropriate form has been receivedand processed by the Trustee.Any NPBS adviser fee(s) agreed between you andyour NPBS adviser cannot be deducted from youraccount if your balance is less than $1,000 (notincluding any amount invested in the Term Depositinvestment option).

Investment option Estimated buy/sellspread (%).

Conservative(Enhanced Indexed) 0.25

ModeratelyConservative

(Enhanced Indexed)0.25

Moderate Growth(Enhanced Indexed) 0.25

Diversified Shares(Indexed) 0.25

Conservative(Active) 0.30

Moderate Growth(Active) 0.50

Assertive (Active) 0.50


If you want to give authority for your NPBS adviserto access information on your account in the Plan,you should complete the relevant part of Step 9 ofthe Application for membership of the PensionDivision form.

GST

The GST disclosures in this PDS are of a generalnature only. Any fees charged to your account asset out in this PDS, already take into account GSTand assume that reduced input tax credits areavailable to the Plan.

TAX AND YOUR SUPER

Tax details are set out in the Tax and SocialSecurity section of this PDS.


DEFINED FEESSet out below are definitions of the various fee types referred to through this section.

Activity fees

A fee is an activity fee if:(a) the fee relates to costs incurred by the Trustee of thePlan that are directly related to an activity of the Trustee:

(i) that is engaged in at the request, or with the consent,of a member; or(ii) that relates to a member and is required by law; and

(b) those costs are not otherwise charged as anadministration fee, an investment fee, a buy-sell spread, aswitching fee, an exit fee or an advice fee.

Administration feesAn administration fee is a fee that relates to theadministration or operation of the Plan and includes costsincurred by the Trustee of the Plan that:

(a) relate to the administration or operation of the Plan;and(b) are not otherwise charged as an investment fee, abuy-sell spread, a switching fee, an exit fee, an activity feeor an advice fee.

Advice feesA fee is an advice fee if:

(a) the fee relates directly to costs incurred by the Trusteeof the Plan because of the provision of financial productadvice to a member by:

(i) a Trustee of the Plan; or(ii) another person acting as an employee of, or underan arrangement with, the Trustee of the Plan; and

(b) those costs are not otherwise charged as anadministration fee, an investment fee, a switching fee, anexit fee or an activity fee.

Buy-sell spreadsA buy-sell spread is a fee to recover transaction costsincurred by the Trustee of the Plan in relation to the saleand purchase of assets of the entity. Refer to ‘Transactionand Operational Costs’ earlier in this section of this PDS fordetails of the buy-sell spreads applicable to specificinvestment options.

Exit feesAn exit fee is a fee to recover the costs of disposing of allor part of members’ interests in the Plan.

Indirect costs

The indirect costs of an investment option offered by thePlan means any amount that:

(a) the Trustee of the Plan knows, or reasonably ought toknow, will directly or indirectly reduce the return on theinvestment of a member of the Plan in any investmentoption offered by the Plan; and(b) is not charged to the member as a fee.

Refer to ‘Indirect cost ratio’ earlier in this section of thisPDS for further details.

Indirect cost ratioThe indirect cost ratio (ICR), for an investment optionoffered by the Plan, is the ratio of the total of the indirectcosts for an investment option, to the total average netassets of the Plan attributed to that investment option.Note: A dollar-based fee deducted directly from a member’saccount is not included in the indirect cost ratio.Refer to ‘Indirect cost ratio’ earlier in this section of thisPDS for further details.

Investment feesAn investment fee is a fee that relates to the investment ofthe assets of the Plan and includes:

(a) fees in payment for the exercise of care and expertisein the investment of those assets (including performancefees*); and(b) costs incurred by the Trustee of the Plan that:

(i) relate to the investment of assets of the Plan; and(ii) are not otherwise charged as an administration fee,a buy-sell spread, a switching fee, an exit fee, anactivity fee or an advice fee.

* There are currently no performance fees included in theinvestment fees. The reason for this is that the Trusteedoes not directly charge or incur any performance fees.Where an external investment trust or manager that is usedto invest the assets of an investment option, charges aperformance fee, these fees form part of the indirect costratio of the relevant investment option. Refer to‘Performance fees’ earlier in this section for further details.

Switching feesA switching fee is a fee to recover the costs of switchingall or part of a member’s interest in the Plan from one classof beneficial interest in the entity to another.


ENQUIRIES ANDCOMPLAINTSPROCEDURESThe Trustee has a process in place for dealing withmember enquiries and complaints. To make an enquiryor complaint you can:

· call the Helpline on 1300 789 636

or

· write to the Plan’s Enquiries and Complaints Officer,Newcastle Permanent Superannuation Plan,GPO Box 4303, Melbourne VIC 3001.

While you can expect a reply to your enquiry within 28days and the Trustee endeavours to deal with all mattersin a timely manner, a period of up to 90 days can beexperienced for complaints.

If you have a complaint and you’re not satisfied with theresponse, you can generally request a formalreconsideration by the Trustee. The Trustee alwaysseeks to resolve any complaints to the satisfaction of allconcerned and in the best interests of all the members ofthe Plan. However, if you have made a complaint andare not satisfied with the outcome or after at least 90days has passed, you may take your complaint to theSuperannuation Complaints Tribunal.

The Tribunal is an external dispute resolution systemthat covers most complaints by members of super funds.Any complaints must be lodged with the Tribunal withincertain time limits.

For more information about requirements and time limits,you can contact the Superannuation Complaints Tribunalat:

· Locked Bag 3060Melbourne VIC 3001

· or phone them on 1300 884 114

· or fax them on (03) 8635 5588

· or email them at [email protected]

· or visit their website: www.sct.gov.au

If the Tribunal decides to proceed with handling yourcomplaint, it will try and help you and the Trustee reacha mutual agreement through conciliation. If conciliation isunsuccessful, the complaint is referred to the Tribunalpanel for a determination.

OTHER THINGS YOUSHOULD KNOWYOUR PRIVACY IS IMPORTANT TO USWe collect, use and disclose personal information aboutyou in order to manage your superannuation benefitsand give you information about your super. We may alsouse it to supply you with information about the otherproducts and services offered by us and our relatedcompanies. If you do not wish to receive marketingmaterial, please contact us on 1300 789 636.Mercer’s Privacy Policy is available to view atnewcastlepermanent.superfacts.comor you can call the Plan’s Superannuation Helpline on1300 789 636 to request a copy.If you do not provide the personal information requested,we may not be able to manage your superannuation.We may sometimes collect information about you fromthird parties such as your employer, a previous superfund, your financial adviser, our related entities andpublicly available sources.We may disclose your information to variousorganisations in order to manage your super, includingyour employer, the fund’s administrator, our professionaladvisors, insurers, our related companies which provideservices or products relevant to the provision of yoursuper, any relevant government authority that requiresyour personal information to be disclosed, and our otherservice providers used to assist with managing yoursuper.In managing your super your personal information will bedisclosed to service providers in another country, mostlikely to our administrator’s processing centre in India.Our Privacy Policy lists all other relevant offshorelocations.Our Privacy Policy sets out in more detail how we dealwith your personal information and who you can talk to ifyou wish to access and seek correction of theinformation we hold about you. It also provides detailabout how you may lodge a complaint about the way wehave dealt with your information and how that complaintwill be handled.If you have any other queries in relation to privacyissues, you may contact us on 1300 789 636 or write toour Privacy Officer, GPO Box 4303, Melbourne VIC3001.


LOST MEMBERS AND UNCLAIMED MONEYIf we’ve written to you twice and both times the mail hasbeen returned unclaimed, and you are under age 65, wemay transfer your account balance to an eligible rolloverfund.

If you’re over age 65 and we have been unable tocontact you for a period of 5 years, then your accountbalance will be considered to be unclaimed money andwill be sent to the Australian Taxation Office (ATO). Youcan approach the ATO to claim any such money directly.

ABOUT THE ELIGIBLE ROLLOVER FUNDAn ERF is a superannuation fund which is eligible toreceive benefits automatically rolled over from otherfunds. ERF’s generally accept inactive small accountsand lost member account rollovers from othersuperannuation funds.

The ERF currently used by the Plan is:

The SuperTrace Eligible Rollover Fund ABN 73 703 878235 (SuperTrace)Locked Bag 5429Parramatta NSW 2124

Telephone: 1300 788 750

Fax: 1300 700 353

The Trustee of SuperTrace is Colonial MutualSuperannuation Pty Ltd ABN 56 006 831 983 AustralianFinancial Services Licence #235025 (CMS).SuperTrace is administered by The Colonial Mutual LifeAssurance Society Limited ABN 12 004 021 809Australian Financial Services Licence #235035 (CMLA).

Set out below is a summary of some of the moresignificant features of SuperTrace, current as at the dateof this PDS:

· All assets of SuperTrace are invested in the Policyissued to CMS by CMLA. The Policy is currentlyinvested solely in the Capital Stable Fund in theCMLA’s No. 2L Statutory Fund. The Capital StableFund and the CMLA No. 2L Statutory Fund invest inassets that can fluctuate in value. There is noinvestment choice available to members.

· The investment objective of the Capital Stable Fundis to provide a reasonably high level of security andconsistent returns.

· The investment strategy for the assets in the CapitalStable Fund is to invest in a broad range of assetswith a majority in defensive investments. Thestrategy aims for consistent real rates of growthwhile at the same time protecting against short-termvolatility risk.

· Investment returns are credited to Members’accounts as an annual crediting rate effective 30June. The crediting rate is derived from the earningrate of the SuperTrace Policy which is net of tax oninvestment earnings, less any asset charge. Thecrediting rate is not guaranteed and the rate appliedcan be negative.

· The following fees and charges apply inSuperTrace:· an asset charge of 2.05% p.a. (actual cost net

of tax) is deducted from the earnings ofSuperTrace prior to the crediting rate beingdeclared

· SuperTrace is unable to accept contributions fromMembers or their employers; however rollovers fromother superannuation funds are permitted.

· SuperTrace does not provide insurance cover.· Should you wish to know more about SuperTrace,

contact a SuperTrace Customer ServiceRepresentative on 1300 788 750 between 8.30amand 6pm Monday to Friday Eastern Standard Timeor go to www.supertrace.com.au for a copy of theirlatest Product Disclosure Statement andIncorporation by Reference documents.

ANTI-MONEY LAUNDERINGUnder the Anti-Money Laundering and CounterTerrorism Financing Act 2006 (AMLCTF),superannuation funds are required to identify, monitorand mitigate the risk that the Plan may be used for thelaundering of money or the financing of terrorism.Because of this, you will be required to provide proof ofyour identity that is satisfactory to the Trustee before youwithdraw your benefit from the Plan or commencereceiving a pension from the Plan. You may also need toprovide satisfactory proof of identity in othercircumstances as required by law.

