Resumed from 29 November.
[speeches and comments of various members]
HON ALISON XAMON (North Metropolitan) [12.21 pm]: I rise as the lead speaker for the Greens on the Salaries and Allowances Amendment (Debt and Deficit Remediation) Bill 2017. This bill seeks to prevent any increase in remuneration paid to officers who are referred to in section 6 of the Salaries and Allowances Act. That will include members of Parliament, the Clerks and Deputy Clerks in both houses, and those in the special division of the public service—for example, the directors general of government departments. It will also incorporate the Governor, the judiciary, the Parliamentary Inspector of the Corruption and Crime Commission and the executive officers of prescribed government trading entities.
Increases will be prevented from the bill’s commencement until 1 July 2021. I note that decreased remuneration will still be possible under this bill. The bill will not freeze any remuneration that does not impact directly on WA’s debt and deficit, including remuneration for CEOs, elected council members of local governments and members of the governing councils of WA’s public universities. That raises some issues in itself. I will speak further on that in my contribution. The bill will also not freeze MP travel that has been approved by the Treasurer, parliamentary superannuation determinations, MP redundancy benefits or the entitlements of former MPs. Again, that is an issue that I will speak on. Regulations may also prescribe the kinds of remuneration outside of the freeze. It is my understanding that the intention is that these will be the kinds of remuneration that are linked to external requirements, such as fringe benefits tax, superannuation guarantees, accommodation, and daily travel allowances, which are linked to determinations of the Australian Taxation Office. If the office of Governor is vacant when the freeze starts, the next office holder will be paid the same as the last Governor, whereas in the case of special division public servants, the next office holder will be paid at the 1 July 2016 rate if the office was filled on the date of the last CPI increase. Newly created positions or positions that were unfilled on 1 July 2016 will be paid at the same rate as comparable officers immediately before the freeze. After the freeze ends and the tribunal is scheduled to resume making determinations, it must not make any compensatory determinations, nor take into account any cost-of-living increases from the date of commencement until 1 July 2021.
I will make some general comments about this bill. Firstly, the Greens—like everyone—recognise the fiscal environment that the government is currently working within. CommSec’s 2017 “State of the States” report on state and territory economic performance paints a very bleak picture of WA’s current finances. WA continues to lag behind other states. Our annual growth rate is below the national average across seven of eight indicators surveyed. The trend of unemployment stands at 5.6 per cent, which is around 17 per cent higher than the 4.8 per cent normal or decade average unemployment rate. Only two economies had rates of construction work that were lower than a year ago. Construction in WA is down by 30.5 per cent and in the Northern Territory it is down 3.9 per cent. Construction work done in the June quarter was almost 39 per cent below the decade average. It is behind Queensland, where construction work was down by 17.7 per cent on decade averages. Wages in WA were up just 1.4 per cent on a year ago, compared with 2.1 per cent wage growth in South Australia and the Northern Territory.
The Greens are very well aware of the human face of the economic downturn and the impact it has had and continues to have on the community. We know that inequality is increasing in the community and levels of poverty are growing. Study after study has borne this out. Increasing levels of poverty will have significant and broad implications for our community as a whole. It has impacts on the health system, our justice system, our housing and our child protection system. That is just to name a few areas it will impact.
The Greens absolutely support action to overcome poverty and inequality within the community. I appreciate that savings have to come from somewhere in this tight fiscal environment. There are areas in which I suggest we could find a range of savings. We could start with our prison system. We are looking at an expansion of prisons, which will be incredibly expensive. It will certainly cost a lot more than the $20 million over four years that is proposed to be saved by this budget measure. I want to be clear that the Greens in WA, and, indeed, nationally and globally, have never supported austerity measures as a way of achieving budget outcomes. The Greens do not support the cutting of important service deliveries and have always maintained that budgets exist to ensure the protection of the most vulnerable in our community. The Greens echo the view of the Western Australian Council of Social Service; that is, that hardline austerity measures that do not protect the most vulnerable in our community will only cause other systemic costs to flow. Such measures ultimately undermine the economy and further disadvantage marginalised people and those who are already vulnerable.
I recognise that people on low or moderate incomes should not have to bear the brunt of savings measures. We are talking about people who are already doing more than their fair share, and the public sector contraction that is currently occurring does not help the situation. As a principle, the Greens support, and have always supported, wage constraint, and I acknowledge general public concern about the level of CEO wages, not just within government, but also in the private sector. I also note that the general public has an expectation that if public servants are being asked to contribute to budget savings, those measures will include not only the rank and file public servants, but also, and indeed be focused on, those who are at the top. I recognise that it is not a good look if members of Parliament and senior public servants continue to get pay rises during times such as these. However, although the Greens are generally supportive of wage constraint, we have significant concerns with what this bill is proposing to do and the precedent it proposes to set regarding MPs setting their own wages. The issue of parliamentary salaries, allowances and entitlements has always, quite rightly, generated significant public interest and comment. The Greens have consistently held the position that parliamentarians should not have any direct involvement in setting their own pay or remuneration. A public servant setting their own pay is just not a good look and the general public have every right to expect it not to happen.
Hon Nick Goiran: The government does not agree with you.
Hon ALISON XAMON: I am aware of that.
