I refer to your memorandum No. G/5872 of the 10th September, 1947, requesting advice as to whether certain allowances payable under the Financial (Military) Regulations should be regarded as ‘salary’ for the purposes of the Superannuation Act 1922–1947. Section 4 of that Act defines ‘salary’ as follows:

‘Salary’ means salary or wages, and includes the value of allowances such as allowances for rent, house allowed rent free, light, fuel, rations and fees allowed regularly as emoluments of office, but does not include bonuses, over-time payments, or allowances for forage equipment, climatic disadvantages, cost of living or travelling expenses.

(2)  For the reasons set out hereunder, I am of the opinion that—

(a)  Marriage allowance, provision allowance, the living out allowance, allowance in lieu of rations or in lieu of quarters or tentage and clothing maintenance allowance should, and

(b)  exchange allowance and separation allowance should not,

be regarded as ‘salary’ for the purposes of the Superannuation Act 1922–1947.

(3)  At the outset, I would point out that the allowances to be included within the meaning of the term ‘salary’ are not exhaustively defined and the allowances specified are merely indicative of the nature of the payments intended to be included. In my view, the allowances contemplated by the definition to be included are, speaking in general terms, payments in kind or payments in lieu thereof customarily and regularly made to persons in a particular service or employment and emoluments or perquisites of office, such payments being taken into account in the fixing of the rates of remuneration of those persons. By contrast the allowances to be excluded appear to be of an occasional, temporary or fortuitous character.

(4)  Exchange allowance, which is payable under regulation 11, is a daily rate of allowance payable, in addition to the prescribed daily rate of pay of a member of the Military Forces according to rank, during the period of his service abroad. It commences on the date of a member’s embarkation for service abroad and ceases on his disembarkation in Australia, on return from such service. Despite that it seems to be a percentage increase of total remuneration during the period of any such service it is clearly of a temporary character and, so, of the nature of the allowances which are excluded from the meaning of ‘salary’ for superannuation purposes. Indeed it appears closely akin to allowances for cost of living or travelling expenses, payment which are specifically excluded.

(5)  Marriage allowance, which is payable under regulation 12, is an allowance payable to a married member or to a widowed member, supporting a wife, or children, as the case may be, in the circumstances specified in the regulation. It is observed that, to be eligible for this payment, it is necessary for—

(a)  a married member to maintain, in the opinion of a prescribed authority, a ‘normal domestic relationship with his wife’, or

(b)  a widowed member to maintain, in the opinion of a prescribed authority, a ‘home for the benefit of’ his children.

(6)  It is understood that, in practice, a prescribed authority approves payment of the allowance to a married member who is not separated from his wife, either by judicial decree, deed of separation or desertion, regardless of whether the member maintains a home or any other form of domestic establishment for his wife. While special provision is made by regulation 13, 15 and 18 for reimbursement of expenses incurred, in varying circumstances, in respect of rent and food, comparable provision is made for single members. It appears, therefore, that marriage allowance is an additional payment made in consideration of additional living expenses inevitably associated with the marital condition of the members concerned. Accordingly, I think that this allowance should be regarded as partaking of the nature of the allowances contemplated by the definition of ‘salary’ as allowances to be included within the meaning of that term for superannuation purposes.

(7)  Provision allowance, which is prescribed by regulation 13, is payable to a ‘member who, being in receipt of marriage allowance, lives at his home or in married quarters’. It appears, having regard to the name of the allowance and the circumstances in which it is payable to be an allowance payable to a member in receipt of marriage allowance in consideration of his bearing the expense of supplying his own household provisions while living at a private home or in married quarters supplied by the Army. It is the normal practice of the Army to provide its members with quarters or tentage and with rations. Insofar as a member who lives in married quarters is concerned it appears (cf. regulation 18(3) and (5)) that he is also eligible for an allowance in lieu of rations, if not supplied by the Army. Nevertheless, I think that provision allowance must be regarded as an allowance of the nature contemplated under the definition of ‘salary’ as an allowance to be included within the meaning of the term.

(8)  Separation allowance, which is prescribed by regulation 14, is payable to ‘a member who, being in receipt of marriage allowance, is required by reason of his military duty, to live away from his home’. A member who draws this allowance also necessarily draws marriage allowance and is eligible for an allowance under regulation 15 or regulation 18(3) or (4) in respect of his own provision of food or accommodation, or one of the other, if not supplied by the Army. The basic consideration for this allowance appears to lie in the loss by the member, by reason of his military duty, of the society and services of his wife and family. It appears to be a payment by way of compensation on that account. Even if the allowance relates to additional expenses incurred in the circumstances to which regulation 14 applies, the assumed normal expenses of a married member additional to rent and food are covered by marriage allowance and the assumed extra expenses contemplated by regulation 14 are clearly of a fortuitous and temporary character. In my view, therefore, the allowance falls within the class of allowances contemplated by the definition of ‘salary’ as allowances to be excluded.

(9)  Living out allowances payable to married and single members, respectively, under regulation 15 and 16 and the allowances in lieu of rations or of quarters or tentage payable under regulation 18 are all allowances payable, in the circumstances specified by the respective regulations, to members who are not supplied by the Army with rations and quarters or tentage as normally provided, or are not supplied with one or the other. In my view, all these allowances, insofar as they relate to rations, are within the class of allowances which, under the definition is specifically to be included in ‘salary’, and, insofar as they relate to quarters or tentage, are akin to other types of allowance specified in that class, namely, an allowance in lieu of rent or house allowed rent free.

(10)  Clothing maintenance allowance, which is payable under regulation 37, is, in my view, an allowance of a nature substantially similar to those allowances which, under the definition of ‘salary’, are to be included within the meaning of that term. It is a regular payment and appears to be in respect of an expense borne by the member which, under the alternative arrangement, would be borne by the Army by provision and maintenance of clothing free as an incidental of the members’ service.

(11)  If it be considered that acceptance of the views expressed in the foregoing paragraphs of the memorandum would involve anomalies or if the result appears to be not in accord with the intention of the Superannuation Act, it appears to me that such variation of the result as is desired can be achieved only by amending legislation.

[Vol. 38, p. 20]