At a minimum, you may be required to provide theTrustee with evidence that verifies your full name, yourdate of birth and your residential address. Suchevidence would usually be in the form of a certified copyof your driver's licence or passport. Unless we receivethis information in appropriate form, we may be unableto process your payment request.

Under AMLCTF we are also required in somecircumstances to undertake additional identificationchecks and to monitor transactions. In some cases, wemay need to block or suspend transactions. Please notethat the Trustee will not be liable for any loss suffered byyou as a result of any delay in making a payment,caused or contributed to by the need to comply withAMLCTF requirements.

By law the Trustee is also required to comply withconfidential reporting obligations to the AMLCTFregulator, AUSTRAC.

BANKRUPTCY & SUPER CONTRIBUTIONSGovernment legislation allows a Trustee in bankruptcy torecover certain super contributions. Your account will beadjusted to reflect any payments in respect of you madeto a Trustee in bankruptcy under a notice issued inaccordance with this legislation.

FAMILY LAWGovernment legislation allows married and de facto*couples (including same sex couples) to make bindingagreements or obtain court orders in respect of howeach partner’s super will be divided upon marriage orrelationship breakdown. The law also gives the FamilyCourt a say in how a couple’s super is divided uponmarriage or relationship breakdown.


*Restrictions apply where a de facto relationship hasbeen in existence for less than 2 years. Restrictionsalso apply in respect of de facto couples in WesternAustralia. Currently the Commonwealth laws in relationto de facto couples do not apply in WA.

Splitting super entitlements with your spouse or de factowill affect the preservation components of your superand may have tax consequences. You should seekprofessional advice as to the consequences of marriageor relationship breakdown on your super.

Please note that under the Family Law Act the Trustee isalso required to provide certain information about amember’s super to ‘eligible persons’ where theinformation is required to negotiate a superannuationagreement or to assist with a court order. For thepurposes of the Family Law Act an eligible personincludes a member, the spouse of a member or a personwho intends to enter a superannuation agreement withthe member.

Your pension payments may need to be adjusted toreflect any agreements or court orders which may bebinding on the Trustee. You’ll be advised of any fee thatapplies when a request is made for actions to be takenunder the Family Law Act in respect of your superpayout.

You can also call the Helpline on 1300 789 636 aboutfamily law matters affecting your super in the Plan.

YOU CAN’T BORROW AGAINST YOURSUPER

As the law currently stands, you can’t borrow againstyour super, use your super as security for a loan, or signover your super to anyone else.

MONITORING ENQUIRIES

The Trustee may, at its discretion, monitor or recordenquiries or transactions made by telephone. This isdone for reasons of accuracy, security and service.

TRUSTEE POWERS ANDRESPONSIBILITIES

The Trustee’s main responsibilities are to make sure:

· your rights and interests as a member of the Planare protected;

· benefits are paid correctly and in a timely manner;· the Plan's assets are invested properly; and· the overall operation of the Plan is conducted in

accordance with the Trust Deed and relevantlegislation.

The Trustee and its directors are entitled to beindemnified out of the assets of the Plan for any costs,liabilities or expenses incurred in performing theirresponsibilities, unless those liabilities have arisen out ofthe Trustee’s or the directors’ dishonesty or intentional orreckless failure to exercise the degree of care anddiligence required or are amounts, such as penalties, forwhich indemnification is not permitted underGovernment legislation.

You can obtain a copy of the Trust Deed by calling thePlan’s Superannuation Helpline on 1300 789 636 orwriting to the Trustee:Mercer Superannuation (Australia) LimitedNewcastle Permanent Superannuation PlanGPO Box 4303Melbourne VIC 3001

RETIREMENT OF TRUSTEEThe Trustee must retire if it ceases to be qualified to actas Trustee of the Plan in accordance with Governmentregulations. The Trustee may also retire at any time byappointing another company to act as Trustee in itsplace. The new Trustee must be eligible to act asTrustee of the Plan. The directors of the Trustee are alsosubject to government regulations concerning theireligibility to be directors.

SERVICE PROVIDERS TO THE TRUSTEEDetails of the service providers to the Plan will be set outeach year in the Plan’s annual report. The Trustee andits service providers are remunerated from the feesdeducted from your account balance (see “Fees andother costs” in the Getting to know your Pensionsection of this PDS).

THE TRUST DEEDThe Plan is governed by a legal document called theTrust Deed which includes a set of governing rules. TheTrust Deed describes the rights and benefits of themembers of the Plan, as well as the duties andobligations of the Trustee in relation to the Plan.

The Trust Deed requires the Trustee to comply with SISand other legislation which governs superannuationfunds. This means the Plan is eligible for concessionaltaxation treatment.

Amending the Trust Deed

As circumstances change, it may be necessary for theTrust Deed to be amended. All amendments made mustcomply with the strict requirements of the Trust Deedand the relevant legislation. In particular, no amendmentmade can materially reduce or adversely affect yourinterest accrued in the Plan up to the date of theamendment without your consent, unless the change isrequired or permitted by law. You’ll be informed,in writing, of the nature and effect of any amendmentmade to the Trust Deed.

Full details of the terms of the amendment power are setout in the Trust Deed. If you would like to see a copy ofthe Trust Deed call the Plan’s Superannuation Helplineon 1300 789 636.

RECENTLY DIVORCED OR SEPARATED?Under Family Law, married or defacto couples(including same sex couples) have the option of splittingtheir super entitlements on marriage or relationshipbreakdown. Call the Helpline for more information aboutFamily Law matters affecting your super in the Plan.


TERMINATION OF THE PLANWhile the Trustee and NPBS intend to continue the Planindefinitely, future events may make it necessary tochange the Plan.

A wind-up of the Plan can occur at the election of theTrustee or if the office of the Trustee becomes vacantand a new Trustee is not appointed within 30 days.If any of these events should happen, you will beinformed. After all expenses have been met, the Plan’sassets will be distributed in the following order:

· any benefits due and payable prior to termination,· members’ withdrawal benefits (including pensions if

applicable), and· any further amount as determined by the Trustee.

RIGHTS OF MEMBERSMembers are entitled to a beneficial interest in the Plan.However, members are not entitled to interfere with, orexercise, the powers of the Trustee in respect of anyPlan property, liability or obligation or to lodge a caveatover the Plan’s property.

MATERIAL CHANGES OR SIGNIFICANTEVENTSYou’ll be provided with at least 30 days’ notice of anyproposed increases in fees or charges. All other materialchanges or significant events will be advised inaccordance with the requirements of the law.

INVESTMENT OF PLAN ASSETSThe Trustee is responsible for the management of thePlan’s assets. The assets of the Plan are held in trustand must be invested in accordance with the investmentpowers contained in the Trust Deed and with therelevant legislative requirements.

EXPENSE PROVISIONThe Trustee may maintain a provision for expenses inthe Plan, which at any point in time is the accumulateddifference between the fees deducted from members’accounts and the actual costs and expenses charged tothe Plan.

PROVING YOUR ENTITLEMENTA person claiming an entitlement to benefits under thePlan must produce whatever evidence is reasonablyrequired by the Trustee to establish entitlement to abenefit from the Plan. For example, evidence of age,identity, death, health, disability and such other evidencemay be requested.

DEALING WITH YOUR BENEFIT IF YOURBENEFICIARY CANNOT BE PAIDWhen a benefit becomes payable from the Plan and thebenefit is payable for the benefit of a person who, in theopinion of the Trustee, is incapable of managing theiraffairs, the Trustee may pay the benefit to anotherperson such as the parent, guardian or person havingcustody or control of the first person’s affairs.

COOLING OFFYou have 14 days after investing in the Plan duringwhich you can write to us to cancel your membership ofthe Plan. This is called the ‘cooling off’ period. The 14day period starts from the earlier of the date you receiveour confirmation of your membership or 5 days after youbecome a member. You will lose your right to cool off ifyou exercise any rights in the Plan, for example if youmake an investment switch or withdrawal.

If you cancel your membership during the cooling offperiod, the amount refunded will be calculated byreference to the price at which the units would havebeen acquired if you had acquired them on the day thecooling off right is exercised, adjusted for pensionpayments or other distributions (if any) made to youduring the period of membership, tax and reasonabletransaction or administration costs. Therefore, theamount refunded may be greater or less than theamount initially invested.

If your initial investment was in the Allocated Pension,the amount refunded will be paid to you or rolled over asdirected by you.

If your initial investment was in the Transition toRetirement Allocated Pension, the amount refunded willbe paid in accordance with the following rules:

· any amount representing preserved or restrictednon-preserved benefits cannot be paid directly to youand must be transferred to a regulatedsuperannuation fund, approved deposit fund or aretirement savings account nominated by you,

· any other amounts will be paid as directed by you.

If no direction is received from you within one month ofnotifying us that you want to cancel your membership, orif the nominated superannuation entity does not acceptthe nomination, your benefit may be transferred to aneligible rollover fund of the Trustee’s choice or paid incash to you where permitted by the law.

Where your super is transferred to an eligible rolloverfund you’ll no longer have any rights under the Plan. ThePlan uses the SuperTrace Eligible Rollover Fund (ERF).See ‘About the Eligible Rollover Fund’ earlier in thissection for further details on the ERF.

If you are above age 65 and haven’t told us how andwhere you’d like your super paid and you can’t becontacted, then your payout will be considered to beunclaimed money and will be sent to the ATO. You canapproach the ATO to claim any such money directly.See ‘Lost Members and Unclaimed Money’ and ‘Aboutthe Eligible Rollover Fund’ earlier in this section forfurther details.


Investing your super 25

INVESTING YOUR SUPER

IN THIS SECTION YOU’LL FIND OUT:· How we invest your super page 26

· Summary of investment options page 27

· Summary of key investment terms page 28

· The Trustee’s investment approach page 29

· Understanding investment risk page 32

· Your investment options… In detail page 34

· The Plan’s investment options page 35

· The Plan’s investment options (continued) page 36

· How the term deposit works page 40

· Some frequently asked questions… page 43

26 Investing your super

HOW WE INVEST YOUR SUPERNo two members are the same. That’s why the Plan provides a suite of investment options tomeet your needs. This gives you the flexibility to tailor your portfolio.This section provides information about how the Trustee invests your super, the Trustee’s investmentapproach, the risks associated with investing, and detailed information about each investment optionavailable to you in the Plan.