Before 1967, members were in charge of determining their own remuneration. At the time, the situation caused such stigma that an independent committee was established to try to address this issue. This committee was the precursor to the Salaries and Allowances Tribunal. The Salaries and Allowances Tribunal replaced this committee in 1975, and was established as an independent body to decide the remuneration of senior public servants. I note the comments by Hon Peter Collier that there was extensive discussion reported in Hansard at that time. I also would encourage members to read that particular Hansard to see why it was deemed to be so important to finally establish this independent body in the first place. It is always instructive to look at why particular provisions were created in the first place.
This bill before us is now seeking to reverse that longstanding achievement of over 40 years and take us back to the time when MPs were in charge of setting their own pay. The Hansard of the debate when the tribunal was established shows that in establishing the tribunal, importantly, the government of the day also sought to address the discrepancy and inconsistency that had arisen through having different bodies determine salaries for different groups of senior public servants and officials. It was intended to try to bring together the different criteria by which people were having wages determined and make sure there was some consistency across government around how wages were being determined. Establishing this tribunal all those decades ago provided for a coordinated approach. The bill also sought to achieve equity and remove disparities between the salaries of public servants, the judiciary and members of Parliament. The tribunal has significant powers, akin to the powers of a royal commission, while undertaking inquiries in respect of its statutory responsibilities. The tribunal can inform itself as it sees fit and it invites public submissions. The members of the tribunal are appointed to these roles precisely because they are experts and they are paid to undertake this work. In making its determination, the tribunal, importantly, is required to take into account government financial matters. Section 10A(2) of the Salaries and Allowances Act 1975 states —
(a) any Public Sector Wages Policy Statement, irrespective of whether or not the statement applies to a person or office in respect of whom or which the determination is made;
(b) the financial position and fiscal strategy of the State as set out in the following—
(i) the most recent Government Financial Strategy Statement released under the Government Financial Responsibility Act 2000 section 11(1) and made publicly available under section 9 of that Act;
(ii) the Government Financial Projections Statement;
(iii) any submissions made to the Tribunal on behalf of the State government.
At the heart of our concerns about this bill is the issue of integrity of government. I am extraordinarily disappointed about being here discussing legislation that seeks to undermine the independence of an independent statutory body. It does not reflect well on the government’s integrity. Even if it is for reasons that we would otherwise support, the Greens believe that it is vital to maintain the independence of the tribunal and to separate its decision-making from political processes.
I want to spend some time talking members through the issue of integrity of government, because it is something that the Greens feel very strongly about and have always had a strong and consistent position about. Government integrity demands more than just general expressions of goodwill. It also demands more than just personal integrity, although, of course, this is always an essential component. Government integrity is dependent on our structures, our processes, the checks and balances, and the safeguards that ensure transparency and ethics in the operations and decisions of government. If an independent tribunal has been created and then Parliament seeks to direct that tribunal how to act, it is compromising the fundamental integrity of the process.
I draw members’ attention to the changes that have occurred over the years. One of the important things to note is that the sorts of changes that have occurred have simply been to incorporate more and more public servants into the legislation. There has been an understanding that far from needing to wind back the provisions of this very important separate tribunal, there has been a need, a desire, to ensure that we are taking a more and more arms-length approach to who is covered by this legislation. The sorts of amendments that have occurred over the last few years have included the Parliamentary Inspector of the Corruption and Crime Commission, the CEOs of local governments, and presidents and judges of courts and the appeal court, making sure that more people, more categories of employees, are included within the legislation. This is the direction in which we have been taking this tribunal over the last 40 years, making sure that we have more and more hands-off independent determinations, not fewer. This is the first time that we are seeking that sort of direct intervention to wind back those hard-fought reforms. Quite simply, this bill absolutely fails the integrity test, not because it seeks to do something fundamentally wrong, but because of the way it seeks to do so. Quite simply, the end does not justify the means. Again, I understand that there is significant support for the principle of the freezing of the pay of politicians and senior officials, including from the Greens, but this is not the right mechanism by which we need to attempt to achieve that outcome. I note that the latest determination that has come down from the Salaries and Allowances Tribunal only a matter of minutes ago has, unsurprisingly, determined that there will be a freeze on the salaries of members of Parliament. This is not surprising to me, and I will get to this more in the future.
When populist politics and polling take precedence over principle and expedience takes precedence over ethics, there is the potential that we will seriously undermine trust in not only the individuals involved, but also, I would suggest, the entire process of democracy. The Greens have consistently fought for government transparency and accountability, and a resilient democracy is absolutely dependent on that level of integrity. Establishing the Salaries and Allowances Tribunal contributed significantly to the public’s perception of integrity in government and has been the understood consensus for over four decades. With its act there was increased transparency and accountability of how members of Parliament and other senior public officials were remunerated. The decisions by which the salaries were determined were transparent. Very importantly, it created more consistency in a whole range of different areas. To now take away the power of the tribunal to independently make these decisions does nothing for integrity of government and nothing to promote public trust in government. This government is basically saying that it does not trust the tribunal to do the right thing in this economic climate, and, clearly, based on the decision that has just come down, it is wrong. This is a completely misguided and problematic assumption to bring into this place. In fact, this bill undermines the confidence and trust in the whole system, because it implies that the Salaries and Allowances Tribunal is incapable of getting it right even though it is an independent body. For members of Parliament, it is especially important not only to have integrity, but also to be seen by the media and the public to have integrity. Although, again, we appreciate that there is a good reason to want to ensure that there is a freeze on salaries, it does not mean that the mechanism by which this is being attempted is appropriate, because quite frankly it is not. Taking control of their own salaries is not something that other salary earners can generally do. They do not have that power. Therefore, it is very easy to cast what is happening here as, effectively, pretty shonky behaviour that is lacking in integrity, even if that is not the intention now or in the future. Integrity is closely connected with trust and I think we would all agree that as politicians we want people, our constituents and the WA public more broadly, to have trust in us, the decisions we make and what we do.
