Senator FAULKNER (11:24 AM) —I wish to take a brief opportunity in this committee stage debate to place on the record the opposition's position on the amendments to the Public Employment (Consequential and Transitional) Amendment Bill 1999 concerning the determination of remuneration for members of parliament. Senators would be aware that the remuneration for MPs is currently set by the Remuneration and Allowances Act 1990, which stipulates that the annual salary is equal to the minimum annual salary rate of salary payable to an SES employee with a classification of SES band 2.

The salary level for SES band 2 was last adjusted in October 1996 in the context of the continuous improvement in the Australian Public Service Enterprise Agreement 1995-96. Since then, that benchmark has been effectively rendered meaningless by the introduction of AWAs for SES officers. These vary from department to department, as the committee would know, and even potentially vary from officer to officer. In addition, they are confidential to the employer and the employ ee. Clearly, there is a need for a new benchmark. As far as the opposition is concerned, I think it is appropriate that these things not go through the parliament without comment.

It is because of this situation that the government has proposed a new process for the benchmarking of MPs' salaries. This will be achieved by amendments to the Remuneration and Allowances Act 1990 and the Remuneration Tribunal Act 1973. I will briefly outline the process and place it on the public record. The Minister for Finance and Administration will seek advice from the Remuneration Tribunal about an appropriate reference salary for benchmarking MPs' salary and an appropriate percentage of that salary. The reference salary can be any salary applicable to an office under a determination of the Remuneration Tribunal or a salary for a principal executive classification as determined by the tribunal. The government will then bring forward a regulation to link MPs' salary to the set percentage of the reference salary. Until regulations are in force, or in the absence of regulations, the current benchmark will continue to apply.

This mechanism is the government's initiative. In determining our response to the government's proposal, the opposition applied two criteria. These are the same criteria that we have insisted on in the negotiation of those sections of the Public Service Bill 1999 which deal with the setting of remuneration for agency heads and other statutory office holders encompassed by the bill. The criteria are, first, a continuing obligatory advisory role for the Remuneration Tribunal and, second, full transparency in relation to the final determination of the level of remuneration. The government's proposal meets these criteria and accordingly the opposition will support it. It is worth while pointing out that, in addition to meeting the requirement for full transparency, the vehicle for achieving transparency will be a regulation which of course is disallowable by either house of the Australian parliament.

I thought it was appropriate that that at least be put on the record as there are often—appropriately—sensitivities about these issues. So I would not want the matter dealt with without me on behalf of the opposition drawing attention to it in the way that I have and outlining fairly what I believe has been the approach of the Senate in these circumstances.