Senate debates

Thursday, 19 March 2015


Defence Amendment (Fair Pay for Members of the ADF) Bill 2014; Second Reading

9:32 am

Photo of Jacqui LambieJacqui Lambie (Tasmania, Independent) Share this | | Hansard source

Today this Australian Senate is presented with an opportunity to debate and vote for the Defence Amendment (Fair Pay for Members of the ADF) Bill 2014. I know that many Australians, including up to one million voters nationwide, are influenced by how this government treats our Australian Defence Force and veterans' families and will be interested in the contributions from senators in this chamber. This is simple private member's legislation I had drafted before Christmas which links pay for members of the Australian Defence Force with pay for Australian parliamentarians or to the consumer price index, whichever is higher.

The need for this legislation became obvious after this Liberal government, led by Prime Minister Abbott, announced a change in pay rates for members of our Army, Navy and RAAF which was in fact a pay cut after our nation's inflation rate was taken into consideration. It became clear to all fair-minded Australians that the system of determining wage rises for our diggers was broken and had to be fixed. The Defence Amendment (Fair Pay for Members of the ADF) Bill 2014 will fix the broken system which determines the amount of pay that members of our Army, Navy and RAAF are awarded.

This simple piece of legislation, if agreed to by the majority of senators in this chamber, will give members of our Australian Defence Force certainty and a guarantee that they will receive a fair pay increase, because this bill puts in place a minimum pay rise which at the very least keeps track with the consumer price index or politicians' pay increase, whichever is higher. Of course, the bill also leaves open the opportunity for politicians and their public servants to ensure that our Defence families receive pay rises greater than current CPI rates or the rates of pay increases for politicians. I was tempted to put in this bill a legislative mechanism that would ensure that our diggers received a pay rise greater than the CPI rate of the day or greater than the current rate of pay increase for politicians. However, I chose to be prudent and more than reasonable given the fiscal restraint all Australians are now being asked to show.

In short, this bill is reasonable and measured. It does not have any provisions that are excessive. If you believe that Australian Defence Force members deserve a fair go when it comes to calculating their wages then my private member's bill will be very difficult to vote against. There may be some from the government who, for mischievous reasons, may want to confuse the debate. They could say: 'The latest national CPI rate is 1.7 per cent and the government has agreed to a two per cent pay rise. Won't that mean we are voting for a pay cut for our military?' Of course, that assertion would be absolute rubbish. This legislation is flexible enough to allow the government of the day to increase Australian Defence pay by however much they want to. If the government wanted to decrease the pay then it would be the government's responsibility, not the legislation's fault.

The legislation is simple and puts in place a safety net which, we have seen from past governments, is desperately needed. At the moment, Australia is governed by mean-spirited leaders who regularly need to be exposed to the heat of a near-death political experience in order to melt the ice frozen to their hearts and the wax built up in their ears. Unfortunately for voiceless members of the Australian Defence Force, doing the right thing does not come easy for our nation's leaders. So that is why this private member's legislation is so important: it is to keep the bastards wearing blue ties honest.

There would be some members of the Senate opposite me who may have forgotten exactly when the 1.5 per cent pay offer, the effective pay cut for our military, was announced by the Abbott government. I remind those members that it was the day before last year's Melbourne Cup Day. Of course, the choice of this day was deliberate. It showed that the Abbott government knew that they were being dishonest and doing the wrong thing by our diggers. It was proof that the Abbott government hoped that the extraordinary media attention devoted to the race that stops the nation would cover up a government decision which shamed a nation.

Thankfully, support from ordinary Australians spontaneously emerged. My office was bombarded with emails from Tasmanians and other states expressing their disgust at Mr Abbott and his Liberal members and the lack of support for our diggers. This government underestimated the love and respect that our nation has for the members of our Australian Defence Force, 365 days a year—not just the few days of the year that some members of the Abbott government fake affection for our diggers and their families.

Following the news of the Liberal Party cut to members of the Australian Defence Force, I appreciated that fact that Labor leader Bill Shorten wrote to the Prime Minister Abbott and asked him to reconsider the pay offer. I also appreciate the fact that Labor have indicated that they will support this legislation today, along with the Greens and many of my crossbench colleagues. So I sincerely thank them in advance.

In recent days and after a stunning electoral defeat in Queensland which was partly influenced by voters in a few key areas like Townsville and Brisbane—where there are high numbers of Australian Defence Force personnel, their supporters and their families—and pressure from their Liberal colleagues in New South Wales fearing a similar fate, this Abbott government belatedly chose to offer a further rise in our Australian Defence Force pay. This is my message to Prime Minister Abbott following his Defence Force pay backdown. It is relevant to today's debate on the Defence Amendment (Fair Pay for Members of the ADF) Bill 2014 and touches on some of the broader defence issues:

Dear Prime Minister,

I note your decision on Wednesday 4th of March to ask the Chief of the Defence Force (CDF) to take a proposed pay increase of only .5% to the Defence Force Remuneration Tribunal, making for a total ADF pay rise of 2%.

In 2000 the Chief of the Defence Force (CDF)— the person you have just asked to increase ordinary diggers pay by .5%--received $305K p/a. The latest figures show that CDF in 2014 took home $764K.

That means the person you have just asked to increase ordinary Diggers pay by .5%—in the last 14 years, own pay increased by almost $460K or 250%. Apart from the obvious embarrassment and humiliation you're subjecting the CDF to, isn't this just another indicator that the system for determining our Diggers pay is broken?

While you attempt to justify this less than fair pay rise, by comparing it to the current inflation rate of 1.7% - I remind you that the core inflation rate is 2.1% and current weighted median Consumer Price Index (CPI) rate is 2.3%.

I also remind you that Parliamentary Library background research I commissioned reveals that the average yearly rise in Defence Pays over the last ten years is approximately 3%.

This stands in stark contrast with the average yearly rise in politician's pay, which since 2004 and taking into account the last two years of 0% pay rise, is still almost 7%.

I'm sure that you would agree, that our Diggers, particularly of the last decade and half, have earnt a pay rise equal to that of our politicians.

So therefore I respectfully ask that you reconsider your pay offer to members of Australia's Defence Force.

It's my view that in making your decision to increase defence pay, you should consider all the facts. If you do so there is a very strong case to:

1.   Strengthen the ADF pay increase by .5% to an annual rate of 2.5%, rather than 2%.

2.   Ensure that all ADF members receive back pay calculated from the 4th of November 2014 or Melbourne Cup Day (the day after their effective pay cut was sneakily announced by your government)

3.   Restore ADF Combat Pay or War Zone Allowance back to $200 per day instead of the reduced $150 per day allowance.

I request that you agree to a meeting to discuss these three important issues.