I will quote from the Organisation for Economic Cooperation and Development “Government at a Glance” publication from 2013. I quote —
Trust in government represents the confidence of citizens and businesses in the actions of government to do what is right and perceived as fair. It is one of the most important foundations upon which the legitimacy and sustainability of political systems are built. Trust in government is essential for social cohesion and well-being as it affects the government’s ability to govern and enables government to act without coercion. Consequently, it is necessary for the fair and effective functioning of public institutions.
In effect, trust is necessary for government to function well. Trust is what drives limited public confidence in government’s ability to perform tasks, and I would say that the sorts of core tasks we are talking about are issues around welfare, combatting illegal and dangerous drugs, managing things like water restriction, and developing infrastructure in our health system and the economy. In the day-to-day of trying to do our job well, it is easy to forget the cynicism with which MPs as a group are regarded by the public. Unfortunately, people’s trust in Australian politicians is very low. Australian survey data consistently indicates low levels of trust and respect for politicians and political institutions. In June this year, the ABC reported on the results of a survey by the University of Canberra that found that trust in Australian politicians and our political system is at its lowest level in 20 years. Only 42 per cent of people reported being happy with the way democracy works and, frankly, I am surprised it is even that high. The Scanlon Foundation in its 2013 social cohesion survey found that in the ranking of trust in institutions and organisations, Australian federal Parliament was at seven per cent and political parties at three per cent, which is last, after hospitals, police, public schools, employers, the legal system and television news. Only seven per cent of people surveyed indicated that they trusted a great deal that government leaders would tell the truth regardless of how complex or unpopular the issue. A lack of trust in politicians, however, does not have to be a given. We can do things that will improve people’s trust in us. According to the historian Professor Andrew Markus, the sorts of factors that determine approval above the base level of trust—I think members could benefit from hearing this—include engagement, which is listening to needs and feedback and communicating frequently and honestly on matters of national significance; integrity, which is the ethical conduct of MPs and legislative policies that are seen to be ethical; ethical administrative practice that takes responsible action transparently and openly, and this bill breaches that; purpose, which is addressing social need and protecting and improving the environment and programs that positively impact on the community; and operation, which is highly regarded and widely admired top leadership and delivering consistently on policy undertakings.
The legislation before us is not going to increase public trust in MPs, and, as I have said already, it does not pass the integrity test. Why do we need this legislation? This is the question that I am asking. Is it true that the tribunal is doing a bad job, which is clearly what is being said by this bill? I am going to go through a bit about the determinations made by the tribunal, because I am not sure I share the implied criticisms of it that, clearly, this government has. The briefing I received on the bill indicated that the tribunal is not failing to be reasonable and conservative in its determinations, that it has been operating according to the relevant wages policy and, importantly, that it is already open to advice. The tribunal considers remuneration only, but does not necessarily increase it, as illustrated by the decision made today. I am briefly going to summarise my understanding of some of the tribunal’s more recent determinations. I will come back to the determination that has just come down, but I will go back from the last one. The current determination, which up until today members of Parliament have been operating under, was the second of 2016 and effective from 12 March 2017. There was no change to salary or electorate allowances. The entitlement for the provision of a motor vehicle was replaced by a motor vehicle allowance, and that was because the government effectively wanted to get out of the business of providing cars. Fair enough; I will not argue whether that was a good or bad decision. But, to be very clear, it was not about extra money; it was simply about changing the way that motor vehicles would be provided. The charter transport allowance was limited to air charter expenses. Allowances were generally adjusted to reflect changes to electorate boundaries. I would consider that to be a sensible move. The tribunal would want to make those sorts of decisions. The postage allowance for certain office holders was abolished. Again, the parliamentary travel allowance was replaced by an annual allowance. It was just a change in the way it was done. We are not talking about increases; in fact, we are talking about a loss of some entitlements. They are the sorts of decisions that the Salaries and Allowances Tribunal makes. There has been some necessary tweaking around the edges to make sure that the sorts of allowances that are made available are reflective of electoral boundaries. Again, would that not be a sensible thing for the Salaries and Allowances Tribunal to do?
I note that this determination was varied on 18 May 2017 to prevent ministers and certain office holders from accessing the motor vehicle allowance because, under separate arrangements, they were already provided with a vehicle. I want to make some further comments about that. I have not made any comments in this place about this issue but I will do so now. I note that when this discrepancy of the double dipping became known—fortunately, journalists were addressing that and keeping on top of it—it was the subject of immediate intervention by the Premier and was immediately addressed by the Salaries and Allowances Tribunal. What I take from that experience is that, firstly, the Salaries and Allowances Tribunal is very quick to rectify if it sees any problems emerging. Secondly, it took a journalist to find out about these issues. Those ministers who received both allowances at no point thought to bring that to the attention of anybody else and say that it was a bad idea and question whether it was something they should be entitled to. It probably would have been a good idea to raise it at the time. Thirdly, I cannot for the life of me understand why those ministers who have not returned that money have not done so yet. If it were me, I absolutely would have returned that money. I would have been embarrassed to continue to hold onto that money.
