Defined-benefit (DB) super funds work fundamentally differently from the accumulation funds covered everywhere else on SuperFind. In an accumulation fund, your retirement benefit is the balance you end up with; investment returns flow through to you and so does investment risk. In a DB fund, your retirement benefit is a formula applied to your final salary and years of service — the fund (or the government, or your employer) bears the investment risk. This guide covers the major Australian DB funds, who they're for, and what to do if you have a legacy entitlement.
The major Australian defined-benefit funds
Commonwealth public sector DB schemes
- Public Sector Superannuation Scheme (PSS) — closed to new members since 1 July 2005. Pays a lifetime indexed pension based on final salary, years of service, and a member contribution multiplier. Approximately 70,000 contributing members and 100,000+ pensioners as at 2025. Managed by the Commonwealth Superannuation Corporation (CSC).
- Commonwealth Superannuation Scheme (CSS) — closed since 1990. Hybrid scheme: part defined benefit (employer-funded indexed pension), part defined contribution (member contributions accumulated and paid as a lump sum at retirement).
- Public Sector Superannuation Accumulation Plan (PSSap) — accumulation-only successor to PSS, opened 2005. Available to new APS employees. Despite the name, PSSap is not a DB scheme.
- MilitarySuper (MSBS) — closed to new members 2016. Australian Defence Force scheme combining employer DB component with member contributions.
- ADF Super — accumulation-only successor to MilitarySuper, opened 2016.
State public sector DB schemes
- GESB West State Super (WA) — closed 1995. DB scheme for Western Australian public servants.
- GESB Gold State Super (WA) — closed 2007. Lump-sum DB scheme.
- QSuper Defined Benefit (QLD) — closed to new members 2008. Now part of Australian Retirement Trust following the 2022 QSuper-Sunsuper merger; existing entitlements preserved.
- SAS State Super (NSW) — closed 1992. Pays lifetime indexed pensions to NSW public-sector retirees.
- State Superannuation Fund (Vic) — closed 1994. Lifetime indexed pensions for Victorian public servants.
- RBF Tasmania — closed 1999. Tasmanian public-sector scheme.
Industry/university DB schemes (open in limited form)
- UniSuper Defined Benefit Division (DBD) — partially closed, but new academic and professional staff at participating universities can still join in some cases. The UniSuper DBD pays a lifetime indexed pension based on final salary, years of service, and contribution rate. This is the only major open-fund DB option in Australia outside the public sector.
- UniSuper Indexed Pension — the post-retirement product for UniSuper DBD members.
How DB benefits are typically calculated
Most Australian DB schemes use a formula along the lines of:
Annual pension = Final Average Salary × Years of Service × Accrual Rate × Member Multiplier
For PSS, the accrual rate is approximately 11% per year of service, and the member multiplier depends on the member's contribution rate (typically 5–10% of salary). A PSS member with 30 years of service and a final average salary of $120,000 might be entitled to a lifetime indexed pension of around $45,000–$55,000 per year — worth roughly $1M–$1.5M in present-value terms at current discount rates.
The commutation question
Most DB schemes allow you to commute your benefit — i.e. exchange the lifetime indexed pension for a lump-sum payment or a partial mix. Commutation factors (how much lump sum your pension converts to) are set by the scheme's actuary and vary by age and pension type.
The commutation value is often substantially less than the present value of the pension. Public-sector schemes in particular use conservative commutation factors that disadvantage members who take the lump sum. Before commuting, get specialist advice from a financial planner with public-sector experience — a generalist adviser may not understand the scheme's specifics.
What to do if you have a DB entitlement
- Confirm what scheme you're in. Check your most recent annual statement or contact your scheme directly. Don't rely on memory — many people confuse PSS with PSSap.
- Get a benefit estimate. Most schemes provide online calculators and personalised benefit projections. Run scenarios at age 55, 60, 65, and 67.
- Don't consolidate without advice. Repeat: DB benefits should not be moved into accumulation funds via the standard MyGov consolidation process. The default rollover destroys irreplaceable entitlements.
- Plan around your DB. If you have a DB pension, your concessional contribution cap is calculated differently (notional contributions reduce your available cap). Be careful about salary sacrifice if you're in a public-sector DB.
- Consider whether to make voluntary contributions. Most DB schemes have a member-contribution component that boosts the final benefit. Higher member contributions usually translate to a higher multiplier and a larger pension.
Beware the "DB is risk-free" framing
DB pensions are commonly described as risk-free because the employer (or government) bears the investment risk. Two caveats:
- Unfunded liability risk. Most state government DB schemes are unfunded, meaning future pension payments come from general state revenue, not a pre-funded pool. In a fiscal crisis, the political pressure to reduce indexation or reformulate benefits is real, even if legally constrained.
- Indexation risk. Most DB pensions are indexed to CPI, but some indexation methodologies have changed over time (e.g. PSS shifted from MTAWE-linked to CPI-linked in 2003). Changes to indexation methodology are politically possible.
That said: for most members, a fully-vested DB entitlement is the single most valuable retirement asset they will ever hold. Protect it.
Related
- How to Consolidate Your Super Accounts — with explicit DB warnings
- How to choose a super fund
- UniSuper Review — the only major open-fund DB option
- Superannuation and Divorce — DB schemes need special valuation