Links

• Western Australian Salaries and Allowances Tribunal
• Commonwealth Remuneration Tribunal
• Remuneration Tribunal of South Australia
• Northern Territory Government Remuneration Tribunal
• ACT Remuneration Tribunal
• NSW Department of Local Government
• NSW Local Government and Shires Association
• Commonwealth Department of Infrastructure, Transport, Regional Development and Local Government

PDF Version

ANNUAL REPORT AND DETERMINATION OF ADDITIONAL

ENTITLEMENTS FOR MEMBERS OF THE PARLIAMENT OF

NEW SOUTH WALES

by the

PARLIAMENTARY REMUNERATION TRIBUNAL

pursuant to the

Parliamentary Remuneration Act 1989

30 JUNE 2003

PARLIAMENTARY REMUNERATION ACT 1989

REPORT PURSUANT TO SECTION 13(1) OF THE ACT

1. INTRODUCTION

Section 11 of the Parliamentary Remuneration Tribunal Act 1989 ("the Act") prescribes that the Parliamentary Remuneration Tribunal ("the Tribunal") shall make an annual Determination as to the additional entitlements for Members and Recognised Office Holders (as defined under the Act) on or before 1 June in each year or on such later date as the President of the Industrial Relations Commission of New South Wales determines.

Section 13 (1) of the Act requires that the Tribunal make a report to the President of the Industrial Relations Commission of New South Wales for each Determination made by the Tribunal. The President is then required, as soon as practicable after receipt of the report, to forward it to the Minister (see section 13(2)).

Because of the election on 22 March 2003 it was not possible to commence the annual review until after its completion. The later commencement date necessitated the Tribunal writing only to the Presiding Officers seeking submissions from them, the major parties and Independents.

Because of time constraints and the later than expected receipt of submissions, the Tribunal wrote to the President of the Industrial Relations Commission on 19 May 2003 and sought, pursuant to section 11(2) of the Act an extension to the completion date of the Determination. By an Order published in the 30 May 2003 edition of the Government Gazette, the President has extended the date of completion of the determination to 30 June 2003.

The Tribunal received submissions from the Presiding Officers, the major political parties and some individual Members. The Tribunal also met with the Presiding Officers and representatives of the major Parties.

While there were a range of matters canvassed in the submissions the Tribunal does not intend to discuss all in their entirety. As has been the previous practice, the Tribunal has made changes to the Determination without the need for detailed separate reasons being provided. Such changes reflect, in general, minor wording changes to give greater consistency to the Determination.

In a number of cases the submissions have repeated matters previously raised without providing any additional information for consideration by the Tribunal. Where the Tribunal has dealt with such matters in earlier Reports and Determinations no further consideration has been given in the present review.

The submissions have, however, also raised a number of substantive issues which, in the Tribunal's view, merit further consideration.

2. GENERAL MATTERS RAISED

Additional Entitlements for Shadow Ministers

For a number of years Members of the major Opposition Parties have sought additional entitlements for the Shadow Ministers. Shadow Ministers are established `offices' in the Westminster System of Parliament and as the title implies they are alternative spokespeople on Government policies in the respective portfolios. Shadow Ministers perform a valuable role in our system of government, providing the community with alternatives to government policies and putting forward counter arguments to Government proposals. The community expects to hear from Shadow Ministers on executive government activities and challenge Ministers on their portfolio responsibilities. The community can only be better informed when alternatives views and proposals are put forward.

The Tribunal is cognisant of the needs of Shadow Ministers to ensure they perform effectively in their role. The Tribunal has repeatedly stated its support for additional entitlements for Shadow Ministers, both to the present Government and the previous coalition Government. Neither took the opportunity to address the issue.

The Tribunal had interpreted the legislation as meaning that it could only provide additional entitlements to Members or Recognised Office Holders (Ministers, Presiding Officers, Leaders of the Opposition etc). As Shadow Ministers were not Recognised Office Holders then the Tribunal could not make specific determinations for them.