Several members interjected.
The ACTING PRESIDENT: Members! We are listening to Hon Alison Xamon. I will have no interaction across the chamber.
Hon ALISON XAMON: Office holders, such as those representing regional areas, may apply to the tribunal to receive the allowance for use predominantly in their electorate. Again, that was the second determination of 2016.
Prior to that determination, the Salaries and Allowances Tribunal determined in 2016 that there would be a salary increase of 1.5 per cent and no changes to allowances and entitlements. Again, this was varied on 24 October 2016, allowing regional ministers to take the cash in lieu allowance instead of an electorate vehicle. That was a pretty moderate increase and not inconsistent with the government wages policy of the day. The determination prior to that was on 23 June 2015. Again, there was no change to salary. There were changes to the electorate allowance, which were the first since 2013, there was a reduction in the transport allowance and there were accommodation and resettlement changes. The determination prior to that was on 24 June 2014. The salary was increased by $5 500 and the postal allowance was increased to reflect the increased prices of Australia Post. I would think that would be only fair, because it was a pretty massive increase, although I note that we no longer have it. This was varied on 22 September 2014 to provide clarification about accommodation allowances following a taxation determination by the Australian Taxation Office.
The determination prior to that was on 9 August 2013 and there was no change to salary. The base electorate allowance increased as per the Perth consumer price index to reflect a significant increase in the average number of electors per electorate for the year ended 30 June 2013. I point out to members that the increase reflected the increase in the number of people who needed to be reached and the increased costs. No extra money came in; it just reflected the increased expenses that we were expected to wear. An additional electorate allowance was paid to regional members. It was increased by the Perth CPI for the year ending 30 June 2013 of 2.5 per cent, rounded to the nearest $50. That reflected the increased costs for regional members, as opposed to members in the metropolitan area. There was a change to the motor vehicle allowance, with an increase in the whole-of-life lease value to $25 000 per annum. The charter transport allowance also increased by 3.8 per cent, rounded to the nearest $50, to reflect increases in fuel costs associated with charter transport services. There was also a change to the metropolitan expenses of country members. There were no changes to telephone and postal costs. There was reimbursement of expenses for parliamentary travel, which was not available during election campaigns, totalling $27 000 over the four-year term of a Parliament. What I have just listed was varied on 24 September 2013 to provide for the remuneration of the then recently appointed National Party Whip in the Legislative Assembly. I note that the Greens Whip does not get that, but the National Party Whip does.
The determination prior to that was on 27 June 2013 and was consistent with emerging trends in economic indicators and the degree of caution that had started to be demonstrated by economic commentators generally. Remuneration increased by 2.6 per cent effective from 1 July 2013 for public office holders within its jurisdiction. The determination prior to that—I remind members that this was when we had a lot of money floating around in the state—on 10 August 2012 was for a 3.25 per cent increase in base salary. There was no change to the salary relativities of parliamentary office holders. There was a two per cent increase in the base electorate allowance, which was equivalent to the Perth CPI, plus additional costs. I was a member of Parliament at that time and I remember there were significant additional costs in our electorate offices. There was a two per cent increase in the additional electorate allowance for regional members, rounded to the nearest $50. There was no change to the motor vehicle allowance. There was a five per cent increase in the charter transport allowance, rounded to the nearest $50. There was no change to the telephone and postal service allowances. There were additional variations around resettlement that made it clear that it applied only to former members of Parliament who were transitioning back to private life, not to MPs who resigned to stand for another seat.
For the judiciary, the current recommendation is dated 31 May 2017. Again, there was no change to the remuneration. The recommendation prior to that on 21 June 2016 was for a 1.8 per cent adjustment to the remuneration paid or provided to judges, District Court judges, masters of the Supreme Court, magistrates and the Parliamentary Inspector of the Corruption and Crime Commission. The recommendation prior to that was on 23 June 2015. Once again, there was no change to the remuneration paid. Motor vehicle entitlements were amended to allow for new leases to be entered into. The recommendation prior to that on 24 June 2014 was for a 2.5 per cent increase in remuneration from 1 July 2014.
In each of these recent examples, the tribunal has demonstrated a conservative and restrained approach and, importantly, has been transparent in how and why it makes its decisions. People cannot wonder why the tribunal has made particular decisions because it is all spelt out independently without having to worry about a lack of integrity in the decision-making processes.
Sitting suspended from 1.00 to 2.00 pm
Hon ALISON XAMON: Before the lunchbreak I was going through the previous determinations of the Salaries and Allowances Tribunal, which demonstrate that there is a pattern of the tribunal being very conservative and considered in its deliberations and that any concerns that people might have that the tribunal might indulge in some exorbitant pay increases or changes to entitlements are completely misguided. I draw the attention of members to the most recent determination, which came down while I was on my feet in this chamber and with which I have now had a chance to familiarise myself. It is very telling, and serves to further illustrate how completely unnecessary this piece of legislation is. The media statement attached to the determination states —
The Western Australian Salaries and Allowances Tribunal has issued its annual Determination in relation to Members of Parliament.
The Tribunal has determined that there will be no increase in remuneration or allowances provided to Members of Parliament.
In reaching this conclusion, the Tribunal’s overriding consideration was the state’s current economic circumstances.
