Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

I have some questions about the bill with respect to the decoupling of superannuation arrangements. It is understood that, in order for the pay rise recommended by the tribunal to come into effect, there must be some decoupling of the superannuation arrangements for those who were elected prior to 2004. That is the general consensus of the intent of the bill.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

Yes.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

The parliamentary secretary Senator Feeney said that is the case. It was a good, direct answer, which is what I expect from Senator Feeney. My question is this: how will the formula be derived at? Has the tribunal indicated to the government the sorts of things that it will be looking at? I understand the independence of the tribunal—I get that—but how will the tribunal look at those issues to ensure that there will not be an undue benefit or, arguably, an undue detriment to those members of parliament elected prior to 2004? The other issue, which would also apply to the issue of the gold pass, is whether consideration has been given as to whether there is any potential for legal action by any aggrieved members of parliament—presumably former members of parliament—in terms of the gold pass being reduced. Would they argue that it is taking away a property right? Similarly, has advice been obtained in relation to the issue of superannuation benefits for those elected prior to 2004, particularly those who may have retired?

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

Thank you, Senator Xenophon. I begin by outlining, in general, the government's position with respect to your amendments, before turning to some of the particular points you made in those remarks.

Firstly, as you foreshadowed, Senator Xenophon, the government does not support your proposed amendments—that is, to add a schedule to the bill prescribing a process for the way the independent Remuneration Tribunal goes about making a determination or a report about members of parliament. It is the government's view that it is a matter for the independent Remuneration Tribunal to determine how best to undertake the task of determining remuneration levels within its jurisdiction. It is already open to the tribunal to take submissions and conduct hearings, and the tribunal can also publish submissions received and the transcripts of hearings.

The easiest way I could sum this up is to say that the public hearings you are seeking may be entirely possible. It is, of course, within the remit of the tribunal to conduct its affairs in that way if it so chooses, but the legislation does not mandate it. Rather, the legislation seeks to emphasise the independence of the tribunal to conduct its affairs as it sees fit. The government submits that the proposed amendments submitted by Senator Xenophon would constrain the independent tribunal's discretion in this matter.

It is worth noting that the tribunal undertook a wide range of public consultations in the lead-up to its most recent reports regarding members of parliament, departmental secretaries and specified statutory office holders. The Remuneration Tribunal already has transparency measures in place. The tribunal is already required by section 7A of the Remuneration Tribunal Act 1973 to publish full details of its reports. In relation to its most recent report into the remuneration of parliamentarians, the tribunal published a detailed report of 67 pages, with 227 pages of appendices for those who have the stomach for it, as well as a related consultant report and an accompanying statement. The tribunal is also subject to the Freedom of Information Act 1982 and, as such, any submissions to the tribunal may be accessed under the act, subject to any necessary exemptions. For these reasons, the government does not support the amendments proposed by Senator Xenophon.

Firstly, with respect to the question, 'Does the tribunal need the power to determine a portion of additional office holder salaries that will not flow to members of the 1948 scheme?' the answer is yes. In its report of 15 December 2011, the Remuneration Tribunal indicated that the link in the 1948 scheme between the additional salary of a current office holder in parliament or a minister of state and the additional pension of a retired parliamentarian be severed. The bill achieves this outcome by extending the tribunal's existing power in the Remuneration Tribunal Act 1973 to determine a portion of parliamentary base salary not to be taken as parliamentary allowance for the purpose of the 1948 scheme. These new powers will allow the tribunal to similarly determine a portion of additional salary that is not to be taken into account for superannuation purposes. The tribunal indicated in its statement that it does not intend to make a determination on the remuneration of parliamentarians until this issue has been resolved.

Secondly, the government does not consider that the closure of the Life Gold Pass scheme, and the reduction in the number of domestic return trips available under entitlement, is an acquisition of property within the meaning of paragraph 51(xxxi) of the Constitution. This issue was considered in 2002, when limits were first introduced on the number of return domestic trips provided by the Life Gold Pass scheme, and resulted in a constitutional safety net provision being included in the Members of Parliament (Life Gold Pass) Act 2002. This bill includes an equivalent provision to provide a reasonable amount of compensation in circumstances where any provisions in the bill are found to result in an acquisition of property under section 51(xxxi) of the Constitution.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

Thank you to Senator Feeney for his answers. I do not have the report in front of me—a comprehensive report with 220-odd pages of appendices—but, as I understand it, the tribunal did not actually advertise for public submissions.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

Only insofar as they advertised on their own website.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

So they requested submissions but did not put it out there publicly?