In 2000 following a major review of the additional entitlements scheme, the Tribunal interpreted the legislation as allowing the determination of additional entitlements for Shadow Ministers (being a specific class of Member). The Tribunal, therefore, determined some additional entitlements for Shadow Ministers. These were continued in the 2001 and 2002 determinations.

For the 2002 determination the Tribunal indicated that it would be seeking a special reference from the Premier to examine whether the Tribunal should determine additional staff resources for Shadow Ministers. Prior to requesting this special reference the Tribunal sought the advice of the Crown Solicitor on the Tribunal's authority to determine additional entitlements for Shadow Ministers and clarification of those sections of the Act which would allow or prevent the Tribunal from determining additional entitlements for Shadow Ministers. This was necessary to ascertain exactly what the Tribunal's statutory powers were in determining additional entitlements for Shadow Ministers.

On 16 October 2002 the Crown Solicitor noted that section 10A of the Act provided for additional entitlements to facilitate the efficient performance of parliamentary duties by Members and Recognised Office Holders.

The Crown Solicitor concluded that the Tribunal could not determine additional entitlements for Shadow Ministers as they were not recognised Office Holders for the purposes of the Act. He also advised that the Tribunal could not determine additional entitlements for Shadow Ministers as Members because the duties performed by Shadow Ministers are not the parliamentary duties ordinarily performed by Members.

He stated that the safest course of action in providing additional entitlements is to include the `office' of Shadow Minister in Schedule 1 of the Act.

The Tribunal, as a result of this advice will no longer be able to determine additional entitlements for Shadow Ministers and the existing entitlements will be removed from this Determination.

There are a number of options available. Option 1 would be to retain the status quo. Option 2 would be to amend the Act to include Shadow Ministers as recognised office holders. Option 3 would be to increase the budget allocation in the Premier's Department for the Leaders of the Opposition to provide sufficient funds to meet the additional needs of the Shadow Ministry. Something similar occurs in the Federal jurisdiction. Option 4 would be to enhance the Budget of the Legislature so that the additional resource needs of the Shadow Ministry can be met by the Parliament. While the Tribunal has long supported the inclusion of Shadow Ministers in the Schedule of Recognised Office Holders, all the above Options are matters for the consideration of the Government.

Some Shadow Ministers who are also Recognised Office Holders have asked the Tribunal to restore the entitlements formerly provided to them as Recognised Office Holders.

In its determination of 20 December 1999 the Tribunal addressed the additional entitlements for Recognised Office Holders and how they would be reflected in the newly created Logistic Support Allocation in the following terms:

"Recognised Office Holders

Schedule 1 of the Act provides a list of office holders whose duties, over and above those duties as a Member, attract an additional salary and an expense of office allowance.

Remuneration Tribunals across Australia have also recognised the additional duties and responsibilities of Recognised Office Holders by providing them with additional entitlements. In NSW, Recognised Office Holders receive the following additional entitlements:

1. Additional travel entitlements
2. One hundred percent reimbursement of home telephone/facsimile charges
3. Additional stamp allowance
4. Additional number of overnight stays for Living Away from Home Allowance
5. A travelling allowance
6. Additional printing and stationery entitlements.

One complicating factor when considering this issue is that the additional entitlements are not applied uniformly to all Recognised Office Holders across the various entitlements. This, coupled with grouping of these entitlements for Members in the initial determination, will also require a different approach to specifying entitlements for Recognised Office Holders.

Draft determination.

The draft determination did not make any provision for the additional entitlements of Recognised Office Holders, preferring to receive submissions from Members after the determination had been published.

Consideration

The Tribunal accepts that Recognised Office Holders have additional duties and responsibilities of office over and above those required of a Member of Parliament. These additional duties and responsibilities vary from office to office.

As all entitlements are now expressed in monetary terms and because the entitlements for Recognised Office Holders are additional to those received by Members they will be expressed as a percentage of the basic amount." (pp103-104)

Schedule 3 of that Determination provided the appropriate percentages for the various components of the Logistic Support Allocation for Recognised Office Holders. This Schedule has been carried forward in subsequent Determinations. For 2001 and 2002 the Schedule also included allocation for Shadow Ministers.