During that meeting I would also like to receive from you a guarantee that Diggers who have served for 20 years, and are therefore covered by multiple compensation acts, and who are now re-deployed to Iraq - are not (because of a bureaucratic provision called offsetting) at a disadvantage compared with younger diggers, if they are injured.

I've been reliably informed that veteran Australian Diggers who have served previously in East Timor, Afghanistan and Iraq - and who have recently been redeployed to Iraq, compared with younger Diggers covered by only one compensation act - can receive compensation payments up to 10 times less, should they be injured during this new deployment.

It's my view that if you properly consider these four issues, you can only come to the conclusion that members of our Defence Force are not being fairly paid or compensated. I would hope that our meeting would find a resolution to these important matters.

Making our own position safe at home.

While I believe that we both share common feelings about Islamic State and the great evil they have brought to this world - I strongly disagree with your decision to send members of our ADF to Iraq in response to their attacks.

Forcing Australian Tax payers to pay for Australian Troops to be sent back into harms way in Iraq, given that America has only deployed about 3000 troops, is not a wise decision.

At best it will be a "flag flying" exercise. At worst we run the risk of supposedly friendly Iraqi troops betraying our Diggers and killing them - or handing them over to Islamic state forces who will use them to make further horrific online videos.

I believe that a prudent response to the threat Australia faces from Islamic state is to dramatically increase the size and capability of the Australian Defence force and that we should make our own country safe, before we try and make countries like Iraq, Syria, Lybia and North Africa safe from Islamic state fanatics and death cult members.

In advocating for that course of action, I draw your attention to the war-time experience of Prime Minister John Curtin, as described by Bob Wurth in his book "1942".

You will recall that following the Japanese Air Raids in February 1942 on Darwin, which killed 243 people and wounded more than 400 Australians, Prime Minister John Curtin received a cable which said that Churchill, acting with out Curtin's authority had already diverted Australian "troop ships to Burma"- leaving our Nation more vulnerable to Japanese attack.

John Curtin is then reported to have told his friend the biographer Lloyd Ross: "its the proper fate of a country which has not built up its own defences. The proper fate of a country which always fights someone else's war, without making its own position safe."

Its my view that as a Nation we're now making the same mistake that Prime Minister Curtain spoke about at the beginning of WW2, namely that, "We're being be drawn into a war and fighting someone else's battles, without making our own position safe at home."

We need to address this problem in an honest manner—and start with a critical look at the numbers and capacity of our ADF.

Too few members of our ADF and combat troops on anti-psychotic medication

Our shocking Veterans' suicide and homeless rates which your government continues to cover up - is a direct result of successive Australian Governments asking too few members of our ADF to shoulder the burden of prolonged commitments in the Middle East war zones.

It's my view that many younger veterans who take their lives or end up homeless, will have spent 3 plus years or more in the War Zone in the space of a decade. This prompts the question:

What is the maximum period of time a combat troop can serve in a War Zone, before they are guaranteed to suffer psychological harm?

Some young veterans I have meet have in 13 or more years of service completed 10 combat deployments or tours of duty in war zones.

And while you can't criticize the commitment and love that these young men and women have for Australia, you can criticize the politicians and high ranking members of the ADF who know that we didn't - and still don't, have enough full time members of our military to safely commit our Nation to prolonged military engagements in Middle East war zones.

Senior ADF medical officers have personally confirmed to me that ADF members are allowed to enter War Zones armed, while officially receiving anti-psychotic medication.

Surely these well known facts would lead any reasonable person to come to the conclusion that we don't have a large enough permanent defence force?

And that to meet the threat posed to western civilization by Islamic maniacs who want to drag us back into the dark ages, then its time to dramatically increase the numbers and capacity of our ADF.

We could begin the process of boosting the numbers of our defence force by re-introducing a National Service Trade and Traineeship program. This would not only boost the capacity of our ADF but it would also address the dual problems of youth unemployment and national skills shortage.

Closing - Important Veterans' Questions

In closing, I have been contacted by older veterans with strong connections to our serving ADF members being deployed to the Middle East.

They have requested that I ask you these confronting but relevant questions in relation to the Australian Soldiers preparing and being sent to train and assist Iraqi troops:

1.   Do they receive the same combat pay or war zone allowance as the initial cohort of soldiers redeployed to Iraq?

2.   Have they received instructions to the effect that: "whatever you do save your last bullet for yourself, don't get captured"?

3.   If these soldiers are being deployed armed and warned not to get captured – can you explain why they have been denied the benefits associated with full war like service - and full combat pay and allowances?

4.   Has the Australian government deployed these ADF personnel using diplomatic type passports? If so, can you explain why?

5.   Are they being warned to discretely advise their families in Australia to be on the lookout for, or vigilant against Islamic state supporters who may be gathering intelligence for future terrorist attacks?

6.   If not, why not?

7.   Are ADF personnel on Australian Military bases authorized to use their weapons to defend themselves when or if, they are attacked by terrorists?

8.If so, can you describe the chain of command and name who is responsible for authorizing our ADF personnel to arm themselves and use lethal force to defend themselves and others against terrorists attacks?

9.   In relation to armed ADF members being authorized to use lethal force, in an emergency or terrorist attack, how long does their lethal force authorization last?

While I will also officially submit these questions as QON, I would appreciate if you provided answers as soon as possible and before the 30 day deadline.

Today I have tried to ask some of the important questions and described some the enormous and deadly challenges faced by serving and former members of our Defence Force. The job before them is one of the most complex, important and hardest that our nation not asks but demands of it citizens. To do the job of a sailor, soldier or member of the Royal Australian Air Force requires extreme courage, dedication, discipline, perseverance, love and loyalty to our country. The least we can do as law-makers is to ensure that they receive a fair day's pay for their extraordinary, unique service to this country. I commend this bill to the house.

9:50 am

Photo of Cory BernardiCory Bernardi (SA, Liberal Party) Share this | | Hansard source

I rise to speak on the Defence Amendment (Fair Pay for Members of the ADF) Bill 2014. To be frank, I am somewhat surprised that this private senator's bill has not been withdrawn, notwithstanding Senator Lambie's abiding interest in this and notwithstanding her service to our country in the Defence Force. But I would point out that there are many in this place and in the other place who have served with distinction in our Defence Force. I look over my left shoulder and I see Brigadier Linda Reynolds. We have another Brigadier in Andrew Nikolic in the other place. Indeed one of the assistant ministers, Stuart Robert, has served. They are just three who have a deep and abiding interest and a commitment to supporting our armed forces and our Defence personnel. You do not even have to have served in the military to have enormous respect for those who choose to do so. I am in awe, quite frankly, of the servicemen and women who are prepared to give their all on behalf of our freedom. They stand in a great tradition and I stand with them albeit as someone who has not served.

