Australia’s moral challenge

Today, while staying at my mother’s place, I have been reading The Australian and The Australian Financial Review. What has caught my attention in particular is Paul Kelly’s exclusive interview with the Prime Minister, Malcolm Turnbull. In that report, which appeared in the Weekend Australian, we are told that reducing the national debt is our pivotal duty. According to the PM, it is  a necessity: “an economic, moral and fairness necessity”.

Now it could be argued that there are other imperatives that should take precedence, such as implementing the climate agreement that was signed in Paris by 193 nations, or closing the offshore detention camps in Manus and Nauru and bringing the refugees here to stop the trauma and abuse,  but let’s leave these aside for now. Let’s take the PM at his word and accept that we should stop being so thoughtless. While we can, we should cease piling billions of dollars onto the scarily large national debt which looks like being passed on to our children and grandchildren. Reducing that debt will have at least two obvious advantages: It will show that we care about our children and their descendants, that we worry about the issue of intergenerational unfairness. It also will reduce our dependence on overseas lenders.

Now, it is of course true, that a leader who issues a moral challenge needs to be credible if he expects others to join forces with him. Any leader who says, “now the way we care for our children is ensuring that we do not burden them with a mountain of debt”, as the PM told Paul Kelly, would clearly be willing to start close to home. For example, at the top of his agenda, we might hope, would be dealing with the disproportionate salary increases that top public servants have been awarded by the Remuneration Tribunal since the start of the global financial crisis.  Robert Gottliebsen has helpfully supplied some useful figures. Those pay rises, which are up to an additional $300 ooo a year, have increased each top public servant’s superannuation by as much as $3 million, a concession that is neither affordable nor well-targeted. This pension scheme exposes the government to a liability that is estimated to be more than $400 billion, and is increasing by $6 billion a year. This growing liability cannot be fully covered by the Future Fund, which on March 31, 2016 only had a balance of $117.4 billion.

We do have a moral challenge, especially  when top public servants who are eligible for superannuation payouts of around $10 million advise the Government to cut back on the superannuation entitlements of non-public-servant Australians, limit their lifetime tax-paid contributions to $.5 million from May 3, 2016 and cap their  tax-deductible contributions at $25 000, while leaving their own benefits intact. We might hope that the Turnbull Government would seek to do what Qantas did; that is, to limit the national debt by freezing the salaries of those who are in these bonanza, defined benefit superannuation schemes. That would be a fair and equitable way of starting to deal with the moral challenge that the PM has identified, and it is the course of action suggested by the former treasurer, Joe Hockey, in May 2014. “Whatever we are asking the electorate to contribute to the budget repair task, we are going to contribute ourselves as well”, Joe Hockey said at the time. ” I think that’s an important message to send,’’ he told the Nine Network. I agree with him.

However, such pay freezes will always be contested by those who argue that significant increases for heads of government departments and agencies are always  warranted because this is the “proper relative remuneration” for “those most senior officers”. There will also be contractual and trust-related difficulties ahead for anyone seeking to negotiate top-level pay freezes. It would take a Prime Minister with extraordinary moral fortitude to take on this challenge.

One self-funded retiree who is frustrated with changes to his superannuation is Dr Dale Kerwin. In response he has focused on politicians’ salaries, using 2014 figures. See below. However, it is important to bear in mind, as Noel Towell reported in the Canberra Times on February 8 this year, that as a result of new pay rises, “those at the top of the public service pile, the secretaries of the Department of the Prime Minster and Cabinet and the Treasury, will be paid salaries of $861,000 and $840,000”.

Subject:  Mr Turnbull is sure to propose this? Update on pension  entitlement for all.

Author: Dr. Dale Kerwin

School of Education

MT Gravatt Campus, Griffith University

Ph. 07 3735 5884  |  fax. 07 3735 5991

As a self funded retiree, I’m frustrated with Canberra’s continuous
fiddle with Superannuation contributions and rule changes

Plus the measure to Re-balance the Pension Assets Test to be
implemented on 1 January 2017.

So here’s fair warning to all politicians of any persuasion, this
group of aged voters may be about to make the greatest impact on any Federal
election in history, ignoring them may be the start of a changed political
environment in this country.

Change the Entitlements

I absolutely agree, if a pension isn’t an entitlement, neither is
theirs. They keep telling us that paying us an aged pension isn’t
sustainable.
Paying politicians all the perks they get is even less sustainable!
The politicians themselves, in Canberra, brought it up, that the Age of
Entitlements is over:
The author is asking each addressee to forward this email to a
minimum of twenty people on their address list; in turn ask each of those to
do likewise. In three days, most people in Australia will have this message.
This is one idea that really should be passed around because the rot has to
stop somewhere.
Proposals to make politicians shoulder their share of the weight now
that the Age of Entitlement is over:

1. Scrap political pensions.
Politicians can purchase their own retirement plan, just as most
other working Australians are expected to do.
2. Retired politicians (past, present & future) participate in
Centrelink.
A Politician collects a substantial salary while in office but
should receive no salary when they’re out of office.
Terminated politicians under 70 can go get a job or apply for
Centrelink unemployment benefits like ordinary Australians.
Terminated politicians under 70 can negotiate with Centrelink like
the rest of the Australian people.

3. Funds already allocated to the Politicians’ retirement fund be
returned immediately to Consolidated Revenue.
This money is to be used to pay down debt they created which they
expect us and our grandchildren to repay for them.

4. Politicians will no longer vote themselves a pay raise.
Politicians pay will rise by the lower of, either the CPI or 3%.

