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Government crushes chance to protect Telstra employees' super benefits.



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*** MEDIA RELEASE ***

SENATOR NICK SHERRY Labor Senator for Tasmania Shadow Minister for Superannuation, Intergenerational Finance: Banking & Financial Services

Government crushes chance to protect Telstra employees' super benefits October 18, 2006

Labor today moved in the Senate an amendment to the Long Services Leave (Commonwealth Employees) Amendment Bill, 2006, to protect 1800 Telstra employees' superannuation benefits.

The Liberal Government opposed the amendment and voted it down.

The Liberal Government is unwilling to meet their moral and possible legal obligations to ensure Telstra employees, who are members of the Commonwealth Superannuation Scheme, are not disadvantaged by the government's T3 sale.

It is an outrage the government understands the need for guaranteeing Telstra employees long service leave entitlements but refuses to do the same for their superannuation entitlements.

The Finance Minister Senator Minchin continues to break his promise to 1800 Telstra workers. Senator Minchin gave a promise to the Senate on September 7, 2005, that "...Superannuation conditions would continue…" for Telstra workers once the Telco was sold by the Government.

In one case communicated to Labor, a supervisor linesman who commenced employment with Telstra at the age of 16 will suffer a pension cut of $11,000 a year.

Labor tabled in the Senate this week secret correspondence between Telstra and the T3 Sales Taskforce where Telstra discloses the possible illegal actions of the Minister for Finance in cutting the pension promise made to these 1800 Telstra employees.

Telstra argued "there is a compelling case in support of Telstra's CSS members remaining in the CSS", and state "our legal advice is that the Deed of Release under

which the Commonwealth assumed liability for Telstra's CSS members is a legally binding document on the three parties".

Both the government and Telstra are exposed to possible legal action by employees of Telstra, whose promised CSS pension benefit has been cut as a consequence of the Telstra privatisation.

The government should have supported Labor's amendment today in the Senate and met their moral obligations to these dedicated employees and in turn remove any possibility of legal action against the government in the future.

As was the case for employees of Qantas and the Commonwealth Bank, whilst employees were required to cease membership of the CSS, new provisions were inserted in their superannuation funds to ensure a comparable benefit was maintained.

For more information contact Nick Sherry 0418 482 807