As a new member of the Pension Division of the Plan, you can choose your investments, by selectingone or more investment options from the Plan’s investment menu. You must choose an investmentoption in Step 3 of the Application for membership of the Pension Division form, even if you aretransferring from the Superannuation Division. If you do not make a valid choice, your super will beinvested in the Conservative (Enhanced Indexed) investment option, which is the default option for thePension Division of the Plan.Prior to making an investment choice, the Trustee recommends that you seek advice from a licensed, orappropriately authorised, financial adviser to assist you in deciding what option will help you achieveyour goals.BALANCING RISK AND RETURNAll investments, including super, carry some risk. Your super is invested in different investment optionsthat have different levels of risk depending on the assets that make up that investment option.You can balance risk and return by spreading your investments across different asset classes, countriesand investment managers.Growth investments, such as shares and property, have the potential to grow over the long term butare also likely to experience more volatility (ups and downs) in the short term.Defensive investments, such as cash or fixed interest (including higher yielding fixed interest), tend toproduce lower but more stable long-term returns than growth investments. Different combinations ofgrowth and defensive investments change the characteristics of an investment option.It is not possible to guarantee investment returns and you may lose some of the money you haveinvested.

The table below shows the various asset classes in which your super can be invested.Asset Class Description

International SharesInvestments in companies listed on securities exchanges around the world,including emerging markets. These investments may be hedged* or unhedgedto manage movements in exchange rates, which can impact the value ofinvestments both positively and negatively.

Australian SharesInvestments in Australian companies listed on the Australian Stock Exchangeor equity based trusts, derivatives or unlisted Australian based equity typeinvestments. It may include a small exposure to companies listed outside theAustralian exchange from time to time.

Property andInfrastructure

Australian and international listed and unlisted property funds including (butnot limited to) office buildings, shopping centres, industrial estates and othersimilar property investments.Australian and international listed and unlisted infrastructure investments areinvestments in long-term assets required to fulfil major economic and socialneeds such as airports, tunnels, bridges, toll roads, pipelines and utilities.

Alternative Assets

Alternative assets comprise investments that do not fit within other assetclasses. They may include investments in hedge funds, private equity, naturalresources, mezzanine debt and insurance linked strategies. Alternativeinvestments may have growth or defensive characteristics. Australian orinternational exposure and may be hedged or unhedged.

Higher YieldingFixed Interest

Targets a higher yield from fixed interest by investing in issuers that carry ahigher degree of credit risk or illiquidity relative to defensive fixed interest andcash investments.Generally the exposures will be to non-investment grade corporate issuers, orsovereign bond issuers in emerging markets which may also carry emergingmarket currency risks.

Defensive FixedInterest and Cash

Fixed interest investments generally provide a regular income stream with therepayment of capital expected at the end of the term. These exposures aregenerally considered defensive as they are invested in highly rated sovereignbond issuers in developed markets or highly rated investment grade corporateissuers. They may be Australian or international and may be hedged orunhedged.Cash includes short-term interest bearing investments and fixed term interestbearing investments (or ‘term deposits’).

*SEE “SUMMARY OF KEY INVESTMENT TERMS” SECTION


SUMMARY OF INVESTMENTOPTIONS

As a member of the Plan, you have a choice ofany one or a combination of the following nineinvestment options:Cash-type Options

· Cash· Term DepositDiversified Options*

Largely Passively Managed

· Conservative (Enhanced Indexed)· Moderately Conservative (Enhanced Indexed)· Moderate Growth (Enhanced Indexed)· Diversified Shares (Indexed), andActively Managed

· Conservative (Active)· Moderate Growth (Active)· Assertive (Active)

*These options hold assets across a number of differentasset types. Refer below for further details.

By selecting one or more of the Diversifiedinvestment options, you are investing your superin a set mix of shares, property, fixed interest,term deposits, cash and other types of assets.The mix of assets in the option that you choosewill determine the level of risk and earnings thatyou could expect in your super.

If the Trustee adds new investment options,removes existing investment options or materiallyalters any investment option, you’ll be informed inin accordance with the law.

Please note you can only invest in the TermDeposit investment option once your membershipin the Plan has been established and your initialinvestment has been received and invested inyour chosen investment option(s) (not includingthe Term Deposit investment option). See the“Term Deposit investment option” later in thissection for more information on how to invest inthis option.

Please note that the Trustee invests in yourchosen option(s) on your behalf. You do nothave a direct interest in the option(s) that apply toyou. The Trustee holds that interest on yourbehalf.


SUMMARY OF KEY INVESTMENT TERMSActive investment approach

Investment managers with an active approachaim to outperform the overall market for thatparticular asset class or investment approach.

Asset allocation

This refers to the allocation between thevarious asset classes (e.g. shares, fixedinterest, and property) of an investment option.It also includes the Growth/Defensivebenchmark of the investment option.

Average Weekly Earnings (AWE)

AWE is a measure of the average weeklyearnings of employed wage and salary earnersin Australia. It is based on employment andearnings data from a sample of businessesfrom the Australian Bureau of Statistics (ABS)register of businesses.

Benchmark and ranges

The benchmark is the asset allocation of theinvestment option which is expected to applyover the long term. Factors such as theTrustee’s ongoing assessment of marketconditions will cause the actual asset allocationto vary from the benchmark from time to time,but the actual asset allocation will generallystay within the asset allocation ranges.Accordingly at any point in time, actual assetallocation is unlikely to be exactly as per thebenchmark for each asset class.

Consumer Price Index (CPI)

CPI is a measure of the rate of inflation. InAustralia it’s based on a selection of householdgoods and services.

Hedging

Hedging is the process of protectinginvestments against a loss, or reducing the riskof a loss. For example, the value ofinternational investments is affected bychanges in the value of the Australian dollar. Ifthe Australian dollar rises in value, theninternational investments reduce in value.Currency hedging is where investmentmanagers use various techniques to minimisethe effect of currency movements oninternational investments.

Minimum suggested timeframe

This is the minimum time for which you shouldconsider holding your investment in aninvestment option. This is a guide only.

Objectives

These identify the amount of investment returnthe option aims to achieve for investors. Theobjectives are sometimes stated in terms of aparticular named index, e.g. the Reserve Bankof Australia cash rate, or a target that relates toCPI or AWE.Please note the objectives of any particularinvestment option should not be treated, orrelied upon as a forecast, indicator orguarantee of any future returns or performancefor that option. The value of investments mayrise and fall, in any of the options.

Passive investment approach

Indexed investment options

Investment managers with an indexedapproach aim to perform in line with the overallmarket for the applicable asset classes of theoption.

Enhanced Indexed investment options

Investment managers with an enhancedindexed approach aim to perform slightly abovethe overall market for the applicable assetclasses of the option. These options aremainly invested in indexed funds but with anactively managed component.


THE TRUSTEE’S INVESTMENT APPROACHThe Trustee aims to help minimise investmentrisks by offering you a range of investmentoptions. The investment options offered throughthe Plan (other than the Cash and Term Depositinvestment options) provide you the benefit ofdiversification by accessing different assetclasses, investment managers and investmentstyles.Each option has a specific performanceobjective, as set out later in this section. TheTrustee’s broad investment objective is tomaximise investment returns over the statedinvestment timeframe for each option, subject toconstraints imposed by the need to containfluctuations in returns over shorter periodswithin acceptable limits.The Trustee may change the investmentobjective and strategy for each option to ensurethat there is a reasonable probability that itdelivers on the objective. The actual assetallocation may fall outside the stated rangesduring material transactions or due to factorsincluding extreme market conditions or assettransitions.The Trustee invests the Plan’s assets asfollows:· The Cash-type investment options are

invested with NPBS. Specifically, the Cashinvestment option is invested in interestbearing deposits with NPBS and the TermDeposit investment option is invested in termdeposits with NPBS. If the NPBS was towind up, then the deposits backing the Cashand Term Deposit investment options wouldrank equally with other NPBS deposits. Asthe underlying assets of these investmentoptions are solely invested in deposits withNPBS, the security of money placed in theseinvestment options is directly linked to thesecurity and financial stability of NPBS.

· The Diversified investment options areinvested by the Trustee in investmentvehicles which are managed by MIAL. MIALutilises a multi-manager style for managingthese vehicles.

Under a multi-manager style, specialistmanagers are appointed to invest assets ineach sector (or ‘asset class’). Often more thanone manager is appointed in an asset class toprovide diversification. For example, a panelof managers may be appointed to manageAustralian shares and a potentially differentpanel appointed for overseas shares.Because no single investment manager islikely to be among the best in every assetclass, a multi-manager option involving anumber of asset classes will typically includea range of different managers or products.The underlying investment manager panelsare configured with the aim of achievingexposure to a range of investmentmanagement styles, with the overall objectiveof producing consistent performancethroughout market cycles.

MIAL further distinquishes its management ofthe Diversified options by utilising either a‘largely passively managed’ investmentapproach or an ‘actively managed’ investmentapproach (refer “Summary of key investmentterms” for details of these two terms).

Choosing and monitoring investmentmanagersThe Trustee receives professional advice froman investment adviser on the selection andongoing evaluation of investment managers,management of investment managerappointments and replacements, and reviewsand reports on performance against investmentobjectives.

USE OF DERIVATIVESDerivatives, such as futures or options, areinvestment products whose value is derivedfrom other investments. For example, the valueof a share option is linked to the value of theunderlying share.

Investment managers may utilise derivatives inmanaging investment options for the Trusteeand in managing pooled investment vehicles inwhich the Trustee invests.

However, the Trustee doesn’t undertake day-to-day management of derivative instruments.Derivatives may be used, among other things, tomanage risk (eg for foreign currency hedging).Losses from derivatives can occur (eg due tomarket movements).

The Trustee seeks to manage risk by investingin vehicles which have appropriate limits on theextent of derivative use.

SUSTAINABLE INVESTMENTSThe Trustee through MIAL builds sustainabilityprinciples into the Plan’s investment options tohelp protect and enhance the value of members’super. The Trustee looks beyond traditionalfinancial factors to consider the potentialinvestment impacts of corporate governance aswell as environment and social issues – such asan ageing population, energy and resourceconstraints and climate change.

The Trustee believes environmental social andgovernance (ESG) factors may have a materialimpact on long-term risk and return outcomes.The Trustee also believes that principles ofactive ownership and investment stewardshipare valuable in the investment process. For thisreason, ESG considerations, principles of activeownership and investments stewardship areincorporated throughout investment decisionmaking and ownership practices.


SOCIALLY RESPONSIBLE INVESTING

Socially Responsible Investing (SRI) meanstaking into account ethical issues when makinginvestment decisions, for example labourstandards.

