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ABC News Breakfast -

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(generated from captions) answered. The only exception is

Penny Wong who makes a

concerted effort. The issue of

executive termination pay-outs

is one of those topics that's

due to be debateed in the

Senate today. The opposition

says the government is moving

too quickly on the issue. For

more the opposition's financial services spokesman Chris Pearce

joins us now from Canberra.

Chris Parkes good morning.

Good morning, Joe. Now, you've made amendments to the

government's legislation. What

are those amendments aimed at

achieving? When the

legislation was in the house of

representives last week, I

moved an amendment, because

what I was trying to do was

trying to assist the government

to actually reach its

objectives it's outlined for

this Bill. But if the Bill as

it currently stands ends up

going through the Senate

unamended as well, I worry,

Joe, that the objectives that the government set actually

won't be achieved. And in fact,

what will end up happening, I

believe, is that executive

remuneration will actually increase. Why will that be the

case? The government plans to

put in this rule that the golden handshakes only be one

year's salary before they need

shareholder approval. Won't

that limit those golden handshakes? What the government has actually

proposed in this legislation is

one year 's base salary. Not

total salary. As you might

know, typically in Australia's

corporate industries, salaries

made up of generally around

about one third of base pay.

And about two-thirds of

performance pay. With base pay,

base bay is guaranteed pay. You

get that regardless of the

performance of yourself or your

business. The performance of

course is at risk, it's based

on the performance. What the

government is focused on is the

base pay. What will end up

happening here is that if this

Bill goes ahead as it is, we'll

lose the link of two-thirds

executives being paid own the

actual performance. What will

increase. happen is the base pay will

increase. Everybody's base pay

will go up. And that will be

guaranteed pay. So it won't

matter how the company

performs, it won't matter how

the executive performs, they'll

get this huge guaranteed base

pay, and of course, as you

would understand, that's not in

shareholders' interests. The

Greens are proposeing that that

base pay be limited to

something like 10 times or I

don't know how many times the

average worker gets. Would you

agree with that kind of

proposal? Well, what I want,

Joe, is I want the government

to achieve its objectives. But

it's not going to happen in

this Bill. I want executives to

be paid predominantly on the

performance of their companies.

And that's why we have said

that you would be better off to

use total pay in base and the

at-risk performance element rer

than just base pay. Because two

things will happen. And this is

the reality of corporate world.

The first thing that's going to

happen is the base pay, the

guaranteed element, will

increase. The second thing

that's going to happen is that

instead of the golden hand

shake be given at the end, at

termination, we'll see the new

introduction of if you like

golden hellos, sign-on bonuses

will happen is it will just go upfront. And so as I say, what

from the back end to the front

end. Base pay will go up and

executives will actually be

paid more. We just move on to another issue. You have indicated you will be stepping

down at the next election. We

thought there was going to be a

reshelf before now. Isn't it

time for you to step down and

let some new blood through so let some new blood through so

they can get used to the portfolios? As you have identified, I will announced

that I will retire from

Parliament at the next

election. The way that the

frontbench is configure ed is a

matter for our leader and he

will do that when he's ready to

do that. In the meantime, I

will be the shadow minister and

I will continue as I am right

now with you this morning to

try to do the best job that I

can and to most importantly

make sure that we can assist

the a government to achieve

its objectives because in

relation to executive pay

that's not going to