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Tuesday, 23 October 1956

Mr SNEDDEN (Bruce) .- Thehonorable member for Banks (Mr. Costa> has said that this measure will effect very slight improvements to the superannuationscheme and that he is therefore disappointed with it. I find it extraordinary that he should think the improvements will be very slight. On the contrary, I think they will be considerable. They are designed to correct certain drafting weaknesses on the onehand, and to effect a progressive improvement of the conditions, particularly the superannuation, of Commonwealth publicservants on the other hand.

Mr Bryant - Any consideration received from this Government is certainly a great surprise.

Mr SNEDDEN - 1 am not surprised at the honorable members' attitude. He probably has not even examined the bill. If he studied it he would discover that it is not so simple as it may seem. A bill that comes before this House usually states that it will take effect from a date to be proclaimed or from a specific date. This bil] states that, with the exception of three clauses, it will take effect on a date to be proclaimed. In the case of those three clauses, which are important ones, a specific date is mentioned from which they will take effect.

The first of these exceptions is clause 6, which provides for an amendment to correct a draftsman's error. As mentioned by the honorable member for Banks (Mr. Costa), the most recent quinquennial report, for the period from 1947 to 1952, was the first such report to disclose a surplus. Previous reports all disclosed deficits. It is only since this surplus has been disclosed that the weakness in draftsmanship has been revealed. The principal act, as it now stands,. says that the amount contributed by the Commonwealth to ensure that an interest rate of H per cent, shall be maintained will be " set off ". The legal people who give opinions on these matters say that set off " relates to something in the future, and that such a provision, therefore, cannot apply to the surplus revealed by the quinquennial report. The Commonwealth contributed £223.000 during the relevant fiveyear period to ensure the maintenance of an interest rate of 3i per cent. The amendment to the principal act which is provided by clause 6 of the bill is to apply from 1st July, 1947, the commencement of the period covered by the quinquennial report.

The two other exceptions to which I referred are contained in clauses 10 and 15, and if the honorable member for Banks thinks that these are very small improvements, I am sure that they will not be so considered by the temporary employees in the Commonwealth Public Service who are at present contributing to the Superannuation Fund, and who may be affected by these provisions. Under existing legislation, a temporary employee may contribute to the Superannuation Fund after having been employed for three years in the Commonwealth Public Service, provided that the Public Service Board certifies that his employment is likely to continue for another seven years. He may then, if he so elects, become a contributor to the Superannuation Fund. The important point is, however, that if he wishes to improve his position by transferring to another department, he must offer his resignation, take a lump sum from the Superannuation Fund, then go to the other department and be employed there for three years before he may become eligible to contribute again to the Superannuation Fund, and again he must take the chance of having the Public Service Board certify that his employment is likely to continue for seven years. In these circumstances it is difficult for a temporary employee to improve his position by transferring to another department. I regard this amendment, contained in clause 10, as a great and real improvement.

This clause is another example of a provision of the bill that will apply from a specific date. It will not take effect from a date to be proclaimed; it will apply as from 1st November, 1954. That date has been selected because it was on that date that a system was adopted, which was not strictly legal - which was really not legal at all - under which a temporary employee who transferred from one department to another was not required to accept a lump sum from the superannuation fund but, by an act of of grace, was allowed to continue his superannuation payments. Clause 10 of the bil) will regularize this practice. Clause 15 of the bill makes a similar provision with regard to the provident fund. The existing legislation contains anomalies for temporary public servants in relation to the provident fund similar to those that I have just mentioned regarding the superannuation fund, and this bill will resolve them.

While this legislation represents a real improvement, I suggest to the Minister f0 Labour and National Service (Mr. Harold Holt), who is sitting at the table, that it does not go far enough. There are many persons, mainly women, who have been temporary employees in the Commonwealth Public Service in Australia, and who have gone to England, after having obtained annual leave or leave without pay, and who have then been employed in England on the staff of the High Commissioner. But the High Commissioner's Act provides that the High Commissioner must recommend to the Minister that such an employee be permitted to continue contributing to the superannuation fund. Many of these persons, particularly single women, having taken up duty on the staff of the High Commissioner, and having maintained continuity of employment, have asked that the Minister make the necessary certification so that they may continue their contributions, but have found that the Minister has declined to do so. As a consequence, many of them have left that employment and allowed a period of time to elapse, before recommencing employment with the Commonwealth Public Service in Australia in a temporary capacity. Their employment has been broken as a consequence, and this legislation allows them no relief. As an unfortunate consequence, such single women are reluctant to go to Great Britain, because they fear they will not be allowed to continue their superannuation payments, that being a matter of absolute importance to unmarried women, who must provide for the future. I suggest to the Minister that it may yet be possible to introduce a further amendment to grant relief to persons in this unfortunate position.

After having looked at the remainder of the bill, 1 must congratulate the Parliamentary Draftsman on having adopted a practice, in clause 3, that I should like to see adopted with all legislation. The Draftsman has had the foresight to set out in parentheses, after the parts of the bill as enumerated in this clause, the clauses that are included under those various parts. This enables one to turn to the part of the bill required, without having to go through the measure clause by clause. I believe that this system should be adopted with regard to all legislation that comes before this House. Indeed, I think that every one who has to deal with a piece of legislation such as this uses some similar system of indexing, and the Parliamentary Draftsman is to be commended for having adopted this practice.

