Nick Minchin (SA, Liberal Party, Minister for Finance and Administration) Share this | Hansard source

I regret that I was not present for all contributions on the second reading debate, except the last part of Senator Brown’s contribution. As I understand it, the Parliamentary Superannuation Amendment Bill 2006 does have the support of the Labor Party and the Democrats, and we are grateful for that, but I understand from Senator Brown’s remarks that he does not share that support. As the minister responsible for introducing the new Public Sector Superannuation Accumulation Plan and striking the contribution rate for that at 15.4 per cent, based on the actuarial evidence that that is the rate required to ensure maintenance of equivalent conditions—about which I much appreciated the cooperation of the Public Service Association—and having now introduced similar accumulation schemes for new members of parliament, I think it is appropriate in the milieu in which we work that we as the notional employer should acknowledge our new members of parliament and those to come. And in all fairness, to quote Senator Brown, the contribution we make to those members of parliament should be the same as that struck for the nation’s public servants.

We do think that is fair and appropriate. Of course, in this country it is the fact that the guaranteed minimum level of superannuation contribution payable by employers is nine per cent. Any employer is free of course to make a contribution greater than that. They must by law pay only nine per cent, but they can pay more than that. We as the employer of public servants have deemed that in our new accumulation scheme our rate will be 15.4 per cent. We think it makes a lot of sense now, in the light of the experience with the new accumulation scheme, for new members of parliament to move, sensibly, to a 15.4 per cent rate. That will go some way towards reducing the situation that was always going to be difficult of having members and senators working alongside each other on different remuneration packages. That is never easy but inevitable in making a change of this kind and without—as we never would have—terminating the arrangements for existing members of parliament. At some point there will be no members of parliament in the existing defined benefit scheme and everybody will be in the new scheme. But that day is yet to come. In the meantime, we think it appropriate to reduce the inequity between existing members and new members, as well as acknowledging the disparity between new members of parliament and new public servants. I think in all fairness this is a sensible measure. There are always people who will take opportunistic advantage of it. I am disappointed with Senator Brown’s contribution, but I do appreciate the support of others in the chamber.

Question agreed to.

Bill read a second time.