With respect to this bill, some of the assertions that have been put forward by Senator Lambie are simply wrong and her draft bill will not achieve what she is seeking to achieve. I understand that Senator Lambie is concerned about Australian Defence Force pay—many of us are. But her bill to link ADF pay to politicians' pay or inflation as it is now, whichever is the higher, would most likely see no advance in ADF pay other than that which has occurred already. In actual fact, a case could be made that if this bill were successful, there could actually be a decline in ADF pay for personnel. The question arises: why is this? Let me explain.

First of all, parliamentary salaries are currently frozen. Parliamentarians will receive no pay rise in 2014 or in 2015. So if you were to tie ADF salaries to parliamentarians' pay at present, ADF personnel would get a zero increase. It is not the first time we have had a zero increase. A couple of years ago we had a zero increase as well, and who is to say what may happen in the future?

Secondly, Senator Lambie quotes some consumer price index inflation figures but she fails to look at the forward forecasts and the low inflation—in fact some would suggest deflationary—environment in which the world currently finds itself. Inflation for the year to December 2014 was 1.7 per cent. The Reserve Bank of Australia is forecasting inflation to June of this year to fall to 1.25 per cent. The National Australia Bank's forward-looking forecast has a rate to December of this year of only 1.2 per cent. Once again, I say that we are experiencing what the rest of the world is experiencing—that is, a deflationary environment.

So ADF members, who were awarded a 1.5 per cent increase last November, which will be lifted to 2 per cent from March—assuming that Defence Force Remuneration Tribunal agrees with the government's proposal—are already keeping level with or doing slightly better than current inflation rates, which is unlikely to be more than two per cent for the foreseeable future. Were inflation to come into under two per cent—say, as forecast by the National Australia Bank, around 1.2—under Senator Lambie's bill, ADF personnel would get less than what the government is already proposing. So the two per cent per annum pay rise already on offer to the ADF personnel from the government is likely to be both better than inflation and better than what parliamentarians end up receiving. Therefore, it will be better than what would be delivered by Senator Lambie's formula. In fact, if you look at the pay rises awarded by the Defence Force Remuneration Tribunal over the past 10 years, they have averaged more than inflation. ADF pay rises under the workplace remuneration arrangements have totalled 38 per cent in simple addition terms, whereas CPI increases have totalled 28 per cent. So I would caution the Senate, and I would caution Senator Lambie, about being too keen to link ADF salaries to the CPI. If history is anything to go by, this would erode their advance very rapidly.

I would also like to deal with some of the misconceptions. Senator Lambie's press release announcing her bill underestimated ADF workplace remuneration agreement pay rises over 2005 to 2014. Between those years, ADF personnel have received increases of 32.8 per cent, an average increase of 3.28 per cent per year, which is marginally more—0.28 per cent—than that cited by Senator Lambie. Moreover, the large increase in remuneration for parliamentarians in 2012, which was included in Senator Lambie's calculations and purported to show that parliamentarians had done better than ADF personnel, resulted from a comprehensive work-value review. It is not dissimilar to the Defence Force Remuneration Reform Project, in 2007-09, which reformed ADF pay structures and resulted in many ADF members receiving increases from previous pay points.

If this work-value review is removed from the equation, ADF wage increases have actually been virtually equal to parliamentarians' wage increases in the 2005 to 2014 period selected by Senator Lambie. Parliamentarians' pay rises between that period awarded by the Remuneration Tribunal totalled 33.2 per cent, whereas ADF pay rises in this period totalled 32.8 per cent, meaning that there is less than half a per cent difference over the decade.

So, over the last decade, as it happens ADF wage increases have broadly reflected those received by parliamentarians. This does not count the advances between pay points or the promotions received by ADF personnel. So I do not see what Senator Lambie's bill will actually achieve. And, of course, at the moment parliamentarians' pay is frozen, whereas ADF personnel will get a two per cent increase over the next three years. I should also note that the Remuneration Tribunal has a long-held view that setting remuneration for one office by reference to another office does not lead to defensible or meaningful wage outcomes.

To recap, increasing the ADF pay offer to two per cent per annum will increase the likelihood going forward that ADF members do better than inflation and better than parliamentarians. I do not doubt that Senator Lambie is concerned about the issue of Defence Force pay. However, I think she needs to get the perspective right and she needs to get her assertions correct. It must also be remembered that salary is only one component of ADF remuneration. ADF personnel receive and deserve decent superannuation, competency based allowances, free medical and dental treatment, subsidised housing and a range of other benefits. ADF personnel involved in war-like operations receive a full tax exemption on their income. All of these, I reiterate, are absolutely right and proper, and, I believe, entirely well deserved.

Significantly, Labor supports the government's new policy of a two per cent per annum offer to ADF personnel. The Leader of the Opposition, Mr Shorten, in a media release dated 4 March 2015 said that 'Labor welcomes the decision.' At question time on the same day he also said that Labor welcomes the decision. In a press conference that same day, Senator Conroy, the shadow defence minister said:

Labor welcomes this decision today to recognise the unique service of Australia’s Defence personnel.

…   …   …

We think that this is an excellent decision …

Ms Brodtmann, the shadow parliamentary secretary for defence, also said 'we welcome this decision'. The conclusion is that Labor welcomes the government's decision.

That being the case I cannot imagine that the Labor Party will be supporting the bill currently before the Senate, because it would throw the government's two per cent per annum pay offer to ADF personnel into doubt, and it could in fact put ADF personnel in a worse position.

The coalition recognises the unique nature of military service and the sacrifices made by Defence personnel and their families, and we have had a strong record of supporting those who serve in our name. I make the point again that we have a number of people in the coalition who have served our country and our nation with absolute distinction. I think they provide a fantastic insight for the coalition into the serving conditions of our military personnel. As a consequence of that, the coalition has already delivered on substantial initiatives which assist ADF members and their families. In January 2014 the coalition delivered the ADF Family Health Program to more than 70,000 eligible dependents of ADF members. Under this program, eligible ADF dependents were reimbursed for all out-of-pocket expenses for GP services. Additionally, each ADF dependent is able to claim back up to $400 per year for allied health services such as dentistry, physiotherapy, psychology and podiatry. Importantly, families are able to pool their allocations to enable greater support for an eligible dependent with higher needs. The program has seen ADF dependents enjoy supported access to over 100,000 allied health and GP consultations, and this program demonstrates the government's commitment to supporting ADF members and their families.

The government's priority is also to ensure we have in place the mental health services and support mechanisms that are needed for veterans, ADF personnel and their families. With the increased operational deployment of the Australian defence forces over more than a decade and the draw-down of ADF operations in Afghanistan more recently, we need to better understand the physical, mental and social health needs of both serving and ex-serving personnel. In June 2014 the government provided $5 million to fund the Transition and Wellbeing Research Program—a crucial study into the mental health and wellbeing of service personnel and veterans. This program is the largest and most comprehensive program of study undertaken in Australia to examine the impact of military service on the mental, physical and social health of serving and ex-serving personnel, and their families, who have been deployed to contemporary conflicts.