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

I contend that putting it on their website is a public communication.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

How many hits has that website had since these submissions? I do not know if it has had as many hits as the 'Happy little vegemite' YouTube posting!

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

Excluding the—

The CHAIRMAN: Senators, do not jump the gun too quickly; otherwise, the recording people will not be able to change the microphones over. Senator Xenophon.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

Unfortunately I did not get to hear Senator Feeney's words of wisdom there. Is he able to indicate how many hits there have been on the website since the call for submissions went up? It was not an actual call for submissions. I asked whether it had had as many hits as, for instance, the 'Happy little vegemite' YouTube posting.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

Your witticisms, as always, are extraordinarily welcome, senator. I will take that on notice. I am not in a position to give you a comprehensive answer. I am advised that there may have been some further advertising, but I undertake to get back to you on that.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

In terms of the whole issue of property rights—and I appreciate Senator Feeney's answer in relation to that, which deals with section 51(xxxi) of the Constitution in terms of the acquisition of property—is it the case that those things that were considered in respect of the gold pass would not apply in terms of altering the issue of parliamentary pensions?

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

I understand that the issue will be treated in the same manner, and the legal advice of government would cover both eventualities.

Lee Rhiannon (NSW, Australian Greens) Share this | Link to this | Hansard source

I want to go back to some of the comments Senator Feeney made earlier. He made out that the problem with Senator Xenophon's amendments is that they will constrain the independence of the tribunal. But he really has not established that case at all. I think this is an important point for our consideration. I congratulate Senator Xenophon. I am sure he will not mind me saying that what he has put forward here is very minimal. It is certainly not a constraint; it is just setting out some very minor issues of process. That is all we have here. Let us remind ourselves what the essence of that is: there should be a call for public submissions; there should be a website where those submissions can be received and there should be a public hearing conducted—and there are a few other process issues. So Senator Feeney's statement that the independence of the tribunal will be restrained—which obviously nobody would want to do—has not been established. I would ask that the senator set out his arguments for making that statement, which, from what I heard, was the whole basis of his argument for dismissing Senator Xenophon's amendments. I would be interested in his arguments.

The CHAIRMAN: Before I call Senator Feeney, I indicate to the committee that we are not actually debating the amendments per se as they have not been moved. Even though we are aware of the amendments, we are in general discussion. Senator Feeney.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

I am happy to expand on my answer. It really goes to the point of the independence of the tribunal. It is the view of the government, as set out in the legislation, that the tribunal itself ultimately determines how best to undertake the important task of determining the remuneration levels within its jurisdiction. It is obviously given an independence—

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

You're shifting the argument now.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

I am just responding to the question. As I said earlier in response to Senator Xenophon, the public hearings, which he in particular is seeking, would not be precluded by the tribunal; rather, it is our view that the tribunal, in determining how best to go about its business, will have discretion as to whether that is or is not appropriate. That is a matter for the tribunal. I understand that in your view, Senator Rhiannon, we should mandate or require that. I would simply say that that is a difference of opinion between you and the government. Our view is that the legislation means the tribunal is able to contemplate what you are seeking but is not required to do so.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

Mr Chairman, I am grateful for your guidance. I think it is appropriate that I move those amendments now, but I may have some further questions in the committee stage about how widely disseminated the call for submissions was and what sorts of submissions the tribunal got in respect of their quite comprehensive report of December last year. I seek leave to move the amendments as a whole.

Leave granted.

I move:

(1) Clause 2, page 2   (at the end of the table), add:

  7. Schedule 3 Immediately after the commencement of the provisions covered by table item 6.

(2) Page 9   (after line 15), at the end of the bill, add:

  Schedule 3—Determinations and reports about politicians' pay and entitlements

Remuneration Tribunal Act 1973

1 After section 7

Insert:

7AA Process for making determination or report about members of Parliament

  (1) Before making a determination or report under this Act relating to a member of the Parliament (including a Minister of State), the Tribunal must:

     (a) make a call to the public for submissions; and

     (b) publish on its website each submission received (but only with the consent of the person making the submission); and

     (c) conduct a public hearing in relation to the matters that are the subject of the proposed determination or report.

  (2) The Tribunal must publish on its website a transcript of public hearings conducted under paragraph (1)(c).

2 Section 7A

Before "The Tribunal", insert "(1)".

3 At the end of section 7A

Add:

  (2) The Tribunal's reasons for a determination or report under this Act relating to a member of the Parliament (including a Minister of State) must address:

     (a) any submissions received under subsection 7AA(1); and

     (b) any evidence given in a public hearing conducted under that subsection.

4 At the end of section 11

Add:

  (3) This section applies subject to section 7AA (process for making determination or report about members of Parliament).