There are no investment options where theTrustee explicitly takes into account labourstandards, environmental, social or other ethicalconsiderations while developing the investmentstrategy and selecting investment managers.

INVESTMENT EARNINGS

The Trustee has determined that it will not createinvestment fluctuation reserves and will generallydistribute all investment earnings (after makingprovisions for tax, and allowing for investmentexpenses) to members. However, unallocatedamounts can arise from time to time, for exampledue to cashflow timing issues and differencesbetween tax provisions made and any tax paid.

The investment performance of each investmentoption is not guaranteed by the Trustee or NPBSand may be positive or negative. However, NPBSguarantees that the rate of return on theunderlying deposits in which the Cash and TermDeposit investment options invest will not benegative, noting that this guarantee is directlylinked to the security and financial stability ofNPBS.For the Cash or Term Deposit investmentoptions, your account will be directly allocatedwith investment earnings at the Cash creditingrate, the Term Deposit crediting rate or the TermDeposit break crediting rate (as applicable). Seelater in this section for more information about‘How the term deposit works’.

If you are invested in any other investment option(not including Cash or Term Deposit investmentoptions), your account and ongoing contributionsand earnings are applied by the Trustee to buyunits in your chosen investment option(s). Theunit price of these option(s) will rise or fall toreflect earnings in your account balance. Thismeans you can calculate the investmentperformance of an option at any time bymeasuring the change in unit price. To calculatethe amounts you have invested in the optionsother than the Cash and Term Depositinvestment options, simply multiply the number ofunits in the particular option by the current unitprice for that same option.

Details of the Plan’s investments and past ratesof investment performance are set out in thePlan’s annual report to members each year. Goto the “Article Library” on the Plan’s website at:newcastlepermanent.superfacts.comfor regular investment updates including theinvestment performance of each of the options.

Cash investment option – the Cashcrediting rate explained

The Cash crediting rate (the rate ofinvestment earnings allocated to the Cashinvestment option) is determined based onthe actual earnings of the investment optionafter an allowance for investment tax andany investment management fees. TheTrustee declares the Cash crediting ratebased on the returns earned on theunderlying deposits held with NPBS, asdeclared by NPBS.

The Cash crediting rate allocated to youraccount when you leave the Plan iscalculated as described above for the periodbetween the date your payment instructionsare received by the Plan Administrator andthe date your benefit is paid.The Cash investment option is solelyinvested in interest bearing deposits withNPBS. The return on these deposits, whichis declared by NPBS, is calculated based onthe cash rate declared by the Reserve Bankof Australia (RBA). Note that NPBSguarantees that the rate of return on theunderlying deposits in which the Cashinvestment option invests will never benegative, noting that this guarantee isdirectly linked to the security and financialstability of NPBS.


Unit prices explainedUnits are a straightforward way of managing the changes in your account and tracking your choiceof investment.

The amount of superannuation you have in your account invested in the Diversified Options in thePlan is converted into units. Your investment in an option or options is represented by thenumber of units you have. When your contributions are paid into the Plan, the contribution dollaramount is converted into units using the unit price calculated at the next valuation date for theinvestment option into which the contributions are made.

For example, if you invest $1,000 and the unit buy price (see below) is $1, you will become entitledto 1,000 units.

The unit price in each option is normally calculated on a daily basis. The Trustee may vary thefrequency of setting unit prices depending on circumstances and prices may be set morefrequently than once a day. The unit price of a whole unit basically reflects the underlying assetvalue of the investment option divided by the number of units which are preferable to that option atthe relevant time, less a provision for expected tax and any investment management fees, andafter an allowance for any transaction and operational costs is made. See the Fees and costssection for details of these fees and costs.

Unless the Trustee determines otherwise, the value of the underlying assets of the investmentoptions will be based on market values determined by an external investment manager. Thevaluation methods and policies used result in the calculation of a unit price that is independentlyverifiable. In valuing assets an estimate is made of the liability for tax which is due but which hasnot yet been paid on investment income and capital gains, both realised and unrealised.

Each option has two prices– a buy price and a sell price. When you choose to invest in an optionyou are allocated units in that option using the buy price.

If you decide to move your money from one investment option to another or you leave the Planand a benefit is payable, the sell price would be used to determine how much money is availablefor you.

Unit prices will go up and down depending on the investment performance of each particularoption. This means that if the option performs well and earns positive returns, the unit price willrise and consequently the value of your investment will rise.

Conversely, the price may fall, which means that the value of your investment will reduce. Theinvestment management costs related to each option will be reflected in the unit prices. Earnings,whether positive or negative, will be reflected directly in the unit price.

Please note that:

· the Trustee can only allocate units when it receives all the information necessary to invest.

· the Trustee may suspend the issue (or redemption) of units during any period in which theTrustee is of the opinion that the buy price (or sell price) of those units cannot be calculated in amanner that is fair to all members holding those units. The Trustee may also suspend theredemption of units if it is unable to realise sufficient amounts of the underlying assets of theinvestment option in order to satisfy a redemption request.

· units are not transferable.


UNDERSTANDING INVESTMENT RISKMost investments have some element of risk associated with them. Generally, investment risk is thechance that your investment will perform differently to what you expect. Your investment in the Plancould rise or fall in value or produce a return which is less than you anticipate. Rises and falls in valueoccur for a variety of reasons and sometimes quickly. The types of investment risks which may have animpact on your investment in the Plan include:

· Individual asset risk – the risk attributable to individual assets within a particular asset class.· Market risk – the risk of major movements within a particular asset class.· Political risk – the risk that domestic and international political events can impact on your

investment.· Inflation risk – the risk that money may not maintain its purchasing power due to increases in the

price of goods and services (inflation).· Timing risk – the risk that, at the date of investment, your money is invested at higher market

prices than those available soon thereafter. Alternatively, it can also mean the risk that, at the dateof redemption, your investments are redeemed at lower market prices than those that were recentlyavailable or that may have been available soon thereafter

· Investment manager risk – the risk that a particular investment manager will underperform (thiscould be for example because their view on markets is wrong or because of their investment ‘style’or because they lose key investment personnel), or will fail and some or all of the capital value ofassets is lost.

· Credit risk – the risk that a debt issuer will default on payment of interest or principal.· Liquidity risk – the risk that you will be unable to redeem your investment at your chosen time.· Currency risk – the risk that overseas investments gain or lose value as a result of a falling or

rising Australian dollar.· Derivative risk – the risk that exposure (either directly or indirectly) to exchange-traded or over-the-

counter derivative instruments increase the risk in the portfolio or exposes a portfolio to additionalrisks. These risks include the possibility that a position is difficult or costly to reverse or that there isan adverse movement in the asset, interest rate, exchange rate or index underlying the derivative.See “Use of derivatives” section for more information.

· Term deposit break risk – the risk you will need to break the term of your term deposit, which willresult in a reduced crediting rate applying.

The table below shows whether there is a low, medium or high likelihood (shown as ‘L’, ‘M’ or ‘H’) that atype of investment risk (referred to on the previous page) may apply, from time to time, to a particularinvestment option. Where a type of investment risk does not apply the relevant column has been leftblank.Please note the information contained in this table is indicative only and the likelihood that a type ofinvestment risk may apply to a particular investment option may change over time.

INVESTMENT OPTION INVESTMENT RISK TABLE

Investment Option Indi

vidu

alA

sset

Ris

k

Mar

ketR

isk

Polit

ical

Ris

k

Infla

tion

Ris

k

Der

ivat

ives

Ris

k

Tim

ing

Ris

k

Inve

stm

entM

anag

erR

isk

Cre

ditR

isk

Liqu

idity

Ris

k

Cur

renc

yR

isk

Term

Dep

osit

Bre

akR

isk

Cash-type OptionsCash L L L H - L L L L - -Term Deposit L L L M - L L L L - L*Diversified OptionsLargely Passively ManagedConservative (Enhanced Index) L L L M L L L L L L -Moderately Conservative (EnhancedIndexed) L L L M L L L L L M -

Moderate Growth (Enhanced Indexed) L M L L L M L L L M -Diversified Shares (Indexed) L H L L L H L L L H -Actively ManagedConservative L L L M L L L L L L -Moderate Growth L M L L L M L L L M -Assertive L H L L L H L L L M -* You should be aware that the risk rating for the Term Deposit Break Risk may be higher depending on your own personalcircumstances.


STANDARD RISK MEASURE

The Standard Risk Measure is based on industryguidance to allow members to compareinvestment options that are expected to deliver asimilar number of negative annual returns overany 20 year period.

The Standard Risk Measure is not a completeassessment of all forms of investment risk, forinstance it does not detail what the size of anegative return could be or the potential for apositive return to be less than a member mayrequire to meet their objectives. Further, it doesnot take into account the impact of administrationfees and tax on the likelihood of a negativereturn.

Members should still ensure they are comfortablewith the risks and potential losses associatedwith their chosen investment option/s.

The standard risk measure consists of seven risklabels:

� ‘very high’ risk means that six or more negativeannual returns are expected over any 20 yearperiod.

� ‘high’ risk means that between four and six

� negative annual returns are expected over any20 year period.

� ‘medium to high’ risk means that between threeand four annual negative returns are expectedover any 20 year period

� ‘medium’ risk means that between two andthree annual negative returns are expectedover any 20 year period.

� ‘low to medium’ risk means that between oneand two negative annual returns are expectedover any 20 year period.

� ‘low’ risk means that between one half and onenegative annual return is expected over any 20year period

� ‘very low’ risk* means that less than one halfnegative annual return is expected over any 20year period.

* For the Cash and Term Deposit investmentoptions only, ‘very low’ risk means that theannual return will not likely be negative overany 20 year period

.

The Standard Risk Measure label for each of thePlan’s investment options can be found in the section“Your investment options…in detail”.


YOUR INVESTMENT OPTIONS… IN DETAIL

The Trustee is responsible for the overallmanagement of each investment option’s assets.Each investment option has an investmentobjective and strategy, which is summarisedbelow. Information on current and historicalinvestment performance of the Plan’s investmentoptions is available in the “Article Library” on thePlan’s website at:newcastlepermanent.superfacts.com

The information presented here is genericinformation and does not take account ofyour specific financial needs, circumstancesand objectives. The Trustee cannot provideyou with financial product advice. The Trusteerecommends that you consult a licensed, orappropriately authorised, financial adviser foradvice as to which is the most appropriateoption for you.

