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Thursday, 1 June 1989
Page: 3231

Senator BUTTON —At Question Time on 6 April Senator Messner asked me a question about the Public Service early retirement scheme. I have obtained an answer. It is fairly long, so I seek leave to incorporate it in Hansard.

Leave granted.

The answer read as follows-

On 6 April (Hansard, page 1072) Senator Messner asked me, as Minister representing the Minister Assisting the Prime Minister for Public Service Matters, a question without notice about the Public Service early retirement scheme. I undertook to raise the issue with the Minister Assisting the Prime Minister for Public Service Matters and seek to obtain an answer as soon as possible.

The Minister Assisting the Prime Minister for Public Service Matters has supplied the following answer to the honourable Senator's question:

It is not true that a public servant aged 54 with at least 20 years' service could have received up to $170,000 more under the Government's one-off early retirement scheme than if he or she had retired at the age of 55 under the normal retirement benefits provisions.

The only additional benefit an officer retiring under the early retirement scheme would have received would be a severance payment based on years of service. If the officer received four weeks' pay in lieu of notice on retirement then the officer may have received a severance payment up to a maximum of 52 weeks' salary. The officer would have been entitled to elect for a lump sum superannuation benefit on retrenchment, an option that is not available to officers retiring on age grounds. This lump sum cannot be regarded as constituting an extra cash benefit; it is paid in lieu of the indexed age pension for life that is the normal option for Public Service retirees.

The maximum amount that a public servant can receive under the early retirement scheme is 48 weeks' salary as severance pay (for officers with 24 or more years of service), and 4 weeks' pay in lieu of notice. Officers also receive payment in lieu of unused recreation leave and long service leave credits, benefits which in most cases would be payable on age retirement or resignation. Benefits payable under the Superannuation Act will depend on the officer's superannuation contribution history as well as the particular superannuation option chosen by the officer.

In relation to the re-employment of retirees as consultants or in other ways, there is no legal barrier to former officers being reappointed to the Service or being engaged as temporary employees or consultants in accordance with the normal competitive merit selection process. It has been clearly recognised, however, that re-engagement may raise particular sensitivities. The former Public Service Board issued advice to departments on this matter in 1987 and the Public Service Commissioner has since written in similar terms to Secretaries indicating his expectation that re-engagement immediately or quite soon after such retirement should not occur. He has asked Secretaries to ensure that careful consideration is given to any proposal for the appointment, employment or consultant engagement of any officer who has recently been retrenched or retired.