I will now go to the determination itself, because I think it is very important. There is a significant amount of preamble and discussion of the economic context in which this determination has been given. Unsurprisingly, the Salaries and Allowances Tribunal goes through exactly what I went through in the beginning of my contribution to this debate. It outlines the economic situation in which we find ourselves, although it makes the point that there is a sign of economic growth in the forward years and potential improvements to our unemployment rates. I will quote from the determination, because I think it is really pertinent. The conclusion states —
(14) In recent years, the Tribunal has restrained the increases in remuneration provided to Members of Parliament due to the difficult economic conditions that have emerged.
(15) In conducting this inquiry the Tribunal has considered existing remuneration of Members of Parliament within the context of wage and salary rates applying generally in the community.
(16) At the time of this Determination, there is proposed legislation that will operate to cap remuneration provided to certain offices within the Tribunal’s jurisdiction, including Members of Parliament. However, as the legislation has not yet been enacted, this Determination is issued under the Tribunal’s existing statutory duty.
(17) Notwithstanding the full discretion available to it, the Tribunal considers that the current economic challenges, and the measures to address them, have significant implications throughout the public sector and the community generally.
(18) The Determination provides no increase to remuneration and allowances provided to Members of Parliament. The Tribunal will continue to monitor Members’ allowances to assess whether the costs of effectively servicing an electorate are reasonably met.
Effectively, all the concerns that have been raised about why we need to take this extraordinary measure to override our independent tribunal would appear to be completely and totally pointless—absolutely unnecessary. I note with concern particularly the last paragraph of the conclusion, which refers to the opportunity to assess whether the costs of effectively servicing an electorate are reasonably met. This bill will deny that opportunity. This is not about salaries; this is about our capacity to do our jobs as members of Parliament and to service our electorates. The provision that the tribunal has flagged as an issue of concern that it needs to keep an eye on has been completely denied us for the next four years. I will have a bit more to say on that in time. Once again, we have further evidence that there is just no need for this piece of legislation and, indeed, the precedent that is set by introducing this bill is highly problematic in terms of the integrity of government.
A fundamental concern with the integrity of government is not the only issue I have, and I will briefly outline a number of my other concerns, which I think all members should share. Firstly, the bill provides for the circumvention of the act’s own measures, causing inconsistency across groups. I remind members that one of the reasons the Salaries and Allowances Act 1975 was introduced all those decades ago was precisely to ensure that there would be no disparity across various categories of public servants. The bill proposes to amend section 8 so that the tribunal will not be required to make an annual determination or report under sections 6(1) and 7(1) before 1 July 2021, but the tribunal is not prevented from doing so if it considers that the circumstances require it. Proposed section 10C provides that the Governor’s remuneration is not to be increased before 1 July 2021, but the regulations may prescribe a kind or class of remuneration to which this section does not apply. The Governor’s current determination is dated from 2014, and the regulation process intrudes the government into this process in a way that attracts less parliamentary scrutiny than a bill. A regulation applies unless and until it is disallowed, unlike a bill.
Proposed section 10D provides that remuneration of those to whom section 6 applies is not to be increased before 1 July 2021, but public university board or senate members, or council members who fall under section 6(1) are exempt. The explanatory memorandum says that this is because that does not affect debt and deficit remediation. However, the main reason for the Salaries and Allowances Tribunal’s establishment was to coordinate and deliver consistency in remuneration across different groups of people, including this group. Exempting any group goes directly against this principle. The regulations may prescribe a kind or class of remuneration to which this proposed section does not apply. Again, this is intruding the government into what up until now has been an independent process, in a way that attracts less parliamentary scrutiny than a bill; a regulation applies, again, unless or until it is disallowed, unlike a bill. Proposed section 10E provides that judicial remuneration is not to be increased before 1 July 2021, but that “the regulations may prescribe a kind or class of remuneration to which this section does not apply”. Again, this is intruding the government into the independent process in a way that will attract less parliamentary scrutiny than a bill and, again, the regulation will apply unless or until it is disallowed, unlike a bill. Proposed section 10F states that the remuneration of certain executive officers of government entities is not to be increased before 1 July 2021 but that “the regulations may prescribe a kind or class of remuneration to which this section does not apply”. Again, this is intruding the government into the process in a way that will attract less parliamentary scrutiny than a bill and a regulation will again apply unless or until it is disallowed.
In the event the tribunal makes a first determination for a newly prescribed government entity, it can also make subsequent determinations if it considers the circumstances, but it is not required to do so. Secondly, some groups are omitted from the bill, which will also now cause further inconsistency across groups. The bill does not amend the tribunal’s determination of MPs’ redundancy benefits; the tribunal’s determination of entitlements and benefits of former MPs; the tribunal’s determination of remuneration of local government CEOs; or the tribunal’s determination of fees and allowance of local government councillors. Again, the main reason for the tribunal’s establishment was to coordinate and deliver consistency in remuneration across the different groups of people, including this group, so exempting any of these groups is going directly against that.
Thirdly, the superannuation differences cause internal inconsistency with how MPs are treated. Under the Parliamentary Superannuation Act, the tribunal has certain functions including determining the contributions that, if not paid by the state as remuneration, are deducted from the salary. It also has the ability to change the scheme. Section 6A of the Salaries and Allowances Act enables the tribunal to carry out those functions. The bill does not amend section 6A, so those functions of the tribunal will continue despite the tribunal’s inability to increase MPs’ remuneration; thus MPs might find that their salaries are reduced if the tribunal decides to increase the superannuation contribution deduction, which is going to further increase the discrepancy between MPs’ salaries and other groups’ salaries.