The Australian government is absolutely committed to ensuring ADF members are provided with the best possible health care. As part of this objective, the government launched the new $133 million Defence eHealth System in September 2014. This system links ADF members' health data from recruitment to discharge and improves the availability of accurate, up-to-date health data to Defence members' treating clinicians and their health care providers. Importantly, it will also allow health information to be easily and accurately passed to the Department of Veterans' Affairs as well as to civilian health providers.

The government has announced that it will provide a full income tax exemption for the pay and allowances of ADF personnel deployed on operations MANITOU and ACCORDION. This was outlined in the government's Mid-Year Economic and Fiscal Outlook 2014-15. This change will align the tax treatment for all ADF members who serve on any of the operations across the Middle East region. Given the continuing disparities in the taxation arrangements for ADF personnel in the Middle East region, namely in relation to ADF personnel deployed on Operation OKRA, the Treasurer decided to allow a full income tax exemption for the pay and allowances of all ADF personnel deployed on that operation.

On 17 July 2014 the government delivered on its commitment to repeal the carbon tax. The coalition's legislation took effect from 1 July 2014 and ensured the burden of the carbon tax was removed from Defence personnel—as it was for families and individuals right across the country. Let us remind ourselves that under the Labor government the carbon tax was applied to everyone in the country, and the ADF were not immune from that. The Gillard government specifically regulated to ensure ADF personnel were hit by the cost of the carbon tax from 1 July 2012, and the ABS statistics show that that alone resulted in electricity prices rising by 15 per cent and gas prices rising by 14 per cent. These costs of course are passed onto ADF personnel utilising on-base, long-term and temporary accommodation. So scrapping the carbon tax has been a benefit for everyone in the country.

The coalition recognises that reserves are an important component of Australia's Defence Force. We have long supported the unique skills that reservists bring to Defence and have always supported the important work reservists carry out in order to meet the ADF's objectives both at home and abroad. There are approximately 47,000 reservists, and since 1999 over 21,000 have deployed on operations in locations in the Middle East, Timor Leste and here at home supporting disaster relief efforts. On 30 June 2014 the government announced reserve allowance reforms that reduced red tape and further recognised reservists' service obligations and contribution to capability.

This reform aligned reserve allowances with permanent ADF members' allowances and reduced the administrative burden associated with processing reserve allowances. On 25 August 2014, in recognition of the increasing integration of reservists into ADF operations, the coalition government also launched the trial Reserve Assistance Program. This program runs until 30 June this year and offers a comprehensive range of mental health and wellbeing support services.

Let us not forget it was the previous coalition government in 2001 who introduced landmark legislation to protect the rights of reservists in civilian employment and education. It was also the previous coalition government that created the Defence Home Ownership Assistance Scheme in 2007, a scheme that provides ongoing incentives for both regular and reserve personnel to join and remain in the ADF. It was the previous coalition government who introduced the financial support scheme for employers to help offset the costs of releasing employees for Defence service along with implementing Exercise Executive Stretch, which is aimed at senior, middle and line management to show and involve them in the types of invaluable skills that can be gained through participation in ADF Reserves.

We have a good track record and I think there is no higher priority for a coalition government than ensuring our national security and that means supporting our ADF personnel. It was the Howard government upon its election in 1996 that first went about repairing and rebuilding Australia's modern defences. In the 13 Labor budgets between 1982 and 1983, and 1995 and 96 Labor cut Defence spending by 8.9 per cent in real terms. After the debt and deficit that was a consequence of the Hawke and Keating years, repairing the federal budget was a first priority but the Howard government recognised that a strong economy is critical to funding a strong Defence Force. Importantly, the Howard government quite rightly quarantined Defence from its initial budget repair work. Over that time, our economy stabilised and we grew the budget from $10.6 billion in 1995-96 to $22 billion in 2007-08, a 47 per cent increase in real terms. We wanted to provide funding certainty and assist the long-term planning needed when building capacity in Defence and that is why we released the 2000 Defence white paper, which committed to three per cent real growth for the defence budget over the following 10 years.

Once again, like Groundhog Day, a recently elected coalition government found itself needing to repair the budget and to stem the bleeding in the Defence portfolio caused by Labor's cuts. Let us remind ourselves that Labor cut $16 billion out of Defence through deferrals, through absorbed costs in the 2009 to 2022 period. As a proportion of GDP, Defence expenditure fell from the coalition's 1.75 per cent of GDP to 1.56 per cent of GDP in 2012-13. This was a figure not seen since 1938. Labor's cuts to Defence in the 2012-13 budget alone were worth $5.5 billion. That saw the largest single-year decrease in Defence expenditure, a massive 10.5 per cent, since the end of the Korean War in 1953. When Labor left office, Defence expenditure was forecast to remain below 1.7 per cent over the next decade. These cuts came despite Labor ministers stating on at least 38 separate occasions that Labor was committed to three per cent annual real growth in the Defence budget.

The coalition government has stated it will take a measured and purposeful approach to rebuilding Australia's defence forces. It is committed to increasing the Defence budget as a proportion of GDP to two per cent over the coming decade. We have provided a down payment on this commitment when this year's budget delivered a 6.1 per cent increase in funding to Defence. We are providing Defence with $29.2 billion in 2014-15 and will provide $122.7 billion over the forward estimates. The leadership and support provided to Defence by the coalition is what the Australian people are entitled to expect from the federal government and we will provide it because we understand the critical role that the Defence Force plays in ensuring our security in an uncertain world.

To conclude, while strongly supporting the serving men and women of the Australian defence forces, the coalition does not support Senator Lambie's private senator's bill. Senator Lambie's bill is the wrong solution to a problem that does not actually exist. The bill will be unnecessarily complex and, if enacted, will have a number of unintended consequences some of which, I think it is fair to say, even Senator Lambie does not intend to create. Finally, the government's move to increase the ADF pay offer from 1.5 per cent to two per cent will now provide an even higher pay increase for ADF personnel than what is provided for by Senator Lambie's bill. I would encourage the Senate not to support this bill.

10:09 am

Photo of Stephen ConroyStephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | | Hansard source

I rise today to speak on the Defence Amendment (Fair Pay for Members of the ADF) Bill 2014. Can I start off by responding to Senator Bernardi and admonishing him for selectively quoting from a press conference that I did. It is very disappointing on an important issue like this to see selective quotes being used to try and support Senator Bernardi's argument. I made it very clear in that press conference that we welcomed the government's decision not to cut the real pay of our defence personnel, but I made it clear that it is only the first of the three years of the deal where this will be the case.