As a result of this Determination those allocations for Shadow Ministers will be removed. Shadow Ministers who also occupied Recognised Office Holder positions will receive the additional entitlements in accordance with Schedule 3.

Legislative Changes

The Parliamentary Remuneration Amendment (Recognised Office Holder) Act 2002 amended Schedule 1 of the Act by amending the description of the Office of Deputy Leader in the Legislative Council (other than the Leader of the Opposition or the Deputy Leader of the Opposition) of a recognised political party by reducing the number of members from ten to nine. For consistency the Tribunal has amended its description of this Office in the determination.

Sydney Allowance

The focus of the submissions received by the Tribunal expressed concerns about the Sydney Allowance. The issues raised in the submissions ranged from matters previously canvassed and rejected by the Tribunal (increase in the rate to the full daily travel allowance amount) to more complex and significant matters dealing with the administration of the scheme and the perceived inequity between the daily rate and the annual rate.

The Presiding Officers have recommended that the existing provisions in respect of the Sydney Allowance remain unchanged pending a further review and consideration of the impact on Members.

The Tribunal was also advised that the condition that Members who opt to receive the annual allowance must repay any unspent portion of the allowance is a deterrent to making long term accommodation arrangements. This, it was argued, contradicted the Tribunal's basic premise for introducing the annual amount.

Some submissions suggested that Members in receipt of the annual rate should have access to additional overnight stays when required.

In discussions on this matter with representatives of the major Parties, the Tribunal was also advised that the number of occasions the Tribunal determines as being reasonable number of overnight stays in Sydney per annum (and hence the basis for determining the annual rate) understates the actual number of overnight stays that Members and Recognised Office Holders actually spend in Sydney on parliamentary business. Because of the shortness of time these matters could not be explored further, hence it was suggested to the Tribunal that rather than making any further changes to this entitlement that a fundamental review of the Sydney Allowance be undertaken at the time of the next annual review. The Parties would then be in a better position to provide comprehensive details of all the relevant issues.

The Sydney Allowance (formerly known as the special expense or Living Away from Home Allowance) was introduced in 1975 by Act of Parliament. The Allowance, as noted by the Tribunal in 1975, was intended to assist country Members in meeting the additional costs associated with overnight stays whilst in Sydney on parliamentary business or in transit to and from Sydney. The Allowance was payable to Members when the stay was for:

• sittings of Parliament or direct travel to and from such sittings; or
• meetings of parliamentary committees of which they are a member or direct travel to or from such meeting; or
• other parliamentary business.

The Tribunal first considered special expense allowances in its Report and Determination of 3 November 1975. The Allowance was only available as an annual amount.

Because country Members would be spending a considerable amount of time in Sydney it was expected that they would make longer term accommodation arrangements at presumably cheaper rates. Indeed, in 1979 the Tribunal noted that:

"...it appears that it was envisaged that the members would rent or buy permanent accommodation rather than stay at hotels and the allowance may have been pitched below the likely hotel, motel charges for this reason."

In keeping with this assessment the rate of this Allowance has consistently been struck at a significantly lower rate than the normal capital city travelling allowance rate available to public servants where the full cost of commercial and/or motel/hotel accommodation is included. This approach has been adopted by the Federal and other State/Territory Remuneration Tribunals.

In 1990 the Tribunal introduced the daily rate of the allowance and also introduced the number of overnight occasions considered reasonable to meet the purposes for which it was intended. Members in receipt of the annual amount were not required to substantiate the expenditure. The annual amount was capped. The daily rate could exceed the number of overnight stays determined by the Tribunal, however, full substantiation was required for each such overnight stay.

The Parliamentary Remuneration Amendment Act 1998, made significant changes to the Act. The Crown Solicitor advised the Tribunal that additional entitlements could only be used for parliamentary duties. This required changes to the administration of the Allowance and the rules applicable to it.

The Initial Determination of 24 December 1999 provided that Members who opted to receive the annual allowance were required to provided evidence of the number of overnight stays. Those Members whose overnight stays are less than the number provide for the annual allowance were required to reimburse the difference to the Parliament. It is this requirement, it is argued, that now makes the annual allowance impractical for members to make longer term accommodation arrangements.

