Trish Crossin (NT, Australian Labor Party) Share this | Hansard source

I rise this afternoon to speak on the Superannuation Legislation Amendment (Superannuation Safety and Other Measures) Bill 2005. Unfortunately, unlike my two colleagues who spoke previously, my comments will not be brief. There is a very small section of this bill that impacts on a very small section of our population—in fact, on 12 or 13 people, to be precise, out of 20 million. The effect of this legislation on those 12 people has been somewhat devastating and disastrous. I think a large amount of time is warranted to actually lay out the facts about the fine print of this legislation and to uncover the devious nature of this government in that, when they are asked to do something for a small number of people, they turn their backs on them. I am quite surprised at the delay in bringing this bill before the Senate. We were expecting it months ago. We have had discussions with Senator Minchin’s office about the particular aspect that I am going to talk about. I am extremely disappointed that more effort has not been made to try to accommodate the needs of these 12 or so people.

This bill covers a number of elements to do with superannuation—we know that. But I specifically want to talk about the validation of certain lump sums. You will find it, in fact, in the back of the explanatory memorandum and in this bill almost in the very last lines of the last page. In fact, in the second reading speech given by the minister on tabling this bill, there is one sentence to do with it. He said:

The bill will also amend the Superannuation Act 1976 to authorize a small number of CSS benefit payments that were incorrectly paid.

Again, the opening paragraph simply makes a cursory remark about this. He said:

The bill ... authorises certain payments made incorrectly to a small number of CSS members.

We know that there are a small number of CSS members, but it actually took many months to discover how many members we were in fact talking about, the implication of this minor amendment in this omnibus legislation and the impact it was going to have on certain people. The section seems to be rather minimal. On the face of it, it simply seeks to ensure that the lump sum payments made under section 111A of the Superannuation Act 1976 are in fact valid. But for at least some members of the public this decision has been unfair and unjust, despite promises that something would be done to ensure that this dozen people would not be disadvantaged.

This sparked a discussion when it was discovered that perhaps some lump sum payments had been made incorrectly. This sudden adherence to a relevant legal opinion obtained by the Commonwealth Superannuation Board emanates from the application of the benefits payable under the Commonwealth Superannuation Scheme. In particular, my encouragement, I suppose, to stand up today and talk about this at length is to do with a particular constituent of mine—a very eminent, well known and well respected educator in the Northern Territory who is in fact the principal of the local primary school that my kids have gone to at Leanyer. It has long been an established practice in the Northern Territory that, if you were employed by the Public Service Commissioner, you reached 55 or the five minutes to midnight and you were a permanent member of the teaching service, you could in fact retire, take your pension and lump sum payment under the Commonwealth Superannuation Scheme and then continue your employment on contract—not with the Northern Territory Public Service as a permanent educator in the Northern Territory government but, rather, on contract employment with the Department of Employment, Education and Training.

I think that in fact signals some problem with the application of this legislation—whether or not a person who does that meets the condition of release. This government and, I think, the Commonwealth Superannuation Board would say that it does not meet the condition of release. No doubt the constituent I am talking about and the people who have gone before him believe they do. I have yet to see legal opinion that supports that stance one way or the other. But, if you are employed permanently by the Northern Territory Public Service Commissioner and you then retire and take up a senior executive contract signed between you and the secretary of the education department, I would have thought there was a change in your employment circumstances and you would meet the condition of release. So going from permanent to contract, being employed by the Northern Territory Public Service Commissioner as opposed to the education department, I would have thought would have been a large enough trigger for this government to say: ‘All right. We’re going to bring down the guillotine here in respect of a legal opinion we’ve had about previous lump sum payments but, because it’s going to affect just 12 others in this country, we’ll just move the goalposts a little bit.’ But, no, these people dug their heels in and, at worst, misled these people prior to the 2004 election—but I will get to that in a minute.

As I said, when people made this move, they would access their pension and their lump sum. In the case of the constituent I am referring to, a change in circumstance occurred in February 2001. That person chose not to be an ongoing active member of the scheme at that time; in fact, he deferred his benefit. Instead of deciding to action his benefit in 2001, he put it off until June 2004. We move ahead in time to June 2004, and my constituent decides to renew a contract—this is not the first contract but a renewal of a senior executive contract with the Northern Territory Department of Education and Training. In signing the second contract, he decides he will access his deferred benefit in June 2004. But, suddenly, the application is denied: ‘You can’t access your lump sum benefit.’ He says, ‘Why is that?’ We find out 150 colleagues before him have been able to do that. He is told that he actually has no entitlement.