On the government's own inflation forecast, two per cent will again be a real pay cut, if 2.5 per cent is the expected inflation rate next year. That is the government's forecast. I accept that it can vary, but let me be very clear. What I said at that press conference was that, if we believed as the inflation numbers rolled in that the government were going to again cut the real pay, we would be coming back to debate it with them. We would not be satisfied with allowing the government to cut next year's pay in real terms, or the third year's pay in real terms. So, while we do welcome the government's decision to reverse its cut, we are not saying that we are signed up to the deal over the full three years, because if inflation is exactly what the government has forecast it to be they will again be cutting the real wage of our defence personnel.

Can I indicate Labor will support this bill. I know there are a number of senators who want to speak on this bill, so I will keep my contribution short. We are here today because the government betrayed the men and women of the ADF when they decided last year to cut their pay. This bill, as a minimum—a minimum: this is the point that needs to be made very clear—links ADF pay to the higher of the increase to CPI or parliamentary allowances. This puts in place a floor that ADF pay cannot fall beneath. Through this bill, our ADF personnel know that their pay will, at the very least, always keep up with the cost of living. Nothing in this bill stops the government of the day providing a higher increase, which is what it has been dragged kicking and screaming to do. But it will prevent the government from doing what the Abbott government so callously did last year, and that was to cut the pay of our service men and women.

We are supporting this bill because this government cannot be trusted to do the right thing. Yes, as I have said, the Prime Minister, with his leadership under increasing threat, was dragged kicking and screaming to increase the government's defence pay offer from 1.5 per cent—a real cut—to 2.0 per cent, an increase. But the government did not do it because they believed it was the right thing to do; they did it to save Mr Abbott's leadership. But this bill ensures that, if inflation moves above this belated pay increase, the ADF will not be worse off.

A future Labor government will undertake a full review of the process for the determination of ADF pay to ensure that it is effective and transparent and properly takes into account the unique nature of military service. Some history here is important. After promising not to cut defence funding before the election, the coalition government cut ADF pay at the first opportunity. In 2012 the Prime Minister told the RSL National Conference:

A "fair go" is the least a grateful nation can offer to serving and former military personnel.

A fair go is not cutting the ADF's pay. A fair go is not cutting ADF Christmas leave and other allowances.

In October last year, reports began to emerge that the government was offering an unfair and below-inflation increase of 1.5 per cent a year across the three-year agreement. This pay cut came into force in November, just before Christmas. This disgraceful deal was explained away by the Prime Minister as a way to drive down the pay and conditions of all Commonwealth public servants. That is right: this offer not only ignored the unique nature of military service but was a designed political strategy to attack all public servants using our military personnel as a battering ram.

ADF personnel have a special place in our society, but, unlike other workers, they cannot bargain, speak out or strike for better pay. That is a fundamentally different place from that of other workers in Australia. As the member for Fisher rightly pointed out when he criticised the Prime Minister's pay decision: 'ADF personnel are not your typical public servants.' Our service men and women undertake unique, demanding and often dangerous work on behalf of all Australians. They put their lives on the line with dedication and courage to ensure Australia is safe. Right now we have ADF personnel deployed overseas supporting international efforts against Daesh in Iraq and the Taliban in Afghanistan. We also have them working on the high seas against drug traffickers. The ADF has been working tirelessly, supporting Australians affected by the recent natural disasters in Queensland and the Northern Territory. And they are doing the same today, supporting our friends in Vanuatu. This is why we have seen such a community backlash at the government for cutting the pay of our ADF personnel.

Australians instinctively respect and understand the ADF's contribution to our society. That is why it has not just been Labor that has been outraged by the Prime Minister's decision. Senator Lambie has been extremely vocal in her calls for the Prime Minister to pay the ADF more, and it is her bill that we debate today. Other crossbenchers have done the same. But this is an issue on which the community has also made its voice heard. The RSL and the Defence Force Welfare Association have pushed hard against this pay cut. And so have ADF families; they, more than anyone else, know how shameful this decision was.

I was proud to be able to receive a petition from Tony Dagger, whose son is in the army. Mr Dagger's petition called for a fair pay deal for ADF personnel and, in less than two months, it received more than 60,000 signatures.

But, as we have seen, with policy backflip after policy backflip, this Prime Minister only acts when his own job is at risk. He did not listen to the opposition leader when he wrote to him twice before the end of last year asking the Prime Minister to reconsider his unfair offer. He did not listen to opposition members and senators when they called on him to reverse the decision. He certainly did not listen to the minor parties. He did not listen to Senator Lambie. He did not listen to Mr Tony Dagger and his 60-thousand-strong petition. He did not listen to the soldier who said that the deal was 'essentially a kick in the teeth to every soldier, airman and sailor'. He did not listen to the RSL. He did not listen to the Defence Force Welfare Association when they told him:

The feeling within the Australian Defence Force … is as negative as I’ve ever seen it.

All of these groups and people pressured the Prime Minister over the unfair pay deal. They all told him this pay cut was the wrong captain's pick to make. But make no mistake: the only reason Tony Abbott backflipped on ADF pay was to save his own job. He was not interested in how his decision affected ADF personnel; he was only interested in his own job.

The government's new deal is an improvement. At two per cent, it is above the current inflation rate. The bill does not stop the government offering above-inflation pay deals. As I have said previously, this bill provides for a floor so that ADF personnel know they will not again get a below-inflation pay deal.

This bill should not be necessary but, because of the meanness and the unfairness of this government, it is. I urge all senators to support it.

10:20 am

Photo of Scott LudlamScott Ludlam (WA, Australian Greens) Share this | | Hansard source

The Greens rise to support Senator Lambie's bill, the Defence Amendment (Fair Pay for Members of the ADF) Bill 2014, and I am glad that it has been brought forward. Senators may remember—I think it was probably in the last or the second last sitting week of the 2014 parliamentary year—that we attempted to suspend standing orders, because at that point it looked as though the Prime Minister was planning on ignoring the calls from across the political spectrum and across the community. With some regret, we saw the suspension motion fail and we were not actually able to get on with substantive debate on the bill. I want to thank Senator Lambie for bringing this forward today, and I look forward to committing this bill to a vote.

When you consider that the annual national Defence budget is slated to grow to around $30.7 billion by 2016 and that the government is in the middle of two of the largest capital acquisition projects probably in the history of defence—the acquisition of the F35 Joint Strike Fighter and the highly-contested and divisive process that has been rolling for years around submarine procurement—the idea that the Prime Minister thought it was appropriate within weeks of committing ADF elements back into Iraq to offer a below-inflation pay deal and then stick to it was extraordinary.