EACH OF THE INVESTMENTOPTIONS HAS AN OBJECTIVE

For each investment option, the Trustee hasdetermined a strategy which it believes isreasonably likely to enable the option to meet itsobjectives. The strategy includes the selection ofa long-term mix of investments (asset classes)that supports the option’s objectives. This mix ischosen after considering independent investmentadvice.

The allocation to each asset class is therecommended benchmark asset allocation forthat option.

While the allocation of assets within eachinvestment option is referrable to the benchmarkfigure, it can vary within the specified range. Forexample, if you have chosen the ModerateGrowth (Enhanced Indexed) option, the amountof your superannuation invested in Property &Infrastructure could be as low as 0% or as highas 15%. The combined asset allocation of anoption across all asset classes always equals100% of the invested funds.The ‘benchmarks’ included in the asset allocationtables for each option are the targeted long-termmix of investments. Factors such as theassessment of market conditions may cause theactual mix to vary from the ‘benchmarks’, but itwill generally stay within the stated ‘ranges’

The Trustee believes that the chosen strategiesgive the investment options a reasonableprobability of meeting their objectives. There is noguarantee however, that a particular objective willbe met over a particular period.

Changes are made to the objectives andstrategies as required in order to ensure that theobjectives continue to have a reasonableprobability of being attained. In addition, theTrustee monitors the options’ performanceagainst their objectives, with formal assessmentsperformed quarterly.

Whilst the Trustee states each investmentoption’s investment objective after tax and fees, itis noted that members of the NPSP PensionDivision do not typically pay tax on theinvestment earnings of their options.


THE PLAN’S INVESTMENT OPTIONSYou may select one or a combination of the following investment options:

CASH-TYPE OPTIONSCASHGrowth/Defensive0% growth assets

100% defensive assets

DescriptionThis option invests solely in interest bearingdeposits managed by NPBS. This is not adiversified investment option and therefore thesecurity of money placed in this option isdirectly linked to the security and financialstability of NPBS. It is designed for memberswho can tolerate a very low level of risk with nonegative annual return expected over any 20year period.

ObjectiveTo achieve an annual return (after tax andinvestment management fees) of at least theReserve Bank of Australia (RBA) cash rate lessan adjustment for tax

Standard Risk Measure

Very low


1 year or less

Asset Allocation

Asset Class Range%

Benchmark%

Total Growthassets 0 0

TotalDefensiveassets

100 - 100 100

Cash 100 - 100 100

TERM DEPOSIT** Please note you can only choose thisinvestment option once your membership inthe Plan has commenced and you havemade your initial investment. See the Howsuper works section for more informationabout making your ‘initial investment’ andsee later in this section how the TermDeposit works.

Growth/Defensive0% growth assets

100% defensive assets

DescriptionThis option invests solely in term depositsmanaged by NPBS. This is not a diversifiedinvestment option and therefore the security ofmoney placed in this option is directly linked tothe security and financial stability of NPBS. Itis designed for members who can tolerate avery low level of risk with no negative annualreturn expected over any 20 year period.

ObjectiveTo achieve an annual return (after tax andinvestment management fees) of at least theReserve Bank of Australia (RBA) cash rate lessan adjustment for tax.

Standard risk measure

Very Low


1 year

Asset Allocation

Asset Class Range%

Benchmark%

Total Growthassets 0 0TotalDefensiveassets

100 - 100 100

Term Deposits 100 - 100 100


THE PLAN’S INVESTMENT OPTIONS (CONTINUED)

DIVERSIFIED OPTIONSLargely Passively Managed

CONSERVATIVE (ENHANCEDINDEXED)Growth/Defensive

30% Growth

70% Defensive

Description – This option investsacross most asset classes but mainly indefensive assets and uses a largely passivelymanaged investment approach. It is designedfor members who want exposure to mainlydefensive assets and can tolerate a low tomedium level of risk over three years.

Objective

To achieve a return (after tax andinvestment management fees) thatexceeds CPI increases by at least 1.5%p.a. over rolling three year periods.


Low to Medium


Three years

Asset allocation

Asset Class Range%

Benchmark%

Australian Shares

International Shares

5-25

5-25

12

14

Property &Infrastructure

0-15 4

Alternative Assets 0-10 0

Higher YieldingFixed Interest 0-10 0

Defensive FixedInterest & Cash 50-90 70

MODERATELY CONSERVATIVE(ENHANCED INDEXED)Growth/Defensive

50% Growth

50% Defensive

Description – This option invests in amixture of growth and defensive assetsacross most asset classes and uses a largelypassively managed investment approach. It isdesigned for members who want exposure to acombination of growth and defensive assetsand can tolerate a medium to high level of riskover four years.

Objective

To achieve a return (after tax andinvestment management fees) thatexceeds CPI increases by at least 2.5%p.a. over rolling four year periods.


Medium to High


Four years

Asset allocation

Asset Class Range%

Benchmark%

Australian Shares


10-35

10-35

21

24


0-15 5





MODERATE GROWTH (ENHANCEDINDEXED)

Growth/Defensive

70% Growth

30% Defensive

Description – This option investsacross most asset classes but mainly in growthassets and uses a largely passively managedinvestment approach. It is designed formembers who want exposure to mainly growthassets and can tolerate a high level ofrisk over five years.

Objective

To achieve a return (after tax andinvestment management fees) thatexceeds CPI increases by at least 3%p.a. over rolling five year periods.


High


Five years

Asset allocation

Asset Class Range%

Benchmark%

Australian Shares


15-45

20-50

30

34


0-15 6




DIVERSIFIED SHARES (INDEXED)

Growth/Defensive

100% Growth

0% Defensive

Description – This option invests in amixture of Australian and InternationalShare asset classes and may include somecurrency hedging using a passiveapproach. It is designed for memberswho want a high exposure to growthassets and can tolerate a high level ofrisk over ten years.

Objective

To achieve a return (after tax andinvestment management fees) thatexceeds CPI increases by at least 4%p.a. over rolling ten year periods.


High


Ten years

Asset allocation

Asset Class Range%

Benchmark%

Australian Shares


30-70

30-70

50

50


0 0

Alternative Assets 0 0

Higher YieldingFixed Interest 0 0



THE PLAN’S INVESTMENT OPTIONS (CONTINUED)

DIVERSIFIED OPTIONSActively Managed

CONSERVATIVE (ACTIVE)

Growth/Defensive

35% Growth

65% Defensive

Description – This option investsmainly in defensive assets. It is designed formembers who want exposure to mainlydefensive assetsand can tolerate a low tomedium levelof risk over 3 years.

Objective

To achieve a return (after tax andinvestment management fees) thatexceeds CPI increases by at least 1.5%p.a. over rolling three year periods.


Low to Medium


Three years

Asset allocation

Asset Class Range%

Benchmark%

Australian Shares


0-25

0-25

11

11


5-20 10




MODERATE GROWTH (ACTIVE)

Growth/Defensive

73% Growth

27% Defensive

Description – This option investsacross most asset classes but mainly in growthassets. It is designed for members who wantexposure to mainly growth assets and cantolerate a medium to high level of risk over 5years.

Objective

To achieve a return (after tax andinvestment management fees) thatexceeds CPI increases by at least 3.5%p.a. over rolling five year periods.


Medium to High


Five years

Asset allocation

Asset Class Range%

Benchmark%

Australian Shares


15-45

15-45

27

28


5-30 13





ASSERTIVE (ACTIVE)

Growth/Defensive

88% Growth

12% Defensive

Description – This option invests inacross most asset classes but predominantly ingrowth assets. It is designed for members whowant a high exposure to growth assets and cantolerate a medium to high level of risk over 7years.

Objective

To achieve a return (after tax andinvestment management fees) thatexceeds CPI increases by at least 4%p.a. over rolling seven year periods.


Medium to High


Seven years

Asset allocation

Asset Class Range%

Benchmark%

Australian Shares


20-50

20-50

34

35


5-30 15





HOW THE TERM DEPOSIT WORKS

HOW TO INVEST…An investment in the Term Deposit investmentoption must be sourced from your investment(s)in any of the other investment options, i.e. youare not permitted to invest directly into the TermDeposit investment option – your investmentmust be initiated by a switch* of monies fromone of the other investment options. Therefore,you must complete a Commencing aninvestment in the Term Deposit investmentoption - Superannuation Division form.

The minimum investment amount is $10,000.There is no maximum investment amount.However, when you make your initialinvestment, you must leave at least $2,500 or2.5% of your total account balance (which canbe capped at the level of $10,000 if you wish)invested in your non-Term Deposit investmentoptions to cover the deduction for administrationfees payable in respect of your investment in theTerm Deposit investment option and anyinsurance premiums payable. This is becausethese deductions cannot be made from yourTerm Deposit investment option.Thereafter, and prior to maturity each year,you will need to consider how much youshould switch from your Term Depositinvestment option into your other investmentoptions to maintain sufficient funds for thesedeductions. Your written instruction toswitch for this purpose must be received bythe Plan Administrator at least 3 businessdays prior to the maturity date. If, during theterm, the amount remaining in your non TermDeposit investment options is not sufficientto cover the cost of the administration feethroughout the term, then a break triggerevent will have occurred. In thesecircumstances, the Term Deposit breakcrediting rate will apply, your investment inthe Term Deposit investment option will beclosed and any final amount payable will beinvested in the Cash investment option. See“Term Deposit break crediting rate” and“Term Deposit investment option – Breaktrigger event” in the grey boxes earlier in thissection for more information and a workedexample. Investment switch fees apply – see ‘Isthere a fee for switching investment options?’ in“Some frequently asked questions …” later inthis section of this Booklet.

TERM DEPOSIT (CONTINUED)

Investment switches into the Term Depositinvestment option are processed only once eachmonth just prior to the end of the month by thePlan Administrator. Therefore you will remaininvested in your existing investment option(s)until the first day of the following month. TheCommencing an investment in the Term Depositinvestment option - Superannuation Divisionform must be received by the Plan Administratorat least three business days before month-endto allow sufficient time for processing on the firstbusiness day of the following month.

The investment term…The investment term for each investment is 12months. Your commencement date in the TermDeposit investment option is the first day of themonth after we receive your switching request.For example, if you submit a completedCommencing your investment in the TermDeposit investment option - SuperannuationDivision form on 15th October, your investment inthe Term Deposit investment option willcommence on 1st November with a maturity dateof 31 st October in the following year.

At the end of the investment term (i.e. thematurity date), your investment will automaticallybe reinvested in the Term Deposit investmentoption for another 12 months at a new TermDeposit crediting rate declared for the next 12month investment term unless you submit anInstructions upon maturity for the Term Depositinvestment option - Superannuation Divisionform. This form must to be received by the PlanAdministrator at least three business days priorto the maturity date with instructions to switchinto another investment option(s).

