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Finance and Public Administration Legislation Committee
20/11/2014
Estimates
FINANCE PORTFOLIO
ComSuper

ComSuper

[15:11]

CHAIR: I welcome Dr Jill Charker, Chief Executive of ComSuper, officers of ComSuper, Mr Peter Carrigy-Ryan, Chief Executive Officer of the Commonwealth Superannuation Corporation, Ms Bronwyn McNaughton, General Counsel, and officers of the Department of Finance covering 1.2—public sector superannuation. Dr Charker, do you wish to make an opening statement?

Dr Charker : No, thank you, Chair.

CHAIR: Mr Carrigy-Ryan, do you wish to make an opening statement?

Mr Carrigy-Ryan : No, thank you, Chair.

CHAIR: I have a few brief questions. I am interested in how the merger between ComSuper and the CSC is progressing. Are you able to provide a brief update?

Mr Carrigy-Ryan : This was a government policy announcement in May this year. The merger is progressing well. It is quite an involved process, as you could imagine. There are two organisations performing functions in relation to APS and military superannuation schemes. We have had lengthy discussions about structures, frameworks and staffing arrangements and those sorts of things going forward. They are ongoing. We would hope to be in a position in the not too distant future to make some announcements to staff about the outcome of those. So, in short, I would say it is progressing very well. As I said, we hope to be in a position to make some announcements about it very shortly.

CHAIR: Are you able to advise us of areas which face greater impacts as a result of the merger and which areas will be perhaps less directly impacted?

Mr Carrigy-Ryan : Our overall intention in relation to that is to ensure two underlying things: that the merger process, as far as the member experience is concerned, is seamless so that members notice no difference in service delivery during the course of the exercise and that both our investment and scheme administration arrangements continue in a business-as-usual way right through that process. Clearly, there are some areas where there duplication of function, and obviously we will seek to rationalise that. In a future structure and organisation there will be some things that will not be required because of the nature of ComSuper prior to the merger and after the merger. So there will be some changes. They are two obvious areas and obviously they have been the focus of our attention to date.

CHAIR: With the rationalisations, is there any suggestion that office locations will be changed in the short term or have you assessed that they are currently suitable?

Mr Carrigy-Ryan : Our assessment to date is that the three offices that CSC and ComSuper occupy—that is, in Belconnen, in CBD Sydney and in Canberra city—are suitable for purpose for the time being and we will retain those locations for the foreseeable future.

CHAIR: You said before that the merger was relatively seamless from a member's point of view. Have you had much interest, reaction or response from your members or the members of the respective organisations?

Mr Carrigy-Ryan : I will take that in two parts: in relation to our scheme members, no. To my knowledge, there has been not much. There has not been much visibility in relation to the public, because of the detailed nature of the work that needs to be done. The second part: in relation to the staff—yes, we have been talking to staff during the course of the exercise and keeping them informed. In fact we have a major staff consultation process scheduled for this coming Monday at ComSuper to make an announcement on progress in relation to a whole range of matters. So yes, there has been engagement. There are some difficult issues. It is quite a significant change and it has taken us quite a while to work through it.

CHAIR: Going back to the scheme: you have advised members—they are aware that the merger is going on, surely.

Mr Carrigy-Ryan : They would be aware of the government policy announcement that was made in the budget, yes, that ComSuper is to merge into CSC with effect from 1 July next year.

CHAIR: That is all from me.

Senator LUDLAM: That was the part that I was going to ask but I was also going to then ask about the military superannuation and the closing of the defined benefits scheme. The first question is more to Finance—is Finance playing any role in that; and what is that role?

Dr Helgeby : The work on the closure of that scheme will be done by Defence, so we will be consulting as appropriate with them but the drafting will be done by Defence.

Senator LUDLAM: So will you liaise with Defence? Will you receive any feedback from Defence as to how they are going? I am just curious as to how it is going to work.

Dr Helgeby : We would have discussions with Defence from time to time, so it will be a normal part of our liaison with them.

Senator LUDLAM: So would you expect to get stakeholder feedback from Defence stakeholders regarding the policy change; or would that go to the minister or the Defence minister? I can then work out what questions I still have to ask.

Dr Helgeby : I would expect that the feedback would largely go to the relevant Defence portfolio minister. From time to time, the finance minister does receive correspondence on several topics.

Senator LUDLAM: Has there been any correspondence about the closure from Defence stakeholders? I am happy for you to take it on notice.

Dr Helgeby : I will have to take it on notice. My recollection is not much, if any.

Ms Halton : No, I have not seen any either.

Senator LUDLAM: So you will give it effectively to the Department of Defence to manage and you will not have an active role—would that be the best way of characterising it?

Dr Helgeby : I think we would have a junior partner role rather than anything else.

Senator LUDLAM: What would a junior partner do then?

Dr Helgeby : From time to time, there are things that have to be investigated such as interconnections between different legislative processes, for example. We would be interested in that side of things. Obviously, we have to put together the numbers that are potentially in the budget papers and in the financial documents and so implications that run through there we would be interested in.

Senator LUDLAM: In your response to the earlier question, can you give me a for instance or an example? I will probably follow this up with Defence—I will—and I will also come back to you as it proceeds.

Dr Helgeby : If Defence wanted to help with something, we would look at whether we could provide that help.

Senator LUDLAM: What type of help? I know you stand ready always to help but would it be actuarial matters, calculation matters—calculating how amongst all their members it works—providing information to members?

Dr Helgeby : It could be any of those. I am not aware that they have asked for help at this point in time.

Senator LUDWIG: I will leave that at that and follow it up later.

CHAIR: I think that concludes the questions. I thank the officers for their attendance today.