28 May 2010

Recap of House debate on Aussie Military Superannuation Pension

Earlier this week whilst I was attending the RSL (NSW) administration seminar and the Annual State Congress in Rooty Hill, the Australian House of Representatives debated the Military Superannuation Pension. (Fortunately this morning an RSL mate reminded me of this and had emailed the transcript of Monday's House debate. h/t Wally) The transcript can be found in a proof issue of the Hansard here (debate starts on page 147).

The issues debated were (1) should the Government consider increasing the Military Superannuation Pension twice annually by the greatest of either the Consumer Price Index, the Pensioner and Beneficiary Living Cost Index ("P&BLCI") or the Male Total Average Weekly Earnings ("MTAWE"); and (2) should the Government do this in recognition of the unique circumstances of military service compared to all others within the public service.

After perusing the transcript and reviewing other pertinent documents here's my take on the issue:

Currently the military superannuation is indexed by the Consumer Price Index, or CPI. Robert Oakeshott MP (Independent-Lyne, NSW) started the debate by arguing that the CPI is not a good indicator for cost-of-living measures and for purchasing power. I agree with Mr Oakeshott.

Chris Hayes MP (ALP - Werriwa, NSW) then chimed in citing the December 2008 Matthews Report (written by Trevor Matthews), which can be found here. Mr Hayes noted that Mr Oakeshott's motion essentially seeks that the military superannuation pension be increased in the same way of the age pension (yes, I agree it does). With that said, Mr Hayes then proceed to tell his colleagues that the Matthews Report did not consider it unfair that civil and military pensions be indexed on a different bases to the age and service related pensions. He further argues that the current package is highly competitive and attractive and concedes that there will be members of the veterans community in Australia (and yes, I'm one of those veterans) who do not agree with the Matthews Report and its recommendations.

Noting that the matter of military superannuation indexation is the single biggest issue affecting veterans and the most important, Bob Baldwin MP (Liberal - Patterson, NSW) proceeded to lambaste the Rudd Government for broken election promises, noting the Labor party's 2007 federal election promise was "to restore the value of compensation and prevent further erosion due to unfair indexation." (Good-on-ya Mr Baldwin, but I regress) In concluding his remarks, Mr Baldwin stated that he is committed to introducing a fair, equitable, financially responsible military superannuation system though he was less on specifics. (Smells like an election is coming up. I would have preferred Mr Baldwin to give specifics instead of innuendo.)

Next up, Shayne Neumann MP (ALP - Blair, QLD): Mr Neumann noted a heavy military and veterans presence in his home district of Blair. He agreed with the Matthews Report finding (again I don't) and stated that the Rudd Government acted "on the basis that the most appropriate purpose of the indexing an occupational superannuation pension is to protect purchasing power of those pensions from the effects of price inflation. And that is what happens overseas. . . We followed the independent advice of Mr Matthews, which was the appropriate thing in the circumstances to do." Mr Neumann also spoke a little bit about the 2007 Prodger review, which the Government originally didn't want to disclose to the public under the Howard Government but that Rudd Government has made it public and is now considering it.

Last but not least Stuart Robert MP (Liberal - Fadden, VIC), who is a graduate of the Australian Defence Force Academy and the Royal Military College Duntroon. Mr Robert spent 12 years as officer in the Australian Army. He noted that when the government released the Matthews report, which recommended that the indexation arrangements stay the same, the government grasped that and did nothing. Mr Robert noted that Minster of Veterans Affairs Alan Griffin stated that the government should clarify the military superannuation situation immediately, as the morale of current members is being seriously affected. . . Well the government has clarified it. It has said that this compact is not well regarded and that they will do nothing.

Sarcastically, Mr Robert said "the Labor side made comments to say that they would index the pension 25 per cent MTAWE. I am even led to believe that Mr Rudd, the Prime Minister, may have made such comments. If so, this is one more broken promise in the conga line of broken promises that so typifies this government. "

My thoughts are simple: The debate lacked specifics and Deputy Speaker Anna Burke MP (ALP - Chisholm, VIC) didn't afford enough time for serious and thoughtful debate - each member who spoke on the motion was afforded only five minutes and no rebuttal time. Disappointingly, no MP could say that either the CPI, P&BCLI or MATWE were the appropriate indexation together with precise arguments and as such I must say I'm disappointed with our elected officials. (Mr Robert sorta hinted the MATWE would be most appropriate but didn't exactly say that.)


Senator Fielding has a petition on his website for a fair-go for veterans. Go here to sign the petition.

Personally, I support MATWE indexation for the military superannuation pension and think it is just, equitable and proper. The MATWE certainly stands out to be the more accurate indexation than that of the CPI or P&BCLI.

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