On 24 June 2004, he signs a contract. On 25 June 2004, he applies for a benefit from the Commonwealth Superannuation Scheme entitlement. On 28 June, he gets a letter saying he has got no entitlements; they are being disallowed. One would think that, if you applied for your deferred benefit and in the space of four days were told you could not have it, you could expect a comprehensive, reasonable explanation from either the minister’s office or the Commonwealth Superannuation Board about why that was the case. But, between this person and me, it took us months to get to the bottom of this story and finally, I might say, receive letters apologising for the incorrect information and misinformation that was given to this person.

In terms of a lump sum payment, we have got at risk nearly $192,000 for this person alone, and that has now increased. We see one line in a second reading speech or the fine print in an omnibus bill on superannuation and we give it some cursory sort of tick and flick in this place, but it impacts significantly on people’s lives. This is one case in particular that I wanted to highlight today. Numerous letters and questions have been generated that I think led to a gross lack of frankness by this government about the decision they took—an absolute lack of honesty and transparency. The constituent I am talking about—and I know this person does not mind if I use his name; I spoke to him two nights ago and he is happy for me to raise his case—Mr Gray, then says: ‘Why has the guillotine suddenly come down on me? What has happened? What is going on here?’

He seeks to get some answers but he does not get any answers. He is simply advised that suddenly the regulations have been interpreted in a different way. So he asks: ‘How have they been interpreted in a different way? What is different in that interpretation from what has previously been advised?’ There are no satisfactory answers. I have got a file full of correspondence that I have been cc-ed on between Mr Gray, Senator Minchin’s office and the Commonwealth Superannuation Board, who are all trying to find a reasonable explanation as to why suddenly 150 people are in and some people are out.

Remember this process all started in June 2004. The clock is ticking. We have a federal election on the horizon. Someone says: ‘Oh my God! Perhaps we’ve got a problem on our hands if we’re too honest with these people prior to a federal election.’ So Mr David Tollner, the member for Solomon, steps in—Mr David Tollner, who purports to be an expert on superannuation: fine on the big picture, sadly lacking on the detail when it comes to a very fine and well respected constituent of his seat of Solomon. Senator Minchin writes to Mr Gray and says:

Following representations from David Tollner on your behalf, I am pleased to confirm that a re-elected Coalition Government would conduct a review—

good one, you might say—

to examine the circumstances of CSS members such as yourself that have been unable to access their CSS benefit following a change in their employment conditions.’ So he does acknowledge there is a change in the employment conditions.

You might ask yourself: why doesn’t that satisfy the conditions of release—a little bit of inconsistency coming out here?

Such a review would encompass those members who had acted in good faith prior to the announcement of the change in ComSuper’s interpretation of this provision.

We come and go, the election is held and the coalition government is re-elected. We wait with bated breath for the ever-promised review. Does it happen? Yes, it happens all right. It happens internally. Do people like Mr Gray get asked about their view in this review? Not at all. In estimates of last year—so we are now 18 months down the track—I asked:

Who undertook that review?

Ms Doran from finance and admin says:

Members of my division.

Senator CROSSIN—How? By accessing single files? What was the nature of the review?

Ms Doran—They worked with ComSuper on the details of the types of individuals covered, looking at their circumstances and their relevance to both the SIS and the CSS legislation...

Senator CROSSIN—Were there some terms of reference for this review?

Ms Doran—Not in a formal sense.

                 …         …           …

Senator CROSSIN—So the review occurred by looking at individuals file by file and circumstance by circumstance.

                 …         …           …

Ms Doran—Not so much file by file, but based on their broad circumstances.

So, really, we have never got to the bottom of exactly what that review entailed. All I know is this: Mr Gray, it now transpires, is one of 12 or 13 people in this nation affected by this application. They were never written to about the review and were never ever asked for any input. I asked questions on notice about how and why this decision was made. I finally got an answer back in April 2005 that said:

No formal review has been undertaken.

