In a Judgement issued recently (2 September 2009), the High Court has ruled in favour of a member of three constitutionally protected schemes in South Australia. This case was the result of an appeal by the member against an earlier decision by the Full Federal Court.

The High Court agreed unanimously that the surcharge legislation in relation to constitutionally protected schemes was invalid “on the ground that they so discriminate against the State of South Australia or so place a particular disability or burden upon the operations and activities of the State of South Australia, as to be beyond the legislative power of the Commonwealth.”

It appears that the Attorney Generals of NSW, Queensland, SA, Victoria and WA supported the member’s appeal.

The appellant was a former Member of Parliament and it is not entirely clear whether the same result would have been achieved by other fund members who were not MPs. The vast majority of the member’s surcharge liability arose in the Parliamentary Scheme however smaller amounts of surcharge arose in the other two schemes.

The appeal succeeded in respect of South Australia, and there seems to be no reason why a similar result will not apply to constitutionally protected schemes in other states.