To earn the Term Deposit crediting rate for the12 month term, a break trigger event must notoccur. See “Term Deposit crediting rate” and“Term Deposit break crediting rate” in the greyboxes earlier in this section for more informationon each of these including what constitutes abreak trigger event.


The Term Deposit crediting rate explainedThe crediting rate for the Term Deposit investment option (the rate of investment earnings allocated to theinvestment option upon completion of the term to maturity) is declared by the Trustee based on the returnsearned on the underlying deposits held with NPBS, and after the Trustee makes an allowance for investmenttax and any investment management fees. The Term Deposit investment option is solely invested in termdeposits with NPBS. The return on these deposits, as declared by NPBS, is expected but not guaranteed toexceed the cash rate declared by the Reserve Bank of Australia (RBA).

The Term Deposit break crediting rate explainedIf any part of your account balance is invested in the Term Deposit investment option and a break triggerevent occurs (this is described on the next page), a further cost will apply. This will be in the form of areduced Term Deposit crediting rate, known as the “Term Deposit break crediting rate”. This means theTerm Deposit crediting rate you were quoted at the commencement of your investment term will no longerapply and you will receive the Term Deposit break crediting rate for your whole investment term. The wholeof your term means from the date your investment in the Term Deposit investment option commenced untilthe date a break trigger event occurs. The Term Deposit break crediting rate is calculated as a percentageof the Term Deposit crediting rate quoted when you commenced your investment in the Term Depositinvestment option. The percentage (as a sliding scale) will depend on the number of days and months youhave completed to the end of your term at the time the investment switch or voluntary withdrawal is made orat the time you leave the Plan – see the table directly below.

When the break trigger event occurs Term Deposit break creditingrate that will apply

Within 7 days of commencement No interest is payable

Between 8 days and less than 3 months^ 20% of the crediting rate applies*

Between 3 months and less than 6 months^ 40% of the crediting rate applies*

Between 6 months and less than 9 months^ 60% of the crediting rate applies*

Between 9 months and less than 12months^ 80% of the crediting rate applies*

^ Months are counted according to the number of days in that calendar month.* The percentage payable is calculated based on the actual number of days of the term you have completed.

Your investment in the Term Deposit investment option will then be closed and any final amount payable willbe invested in the Cash investment option (unless you have advised the Plan Administrator otherwise on theappropriate form).

Note the Term Deposit break crediting rate does not apply if a voluntary withdrawal is made from the part ofyour account which is invested in the Term Deposit investment option due to your death, or if you areassessed as being totally and permanently disabled or if a payment is required due to a family law order.

To find out the Term Deposit break crediting rate applicable to you at such time, you can call the Plan’sSuperannuation Helpline on 1300 789 636 or visit the Plan’s website at:newcastlepermanent.superfacts.com where you can access up-to-date information about the creditingrates applicable to the Term Deposit investment option.


What is a break trigger event?A break trigger event will have occurred if any part of your account is invested in the Term Depositinvestment option and prior to maturity you:

· make an investment switch out of that part of your account, or· make a voluntary withdrawal # from that part of your account, or· you make a partial withdrawal # which cannot be fully funded from your “non Term Deposit

investment options”, or· you leave the Plan, or· the Plan Administrator is required to switch an amount out of your investment in the Term Deposit

investment option to cover any deductions required for administration fees payable in respect of yourinvestment in the Term Deposit investment option and any insurance premiums payable.

# This includes (but is not limited to) any early release applications approved by the Trustee.

A break trigger event will not be deemed to have occurred if a withdrawal is required from the part ofyour account which is invested in the Term Deposit investment option due to your death, or if you areassessed as being totally and permanently disabled or if a payment is required due to a family laworder.

If you make an investment switch prior to maturity - An exampleOn 1 April you have an account balance of $45,000 invested in the Cash investment option. Youdecide to switch1 $40,000 into the Term Deposit investment option, leaving a balance of $5,000 in theCash investment option to cover the deductions for administration fees2 payable in respect of yourCash and Term Deposit investment options and any insurance premiums payable.

The term of this investment is 12 months and will mature on 31 March in the following year. The TermDeposit crediting rate quoted to you at the commencement of your term is 5.0% p.a., which will bepayable to you on 31 March in the following year (i.e. the end of the term).

On 1 December, the daily interest accrued will be $1,337 calculated as3:

$40,000 x 5.0% x 244/365 (i.e. 244 days have been completed between 1 April and 30November, both days inclusive).

On 1 December you decide to switch4 back from the Term Deposit investment option to the Cashinvestment option. This choice by you is classed as a break trigger event and as a result the TermDeposit break crediting rate (as described earlier) will apply.

The Term Deposit break crediting rate that will apply to determine your final interest payment will be3.0% calculated as:

60% (i.e. eight full months have been completed between 1 April and 30 November - thepercentage payable where a break occurs between six and nine months from the table above is60%) x 5.0% (i.e. the Term Deposit crediting rate originally quoted when you commenced yourinvestment).

The final Term Deposit interest payment will be $802 calculated as3:

$40,000 x 3.0% x 244/365.

Therefore a total amount of $40,802 will be switched from the Term Deposit investment option to theCash investment option on 1 December and your Term Deposit investment option will be closed.1 A switch fee of $30 will be deducted from the balance in your Cash investment option.2 An administration fee of 0.45% pa of your account balance applies to both your Term Deposit andCash investment options. However, because deductions cannot be made from your Term Depositinvestment option, the administration fee applying to your Term Deposit investment option is deductedfrom your Cash investment option account balance.3 Rounded to the nearest dollar for the purposes of this example.


SOME FREQUENTLY ASKEDQUESTIONS …HOW DOES INVESTMENTPERFORMANCE AFFECT YOURBENEFITS?

A rollover is made to an account in your name inthe Plan. The money is invested in one or moreof the nine investment options selected by youand your account is credited or debited with theinvestment earnings (positive or negative) ofthose options. The exceptions to this are theCash and Term Deposit investment optionswhere your investment cannot generally bereduced by negative investment earnings. Thismeans your super is linked directly to how thePlan’s investments in the option (or options) thatapplies to you have performed. See earlier inthis section for more information on theinvestment risks and the investment optionsavailable.

WHICH OPTION MAY SUIT YOU?This very much depends on your individualfinancial circumstances. It is recommended thatyou seek professional advice from a licensed, orappropriately authorised, financial adviser whenmaking this decision.

When making your choice of investment option,the Plan’s Superannuation Helpline can help youwith general inquiries, but for legal reasons arenot allowed to give advice as to whichinvestment option you should choose. Thischoice will be your decision alone and will needto be based on your individual financialcircumstances and needs.

HOW MUCH RISK ARE YOUCOMFORTABLE WITH?Most investments involve some level of ‘risk’ –(the chance of the investment changing in value– either up or down). Because someinvestments are more volatile than others(depending on the mix of growth and defensiveinvestments) having a choice of investmentoptions means that you can help control howmuch risk you want to take. See earlier in thissection for more information on the investmentrisks and the investment options available.

HOW IMPORTANT IS THE SECURITYOF YOUR PENSION?Depending on your personal financialcircumstances, the answer to this question willvary.If you are relying on the value of your pension tosupport your lifestyle in retirement or leading upto retirement, then you may wish to considerfocusing on investments that are unlikely to fallin value.On the other hand, if your pension represents asmall portion of your income you may feel youcan afford to ride out the inevitable ups anddowns of investment markets and mightconsider focusing some of your account on

growth assets. This may provide you with higherreturns and your pension may last for a longerperiod.Whatever decision you make needs to be basedon your own financial circumstances.

OTHER ISSUES YOU MAY WANT TOTHINK ABOUT:Do you have other investments outside ofsuper? Are they mainly growth or defensiveinvestments?You may want to take this into account whenchoosing your investment option.

DOES MY CHOICE OF INVESTMENTOPTION APPLY TO ALL MYSUPERANNUATION?The investment options you first choose willapply to your initial investment. After you joinyou can change investment options at any time.Note, you can change your investment optionsfor just your current super account, or just foryour future contributions and transfers, or forboth. If you make a change it is important tospecify whether the change is to apply to yourcurrent super account, your future contributionsand transfers, or to both.

CAN I SPLIT MY MONEY BETWEENINVESTMENT OPTIONS?Yes, your superannuation can be invested in anycombination of the investment options.

HOW CAN I SWITCH MYINVESTMENT OPTION?You can change your investment options bycompleting and returning a:· Changing your investment options in the

Newcastle Permanent Superannuation Plan -Superannuation Division form, if you areswitching between any investment options(other than the Term Deposit investmentoption)

· Commencing an investment in the TermDeposit investment option - SuperannuationDivision form, if you are switching into theTerm Deposit investment option

· Instructions upon maturity for the TermDeposit investment option - SuperannuationDivision form, if you are switching out of theTerm Deposit investment option at thematurity date

· Breaking your investment in the Term Depositinvestment option - Superannuation Divisionform, if you are switching out the TermDeposit investment option before the maturitydate

You can obtain copies of these forms by callingthe Plan’s Superannuation Helpline on 1300 789636 or by visiting the Plan’s website at:newcastlepermanent.superfacts.com


When the Plan Administrator receives yourcompleted form, your change will generally beeffective from the date the Plan Administratorreceives your form or for an election tocommence an investment in or any changes toan existing investment in the Term Depositinvestment option, from the 1st day of the monthfollowing the day we receive your form. Yourform can only be processed once the applicablecrediting rate/unit price is available. Processingis normally done within 5 business days from thedate the Plan Administrator receives your form(except as described earlier in relation to theTerm Deposit investment option). Aconfirmation letter will be sent to you once yourswitch has been processed.

IS THERE A FEE FOR SWITCHINGINVESTMENT OPTIONS?There is no fee charged for investment switchesexcept the Term Deposit investment option (seebelow). Buy/sell spreads may also apply whenchanging your investment options. See“Transactional and operational costs” in theFees and costs section for details of any feesthat you may incur when you make aninvestment switch.For the Term Deposit investment option only, aswitch fee will be charged when:· any amount is moved into this option.· any amount is moved out of this option prior

to maturity.· only part of the maturity value is moved out

of this option at maturity.Note a switch fee will not be charged if the wholeof the maturity value is moved out of this optionat maturity. However, the Term Deposit breakcrediting rate will generally apply if a breaktrigger event occurs. See “Term Deposit breakcrediting rate” and “Term Deposit investmentoption – break trigger event” earlier in thissection for more information about the TermDeposit break crediting rate and what constitutesa break trigger event.

