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Monday, 24 May 1965


Senator McKENNA (Tasmania) . - The Bill before the Senate, which deals with parliamentary retiring allowances, is one of great importance to all honorable senators. The fact that quite a number of defects in the legislation passed last year have now to be corrected indicates, I suggest, either great carelessness or great casualness on the part of the Government in submitting the 1964 Bill.


Senator Wright - Or perhaps impatience.


Senator McKENNA - I do not suggest that. But there are defects in the legislation, and three of them are quite obvious. First, it is found necessary to restate the basis for the actuarial calculations in paying to those who have retired and are enjoying pensions - or certain of those people - a proportion, by way of lump sum payments, of the surplus of the funds that are held. It has been necessary to validate the payments that have in fact been made.

Another defect relates to the ministerial fund and affects only the Deputy Leader of the Opposition in another place and the Leader of the Opposition and the Deputy Leader of the Opposition in this chamber. Last year's Bill provided that contributions to the fund should cease after 14 years. That entitled those who were contributing to the fund at the full rate to end their contributions at the end of 14 years, but also it entitled those who were contributing at half or one quarter of the full rate to cease their contributions at the end of .14 years. That obviously was not fair and was never intended, so it is now being corrected. It is surprising that this was not put right in the first instance.


Senator Wright - What is meant by " those who contribute at half or one quarter of the full rate "?


Senator McKENNA - The provision is that Ministers and the Leader of the Opposition in another place shall contribute at the full rate. The Deputy Leader of the Opposition in another place and the Leader of the Opposition in this chamber contribute at only half the full rate, but they are also credited with only half the time they serve. In other words - the Deputy Leader of the Opposition in another place and the Leader of the Opposition in this chamber - are credited with only six months in respect of each year of their service in qualifying for the minimum of eight years that brings entitlement to a ministerial pension. They pay only at half rate and are credited with only half the time they serve towards the qualifying period. The Deputy Leader of the Opposition in this place is credited with only one quarter of the time served towards the eight years qualifying period. He has a long way to go, having regard to the fact that if he is to acquire his entitlement upon the basis of service as Deputy Leader of the Opposition he has to serve for 32 years.


Senator Hannaford - That is not beyond the bounds of possibility, is it?


Senator McKENNA - I am sure that office holder would be delighted to know that the honorable senator takes that view of his longevity. But I do not think he would be so happy to know that that is the view of his continued activities in that office. It is obvious that the provision that payment should cease at the end of 14 years could not be applied to those paying at half rate and quarter rate and only getting proportionate entitlements for their terms of service.

The next defect was the provision in the Act which provided that any of the office holders who were contributing to the ministerial fund should acquire entitlement on an 8-year basis if they had been serving at the end of their term in each of three Parliaments. Again there is the fact that that could hardly apply to those who contributed at full, half or quarter rates. The Bill corrects the position and ensures that the same distinction is applied there, having regard to the varied nature of the contributions. The eight year rule will not apply to the Deputy Leader of the Opposition in another place, the Leader of the Opposition here or the Deputy Leader of the Opposition here. We are not complaining about it. Obviously, these are matters that should have been presented in that way in the first place.

The other change - this relates not to a defect but to a rule of convenience - is that the basis of contribution for ordinary pensions, as well as Ministerial pensions, is now a monthly one. It involves, in the case of the three office bearers I mentioned, namely, the Deputy Leader of the Opposition in another place and the Leader and Deputy Leader of the Opposition here, a very slight increase in payments when it is put on a monthly basis. The Ministers and the Leader of the Opposition in another place will contribute £222 instead of £221. The Deputy Leader of the Oposition in another place and the Leader of the Opposition here will contribute £111 instead of £110 10s. and the Deputy Leader of the Opposition here will contribute £55 10s. instead of £55 5s. I have a feeling that the Ministers and the Leader of the Opposition in another place will not mind the additional £1 per annum any more than the Deputy Leader of the Opposition in another place and the Leader here will mind the extra 10s. per annum or the Deputy Leader of the Opposition here the extra 5s. per annum. I think that we will be able to stand the financial strain involved in that slight variation of the contributions.

The other provision of the Bil!, which is referred to as a defect, is to correct the omission to vest the management of the ministerial fund formally in the Parliamentary Retiring Allowances Trust. That is the fourth of the defects acknowledged under the Bill to have existed in the Act which we are amending. Apart from those matters, there are provisions dealing with' the delegation of the powers of the Trust, the contributions by way of monthly instead of weekly payments, to which I have referred, and the question of the accrual and method of calculation of payments of contributions and pensions. Finally the election or option which a person may exercise to take a lump sum may be revoked, even though exercised, at any time before it has been in fact acted upon. The Trust has, in equity and justice, been meeting that position, but probably without the formal authority of the Act. This is included as one of the powers under the Bill.

The Opposition does not oppose any of the provisions in the Bill. I hope that the Senate will see that I, on behalf of the Opposition leaders who are affected, am not shedding any tears over what has been done to us.







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