It's Super: Mps Take A Golden Nest Egg

Sydney Morning Herald

Friday September 8, 2006

Phillip Coorey Chief Political Correspondent

THE Prime Minister, John Howard, has defended MPs' salaries as he fast-tracks a superannuation boost for newly elected MPs, giving them a 6 per cent increase in employer contributions and a redundancy package worth almost $30,000.

The announcement, which Mr Howard said would put MPs' super on par with that of "hundreds of thousands of Commonwealth public servants" was brought forward after the Herald reported that a bipartisan push by backbenchers for better super was gathering steam.

The increase came the same week Parliament approved a 7 per cent pay rise for all MPs and supported a hefty rise in printing and postal allowances.

Anticipating a public backlash, Mr Howard stressed repeatedly that the super increase had bipartisan support. He was swiftly backed by the Opposition Leader, Kim Beazley.

Mr Howard warned that the long-term health of Parliament would suffer if MPs' pay and conditions continued to be pilloried, especially as salaries in the private sector were much higher than those of ministers and senior MPs.

"I do not believe that the great bulk of members of Parliament in this place are overpaid," Mr Howard said.

"I believe that if we continue to take the populist route on this issue, we will trash the gene pool of potential entrants to this Parliament.

"I do not want to see the Parliament of this nation filled with trade union officials, political staffers or careerist political figures. I want it filled with a cross-section of this nation."

The changes increase the taxpayer-funded employer contribution from 9 per cent to 15.4 per cent for all MPs elected from 2004 and onwards. Those elected from 2001 and onwards will also be entitled to a redundancy package equivalent to three months of a backbencher's salary should they lose their seat or preselection.

The changes were approved at a hastily convened, midday Coalition party room meeting that lasted less than five minutes.

The pressure is now on the states to follow suit: they also axed the generous scheme for new MPs in 2004. A spokesman for Morris Iemma said the Premier had no opportunity to consider the proposal yesterday.

In February 2004 Mr Howard bowed to populist pressure from the then Labor leader, Mark Latham, and ended the generous super scheme which provided a lifelong, tax-free and indexed pension for politicians who survived more than two terms.

The Prime Minister announced that all politicians elected from 2004 onwards would be entitled to the minimum community scheme of a 9 per cent employer contribution with no pension.

Mr Howard said Labor was equally to blame for that decision.

"What happened two years ago is the Labor Party withdrew its support for the then superannuation scheme and it became impossible to sustain it," he said.

Mr Beazley said the 2004 decision went too far and the rises announced yesterday were in line with community standards.

"What's important is that those who find themselves elected to Parliament, at the conclusion of their time in office, have experience on retirement that's much the same as everybody else."

The Greens said they would oppose the changes. Senator Bob Brown said the system should be changed so that everybody received the 9 per cent contribution, regardless of whether they were on the old scheme or not.

The NSW independent Peter Andren was also against the move, saying MPs enjoyed better conditions than their constituents.

WHAT A BACKBENCHER GETS

Base salary: $118,950 (ministers and office holders receive extra pay).

Superannuation: If elected before 2004 they contribute 11 per cent of their post-tax income and if they serve more than two terms they receive a lifelong, indexed and tax-free pension based on positions held and length of service.

If elected after 2004 they are set to receive a employer contribution of 15.4 per cent.

Electorate allowance: $27,300 to $39,600.

Telephones: A mobile phone, two home phones, call costs plus answering machine.

Communication Allowance (includes postal allowance): $40,000, plus a lap-top computer.

Printing Allowance: $150,000

Travel allowance: $175 a night in Canberra, $303 in Sydney, $280 in Melbourne, other rates for other cities.

Spouse, nominated travel companion such as a nanny and dependent children are entitled to taxpayer-funded air and rail travel.

Choice of taxpayer-funded car with free petrol for use in the electorate, or $19,500

a year to spend on public transport.

Use of Commonwealth cars for parliamentary business.

Charter transport allowance of up to $72,250 for MPs with large electorates.

Overseas study trips every three years.

Letters - Page 10

© 2006 Sydney Morning Herald

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