Clause 4 is an interesting provision. It is consequential upon the recent legislation passed by this Parliament with regard to the Commonwealth Industrial Court and the Conciliation and Arbitration Commission. But for this legislation the interesting situation may have arisen in which presidential members of the Conciliation and Arbitration Commission may have been entitled to two lots of retiring benefits, one under the Judges' Pensions Act and another under the Superannuation Act. Clause 4 is designed to prevent such a situation arising. Up till now, a quinquennial report has never disclosed a surplus. In consequence, clause 5 of the bill is designed to draw to the actuary's notice that before he recommends in what manner additional benefits can be paid to the contributors to superannuation schemes, he should take into account the amount that the Commonwealth has put in to ensure an interest rate of 3} per cent.

Clause 8 of the bill is designed to give effect to the actuary's recommendations, which are contained in the quinquennial report. In accordance with the principal act, the actuary has recommended that pensions to be paid to people who continue m the service after the date upon which i hey are eligible to retire should be increased. This legislation approves the actuary's suggestion. The actuary has stated that the fund can now bear these increased demands. The honorable member for Banks said that the increases are not enough. He said that they should be greater, because the person, if he were noi working, would receive a 100 per cent, pension. I prefer, with great respect to the honorable member for Banks, to accept the recommendation of the actuary to the recommendation of the honorable member as to what amount the fund can pay by way of an increase.

If we look at the history of this matter, it will show us something interesting. Up till 1947, a person who could have retired at 60 years of age but who continued working after that age, received on his ultimate retirement his pension and nothing more In 1947, when the present Government was not in office, legislation was introduced to give such people an increase of pension Instead of getting only a 100 per cent, pension on retirement, if they had worked for one year after the age at which they could have retired, they received, in addition. 5 per cent, of the portion of the pension equivalent to their contribution. If the' had worked on for two years, they received a greater amount, for three years an even greater amount and so on. I think thai the rates paid ranged from 5 per cent, up to 31 per cent. That provision was made in 1947 and it applied only to people who had retired after 12th June, 1947; so that when the act came into force it applied to nobody.

Some people who had retired within the few years prior to 1947 had worked in the Commonwealth Public Service during the war years after their normal retiring age. They were alarmed at this proposal and there was a great deal of campaigning among them to influence the government to change its mind and post-date the payments. The government was adamant, and refused on the ground that the fund could not, on the actuary's advice, pay the additional amount sought.

But in 1951, when the present Government was in office, a change was made Legislation was introduced to backdate the payments. The actuary said, in effect, " You cannot do this. The fund will not bear it." The Government said. "We will accept the responsibility, and make sure it is paid ". The Government in that way brought a great measure of relief to many people. Now, the bill before the House proposes to increase the rate paid to superannuated people who work past the retiring age. Those payments will be back-dated to 4th July, 1952. Those people who, had this measure been passed in 1952, would have been getting 6 per cent, instead of 5 per cent, or 13 per cent, instead of 1 1 per cent, or 20 per cent, instead of 1 7 per cent., will receive a lump sum payment, dating back to the first pay period after June, 1952 - that is the 4th July, 1952.

There is only one more point to which I want to address myself. That is in relation to clause 6. It was interesting that the honorable member for Banks spent most of his time complaining that the amount of the unit had not been increased. In its initial stage, the amount of the unit was 10s. of which the contributor paid 5s. and the Government paid 5s. The amount of the unit is now 17s. 6d., of which all the increase is borne by the Government. So, of the unit of 17s. 6d., 12s. 6d. is contributed by the Government and 5s. by the contributors to the fund. The honorable member for Banks put up what might seem to be a reasonable proposition, but when one looks at it, one finds that it is so fallacious that it is almost funny. He said that because there was a surplus - a gross surplus of £653,000, of which £203,000 has to be paid back to the Commonwealth, leaving a net amount of £450,000 - we ought to be able to increase the amount of the unit. How long does the honorable member for Banks think a surplus would remain if it were distributed among all the superannuated public servants? If one resolved it, the amount would probably be 3d. for each person. An increase in the amount of the unit requires a greater contribution by each individual contributor. The honorable member for Banks said that we must bear in mind the big difference between the alleged salaries of public servants and the amounts that they take home after superannuation and tax have been deducted. On the one hand, he wanted the unit to be increased out of the surplus in the fund; and again, he said that there must not be too big a cleavage between nominal salary and the amount actually received. In other words, he said, " Do not increase the amount of contribution of each individual contributor but give each contributor more out of this fund ". But the figure of £450,000 is relatively insignificant in this connexion. 1 think it is indeed very pleasant that, for the first time, the quinquennial report has disclosed a surplus. But, please do not let us assume that the surpluses will grow and grow, or that a surplus of that magnitude could do the job that the honorable member for Banks has asked that it should do!

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