MPs elected before 2001 are on pensions and those elected afterwards are on superannuation, but as the latter is salary based, this creates inconsistency internally within the MP group in addition to the above inconsistencies between groups. Do not think that it has escaped my attention that we have effectively two classes of MPs when it comes to wages and entitlements. I suggest that if this government and this Premier were serious about wanting to look at budgetary measures and constraints, one thing that they might have considered was looking at the parliamentary pension scheme and perhaps the overly generous requirements that exist within much of that. It is very easy for the Premier to call for wage restraint when he knows that upon leaving this place he will receive a really generous ongoing amount of money from the parliamentary pension scheme, something that the rest of us, bar five, will not receive. I also say that I think it is quite rich—I use that word very deliberately—for someone currently on a salary of $355 000, which is not the same as what everybody in this place is on, to start talking about restraint.
Lastly, I will also talk about the problematic provision for no compensatory determinations after 1 July 2021, which is contained within the proposed amendments. That amendment states that after the freeze is over —
(2) The Tribunal must not make a determination ... or a report ... which—
(a) has the effect of providing for the payment or provision of remuneration on the basis that the remuneration was not paid or provided before 1 July 2021 by reason of the operation of ...
The bill —
(b) takes into account any increase in the cost of living that occurred between commencement day and 1 July 2021.
The intention is to prevent catch-up compensatory payments for any remuneration foregone. This will permanently preserve inconsistency across different groups in the future, despite decades of trying to ensure that we had parity and consistency, and contrary to the purpose of the tribunal’s establishment.
I also want to talk a little about electorate allowances. I do not know about other members in this place, but I spend every single cent of my electorate allowance and, indeed, some of my personal wage running my office. In fact, because I do not have enough in the way of staffing arrangements—I am going to speak a bit about that as well— I employ a woman a few hours a week, as much as I can afford, out of my electorate allowance to assist in the capacity of my office. This bill will effectively mean that I will have to freeze her wage for the next four years because I am not going to have any sort of consumer price index increase that is reflective of the increased costs associated with the running of my office. That means she is never going to see an increase despite the fact that she, as a regular citizen, is likely to be subject to increased costs over the next four years, particularly as all the predictors are that the economy is getting back on track. Effectively, I am going to go backwards in my capacity to run my office because of increased costs, but without any increases in wages to be able to hold on to that.
I have long maintained that perhaps there is a need to look at the way our offices are funded. I, for one, am concerned about it appearing as though individual members are taking their electorate allowances and pocketing them. I have to say, what a luxurious position to be in. I do not know how others can do that, but I am most certainly not in a position to take any of that money for myself. As I say, in order to perform my role effectively I already have to cut into my personal wage, my family’s wage, to make sure that I am performing my job effectively. I am very concerned that that particular provision is not even able to be independently assessed any further. Perhaps there is a need there. I would have preferred the opportunity to have been able to put a submission to the Salaries and Allowances Tribunal to talk about not only the associated increased costs of the electorate allowance that will be needed in the future, but also perhaps different ways that that could be treated and managed if indeed there is a problem with individuals treating it like a wage. If members are treating it like a wage, I reckon they are not really doing what they are meant to be doing in this place. That is another issue. However, I am going to presume that people are not doing that. I am going to presume that people are using the electorate allowance for the purposes for which it is intended, and in that case there really is no justification for freezing it when we know that we need to be able to perform our jobs and to perform them to best effect.
Alternatives to this bill could have been considered. As noted earlier, the Greens recognise and even have some support for the intended outcome of this legislation, which is to ensure that people who are in a position to afford it—I would suggest that is members of Parliament—are playing their part in wage restraint, and right now there is a good economic argument for why it is important that wage restraint could be exercised particularly by people on comparatively generous wages. I think that is particularly the case because everyone recognises that we are in the midst of an economic downturn and there is a strong argument to be made that it is important to ensure that people are bearing the burden of addressing that proportionally. However, there are other ways of achieving this without infringing on the independence of the Salaries and Allowances Tribunal. Again, I suggest that today’s determination only demonstrates that more and more. We know already that the tribunal takes into account—in fact, must take into account—the wages policies of the day as well as the economic circumstances at the time. That is clearly what has happened in this determination as it has happened in previous determinations. Certainly, nothing at all was preventing this government from ensuring it put in a submission to the tribunal containing the recommendation to freeze the remuneration. Previous governments have done exactly that and, clearly, they have been taken into account. Nothing was preventing this government from doing that. The tribunal would then have the authority to inform itself as it sees fit. It can take written and oral statements that serve that exact purpose.
From the briefing I received, I understand that government has in the past made submissions and, again, the tribunal has taken them into account, as seen by its determinations. For example, on 9 August 2013, the tribunal noted the following in making its determination —
... the Tribunal has considered the submissions it received; the state of the economy reflected in movements in a range of economic indicators and current use of entitlements.
This is what the Salaries and Allowances Tribunal already does; we do not need to start messing with its independence to achieve that outcome.
