Nick Sherry (Tasmania, Australian Labor Party, Shadow Minister for Banking and Financial Services) Share this | Hansard source

I move:

That the Senate take note of the answers given by ministers to questions without notice asked today.

I particularly want to raise the issue today that Senator Minchin has already referred to—that is, the future superannuation arrangements of some 1,800 Telstra employees who are to effectively receive a cut in their promised pension arrangements as a consequence of the privatisation of Telstra. As I raised yesterday by way of an example, the reductions in the promised defined benefit are significant. They vary from employee to employee, but I have been contacted by a number of existing employees of Telstra who, when they commenced employment with Telstra, joined the CSS. The example I gave yesterday was of a foreman-linesman who, because of the sale of Telstra and the new pension arrangements that will have to be entered into, will effectively have a cut in the promised pension benefit of $11,000 a year. The impacts vary depending on the circumstances of the 1,800 employees.

We would expect more from Senator Minchin. We do not expect much from Senator Coonan; in fact, we expect nothing from Senator Coonan in her role in this matter. Labor argues that one of the difficulties the government has with the treatment of these Telstra employees is that they have not even been offered any ongoing or comparable pension benefit. In the case of the Commonwealth Bank and Qantas, Senator Minchin is frankly being a bit disingenuous. He makes the correct point that the employees in those cases did not continue in the CSS. However, those employees, continuing in their service with Qantas and the Commonwealth Bank, had at least a comparable superannuation benefit pension fund promise that was met by Qantas and the Commonwealth Bank. That is not the case with respect to Telstra privatisation.

In addition to that, today I have been able to release secret correspondence—it is not secret now, of course; I got hold of it, probably to Senator Minchin’s embarrassment—between Telstra and the privatisation unit of Telstra. It makes a point, I think a very valid legal point, that—aside from the possible illegality, given the successor arrangements that are being put in place for these 1,800 employees—at least questions Senator Minchin’s role in this. It refers to the 2004 deed of release signed between Telstra, the Commonwealth government and Telstra Superannuation Pty Ltd. It draws the attention of officers in the privatisation unit to legal advice that Telstra had received with respect to that deed of release. That is at least one of the legal arguments which Telstra presents to the government to say that continuing membership of the CSS should be allowed because of the deed of release. But I would argue—I have already referred to it—that, because the disadvantage to be suffered by these 1,800 employees with the cuts in their promised pension benefit is so significant, the government faces a significant legal issue.

I have asked the minister today whether in fact this matter has been considered by the pension regulator, APRA. APRA do take a very tough position with respect to any attempt to reduce the pension benefits that were promised with respect to a defined benefit. Did the government consult with APRA on this matter? There is a possible constitutional issue about reducing promised pension benefits. So, as a consequence, both the government and Telstra may be open to legal action by at least some, or all, of the 1,800 Telstra employees who are being significantly disadvantaged by the failure of the minister to deliver at least a comparable ongoing pension benefit that has been promised to them as membership of the CSS. (Time expired)