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Wednesday, 16 June 2004
Page: 23885


Senator CHERRY (12:26 PM) —I want to respond to the complete codswallop that was just presented by Senator Sherry in arguing for this legislation. Senator Sherry stood next to Mr Latham on 10 February, when Mr Latham announced the Labor Party's position on this matter. I want to quote Mr Latham yet again because it is a good quote:

These schemes are well outside the community standard in Australia, and have become out of date. They offer superannuation benefits seven times more generous than the current contribution scheme available to the general public. Parliamentary superannuation has become a major source of public dissatisfaction and cynicism in modern politics.

After hearing what Senator Sherry has just said, that cynicism will be much increased. There is a significant legal and constitutional difference between the Public Sector Superannuation Scheme and the parliamentarians' superannuation scheme because the Public Sector Superannuation Scheme deals with employees. I have not come in here to try to change the Public Sector Superannuation Scheme retrospectively, because that would be unconstitutional. I know that, and Senator Sherry should know that. Section 51(xxxi) of the federal Constitution makes it clear that the Commonwealth cannot take away the acquisition of property, which includes rights, from any person in respect of any matter. The High Court has held that that extends to superannuation entitlements for employees.

The question then becomes: are we in this case as an employee dealing with a superannuation entitlement, or are we dealing with a statutory entitlement? It is abundantly clear that we are dealing with a statutory entitlement because we are not employees. We are not dealing with a particular right that flows out of a law of contract. We are dealing with an aspect of statute, and that is what the DOFA representatives before the Senate committee made abundantly clear.

Senator Sherry has been caught out once before not doing his homework on superannuation. On this occasion he has again not done his homework. It was quite clear in DOFA's evidence to the committee that we can amend this bill if we want to, and make it prospective. I am not talking about retrospective changes. I am talking about freezing the current entitlements of all existing members of parliament at the current level. If we do not do that, we are guilty of the same hypocrisy and double standards that Mr Latham identified—quite correctly—as affecting public attitudes towards parliamentarians and their superannuation. We have the legal and the constitutional power to cut our own superannuation prospectively, and we should do that. That would be the fair, reasonable and just thing to do. We do not have the power, under section 51(xxxi), to cut superannuation for future public sector employees. I might add, given that we are on broadcast and that people might actually believe Senator Sherry was telling the truth in his earlier statement, that the government has proposed for the new public sector scheme exactly the same employer contribution as is contained in the old public sector scheme—15.4 per cent. That is very different from what we are dealing with in the parliamentarians' scheme—a government contribution of 67.6 per cent, which is four times higher than the government contribution in the public sector scheme.

I think that all the allegations, assertions and linkages that Senator Sherry tried to make simply do not stack up. We do have the constitutional power. We are dealing with a completely different situation from what we are dealing with in terms of retrospectivity of superannuation generally, and that was quite clear from the evidence we received. We are dealing with a scheme way outside the community's expectation, as acknowledged by Mr Latham on 10 February. It is a real pity that the Labor Party—typical, unfortunately, of the Labor Party, in my experience—having decided that something needs to change, squib out of doing the changes properly. In terms of reform, we have seen it time and time again—you identify a problem, you identify a need to fix the problem and then you fail to follow through and produce the appropriate policy to do so.

The Prime Minister was prepared to acknowledge that, if you are going to reform the parliamentary superannuation scheme, you go the full monty, you go the whole hog. Unfortunately, his backbencher overruled him on that particular matter. That is deeply regretful that the backbench of the Liberal coalition parties were not prepared to acknowledge that we should in fact change this scheme for all MPs and not have the class of 2004 sitting out there like a shag on a rock with special conditions, with special arrangements seven times more generous than those of new MPs coming in. From that point of view, the Democrats will be supporting the Greens amendments. I am not sure whether these amendments will work, because I have not had a chance to check them, having only just seen them. I can understand the intent of them, but I am not sure whether they will work in respect of the other superannuation act. But from the point of view of acknowledging the intent of the amendments, I am prepared to support them at this particular point. The Democrats will also be moving two fall back amendments to the Greens amendments, which will give the parliament plenty of opportunities to vote on a range of options for applying this superannuation change.