What this bill does, rather than fixing a three per cent figure, is basically make sure that this can never happen again—that a Prime Minister or a government of the day, faced with budget circumstances entirely of their own making, would take a cohort of people, who from time to time will be called on to risk their lives or serious physical or mental injury in the line of their ordinary course of duty and who have no industrial representation. They cannot actually get their unions to go out in front, they cannot go on strike, and they basically have no real recourse. The passing of this bill will ensure that this can never happen again. The government will not be limited in the upper limit of a pay offer it could make to ADF personnel, but it would prevent the Prime Minister of the day doing what Prime Minister Tony Abbott tried to do, which was to offer a below-inflation pay increase to people who really have no recourse and no way of contesting that kind of appalling decision.

The Australian Greens believe that we have, essentially, a twofold obligation to our serving personnel. The first is that we should never deploy them unless it is absolutely necessary. We are well aware that in the past 15 years the ADF have been deployed into three wars of choice. I do not propose to get into arguments about where that decision should lie, or even the merits of those particular deployments. But we owe it to them—in fact, I think it is our highest responsibility—not to throw them into harm's way unless there is the very best possible reason for doing so. Obviously, we strongly disagree with some of the decisions that have been made in the recent past.

The second obligation we owe them is to look after them, both while they are on deployment and particularly when they come back. For anybody who is not aware of what I am talking about, view a Four Corners program that ran not long ago, or read Major General John Cantwell's book Exit Wounds, to get a vivid insight into what happens to some of these people who have been exposed to horrific violence—and these are some of the most highly-trained and disciplined people the ADF has—who, when they return, are basically unable to decompress and assimilate the things that they have seen and done, having been at very close quarters to people being killed or injured, or having suffering horrific injuries themselves.

One of the things that I was not aware of until that Four Corners piece was the fact that it may well be that suicide deaths of personnel after they have returned from deployment may be three times higher than the 41 combat deaths that Australia suffered during the Afghanistan conflict. The most distressing thing is that we do not actually know if that is true. It could in fact be higher. So people return with these invisible wounds and then they are actually, in many instances, very poorly treated, partly by the culture of the ADF, in which it is seen as a sign of weakness to admit that you are having a rough time, and partly by the intense bureaucracy. In one instance, DVA cleared one young soldier's payout and assistance two weeks after he killed himself. We are tying people up in a paralysing web of bureaucracy when actually they need our help.

I guess that second point is the idea that we have an obligation—not that parliamentarians in this place ever put their names to a motion to deploy, because of course that power still rests with the Prime Minister's office. But nonetheless it is amazing TV fodder for politicians to wrap themselves up in the flag and stand in front of the troops before sending them off into harm's way. But it is much harder to find politicians who will stand up for people who are suffering inordinately once they return home. It is that obligation to take care of these people that I think Senator Lambie's bill goes through today.

I think it is entirely responsible—rather than setting a hard and fast rate of pay increase, which we do not really do for any other cohorts—that we set effectively a rate that would float and would not be allowed to fall below the rate of inflation. Linking it to politicians' pay is cheeky, but nonetheless it is one way of ensuring that these people are not forgotten.

So the Australian Greens are pleased to support this bill. I look forward to committing it to a vote, and I think this debate can usefully be used as a way for those who have collectively sent soldiers into war, particularly those who turned up at the press conferences or spent—as I was very fortunate to do—a couple of days on deployment with them, to learn a bit. Politicians enjoy the political limelight, such as it is, but we should ask ourselves, 'What have we done since for these people?' particularly when we are given an opportunity, as we are being given this morning, to ensure—which is one of the least things we can do—that these people are paid fairly.

10:27 am

Photo of Linda ReynoldsLinda Reynolds (WA, Liberal Party) Share this | | Hansard source

I too rise today to speak on the Defence Amendment (Fair Pay for Members of the ADF) Bill 2014. On 1 December last year, I rose in this place to speak on the initial ADF pay offer of 1.5 per cent per annum. At that time, I noted the budget constraints and the need to make tough decisions in today's fiscal environment, but I also noted the requirement to ensure it was a fair and reasonable outcome in the circumstances. Earlier this month, after quiet but persistent lobbying by me and many of my coalition colleagues, a fair and reasonable offer was proposed to the minister.

Senator Cameron interjecting

Photo of Peter Whish-WilsonPeter Whish-Wilson (Tasmania, Australian Greens) Share this | | Hansard source

Order! I remind—

Photo of Linda ReynoldsLinda Reynolds (WA, Liberal Party) Share this | | Hansard source

Mr Acting Deputy President, Senator Cameron may not take this issue seriously, but I can assure the Senate that I do.

Photo of Peter Whish-WilsonPeter Whish-Wilson (Tasmania, Australian Greens) Share this | | Hansard source

Senator Reynolds, I remind the chamber that interjections are disorderly. Senator Reynolds, please continue.

Photo of Linda ReynoldsLinda Reynolds (WA, Liberal Party) Share this | | Hansard source

Thank you very much, Mr Acting Deputy President. Earlier this month, after quiet lobbying by me and my coalition colleagues, a fair and reasonable offer was proposed to the minister, and subsequently the government announced that it had recommended the Defence Force Remuneration Tribunal increase the pay offer to two per cent annum.

Initially, I would like to commend Senator Lambie's intent, and I support the sentiment that she shows behind this bill. While we certainly have different styles and approaches, I have absolutely no doubt that both of us want what is in the best interests of those who serve in uniform and the families who serve in partnership with them.

The first duty of any federal government is to protect the nation. The Australian Defence Force fulfils this responsibility on behalf of us all. Every single year, our service men and women reconfirm their availability and their readiness to deploy on operations and put their lives in harm's way in service of our country and of all Australians. Military service, in this fundamental respect, is unique.

For their part, Australians accept the moral obligation to preserve the physical, mental and spiritual wellbeing of our men and women in uniform and their families, who make their service to our nation possible. The government of the day is custodian of this covenant or moral obligation on behalf of all Australians. We have this moral obligation not only to our uniformed personnel but also to their families.

ADF personnel are not public servants. Their roles differ substantially from those of public servants, and their roles are unique. The contribution they make to us all is unique. No-one I know—and no-one I have ever met in 29 years in the Army—serves our nation for the pay, but pay and conditions must always be fair. Our moral obligation to our men and women in uniform goes much further than simply pay and conditions. Our reciprocal obligation is to ensure that those who serve are as safe and prepared as they can be. This means not only in pay and conditions but also in ensuring the best possible equipment, training, health, housing and other support for their families and themselves are provided to them. Senator Bernardi has listed these in great detail. It is entirely appropriate and right that the employment conditions of the ADF uniformed personnel are handled very differently from public servants, because ADF personnel are not public servants.