5. Politicians lose their privileged health care system and
participate in the same health care system as ordinary Australian people.
i.e. Politicians either pay for private cover from their own funds
or accept ordinary Medicare.

6. Politicians must equally abide by all laws they impose on the
Australian people.

7. All contracts with past and present Politicians men/women are
void effective 31/12/16.

The Australian people did not agree to provide perks to Politicians,
that burden was thrust upon them.
Politicians devised all these contracts to benefit themselves.
Serving in Parliament is an honour not a career.
The Founding Fathers envisioned citizen legislators, so our
politicians should serve their term(s), then go home and back to work.

If each person contacts a minimum of twenty people, then it will
only take three or so days for most Australians to receive the message.
Don’t you think it’s time?

THIS IS HOW YOU FIX Parliament and help bring fairness back into
this country!

If you agree with the above, pass it on. If not, just delete.

If you wonder why the above individuals are asking for your help
look at the figures below.

STATUTORY OFFICES

Date of Effect 1 July 2014

Specified Statutory Office

Base Salary  (per annum)

Total Remuneration for office  (per annum)

Chief of the Defence Force > $535,100  – $764,420

Commissioner of Taxation > $518,000  – $740,000

Chief Executive Officer, Australian Customs

And Border Protection Service > $483,840  – $691,200

Auditor-General for Australia > $469,150  – $670,210

Australian Statistician > $469,150 – $670,210

“PAY FREEZE, NOT FAIR.        SOB, SOB”

Salaries of retired Prime Minister and Politicians

Office
Additional salary (%)
Salary as of 1 July

Prime Minister
160
$507,338

Deputy Prime Minister
105
$400,016

Treasurer
87.5
$365,868

Leader of the Opposition
85.0
$360,990

House of Reps Speaker
75.0
$341,477

Leader of the House
75.0
$341,477

Minister in Cabinet
72.5
$336,599

Parliamentary secretary
25.0
$243,912

Other ministers
57.5
$307,329

Shadow minister
25.0
$243,912

Source: Remuneration Tribunal.

So if I press all the right buttons, the TOTAL annual wages for the 150 seats in the Parliament are:

Prime Minister
$507,338

Deputy Prime Minister
$400,016

Treasurer
$365,868

Leader of the Opposition
$360,990

House of Reps Speaker
$341,477

Leader of the House
$341,477

Minister in Cabinet
$336,599

Parliamentary secretary
$243,912

Other ministers*
307,329  x 71 =  A$21,820,359

Shadow ministers*
$243,912  x 71 =  A$17,317,752

The TOTAL ANNUAL SALARIES (for 150 seats) =
$41,694,311 – PER YEAR!

And that’s just the Federal Politicians, no one else!

For the ‘lifetime’ payment example (below) I
used the scenario that:

1.  They are paid ‘lifetime’ salaries the same as their last working year and
2.  After retiring, the ’average’ pollie’s life expectancy is an additional 20 years (which is not unreasonable).

It’s worth remembering that this is EXCLUDING all their other perks!

SO, for a 20 years ‘lifetime’ payment (excluding wages paid while a Parliamentarian)

Prime Minister            @ $507,338  = A$10,146,760

Deputy Prime Minister    @ $400,016  = A$8,000,320

Treasurer                  @ $365,868  = A$7,317,360

Leader of the Opposition  @ $360,990  = A$7,219,800

House of Reps Speaker  @ $341,477  = A$6,829,540

Leader of the House      @ $341,477  = A$6,829,540

Minister in Cabinet        @ $336,599  = A$6,731,980

Parliamentary Secretary  @ $243,912  = A$4,782,240

Other ministers**          @ $307,329  = A$6,146,580 x 71 = A$436,407,180

Shadow ministers**        @ $243,912  = A$4,878,240 x 71 = A$346,355,040

Conclusions:

TOTAL ‘life time’ (20 year) payments,
(excluding wages paid while in parliament) = A$833,886,220 – OVER $833
MILLION
Julia Gillard, Kevin Rudd, John Howard, Paul
Keating, Malcolm Fraser, Bob Hawke, et al, add nauseum, are receiving $10
MILLION + EXTRA at taxpayer expense.

Should an elected PM serve 4 years and then
decide to retire, each year (of the 4 years) will have cost taxpayers an
EXTRA Two and a half million bucks a year! A$2,536,690 to be precise.

A 2 year retirement payment cut-off will
SAVE our Oz bottom line A$792,201,909  *** NEARLY $800 MILLION.

There are 150 seats in House, minus the 8
above = 142 seats, divided equally for example = 71 each for both shadow and
elected ministers.

This example excludes all wages paid while a
parliamentarian AND all perks on top of that – travel, hotels, Secretarial
staff, speech writers, restaurants, offices, chauffeured limos, security,
etc. etc.
150 seats, 20-year payment of A$833,886,220 less annual salary x 2 years of A$83,388,622. [$41,694,311 x 2]

“Instead of giving a politician the keys to the city, it might be better to change the locks.”

YOU’RE RIGHT, YOU HAVE FOUND WHERE THE CUTS SHOULD BE MADE!

ACTION: Push for a MAX 2 year post
retirement payment (give ‘em time to get a real job).

Spread it far and wide folks. People should
know.

Dr. Dale Kerwin
School of Education
MT Gravatt Campus
Grifffith University
ph. 07 3735 5884
fax. 07 3735 5991
email: d.kerwin@griffith.edu.au‘)