These amendments introduce an additional process for the Remuneration Tribunal to follow when considering politicians' pay and entitlements. Item 1 states that these amendments will come into effect immediately after the provisions covered by schedule 2 of the bill. Item 2 inserts a new schedule into the bill. This schedule states that before making a determination or report about politicians' pay and entitlements the Remuneration Tribunal must take the following steps: firstly, make a call to the public for submissions; secondly, publish all submissions on its website, subject to the consent of the person or organisation making the submission; thirdly, conduct a public hearing in relation to the proposed determination or report; fourthly, publish a transcript of the hearings on its website; and, fifthly, refer to the submissions and evidence provided in the public hearing when providing reasons for the decisions reached by the tribunal in relation to the proposed determination or report.

Senator Rhiannon is right. These are minimalist amendments and there is nothing wrong with minimalism, Senator Rhiannon. Sometimes less is more. It is a case of these amendments being quite straightforward. These amendments do not constrain—in any way, whatsoever—the independence of the tribunal in making a determination about the salary, conditions and entitlements of members of parliament. But it sets up a process that guarantees a certain benchmark of transparency. To require that certain benchmark of transparency is not onerous and is essential for public confidence in the whole issue of politicians' pay and entitlements. It would help demystify the process; it would help strengthen public confidence in the process by which politicians are remunerated and how their pay and conditions are set. That would unambiguously be a good thing. At the moment there seems to be too much mystery. There is something to be said for having this benchmark of transparency.

These amendments would also allow members of parliament, unions, industry groups and other interested parties to provide information to the tribunal in relation to determinations or reports. Politicians are employed to serve the Australian public. I think it only fair that the Australian public be involved in that process in a transparent fashion. This bill makes amendments to the definition of salary and allows the tribunal to make determinations of what constitutes salary for the purpose of assessing superannuation. Therefore, there is a direct relevance to these amendments, because they relate to the heart of what is being proposed. These amendments would not have been necessary, in a sense, had it not been for the subject matter of the bill and what is being proposed.

I note that Senator Feeney has indicated the government's opposition to this. I ask Senator Feeney if he would concede that the independence of the tribunal to make determinations as to the pay and conditions and entitlements of members of parliament is not in any way constrained by this bill. There is simply a requirement to have advertisements for public hearings, to conduct a public hearing, to have submissions that can be published on the website subject to the consent of those making the submissions and to at least make reference to the submissions that have been made and to the evidence heard in the course of a public hearing. I say to Senator Feeney, with his eminent legal background—I say that without any irony whatsoever: how does that impinge on the independence of the tribunal? The tribunal could hear all this evidence and go through the process that is suggested or mandated in this amendment. It can still decide what it wants to decide, but at least the Australian people will know that there has been a benchmark of accountability and transparency in the process.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

Senator Xenophon, I do not have a great deal to add to what I have already said. I accept the fact that your motives here are pure and that you are seeking for the tribunal to operate, going forward, in a manner that engenders public confidence and I agree that is a worthwhile objective. But the government's view is that the objective is best secured by enshrining the independence of the tribunal and its capacity to govern its own affairs.

With respect to the point you made concerning the process and demystifying the process for the purposes of justifying the decisions of the tribunal, I would point you to the fact that the tribunal is now required to publish reasons for its decisions. They will be public documents in a way with which you are familiar, and the reasons for decisions are then available for people to peruse and make their own assessments.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

Oops, Mr Chairman, the question has not been asked. Regarding the requirement for the tribunal to advertise that it is seeking submissions, to obtain submissions, to publish those submissions with consent and to hold a public hearing, it does not say how long the hearing has to be. It could be a 30-minute hearing, which would be problematic. But, if it were a one-day hearing in Canberra or a half-day hearing, how on earth does that impinge on the independence of the tribunal? That is what the government is saying, through Senator Feeney's answer.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

Senator Xenophon, I am happy to repeat my answer. It really is very simple. It is within the remit of the tribunal to do all of the things you have described. We have in no way constrained its powers. It may very well undertake the course of action that you are suggesting. But it is the government's view that the independence of the tribunal must be enshrined and maintained and that it must govern its own affairs. It may very well do the things that you are describing, but we are not mandating that it does.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

Senator Feeney made reference to the issue of public confidence. Does the government believe that there would be greater public confidence in the process of setting the pay and conditions of members of parliament if there is a process that would involve public submissions and a public hearing? It is my understanding that he does not disagree with that proposition—that there would be greater public confidence in the process if the tribunal undertook, for instance, the public submissions and the public hearing, referring to the evidence that was obtained and heard.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

It is my very firm view that public confidence in these matters is critically important. It is equally my firm view that that public confidence will be strengthened by the fact that this tribunal is independent—independent of politicians and the decisions of politicians—and is able to go about its business and to govern its own inquiry process. I believe that that governance—that independence—will ensure that its future determinations have the confidence of the public.

