Thursday, 9 February 2017
Questions without Notice
I thank Senator Paterson for his question. Colleagues, on 7 February the Senate Standing Committee on Environment and Communications released Australia Post's answers to questions on notice from the October estimates. The released information disclosed that the Managing Director of Australia Post made a total of $5.6 million in 2015-16, including $4.4 million in short-term employee benefits and $1.2 million in post-employment benefits.
The view of the community, the government, the Prime Minister and me is that the current level of executive remuneration is out of step with community expectations. The government also agrees with the Senate committee's unanimous view that there is a public interest to report the executive remuneration offered at GBEs and that GBEs should be held to a high standard of disclosure.
Yesterday I called the Chairman of Australia Post to make these views clear. Additionally, I and my joint shareholder minister, Senator Cormann, wrote to the Chairman of Australia Post, requesting that the board give more rigorous consideration to remuneration packages offered to senior executives, that the board should be conscious of community expectations in relation to remuneration, that the board take executive remuneration into account when seeking to reduce operational costs and that the board should ensure greater transparency in relation to executive remuneration.
While the setting of executive remuneration is the responsibility of the board of Australia Post, the letter makes clear that the board needs to be able to justify its decisions to the Australian public.
The Australian community deserves high levels of accountability and transparency from government business enterprises. While Australia Post's reporting of senior executive remuneration is in accordance with the Public Governance, Performance and Accountability Act, it is not in line with the community or government expectations. Australia Post should provide transparency of executive remuneration, which goes beyond its obligations under the PGPA Act. I have asked the board to follow the practice of other GBEs, which disaggregate reporting of senior executive remuneration in annual reports. The PGPA Act should be viewed as the floor, not the ceiling, in the disclosure requirements for the GBE.
We recognise that, according to the PGPA Act, decisions regarding senior executive remuneration are the responsibility of the Australia Post board. Shareholder ministers also recognise that Australia Post operates in a competitive environment. However, it is the government's view that the board of Australia Post should be conscious of community expectations when determining remuneration for senior executives and be prepared to give a public justification to the satisfaction of the Australian community. Accordingly, I have spoken with the Chair of the Senate Standing Committee on Environment and Communications, Senator Paterson, who has indicated that the committee intends to invite the Chairman of Australia Post to attend the next estimates hearing, on 28 February, to inform the committee of the board's response to expressed community and government concerns and to do so in that public forum. I have spoken to the Chairman of Australia Post today to convey my view that he should do so. All of us who are employed in the service of the community are rightly accountable to the Australian public.