I would like to say also that if we want to talk about significant savings, let us start talking about capping staff numbers. One of the things the Greens have long argued—in fact, in correspondence going back since 2001—is that we believe staffing arrangements for members of Parliament should be prescribed by the Salaries and Allowances Tribunal. It should be independently determined. It is part of what allows us to do our job—or not, depending on whether staff have been withheld from us. We believe it is very important it be independently determined. It is no surprise to members in this place that at the beginning of every single term of government, since 2001, the Greens have written to whatever the government of the day is, cap in hand, to beg for some additional resourcing capacity to enable us to fulfil our job in this place. Every single time it is subject to discussions and negotiations going back and forth. Sometimes we have been successful in getting additional staff and sometimes we have not. My parliamentary colleagues in the thirty-ninth Parliament were certainly unsuccessful in garnering any additional support to enable them to do their jobs. I am happy to say that we have managed to get some in the fortieth Parliament, just as we were in the thirty-eighth and thirty-seventh Parliaments but always with a different number of FTEs. What concerns me is that it is pretty much up to the whim of the government of the day—we have had to deal with both sides of politics in these negotiations—to determine whether it is prepared to give us that additional resource, or largesse, to enable us to do our jobs. We believe this to be a highly unsatisfactory arrangement. In fact, this pretty much blew up as an issue in 2010 when a former member for Fremantle, upon becoming an Independent, came to an agreement with the government of the day for additional staffing arrangements in return for their guaranteeing supply. At the time, the Greens lost their minds!
Several members interjected.
Hon ALISON XAMON: I have them, polished and twice as good as ever!
It highlighted at the time just how problematic it was to have arrangements around staffing being determined by the government of the day. That was the problem. It reinforces for us how important it is to have that independently determined. I think that if that is independently determined and we can take the politics out of it, the Greens would end up with more staff because we could demonstrate without a shadow of a doubt that we punch above our weight in terms of how much work we do in this place and how much work we deliver. Also, importantly, if the Premier is serious about this, let us start talking about the number of staff who are employed out of the Premier’s office and ministerial offices and whether they are really all necessary. Do ministers need a staff member to manage their Twitter account, another to manage Facebook and another to manage Grinder or whatever? Do they need that many spin doctors at their disposal? Do they need to be paid the sort of money they get? Is that really a good use of taxpayer dollars? Is that something that is responsible? I suggest that the number of staff employed out of the Premier’s and ministers’ offices should be subject to closer scrutiny. Also, it would be better off being independently determined. I would rather, after people have put in their submissions, that the Salaries and Allowances Tribunal independently determine what a genuine workload is and what the community’s reasonable expectations are about what people genuinely need. The tribunal should then decide whether it is reasonable to employ people to do particular roles.
A minister in charge of an extraordinarily large department perhaps has a really good argument for having a greater number of staff to perform their roles, particularly if there is a large array of policy areas to cover. They could make that case. The point is that it would be transparent and people would know exactly why people are employed in a certain way. Those are the sorts of things we should be looking at adding to the tribunal’s role, not taking away its power. Although the Premier has been very good at preaching austerity, I do not think he has been good at putting his money where his mouth is and has not demonstrated any restraint in the appointment of ministerial staff. In fact, an analysis in The Australian in June revealed that WA was second only to South Australia in the number of ministerial staffers and the ratio of staff to ministers. This is despite our current economic situation. We are clearly not showing any restraint in that area. Instead of the legislation before us, which seeks to restrict the independent decision-making of the Salaries and Allowances Tribunal, consideration should have been given to extending the tribunal’s remit to include determination of ministerial and MP staffing levels so that that process is undertaken in an ethical and transparent way. Let us see that sort of amendment. The Greens would be happy to support that. That would be great.
No future increase has been granted because, as I have said, the Salaries and Allowances Tribunal already takes into account its concerns about the economy and the need for restraint. But if it happens that there is some sort of significant improvement in the economy in the next four years and the tribunal, as an independent entity, saw fit to deal with the consumer price index or something like that by giving members of Parliament a pay increase, the members of Parliament who are so affronted by it have the right to return it. If they really feel that strongly about a pay increase, they could give the money back. That measure is potentially available to them.
The Salaries and Allowances Amendment (Debt and Deficit Remediation) Bill 2017 is a significant diversion from current policy. It sets a dangerous and extraordinarily disappointing precedent, one that I am not particularly comfortable with. The bill takes an issue that was previously separated from the political process—quite rightly and necessarily so—and politicises it. It is unlikely that the media and public will miss the fact that MPs, under the guise of sharing wage restraint, are stealing the opportunity to create a precedent and take control of their own salaries rather than adopting an alternative mechanism to achieve the same end. Similar to many Western Australians, the Greens do not like cheap stunts and this bill absolutely has the air of a cheap political stunt. The government should be looking at other strategies to promote and achieve equity across the public sector. We need a strategic direction, an evidence-based approach and the political will to tackle the significant issues facing the state. We do not need these sorts of stunts, which set such distressing precedents.
As elected representatives, we are in the service of the public and we are funded by taxpayers. Integrity is not something that we get to put aside when it does not suit us. Although the Greens absolutely support wage restraint, actions such as this undermine public confidence in government decision-making. Again, politicians should not determine their own wages and entitlements. This bill will set a precedent that I am extraordinarily uncomfortable with, and the fact that it is being done for reasons that I might otherwise support does not mean that the end justifies the means. The government previously acknowledged that the tribunal has been doing a good job, so quite simply, if it is not broken, why fix it? We do not need to start down this slippery slope. Trust is important for effective governing and it is important that we take every opportunity to demonstrate integrity in government. I strongly believe that the desired outcome can be achieved without ousting the discretion and independence of the tribunal.