HOW OFTEN SHOULD I CHANGE MYINVESTMENT OPTIONS?Most financial advisers would suggest that it’sappropriate to review your choice of investmentoption, particularly if your personal needs,circumstances and objectives change. You maywish to undertake a review of your financialobjectives with a licensed, or appropriatelyauthorised, financial adviser before making adecision.

ARE THE INVESTMENT RETURNSGUARANTEED?The Cash and Term Deposit investment optionsare invested in deposits with NPBS. In bothcases, NPBS has guaranteed that the rate ofreturn on these deposits to the Trustee will notbe negative, noting that this guarantee is directlylinked to the security and financial stability ofNPBS.As the Cash crediting rate, the Term Depositcrediting rate and the Term Deposit breakcrediting rate are based on the earnings rates of

the underlying assets it is expected, but notguaranteed by the Trustee, that these creditingrates will therefore not be negative.The performance of the Diversified investmentoptions is not guaranteed and investmentearnings can be negative for these options. Youraccount balance will move up and down in valuedepending on the movements in the value of theunderlying investments in your choseninvestment option(s). Past investmentperformance is not an indication of futureperformance.Note that the Trustee reviews the performanceof its managers regularly with a view to ensuringthat the investment managers remainappropriate for the Plan and its investmentobjectives and strategy.If you leave the Plan within a few years ofjoining, the payout you receive may be less thanthe amount paid into your account, if investmentperformance has been low or negative. Theimpact of any fees and charges incurred will alsoreduce the amount you receive.WHAT HAPPENS IF I DO NOT MAKEA CHOICE?If you do not make a choice, then the Trusteewill be unable to accept your application formembership of the Plan.If, in the future, you decide you would like tochange your investment choice, call the Plan’sSuperannuation Helpline on 1300 789 636 whowill provide you with the appropriate form to becompleted or you can download it from thePlan’s website at:newcastlepermanent.superfacts.com.

WHAT IF I’M NOT SURE WHICHOPTION TO CHOOSE?If you are unsure see a licensed, orappropriately authorised, financial adviser foradvice. They will be able to help you make themost appropriate decision for your needs, andperhaps advise you on your overall financialsituation at the time.Please remember, the Trustee, the PlanAdministrator and the Plan’s SuperannuationHelpline cannot advise you on which investmentoption may be best for you. They can onlydescribe and generally explain the choicesavailable through the Plan.

WHERE TO FIND UP-TO-DATEPERFORMANCE INFORMATION?Once you’re a member of the Plan, you canaccess up-to-date information about theperformance of the investment optionsavailable through the Plan by:Ø calling the Plan’s Superannuation

Helpline on 1300 789 636Ø viewing the Plan’s most recent annual

reportØ by visiting the Plan’s website at:

newcastlepermanent.superfacts.com

Beneficiaries 45

BENEFICIARIES

IN THIS SECTION YOU’LL FIND OUT:

· What happens in the event of your death? page 46

· How can you make a nomination? page 46

46 Beneficiaries

WHAT HAPPENS IN THE EVENT OF YOUR DEATH?You can nominate how you want your account balance to be paid in the event of your death. It may be possible toarrange for the remainder of your account to be paid as a continuing pension referred to as a Reversionary Pension or alump sum (depending on the type of nomination you have made). Each type of nomination and who you can nominate toreceive your pension in the event of your death are described in this section. As there may be estate planning and taxconsequences involved in making a particular nomination, we suggest you seek advice from a licensed, orappropriately authorised, financial adviser before making such a nomination.

HOW CAN YOU MAKE ANOMINATION?You have 3 options as to how your remaining accountbalance is to be paid in the event of your death. They are:

1. Benefit Direction – this specifies that if you die yourpension continues to be paid to your nominateddependant.

2. Binding Death Benefit Nomination – this specifiesthat if you die your remaining account balance will be paidto your nominated dependants and is binding on theTrustee (for up to 3 years). You can also indicate apreference for the benefit to be paid as a lump sum or aPension.

3. Nomination of Beneficiary (non-Binding) – gives theTrustee an indication of who you want your death benefitpaid to. You can also indicate a preference for the benefitto be paid as a lump sum or a Pension.

1. BENEFIT DIRECTION – PENSIONPAYMENTS ONLY

In order to continue your pension payments under aBenefit Direction you must nominate a dependant toreceive the remaining pension entitlements as aReversionary Pension. See “Who can you nominate?”later in this section for further details. Your request isbinding on the Trustee and, once made, cannot be altered.This applies even if you and your spouse get divorced oryour spouse or dependant dies.

The percentage of the pension payable to your nominateddependant that is tax-free is the same as the tax-freepercentage of the pension that was payable to you. Thetax-free percentage of your pension payments does notchange when either you or your nominated dependantdies.

Your nominated dependant will receive the remainingpension as income payments until his or her death or untilthe account balance is zero, and can elect at any time towithdraw all or part of the account balance.

If your nominated dependant has died before you, theTrustee will pay any remaining account balance when youdie to your legal personal representative. If you do nothave a legal personal representative the Trustee will paythe benefit to one or more of your dependants, or, if nodependants, to any other person that superannuation lawpermits. This may also apply if superannuation law doesnot allow the Trustee to pay the pension to yournominated dependant.

For so long as the pension is payable, the Trustee willensure that at least one payment equal to the minimumamount required by law is made during each financialyear, unless superannuation law permits otherwise.

To let the Trustee know that you want to set up yourBenefit Direction request you must complete Step 8 of theApplication for membership of the Pension Division form.

You can only make a Benefit Direction request when youfirst join the Pension Division in the Plan.

2. BINDING DEATH BENEFIT NOMINATION

You can nominate one or more persons that you requirethe Trustee to pay your super benefit to, according to theproportions specified by you, by making a binding deathbenefit nomination.

If you make a valid binding death benefit nomination and itis still in effect when you die, the Trustee will be bound topay your account balance to the person or personsnominated by you. You can also specify whether you wantthe balance to be paid as a lump sum or a Pension.However the Trustee is not required to pay the balance inthe way you have nominated.

You must specify in Step 2 of the Binding Death BenefitNomination form which option you’d like your benefit paidas, either a lump sum benefit or pension. Note themethod of payment is not binding on the Trustee - only theperson or persons you nominate to receive this benefit.

You cannot make a binding death benefit nomination ifyou have already given the Trustee a Benefit Direction.

Beneficiaries 47

A binding death benefit nomination will not be valid if:

· it is not made using the Binding Death BenefitNomination form; or

· the Binding Death Benefit Nomination form has notbeen properly completed in accordance with therelevant legal requirements which are specified on theform (for example, the nominated proportions are notclear or do not equal 100% or the form has not beensigned and witnessed correctly); or

· at the time of your death, one or more of the personsnominated by you in the Binding Death BenefitNomination form has died or is not your dependant orlegal personal representative; or

· you remarry after making the nomination; or· you were legally incapable of making the nomination;

or· the Trustee is legally restrained or prohibited from

paying your super payout to one or more of thepersons nominated by you in the Binding DeathBenefit Nomination form.

A binding death benefit nomination will cease to haveeffect if:

· three years has passed from the day you signed theBinding Death Benefit Nomination form or last re-confirmed that nomination; or

· you have revoked the nomination; or· the Trustee is prevented from making payment in

accordance with your binding death benefitnomination due to the operation of the Family Law Act1975; or

· you are subject to a Court Order that prevents youfrom making a binding death benefit nomination orthat requires you to revoke an otherwise valid bindingdeath benefit nomination.

In the event that the Trustee is not able to pay the benefitto your nominated beneficiary, and you have not made anon-binding nomination of a preferred beneficiary (see 3.below), the Trustee will pay the benefit to your legalpersonal representative. If you do not have a legalpersonal representative the Trustee will pay the benefit toone or more of your dependants, or if no dependants toany other person that superannuation law permits.

Making, changing, revoking or re-confirming yourbinding death benefit nomination

If you wish to make, change or revoke your binding deathbenefit nomination, you need to complete and return aBinding Death Benefit Nomination form. You can obtain acopy of this form by calling the Plan’s SuperannuationHelpline on 1300 789 636 or by visiting the Plan’s websiteat: newcastlepermanent.superfacts.com

If you wish to re-confirm your existing binding deathbenefit nomination to continue for another three years, callthe Plan’s Superannuation Helpline on 1300 789 636 forthe necessary form to complete and return.

3. NOMINATION OF BENEFICIARIES (NONBINDING)

You can nominate who you would prefer to receive yoursuper benefit in the event of your death. You can alsonominate whether you would like the benefit paid as apension or lump sum. This is an indication of yourpreferences only. The Trustee is not legally bound by yourwishes but will take them into account.

Your nomination may provide for the payment of youraccount balance to alternate dependants in the event thatone or more of your nominated dependants are not aliveat the time of your death or do not meet the definition of‘dependant’ at that time. See below for details on who youcan nominate.

After taking into account your nomination, the Trustee willpay any remaining account balance to dependants and/oryour legal personal representative in such proportions asthe Trustee may determine. If there are no dependants orlegal personal representatives, the Trustee may pay thebenefit to any other person that superannuation lawpermits.

Making or changing your preferred beneficiarynomination

To let the Trustee know your wishes, you should completeStep 7 of the Application for membership of the PensionDivision form.

You must also indicate your preference for either a lumpsum benefit or a pension.

You can also make a nomination of preferredbeneficiaries, or change your existing preferred beneficiarynomination at any time by calling the Plan’sSuperannuation Helpline on 1300 789 636.

48 Beneficiaries

WHO CAN YOU NOMINATE?

When making a nomination of preferred beneficiaries or abinding death benefit nomination you have the choice ofnominating one or more of your dependants or your legalpersonal representative (your estate).

Your dependants can include:

· your spouse as defined in the relevant legislationwhich generally includes:· your husband or wife,· another person (whether of the same sex or not)

with whom you are in a registered relationship, or· another person who, although not legally married to

you, lives with you on a genuine domestic basis in arelationship as a couple,

· your children as defined in the relevant legislationwhich generally includes:· your adopted child, step-child, or ex-nuptial

children, or· your spouse’s child, or· someone who is a child of you within the meaning

of the Family Law Act 1975,· any other person who the Trustee considers is wholly

or partially financially dependent on you, and· any other person with whom you have an

interdependency relationship. (This will occur whereyou have a close personal relationship with anotherperson (whether or not related by family) and:· you and that other person live together,· you, the other person, or both of you provide the

other with financial support, and· you, the other person, or both of you provide the

other with domestic support and personal care.