A decision to simply bring down the guillotine was made when the Commonwealth Superannuation Board had a look at the circumstances after a concerned member had a query about superannuation entitlements where a Commonwealth agency may be sold.

The bottom line is this: the letter prior to the 2004 election was simply a letter to appease people like Mr Gray. There was never any intention to conduct any sort of genuine review. It was simply a letter in the name of Mr Tollner and the Minister for Finance and Administration to ensure that no such review would occur. The government had well and truly made up its mind in 2004 that those people who had accessed a benefit could keep it and that those people who had applied for a benefit, deferred a benefit or sought access to a benefit in a very small window of time would be totally cut out of the loop.

You have to ask yourself: why would the government do that for only a dozen people? The department tells us, ‘When you get a legal decision you get a legal decision.’ But the bill actually determines a date on which that decision will be applied. For the life of me, I still cannot get a reasonable explanation as to why those 12 people—who had applied, whose applications were in train but who had not yet received their benefit—are not included in this legislation.

To be fair to Senator Minchin, I got a letter back in May last year which said:

I intend to write to Mr Gray as soon as I am informed of my Department’s findings.

My understanding is that that never occurred. The letter also stated that I would be provided with a copy of the minister’s letter; I have not received any letter in respect of or further to that review either. You have to ask yourself why it is that the government would not assist those 12 members to access their deferred benefits. Was the promised review an election stunt to appease them, so that they would be led to believe the whole time that they were going to be assisted and helped to get their deferred benefits? So far there has been a shallow response—little action and no depth.

And then Mr Gray got a letter from CSS in November 2004. Interestingly enough, this letter makes some apologies for the misinformation. What does it say? Interestingly enough, it goes to the fact that the regulations had not been interpreted differently. It goes on to say that in fact the CSS had obtained a different and new legal opinion that meant that the application of the deferred benefit meant that people who had received it previously had done so illegally. The question is: why has it taken 18 months to get some truth out of the CSS board? Why has it taken 18 months to get some truth out of the minister’s office? Why has it taken 18 months for people like Mr Gray to get some satisfaction on their queries about the answers given as to why they have not been able to access their lump sum payments?

After assisting Mr Gray and digging around on this, I have simply come to conclusions about a number of things. There was never any real intention to have any kind of genuine review. Once the decision was made, in June 2004, that was it. People like Mr Gray have been seriously misled. There were high expectations and an anticipation that this matter would be resolved but, all along, the government had no intention of doing that. The government was not instructed by this minister to assist the Commonwealth superannuation people to go out of their way. There was no genuine attempt to put pressure on the CSS to try and get the matter resolved.

We now find, after many months, that people have been able to access their pension entitlement under the deferred scheme and that their lump sums have now been rolled over into another scheme. That was Senator Minchin’s answer for the 12 people late last year and early this year. But that is not what some of them wanted. Some of them wanted to be able to access their lump sum payment. It is a second-rate response to assisting those people, to go ahead and say to them, ‘You can draw down your pension from your entitlement but you have to still roll your lump sum into another scheme.’ Mr Gray received a letter from Senator Minchin on 1 June 2005. It said:

… when you applied to commence taking your benefit in June 2004, a few weeks after the error was discovered, the CSS Board and ComSuper were under a legal obligation to not pay your benefit.

                 …         …           …

My department has concluded that, even allowing for the initial error that has affected a number of CSS members, ComSuper could have handled your situation with more clarity—

an admission, at least—

particularly in relation to the two issues outlined above.

Senator Minchin goes on to say:

You are right to be upset at the way you have been treated and, notwithstanding the complexity of the circumstances, I appreciate your frustration at the lack of a clear explanation of your overall position.

Finally there was at least some acceptance of Mr Gray’s anticipation and frustration, and the lack of action on the part of the minister’s office was acknowledged. But that letter is dated June 2005. It was ‘timely’ because it was some seven months after the federal election. I have come to the conclusion that the promise of a review and the creation of anticipation that the matter would be resolved were, taken together, nothing more than an election stunt to protect Mr Tollner and ensure his re-election. This is a man who is fine on the superannuation big picture but who let down a constituent. Mr Tollner was the man most able to support and get a resolution for Mr Gray, and he has sadly failed in that.

Debate interrupted.