Scott Ryan (Victoria, Liberal Party, Shadow Parliamentary Secretary for Small Business and Fair Competition) Share this | Link to this | Hansard source

The opposition does not support the amendments moved by Senator Xenophon. In short, I note that Senator Xenophon earlier commended the work of the Remuneration Tribunal in recent months. The opposition agrees that the current legislation allows the tribunal to conduct investigations as it sees fit. Everything Senator Xenophon has proposed is quite within the powers of the tribunal to conduct at the moment. The very independence that parliament has granted the tribunal is critical to generating the public confidence that I think we all share with Senator Xenophon. The opposition does not see the need to mandate a particular course of action for the now independent Remuneration Tribunal. We will not be supporting the amendments.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

I thank Senator Ryan for outlining the opposition's position. It seems that there is no real dispute that the more transparent and robust the process, the greater the degree of public confidence. But you do not want to mandate that, notwithstanding that the tribunal is still free to decide whatever it wants to decide in terms of politicians' pay and entitlements.

I have a budgetary question. It goes to the ability of the tribunal to have a public process. In other words, if it wanted to advertise and hold a public hearing for a day, two days or more, is there any provision in the current budget of the tribunal for that to take place? If there is not, would the government be in a position to say, here and now, that if the tribunal made a request, 'We want to hold public hearings; we want to hear the submissions'—because it has been flooded with submissions and they have to be duly considered—the government would provide the necessary resources for the tribunal to carry out its work? If it does not have adequate resources then that raises issues of its ability to carry out its functions appropriately and independently.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

I thank Senator Xenophon for his question. I am advised that, should the tribunal resolve to go down the course of seeking public hearings, then that would, in all likelihood, mean that the tribunal's small budget would require budget supplementation in order to meet such requirement. In the event that the tribunal resolves upon a process which engenders more costs, that is something the tribunal would then raise with the minister.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

My question to the parliamentary secretary is: is the government not in a position to say that, if a tribunal is truly independent in terms of the carrying out of its functions and it wants to hold public hearings—if it considers that that is the best way of undertaking its work—the government will be able to facilitate any reasonable request for the funding of a public hearing of submissions?

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

Unfortunately it is not possible for me at this moment—let alone in my very different capacity as Parliamentary Secretary for Defence—to commit to how it would respond to any such request.

Senator Xenophon interjecting—

Certainly not. I really can go no further than to say that, in the event that the tribunal was to develop such a request and provide it to the minister, that would be a matter for the minister's consideration.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

Does the parliamentary secretary concede that, if the tribunal made such a request and the government said, for instance, 'No, we won't facilitate additional resources for a public hearing,' that that act in itself could arguably fetter the independence of the tribunal because it would not be able to do its job as it sees fit—that is, to hold a public hearing?

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

I think you are inviting me to participate in a political debate around a question that is obviously dear to your heart. I will decline your invitation. It is not for me to imagine future scenarios and engage in hypotheticals. I really cannot go any further than to say that should the tribunal seek to adopt a course of action whereby it requires additional resources then it would, of course, put such a request to the relevant minister.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

I just say that I am disappointed in the position of both the government and the opposition. I think that here was an oppor­tunity to strengthen transparency, accoun­tability and processes. Senator Ryan quite accurately reflected my views of the Remuneration Tribunal. I think that they have done a good job in terms of improving processes and in their publishing of decisions. I thought they were quite rigorous and robust but fair in the processes by which they dealt with members of parliament in taking a forensic view of their roles and the like. I have confidence, based on their past record, that if they were mandated to do this—to have public hearings and to request public submissions—they would do a very good job.

I think we are losing an opportunity here to have a greater degree of accountability, transparency, robustness and, above all, increasing public confidence in the system by which politicians' pay and entitlements are determined. We had an opportunity with this amendment tonight to say that we have confidence in this process in the sense that we can mandate these requirements. I think we would have brought some significant members of the public with us to say that this is a better process. I am happy for this to be put to a vote. I will be seeking a division, come what may.

The CHAIRMAN: The question is that amendments (1) and (2) on sheet 7194 moved by Senator Xenophon be agreed to.

The CHAIRMAN: The question now is that the bill stand as printed.

Question agreed to.

Bill reported without amendment; report adopted.