I would like to address some of the deep concerns I have with this bill and its unintended consequences. One of the underpinning provisions of the explanatory memorandum of this bill states:

The members of the ADF have their pay assessed arbitrarily by the Minister of Defence (the Minister) under section 58B of the Defence Act 1903.

I argue that this entire premise underpinning the bill is not correct. The Minister for Defence does not make determinations on ADF pay. In fact, under the act, this power is reserved specifically to the Defence Force Remuneration Tribunal, the DFRT, pursuant to section 58H(2)(a) of the Defence Act.

Unlike what is said in the explanatory memorandum, the powers of the minister in relation to ADF remuneration, under section 58(B) of the Defence Act, relate to determinations regarding conditions of service for ADF members other than salary—that is, not pay. These determinations in the past have included housing benefits, relocation support, leave entitlements, the Abbott government's rollout of the ADF Family Health Program and a range of other non-salary related allowances.

In fact, the Hawke government, in the Defence Legislation Amendment Act 1984 established a Defence Force Remuneration Tribunal, which comprises three independent members: the vice president of Fair Work Australia, a person experienced in industrial relations matters and a person who has been a member of the ADF. This is a fundamental and critical fact that this bill has ignored and therefore renders it invalid.

The DFRT was established by Labor to ensure that all decisions and determinations made in relation to ADF pay are relevant to the contemporary roles and living and working environments of personnel serving in the ADF. This is a 30-year precedent—established by the Labor Party—which has worked very well until now. The DFRT determinations are to be made taking into account the special skills and capabilities required of ADF members and their unique employment circumstances. Last year, the DFRT determination was to offer a 1.5 per cent pay increase and was made with these considerations in mind. In the aftermath of the decision to offer a 1.5 per cent pay increase to ADF personnel, I received a significant number of representations from serving and retired members of the ADF about the appropriateness of that outcome. I am also aware that many of my coalition colleagues—who enjoy very close working relationships with their Defence communities in their own electorates—received similar representations. The critical difference from those opposite is that we all understood that any pay outcome for uniformed personnel could not add further per pressure to this government's efforts to repair the economic damage done to this country by the previous Labor and Labor-Greens governments.

So, after carefully considering the extensive feedback we received on this matter, Andrew Nikolic and I approached the Minister for Defence with what we believed was a sensible and workable solution in the current fiscal environment—as did, I know, many of our colleagues—and that was a two per cent pay increase. Another powerful and ultimately persuasive argument to the minister was the fact that under the last government, the Labor government, the wage increases of ADF uniformed personnel lagged behind those of the APS workforce by up to 25 per cent. We believed, therefore, that this recommendation was not only appropriate but affordable.

The second serious concern I would like to raise in relation to this bill is its stated intent that it:

… ensures fairness in the assessment of annual wage increases for members of the Australian defence force by linking Defence Force pay to the higher of increases in Parliamentary allowance and CPI.

Again I congratulate and acknowledge Senator Lambie for the intent behind it, because I know it is a genuine intent to look after our men and women in uniform; I know this. But the practical consequences of this would be to see the ADF pay actually go backwards, and I will explain why. If ADF personnel's pay were tied to inflation, they would be worse off than under the currently proposed two per cent. That is because politicians and senior public servants have actually had their pay frozen to zero since last year, and the Prime Minister has given absolutely no indication that this decision will be overturned in the foreseeable future, so it is a zero per cent pay increase for parliamentarians. So we have a start point of zero per cent. As Senator Bernardi just said, currently the inflation rate is 1.7 per cent, but forward forecasts are that it will decrease, possibly below 1.5 per cent. So this bill is actually mandating an increase between zero and probably somewhere around 1.5 per cent, which would clearly mandate that ADF pay would in fact go backwards from what is currently proposed. That is, I know, absolutely an unintended consequence. I believe it is certainly not the intent of Senator Lambie that this would happen.

I would now like to address some of the technical detail in aspects of this bill, because I have some background in this area. All of us in this place know that the devil and sometimes further unintended consequences are in the detail of the legislation. Firstly, the explanatory memorandum and second reading speech for the bill appear to show that the bill's intent is to apply a minimum to the 'annual increases' arising from a Workplace Remuneration Arrangement, or WRA, type review. However, the definitions in the bill are far broader than just a minimum increase in the pay. I am sure, again, this is another unintended consequence of the wording of this bill. After a close review of the amendments, I believe it would be totally unworkable, and I will now explain why.

A definition that helps establish this potentially far broader scope than that indicated by Senator Lambie, the Labor Party and the Greens is that the proposed section 58Z defines Defence Force pay as 'salary (within the meaning of Division 2)'. Division 2 is the division actually dealing with the DFRT itself. The impact of that is that the bill affects all salary, not just annual increases. It might not sound significant, but it has wide-ranging and unforeseen impacts on the DFRT and on our service personnel.

A Defence Force pay determination is defined as 'a determination made by the Minister under division 1'—or section 58B—'or by the Defence Force Remuneration Tribunal under Division 2, in relation to Defence Force pay'. The practical implication of this is that the bill can impact on many more determinations than just those dealing with pay adjustments. It might sound innocuous, but I can assure this place that it is far from innocuous. Under existing section 58H(2)(a) of the act, the DFRT shall 'inquire into and determine the salaries and relevant allowances to be paid to members'—I stress 'relevant allowances to be paid to members'. This function is not limited to making 'annual increases' to ADF salaries, as currently determined under the recent Workplace Remuneration Arrangement.

Therefore, by extending to salary determinations, this bill potentially affects all of the DFRT work on salaries and not just the annual adjustments, as per the stated intent of the bill. The implications of that are wide ranging and have yet been unacknowledged by those opposite. For example, the DFRT can and does regularly review and determine individual salary placements and increases applying to employment categories within one of the services or triservice categories such as specialist structures for doctors, dentists, lawyers or our chaplains. This is part of the tribunal's day-to-day business and there is already a statutory requirement to review such determinations at least every two years, under section 58H(6) of the act.

Due to the broad definition of 'defence pay determination', the complex formula in the operative clause of this bill, clause 58ZC, would need to be applied to all of those individual pay reviews, not just the annual salary increase. This would force the tribunal to factor in the calculation of CPI and parliamentary allowances each and every time it makes one of its hundreds of salary determinations, remembering that under the proposed changes the calculation would currently result in lower rates, not higher rates. So proposed section 58ZC would introduce a mandatory formula into all Defence Force pay determinations and not just those suggested in the bill. The tribunal, in making any salary determination, would need to include a calculation that converts any amount it decides upon into a percentage increase for the purposes of working out a minimum salary increase, using the amount and rate comparison set out in the proposed new section 58ZC.

