Senate debates

Tuesday, 21 March 2017

Bills

Communications Legislation Amendment (Executive Remuneration) Bill 2017; Second Reading

3:45 pm

Photo of Pauline HansonPauline Hanson (Queensland, Pauline Hanson's One Nation Party) Share this | | Hansard source

I move:

That this bill be now read a second time.

I seek leave to table an explanatory memorandum relating to the bill.

Leave granted.

I table an explanatory memorandum, and I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows—

I rise to speak on my private senator's bill, the Communications Legislation Amendment (Executive Remuneration) Bill 2017. The purpose of this bill is to amend the Australian Postal Corporation Act 1989 and the National Broadband Network Companies Act 2011 to remove the ability of the respective Boards to set remuneration and to give that authority to the Remuneration Tribunal by amending to the Remuneration Tribunal Act 1973.

Australia Post and the National Broadband Network Company (NBN Co) are two of six government owned enterprises known as Government Business Enterprises (GBEs) which are defined in section 8 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) and are prescribed in section 5 of the PGPA Rule to the PGPA Act.

The other four are the Australian Rail Track Corporation Limited responsible for some 10,000 kilometres of interstate rail, Australian Submarine Corporation Pty Ltd responsible for naval ship building and in particular the proposed spend of $50 billion on new submarines, Defence Housing Australia and the Moorebank Intermodal Company Limited to be responsible for the major infrastructure hub in Sydney.

All these businesses are very different but they share some important characteristics.

        I now want to turn to Australia Post. It is common ground in the community that the payment of some $5.6 million to the Managing Director of Australia Post is out of step with community expectations. The way in which the remuneration package was discovered, the response of the shareholder Ministers and the Board and the Managing Director will no doubt become a text book study of what not to do.

        It seems that this payment of $5.6 million also permitted the Managing Director of Australia Post to take on other paid work. The 2016 Annual Report of Pro-Pac Packaging reports Mr Ahmed Fahour was also paid a fee of $109,500 last year by the ASX listed. It maybe that Mr Fahour also earned other income but my concern is not with Mr Fahour but with the Board of Australia Post.

        The Board of Australia Post is either unaware its Managing Director has another job in the same space that Australia Post operates in or it is aware and does not care.

        The Board of Australia Post has failed the people of Australia and needs to be replaced. In the meantime the power to set remuneration for the Managing Director needs to be removed and given to the Remuneration Tribunal which already sets the remuneration of most of the other GBE's.

        Here are the problems with setting the remuneration of the Managing Director at $5.6 million.

        The single payment is excessive, it reduces the dividend to government, but worse it has a flow on effect throughout Australia Post. It makes payment of between $1.3 and $1.8 million to a number of other executives seem reasonable when it is not and that further reduces the dividend.

        The flow on effect goes on and on because these excessive payments come at the cost of moral and a sense of fairness to the real workers at Australia Post, the staff, the contractors and owners of licensed and franchised post offices who deliver the community service obligation. It's a zero sum game: someone has to pay for this excessive remuneration regime.

        So the question now has to be asked 'how did this happen'? The short answer is a complete failure of the Board of Australia Post and the Coalition Government who failed to bring to a stop a remuneration arrangement already in play under the previous Labour Government.

        I think it is instructive to look at the sequence of recent events. The Board of Australia Post ceased publishing the remuneration arrangements of the Managing Director in its Annual Report in 2013.

        The remuneration arrangement for the Managing Director of Australia Post were revealed in a response to a question at Senate Estimates and a flurry of newspaper articles in The Australian and other print media which was followed by radio and television commentators. Finally we knew what the Board and the shareholder Ministers had known all along.

        Once the media took up the story, the Government responded with a letter to the Board of Australia Post. Later the Prime Minister thought the Managing Director of Australia Post could search his conscience and return some of the money. You would have thought the Government was simply powerless to act.

        This Bill makes it clear that the tools necessary to deal with the matter of remuneration were always available to Government.

        I met with Communications Minister Fifield on 9 February 2017 and pointed out that the position of Managing Director of Australia was already a principal executive office along with the CEO of the Australian Rail Track Corporation Ltd which seemed to surprise him and he told me he would get back to me shortly. He didn't.

        On the 16th of February 2017 I won the ballot for that day's Matter of Public Importance and spoke about Australia Post and said I had been left with no alternative but to try to fix the problem myself because quite clearly no one else had any interest in doing so.

        The Bill before you reflects no more and no less than the removal of the remuneration setting power of the Board of Australia Post and the allocation of that removed power to the Remuneration Tribunal.

        The Remuneration Tribunal sets the salary of the Prime Minister which is $517,504. The Chief of the Navy, the Chief of the Army and the Chief of the Airforce receive much less.

        If the Remuneration Tribunal as an independent statutory body can handle the remuneration of the Prime Minister, the judiciary and others managing government businesses then they can handle the remuneration for the most senior officers at Australia Post and NBN.

        Once the Remuneration Tribunal sets the remuneration package for the Managing Director at Australia Post some community confidence will be re-established in the system of government in Australia. Possibly some lessons will learned.

        The Coalition and Labour need to get out more. Less time in their political bubble in-fighting and more time with the rest of Australia, the people they so passionately care about when interviewed for television and radio. In 2016 Australia Post reported a dividend of $20 million and that amount would have been much higher probably double if the Board of Australia Post and the shareholder Ministers were not asleep at the wheel of Australia Post.

        Before I leave the case for change, I want to look briefly at the remuneration for comparable organisations.

        In the United States (US) the US Postal Service is an independent agency responsible for providing the postal service and like Australia Post it is obliged to provide a postal service regardless of geography at a uniform price. The US Postal Service employs over 600,000 staff and delivers more than 660 million pieces of mail a day yet their CEO has a package worth $1.2 million Australian dollars, which is one quarter of the remuneration of the equivalent position in Australia Post. How can that be justified? It's the same story for the United Kingdom and Canada.

        On the 24th of February 2017 the Government announced it would bring the position of Managing Director of Australia Post within the regime administered by the Remuneration Tribunal but it said nothing about the CEO of NBN.

        I now want to turn to the Board of the NBN Co and its payment of $3.6 million to the Chief Executive Officer. This Bill also brings the CEO of NBN Co within the framework of the Remuneration Tribunal.

        Finally I would like to mention the questions asked and replied to at the Additional Senate Estimates Environment and Communication Committee on the 28th of February 2017. The Managing Director of Australia Post suggested that his religion and his skin colour have paid a role in my decision to speak in Parliament on the issue of his remuneration. It has not.

        Personal factors have played no role in my decision to speak up on the remuneration of the Managing Director at Australia Post on the 16th of February 2017. Every other speaker on that occasion agreed the remuneration package for the managing Director of Australia Post was excessive. On that basis I would expect them to support this Bill.

        I seek leave to continue my remarks later.

        Leave granted; debate adjourned.