Peter Andren MP
Independent Federal Member for Calare : 2 March 1996 - 17 October 2007
In June 2004 the federal parliament passed two bills: the Parliamentary Superannuation Bill 2004 and Parliamentary Superannuation and other Entitlements Bill 2004, ending the out-of-date and outrageously generous parliamentary superannuation scheme – but only for new MPs and senators elected at the 2004 federal election.
Despite their rhetoric in support of bringing politicians' remuneration into line with community standards, no current Labor or Coalition MP was prepared to apply the reforms to themselves.
From October 2004, new parliamentarians, and those who rejoin parliament after a break in service, will receive a 9% employer contribution to a superannuation fund of their choice. But those MPs who have made this decision for their future colleagues will hold onto their guaranteed, indexed, 69% employer contribution, taxpayer funded lifetime pensions.
Neither side would consider the inclusion of Peter's amendment (based on his two previous private member's bills for MPs' super reform) to allow members with conscientious objections, the choice to opt-out of the scheme.
It was not surprising that two years later, the government moved to increase the employer contribution to superannuation for MPs and Senators on the new parliamentary scheme to 15.4% – above the 9% superannuation guarantee for the rest of Australia’s workers.
Peter tried to amend this bill to tie the employer contribution percentage for politicians to the superannuation guarantee percentage for everyone else (to ensure that if the pollies get an increase, everyone gets an increase), and to (again) allow MPs on the old scheme to ‘opt-out’ for the new one. His amendments were not supported. You can read his speeches on the bill and his amendments by clicking on the links.
The double-standard is shameful.
The government happily bases its health, education, workplace and finance policies on the peoples' right to 'freedom of choice', but will not extend the same choice to MPs and their superannuation.
How did all this come about?
In March 2001, Peter introduced the first of his Parliamentary (Choice of Superannuation) private member's bills to give serving MPs and Senators the freedom to opt-out of the over-generous Parliamentary Contributory Superannuation Scheme (PCSS) and have their employer superannuation contributions paid into a fund of their choice in accordance with the superannuation guarantee legislation.
This original bill generated considerable media attention on the issue, and following a story on Channel 9's A Current Affair, a Senate inquiry into the bill attracted some 3,000 submissions from the public, interest groups and government agencies.
This strength of public sentiment saw the introduction of a preservation age of 55 years for new members after the November 2001 election – the government's first reluctant nod to reform since being elected in 1996.
In the new parliament both sides were again silent on the issue. Peter again became "voice in the wilderness" urging reform, until 2003 saw some movement.
Early in the 2003, Peter foreshadowed the introduction of a new and improved private member's bill to allow MPs to opt-out of the scheme. In August 2003, Mark Latham commented in the press he was 'uncomfortable' with the parliamentary superannuation scheme and the Australian Democrats joined the push for reform.
Peter introduced his Parliamentary (Choice of Superannuation) Bill 2003 on 8 September 2003, accounting for the technical weaknesses identified by the Department of Finance & Administration during the 2001 Senate inquiry into the original bill. Read Peter’s introductory speech here. Again, the media took up the issue.
On 10 February 2004 Mark Latham, now Leader of the Opposition, officially announced a Labor government would end the MPs' superannuation scheme and establish a fully-funded, market based scheme for new MPs. The proposal would come into effect after the 2007 election – if Labor was successful in 2004.
Two days later the Prime Minister announced the government would close the PCSS to new members after the 2004 election, and all newly elected MPs would receive a 9% employer contribution to a superannuation fund of their choice. The State governments (with similar MPs super schemes) followed suit.
The PM originally intended to close the scheme for currently serving MPs as well but this met with stiff resistance in the coalition party room. Few sitting members or senators, government or opposition, were willing to entertain the thought of giving up their guaranteed pension.
The bill to implement the government's plan was introduced in budget week, where the focus of the nation was on tax breaks and family bonus payments in the biggest spending budget since 1996.
Peter attempted to amend the bill to include an 'opt-out' clause for sitting MPs to leave the PCSS, have an equivalent benefit transferred to a fund of their choice and from then on receive the 9% superannuation guarantee.
The bill passed the House unamended, with both Coalition and Labor voting together to defeat Peter's amendment.
A Senate inquiry into the government's new community standard superannuation arrangements was held in June 2004. As one of the few witnesses, Peter argued in support of his 'opt-out' amendment, citing the precedent of the West Australian MPs' superannuation scheme that included such a clause.
Democrat's Senator John Cherry took up the 'opt-out' issue with witnesses from the Department of Finance and Administration and the government's contracted actuary, who indicated it would be a workable inclusion in the new arrangements.
Despite this, the inquiry found against the inclusion of Peter's amendment. The Democrats attempted to move the same amendment in the Senate but were also defeated.
The bill passed the Senate with Labor amendments to cap payments to the Prime Minister and Deputy Prime Minister. However, these were not agreed to in the House, and when returned to the Senate, the ALP did not insist on their inclusion, even though they had the support of the Democrats and Greens to try and force the government's hand. The Opposition's stance was nothing more than a weak political stunt.
So after all the rhetoric from the Coalition and Labor, the extent of their willingness to embrace the community standard was to apply the new rules only to their future colleagues.
Only Peter and his independent and minor party colleagues in the House and Senate sought the right to choose the community standard for themselves over the outrageous lifelong rort of the PCSS.
For more information view the following links:
Read Peter's speech on the Government's Parliamentary Superannuation Bill 2004 and Parliamentary Superannuation and other Entitlements Bill 2004.
Read the Senate's Finance & Public Administration Legislation Committee report into the 2004 parliamentary superannuation bills and the Hansard record of evidence to the inquiry by clicking the links.
For a detailed summary of the parliamentary superannuation scheme and Peter's bill read the explanatory memorandum of the Parliamentary (Choice of Superannuation) Bill 2003. You can also read Peter's speech introducing his bill, and the text of the Parliamentary (Choice of Superannuation) Bill 2003.
Below are links to press releases associated with the reform of MPs' superannuation:
June 2004: Labor stunt on MPs' super
For historical data on Peter's efforts to reform the parliamentary superannuation scheme use the Australian Parliament House website's Parlinfo Web database and search for 'Andren' and 'superannuation'.