It will also occur where you have a close personalrelationship with another person but due to a disabilitythe other criteria of interdependency cannot be met.)

As mentioned previously, you can also nominate yourlegal personal representative (your estate). If your legalpersonal representative receives your payout, typically itwill be distributed according to your will, or if you don’thave a valid will, according to the laws of the State inwhich you resided at the date of your death.

You should note that reversionary pensions cannot bepaid to beneficiaries who do not meet the definition of‘dependant’ at the time of your death.

Further, the law does not generally allow a reversionarypension to be paid to your child unless the child:

· is under age 18;· is under age 25 and financially dependent on the

deceased pensioner; or· suffers a disability as defined in the relevant

legislation.Once the child reaches age 25, the pension must normallybe commuted and paid out as a lump sum unless the childis suffering from a relevant disability, in which case thepension can continue to be paid.

Tax and social security 49

TAX AND SOCIAL SECURITY

IN THIS SECTION YOU’LL FIND OUT:

· How tax applies to amounts transferred to the Pension Division page 50

· Your Tax File Number is important page 50

· Tax on pension payments and withdrawals page 50

· Tax on your pension payments page 50

· Tax on your lump sum withdrawals page 51

· Your death payout and tax page 51

· Tax on investment income page 51

· Surcharge assessments page 51

· Payments of tax assessments and Refunds of tax page 51

· Social Security page 52

· Up to date information page 52

50 Tax and social security

THE RULES AT A GLANCE….

Generally, no tax is payable on amounts transferredto the Plan. However if the amount you transferincludes an untaxed element that part will be taxedat 15%.

Investment income (including capital gains) isgenerally tax free.

Pension payments and lump sum withdrawals are:

· tax free when paid from age 60 (although sometax may be payable on death payouts)

· generally taxable when paid before age 60.

You may be entitled to a 15% tax offset on thetaxable portion of your pension payments if you havereached your preservation age and are under age60.

The following information is a general description of the taxtreatment of superannuation and is based on ourunderstanding of the tax laws as at the date of this PDS. Itaims to give you an overview only, assuming you are anAustralian or New Zealand citizen or permanent resident. Ifyou are not an Australian or New Zealand citizen orpermanent resident different tax rules may apply and youwill generally not be able to join the Plan. Different tax rulesmay also apply if you are an Australian or New Zealandcitizen or a permanent resident but are currently not aresident of Australia for tax purposes.As the tax treatment of superannuation is complex and maychange at any time we strongly recommend that you obtainadvice from a licensed, or appropriately authorised,financial adviser, about how the tax laws affect you.

HOW TAX APPLIES TO AMOUNTSTRANSFERRED TO THE PENSIONDIVISIONGenerally you’ll not be taxed on any superannuation fundpayments that are transferred into the Pension Division.

However, where the payment includes an untaxed elementthat component will be taxed at a rate of 15%. Thiscomponent arises from an untaxed super fund payment.Your rollover statement will show whether you have anuntaxed amount.

If an untaxed amount is received by the Plan, then tax willbe deducted at 15% immediately. The deducted tax will beheld in the Plan and invested until the tax is required to bepaid to the Australian Taxation Office (ATO). The Trusteemay retain for its own use any interest earned on the tax inthe period between its deduction and its payment to theATO.

YOUR TAX FILE NUMBER ISIMPORTANTWhile you don’t have to provide your tax file number (TFN)to the Trustee, and it is not an offence if you don’t, if theTrustee does not have your TFN we may be required todeduct tax at the highest marginal rate (including MedicareLevy) from the taxable portion of any pension payments orany lump sum withdrawals you make before age 60.Tax at a higher rate of 49% (rather than 15%) may alsoapply to any untaxed element rolled over from anothersuper fund.Any TFN information supplied will automatically be appliedto all future investments to and payouts from the Plan. Formore information on the use of TFNs call your local branchof the ATO.

TAX ON PENSION PAYMENTS ANDWITHDRAWALSYou may have to pay tax on pension payments and anywithdrawals you make from the Plan. The actual amount oftax you’ll have to pay depends on:

· your age when your pension or withdrawal is paid, and

· certain other factors.

TAX ON YOUR PENSIONPAYMENTSThe tax payable on your pension payments depends onyour age and the different components that make up yourpension.

PENSION PAYMENTS FROM AGE 60You pay no tax on your pension payments from age 60.

PENSION PAYMENTS BEFORE AGE 60The taxable component of your pension payments will betreated as income. An estimate of the income tax payableas required by law plus the Medicare levy, will be deductedat the time of payment. This may be more or less than theactual amount of tax. Once you have lodged your incometax return, the ATO will determine the actual tax payableand an appropriate adjustment will be made. The Medicaresurcharge may also apply.No tax is payable on the tax-free component of yourpension payments, if any.If you are between your preservation age and 60, you willbe entitled to a tax offset equal to 15% of the taxablecomponent of your pension payments. A 15% tax offsetmay also apply if your pension has resulted from the deathof another person or due to disability.

Tax and social security 51

TAXABLE AND TAX-FREE COMPONENTSThe taxable and tax-free components of your pensionpayments are a percentage of each pension payment. Thepercentages are determined at the commencement of yourpension based on the taxable and tax-free components ofthe amount you transferred into the Plan.For example, if you transfer an amount of $200,000 into thePlan and this is made up of a taxable component of$150,000 and a tax-free component of $50,000, then thetaxable and tax-free components of your future pensionpayments will be:Taxable component = $150,000 divided by $200,000 times100 = 75%Tax-free component = $50,000 divided by $200,000 times100 = 25%

TAX ON YOUR LUMP SUMWITHDRAWALSThe tax payable on any lump sum withdrawals depends onyour age and the different components that make up yourpension.

LUMP SUM WITHDRAWALS FROM AGE 60You pay no tax on your lump sum withdrawals from age 60.

LUMP SUM WITHDRAWALS BEFORE AGE 60Any lump sum withdrawals will generally be split between atax-free component and a taxable component. The split willbe based on the percentage determined when youcommenced your pension as outlined above. A higher taxfree amount may apply if you are totally and permanentlydisabled or the whole amount may be tax free if you have aterminal illness.You pay no tax on your tax-free component.If your lump sum withdrawal is paid after you reach yourpreservation age but before age 60, you pay no tax on thefirst $195,000* of your taxable component and 15%^ tax onany amount over $195,000. If you take your lump sumwithdrawal before your preservation age, you pay tax at20%^ on your total taxable component.* The limit, the “low-rate threshold” is applicable for 2015/16and is indexed from 1 July each year to Average WeeklyOrdinary Time Earnings (AWOTE) in steps of $5,000. Thelimit is a lifetime limit applicable to all payments made afteryou reach your preservation age.^ The Medicare levy (plus where applicable the Medicaresurcharge) is also payable.

YOUR DEATH PAYOUT AND TAXIf you die and your account is paid to your spouse or otherdependants, the tax treatment will vary depending on yourage and whether the amount paid is a lump sum orreversionary pension.The treatment can also vary depending on your relationshipwith the recipient of the benefit.The taxation implications are complex and you should seekprofessional tax advice or see a licensed or appropriatelyauthorised financial adviser.

TAX ON INVESTMENT INCOMEThe Trustee is generally not liable to pay tax on theinvestment income (including capital gains) of the Plan’sassets held in respect of the Pension Division. Where tax isapplicable, an allowance for any tax will be deducted fromthe value of the assets in order to determine theappropriate unit prices.Depending on your selected investment option you mayreceive a bonus payment to your account where anyexcess imputation and foreign tax credits are used toreduce the Plan’s overall tax liability.

SURCHARGE ASSESSMENTSIf we receive a surcharge assessment in respect of you wewill return it to the ATO. The ATO will then forward it to you.

PAYMENTS OF TAXASSESSMENTS AND REFUNDS OFTAXIf you receive a tax assessment from the ATO due to

· a superannuation surcharge debt, or

· an excess contributions tax debt, or

· the additional 15% tax applying to concessionalcontributions of individuals with relevant incomes over$300,000

the assessment can generally be paid from your account inthe Plan to the ATO. In certain circumstances excessconcessional contributions (less tax) and excess non-concessional contributions (plus 85% of deemed earnings)can also be refunded. Any such tax payments or refundswill reduce your account accordingly.In some cases:

· payment can only be made if your request is made tothe Trustee within the time period set down by the ATO;and/or

· the ATO may impose penalties if you do not lodge yourrequest with the Trustee within that time period.

Please note that if you have previously not provided yourTFN to the Trustee and paid additional tax on your supercontributions, you cannot request a refund of this additionaltax paid via the Plan. Any requests for a refund of thisadditional tax must be made to the super fund or division ofthe plan that paid the additional tax.

52 Tax and social security

SOCIAL SECURITYThe amount of your superannuation may affect yourentitlement to benefits. Two tests are applied by theGovernment to determine your eligibility for benefits – anassets test and an income test. In some cases,superannuation pensions which commenced before 1January 2015 are assessed using different rules from thoseapplicable to pensions commenced after that date(including for the same individual).The Federal Government’s regulations relating tosocial security entitlements and the taxation ofsuperannuation are complex and can change with littlenotice. As each member’s personal circumstancesdiffer, these taxation laws will affect individuals indifferent ways.We recommend that you see a licensed orappropriately authorised financial adviser for advice onsocial security and taxation matters.

UP TO DATE INFORMATIONYou can find up to date information on the taxes that mayapply to you by calling our Helpline on 1300 789 636.We can also send you a copy of the updated information,free of charge on request.

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Newcastle Permanent Superannuation PlanPension DivisionProduct Disclosure Statement (PDS) dated 27 July 2015

This Product Disclosure Statement (PDS) is only applicable to members of the Pension Division of the Newcastle Permanent Superannuation Plan ABN 57 170 878 804 (The Plan).This PDS is issued by the Trustee of the Plan, Mercer Superannuation (Australia) Limited (MSAL) ABN 79 004 717 533, Australian Financial Services Licence 235906, RSE Licence L0000819.The Plan’s administrator is Mercer Outsourcing (Australia) Pty Ltd ABN 83 068 908 912, Australian Financial Services Licence 411980.The Plan is distributed by Newcastle Permanent Building Society Limited (NPBS) ACN 087 651 992, Australian Financial Services Licence/Australian Credit Licence 238273.The Newcastle Permanent logo is a trademark of NPBS.

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Documents

Newcastle Permanent Superannuation Plan · Newcastle Permanent Superannuation Plan ... This PDS is issued by the Trustee of the Plan, ... The Plan’s administrator is Mercer Outsourcing