What is important to remember is that when the ADF seeks to adjust its pay structures it does so in two ways. First of all, there are general movements such as annual increases, which must be applied across all structures. But the ADF also makes adjustments to individual categories, which usually occur within the constraints of the existing pay points within the system.

The most recent WRA decision is applied to all salary structures and relevant allowances determined by the tribunal, and this occurs on average every two years. This matter has usually been progressed under section 58KD of the act, which states:

The Tribunal may, in making a determination, give effect to any agreement reached between the Minister, acting on behalf of the Commonwealth, and the Chief of the Defence Force

The interpretation of this section has always been one that suggests that giving effect to a section 58KD agreement does not give the tribunal scope to vary the agreed pay increase put before it. The tribunal in these circumstances essentially has a choice to say yes or no. In those circumstances, any application of the proposed new section 58ZC would have to occur between the parties agreeing on the matter to be put before the tribunal. I believe this in itself makes this proposal uncertain and unworkable for the Defence Force Remuneration Tribunal.

The bottom line in all of this technical detail, I believe, is that the scope of this bill applies beyond its intended target of annual salary increases. If it were clearly restricted to this intended target of salary alone, the detrimental effect of this bill would be lessened, although the system would become even more complex than it is and, in practicality, unworkable for the DFRT.

Additionally, as the WRA also applies to relevant allowances determined by the tribunal, including service allowances, and there is no requirement to apply clause 58ZC to that part of ADF remuneration, the bill could potentially cause additional distortions to the current ADF remuneration. For example, the service allowance is a stand-alone payment for ADF personnel of major-equivalent ranks and below. However, the service allowance for lieutenant colonel equivalents and above was rolled into their salaries in the 1980s and continues to be a component of these people's salaries. To not apply consistent increases to salary and relevant allowances of this type would cause further salary distortion. I know, Senator Lambie, that was not your intent in this bill, but that would be the practical implication.

If this bill was introduced, I believe the integrity of ADF pay structures for GOPS and GORPS would be impacted on by the application of this new section to individual employment category cases, which is fundamentally the day-to-day work of the tribunal. That is because any increase to individual pay placements would have to match the minimum pay clause, creating a range of additional pay points, distorting relativities between placements and creating distortion of the complete salary structures. With around 1,300 pay points remunerating more than 500 employment categories across all three services, the operation of Senator Lambie's proposed section 58ZC, with its minimum requirement for all adjustments the ADF seeks to make, I believe would completely distort this structure and render it almost unachievable.

In conclusion, I believe that the two per cent increase per annum for our ADF personnel that has already been negotiated is a fair outcome in our current circumstances. It represents the utmost respect that this government has for our defence forces and acknowledges the critical role they perform in ensuring a safe and secure Australia for us all. While I genuinely commend Senator Lambie for this initiative and the intent behind it, I cannot in good conscience support this bill because it would significantly disadvantage our brave men and women in uniform, who dedicate their lives to serving Australia, and their families. I know that was not her intent, but that is what the impact would be. It would make them worse off. For those reasons, I cannot support this bill.

10:47 am

Photo of Alex GallacherAlex Gallacher (SA, Australian Labor Party) Share this | | Hansard source

I rise to make a contribution in this debate. I think it would be fair to say at the outset that there is not a senator elected to this chamber who is not fully supportive of the Australian Defence Force and the contribution its members make and have made over an extremely long period of time. I think it is unfortunate that they have found themselves in this situation where they were let down—if not something more serious—by this government.

I want to pick up on a couple of points that Senator Reynolds made in her contribution. The first point was on repairing the budget. There are ways of repairing the budget, and I want to give one very specific example. The Public Works Committee, which is charged with examining Defence expenditure, had a proposal put to it to build 50 houses at RAAF Base Tindal. The bespoke, architecturally designed houses were to cost $89.4 million. The committee found that that was not value for money. After a number of hearings and a number of examinations of this situation that was put to it, another model was put up to build 50 tropical designed dwellings using the Defence Housing Association as business as usual to design and construct a delivery model at a cost of $47.15 million. If you are serious about repairing the budget and examining Defence expenditure then you can find an instance on the public record that was subject to public hearings where $40-odd million was saved in one project. It gives you an understanding of how deeply and widely felt the antagonism towards this government's decision clearly is. We see these projects ad hoc. Defence is a large part of the expenditure that goes to the Public Works Committee. We test whether it is value for money and fit for purpose in the public interest. If we can put up an example of where $40 million was proposed to be spent and a business-as-usual model delivered a $40 million saving, how do the people in Defence feel when they cannot get a modest increase when clearly there are savings to be made—and not insignificant ones?

Whilst repairing the budget is the goal of all governments, at what cost should it be? Should it be at the cost of the people who put their limbs and lives on the line every day in the service of this country? I think not. I think, actually, there is bipartisan support for that. I really do. I think there are many people in the coalition ranks who think that this is grossly unfair. I think their numbers are quite significant. There are a number who have gone on the public record to say that. The simple facts are that they should not be in this position. This is a fight that they should not have had to have.

Take the Prime Minister's comment that no-one in the public sector will be paid a higher rate of increase than our Defence Force—that is factually incorrect. If you look at the relevant agreements you will see that the CSIRO will receive an increase of 2.8 per cent per year for the next three years. Airservices Australia will receive a 5.1 per cent pay rise over the next 15 months up to July 2016. Future Fund employees have been reported to be receiving a three per cent annual pay increase. So is it any wonder that our serving men and women are feeling let down? Is it any wonder at all that the various stakeholders who support those men and women in the Defence Force are agitating for a better deal? There is no wonder at all.

This is really the consequence of the bravado of this government. After gaining a significant electoral victory, they said, 'The next thing we are going to do is chop.' There are some places you do not chop. In my view, Australian Defence Force personnel are entitled to a respectable, ongoing increase in their wages and conditions commensurate with the level of commitment that they give to this country without having to agitate in the way that they have been forced to this time. If the government are serious about budget repair, I suggest they have a very close look at some of the procurement contracts and expenditure that are ongoing in our Defence Force as we speak, rather than taking money out of the pockets of those hardworking men and women of our Australian Defence Force.

10:52 am

Photo of Glenn LazarusGlenn Lazarus (Queensland, Independent) Share this | | Hansard source

I move:

That the question be now put.

Photo of Stephen ParryStephen Parry (President) Share this | | Hansard source

The question is that the motion moved by Senator Lazarus, that the question be now put, be agreed to.

11:01 am

Photo of Stephen ParryStephen Parry (President) Share this | | Hansard source

The question now is that the Defence Amendment (Fair Pay for Members of the ADF) Bill 2014 be read a second time.

Question agreed to.

Bill read a second time.

As no amendments to the bill have been circulated, I shall call Senator Lambie to move the third reading unless any senator requires that the bill be considered in Committee of the Whole.