Save Search

Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard    View Or Save XMLView/Save XML

Previous Fragment    Next Fragment
Wednesday, 15 June 2011
Page: 6081


Mr BALDWIN (Paterson) (11:29): I rise today to speak on the Governance of Australian Government Superannuation Schemes Bill 2011, the ComSuper Bill 2011 and the Superannuation Legislation (Consequential Amendments and Transitional Provisions) Bill 2011. Just over a year ago we stood in this chamber debating this very bill. This bill lapsed because the then Minister for Finance and Deregulation, Lindsay Tanner, failed to consult adequately with stakeholders and the crossbenchers in the Senate and refused to take onboard the advice that was provided by the veteran community. It is true that this bill will take various organisations—one of those being the Australian Reward Investment Alliance, ARIA, who have the investment management rights over the CSS, PSS and PSSap—and bring them together with the board which oversees the MSBS as well as parts of the DFRDB and DFRB.

The Public Service superannuation fund this time last year amounted to some $16 billion. The money held on MSBS amounted to some $3 billion. As I stated when this bill was being debated last year, in principle the coalition has no problem with that money being joined together for investment to provide greater returns to each member, whether they be public servants or retired military personnel. The coalition sticking point all along has been this Labor government's desire, in essence, to hand over control of these funds de facto to the ACTU.

A board will be formed that will have five employer directors chosen in consultation between finance and defence ministers. It will have three members nominated by the President of the ACTU. It will have only two members nominated by the Chief of the Defence Force and it will have one independent chair. Already Defence is behind the eight ball, because there are three sectors of service in the Defence Force. There is the Air Force, there is the Navy and there is the Army. But the issue with this bill that concerns the coalition most of all is not just the imbalance in the structure of the board; it is the fact that the minister cannot dismiss an ACTU-nominated director. The President of the ACTU has more power in control of these funds than the minister, who ultimately is accountable to this parliament for the administration of the funds. This is outlined in the explanatory memorandum, which says:

The CEO is not subject to ministerial direction in the performance of this statutory function.

Given the make-up of the board, the CEO is de facto responsible to the President of the ACTU. That is an area that we have concerns with.

I cannot recollect any board of 11 where you need a quorum of nine. As my colleague the member for Fadden so rightly pointed out, this would mean that the ACTU could spoil the quorum and delay the progress of any investment decisions if it does not go their way.

The thing that concerns me most of all is the unintended consequences of this. In the last parliament I was the shadow minister responsible for this—and I congratulate the member for Fadden for the work that he has been doing on behalf of our defence members. One of the briefings said that this $16 billion and $3 billion will be combined to create a $19 billion fund which will then be put out to tender. It will not be the board of directors working out where the investment goes. It will go to tender. I suspect that sitting in the back of the mind of the President of the ACTU and all the ACTU members is the idea that this fund would be well placed with an ACTU-driven superannuation investment arm. That is why the sticking point is with this government. They want to make sure that they have absolute control over all these funds so that they can put all these funds to a union-driven superannuation management fund and therefore prop up the union movement even further.

Mr Perrett interjecting

Mr BALDWIN: This will be payback. The member opposite says to name the ones that will exist. The member is nothing but a fool if he does not understand that within a moment's notice the ACTU could pop up an arm and establish such a body.

The DEPUTY SPEAKER ( Ms AE Burke ): The member for Paterson tested my patience yesterday and I do not think he should try to test it again today.

Mr BALDWIN: Madam Deputy Speaker, I suggest you ask the member not to intervene.

The DEPUTY SPEAKER: The member for Paterson knows he should not respond to interjections. I have not thrown anyone out in a while. It could be my day.

Mr BALDWIN: Madam Deputy Speaker, that is entirely your prerogative.

The DEPUTY SPEAKER: It is.

Mr BALDWIN: There are flaws in this bill and the current minister is repeating the errors of the previous finance minister. He is failing to consult. He is failing to negotiate and find a pathway forward. It is true that after 1 July the balance of power in the Senate will shift. The Greens will have power. I would think the Greens, who on a number of occasions have stood up for the financial rights of members of our military, will stand up to this minister and say, 'No, the ACTU president should not have more power than the minister for finance.' As I said, and as is outlined in the explanatory memorandum, the CEO is not subject to ministerial direction in the performance of his statutory functions but in essence will be there to serve the needs of the President of the ACTU, given the balance of the power and the make-up of the board and given the fact that only the President of the ACTU can dismiss members. The member for Fadden has moved amendments that move the balance of power of the ACTU in this board—

Government members interjecting

Mr BALDWIN: Members opposite interject and say, 'They're only trustees,' but trustees set direction; otherwise, there would not be much point in having trustees. Indeed, there would not be much point in having a board if it was not establishing the policy matrix by which the administration of the funds occurs.

I also refer to the contribution of the previous speaker, the member for Throsby, who for the better part of seven minutes did nothing but waffle on about tones of speech as though he were some great oracle in relation to this industry. I am sad to inform the member for Throsby that he is a long way from being such an oracle. In the tone of his discussion he displayed a relative lack of understanding of the needs of the security of the financial investments of members of our Australian Defence Force. I, like the member for Fadden and other members in the coalition, have taken time to speak to organisations like DFWA and, more importantly, individual members of the Defence Force, retired and serving. Their greatest concern is that this government will again, like it has in the past, destroy the superannuation benefits of those, both serving and retired, in our military system. So there are great concerns.

The government has failed to explain, through a failure to sit down and discuss, why when the union movement represents only 41 per cent of the Public Service it should have the majority control. Defence has 100 per cent of its members represented by only the two nominated directors; the ACTU will have three nominated directors for 41 per cent of its contributors. I would have thought that would have said something: if 59 per cent of the people choose not to be in the union movement then perhaps it might be wiser to have more independently nominated directors put forward by the minister and the Chief of the Defence Force. After all, whilst the Chief of the Defence Force and others are in the military, they are also public servants.

I cannot support this bill, and I cannot support it for the exact reasons I outlined on 2 July in this House, not only in my main speech but also during consideration in detail. Again, this minister, like the previous minister, has failed to adequately consult. Through maintaining their position on the bill, they have not secured the confidence of the Defence personnel whose funds they seek to represent, because those people are concerned that the government will be putting the ACTU in with an absolute, uncontrollable balance of power to administer their funds. Given the government's previous track record going back to the Whitlam era, I can understand their fears. So I will not be supporting this bill.

Even though the government may use its numbers to push the bill through, I would have thought some of the Independents in here would have sat down and thought wisely of the ramifications of the bill in its current form and made the minister stand to account. Then again, perhaps they are more interested in their carbon tax or their poker machines levy. Perhaps they give greater precedence to those things than to the welfare of former and current serving members of the military of this country.