I will make some comments in response to one of the contributions about the bill in this place. I think in many ways it is one of the saddest contributions I have heard in the last four and a half years. I refer to the argument about the need to keep the freeze going until such time that the budget finally gets into surplus—if, indeed, it ever gets into surplus. I will explain why I am saddened by that. I am saddened because one of the arguments that was made is that members only ever advocate for their own self-interest and if wages are directly attached to the possibility of bringing us into surplus, that would somehow change the way we argue our positions in this place and it would change our practices in this place. Not all of us are wired that way. Not all of us feel the need to argue for self-interest. Some of us are here because we believe in a greater good. Some of us here will continue to argue for the things that we believe in, even if it means that the state always has a certain deficit. I am the first to say that the state’s deficit is too large. I am personally disappointed that we lost our AAA rating and we need to move towards that. That is really important. I am personally supportive of trying to take measures that will achieve a better budgetary situation but I do not necessarily concur that that automatically means that we need to get to a surplus at all costs.
I tell members that regardless of what happens to my wage—it can be dropped down to 20 per cent or 10 per cent; hell, it could be nothing—it will not change how I advocate in this place. I will still advocate for upfront investment in mental health services and appropriate levels of mental health services. I will still advocate for appropriate suicide prevention programs that are well funded and help to save people’s lives. I will keep pushing for more investment in alcohol and other drug services regardless of what that means for short-term budgetary implications because people’s lives are at stake. The community is demanding it and the community needs it. I will continue to push for a well-funded National Disability Insurance Scheme. It is really important that this critical reform is appropriately funded and that we recognise that part of the greater good is that the government has a significant role in improving the lives of people with disability. I will still talk about making sure that the community is more accessible and welcoming, has appropriate levels of services and appropriate built environments for people with disability—and all that costs money. That will stand in the way of us achieving a surplus but I will still advocate for it. I will still advocate for appropriately funded child protection services so that children at risk receive intervention immediately so that they do not die on our watch, so that they are not traumatised on our watch and so that they are okay. That means continuing to invest in family services to make sure that we have services to address issues of family and domestic violence and have intervention services for families at risk. All these things cost money. Funding all these things will stand in the way of us immediately leaping to a surplus. We need to ensure that we have prevention services for people at risk of offending and intervention services when people are offending. Do I believe in the long term that that will save us money? Yes, I absolutely do. Prisons are really expensive. If we invest in those services now, it will cost more money and will take us away from achieving a surplus.
We need to address foetal alcohol spectrum disorder. I am not interested in seeing cuts to education; I do not want that. I want to make sure that our teachers are doing well, and I support teacher assistants. I do not want a winding back of psychologists and other specialists working in the public education system. I want us to continue to try to have the best education system we can—and that costs money. I want us to turn TAFE around. We could easily ensure that everyone pays full fees to attend TAFE, but I am not interested in TAFE being the exclusive province of a very few; I want TAFEs to be accessible to as many people as possible so that they can be trained, and that costs money. We need to provide services for our ageing population and we need to address elder abuse. I think that that is the sort of obligation the government has. We need to start seeing housing as a right. We need proper public transport, and that includes Metronet as well as other provisions in public transport. But that is an expense. We need to create liveable cities. I do not think any money should be spared ensuring worker safety and the saving of workers’ lives. If that means that we have to put extra money into government services, frankly, that is money well spent. Workers have the right to go home safe and alive at the end of the day. We need to invest in environmental protection. I say all this because I will not resile from any of that advocacy. I will not resile from any of it, as evidenced by my time outside this chamber. These are the things that I have always advocated for and I will continue to advocate for them whether I am inside or outside this chamber. Trying to tie our wages into whatever is happening with the budget, whether there is a surplus or not, is a rather cynical exercise. I, for one, will not be changing what I advocate for simply because of self-interest about whatever my wage may or may not be. I think that would be incredibly sad.
My final issue is that if ever there was a bill that deserved to be referred to a committee, it is the Salaries and Allowances Amendment (Debt and Deficit Remediation) Bill 2017. This bill has many unforeseen consequences in terms of disparity across the public sector and its impact on the integrity of government. It is so problematic that it is the breaking of a political consensus that has stood for over 40 years, for nothing more than a stunt. I want to move a motion to refer this bill to the Standing Committee on Legislation.
Discharge of Order and Referral to Standing Committee on Legislation
HON ALISON XAMON (North Metropolitan) [2.40 pm] — without notice: I move —
(1) That the Salaries and Allowances Amendment (Debt and Deficit Remediation) Bill 2017 be discharged and referred to the Standing Committee on Legislation for consideration and report by no later than Tuesday, 20 March 2018; and
(2) the committee has the power to inquire into and report on the policy of the bill.
[speeches and comments of various members]
Hon PETER COLLIER: We are fully entitled to have this debate today about referring this legislation to a committee.
Hon Alison Xamon: Which I always said I was going to do.
Hon PETER COLLIER: Precisely. Hon Alison Xamon has been totally up-front and transparent about that.
[speeches and comments of various members]
Debate interrupted, pursuant to standing orders. [Continued on page 6381.]
Sitting suspended from 4.15 to 4.30 pm