Since the Initial Determination the Tribunal has made changes to the rules governing this entitlement. One such change had the unintended consequence of providing a potentially greater benefit to those Members in receipt of the daily allowance than those on the annual rate.

It is clear to the Tribunal that the Sydney Allowance is in need of a fundamental review. All aspects of the Allowance require consideration from the quantum of the daily rate to whether the number of overnight stays - introduced in 1990 - need to be re-assessed in light of the work patterns of Members and Recognised Office Holders. The rules underpinning this entitlement will also need to be examined to ensure they are sufficient to meet the needs of Members and the Legislature. Finally, the Tribunal may also need to assess a definition of "principal place of residence" in connection with this entitlement.

Such a broad sweeping review will require greater time than is available for this annual review. For this reason the Tribunal will make a cost of living adjustment to the entitlement. The Tribunal has considered the suggestion that the Allowance be reviewed as part of the next annual review but would prefer not to wait that long.

On completion of this review the Tribunal will, therefore, write to the Premier seeking a special reference to review all aspects of the Sydney Allowance. This will ensure that a new determination is in place prior to the next annual review where any potential adjustments can be made at that time.

Interpretations of the Tribunal's Determinations.

Since the making of the 2002 Determination the Presiding Officers have, on occasion, sought interpretations from the Tribunal. These have assisted the Presiding Officers with the administration of the entitlements scheme or clarified particular matters. Where subsequent changes have been required to be made to the Determination this has been done without additional comment here.

3. REVIEW OF ADDITIONAL ENTITLEMENTS

Electoral Allowance

The Tribunal has again received submissions seeking an increase in the Electoral Allowance beyond the normal Consumer Price Index (CPI) movement. The Tribunal has also been requested to re-categorise one electorate to a higher category.

The Tribunal has been provided with information on the how the allowance is expended and, in particular, the significant cost of the motor vehicle that Members are required to purchase or lease from this entitlement.

The Electorate Allowance has always included a component for the acquisition of a motor vehicle. Unlike Federal Members of Parliament, NSW Members do not have access to private plated motor vehicles for $750 pa. For this reason NSW Members receive a higher rate of electorate allowance than their Federal counterparts.

The Tribunal has also considered the application for re-categorisation. The Categories were established at the time of the last electoral redistribution in 1999. Nothing has changed since that time to warrant a new examination of a particular electorate. The Tribunal does not intend to review electorates individually unless demonstrated exceptional circumstances warrant such a review. The Tribunal will again review the categories of electorates at the time of the next redistribution.

The Tribunal intends for this review to increase electorate allowances in line with the movements in the Consumer Price Index i.e., 3.4 percent.

Sydney Allowance

In light of what has been noted above the Tribunal will increase the Sydney Allowance in line with the movement in the Consumer Price Index i.e., 3.4 percent.

Logistic Support Allocation (LSA)

The Tribunal introduced the LSA in 2000 as a means of grouping a broad range of entitlements formerly available to Members in various forms. To simplify these entitlements the Tribunal determined a monetary value for each entitlement and grouped them into four broad areas of activity. Each Member was allocated an LSA account to which various expenditures incurred under the four broad areas would be debited.

LSA budgets were based on electorate Groupings for the Legislative Assembly and Zones for the Legislative Council. Budgets were based on actual expenditure figures obtained from the Legislature.

Members are given the flexibility to use the LSA to meet their particular needs in the performance of their parliamentary duties. Members are able to carry forward unspent entitlements and may manage the funds as they deem appropriate. Accountability and transparency in the use of the LSA are provided through the rules imposed by the Tribunal including an annual audit requirement.

For the current review the Tribunal has been requested to increase the transport component of the Allocation. The National Party submission provided costings of flights to certain destinations but beyond that there was no information which the Tribunal could use to accurately assess the merits of the argument. While the submission provided the cost of a flight from Sydney to Dubbo, for example, it provided no details of how many Members travel to Dubbo or how often. Such quantifiable information would assist the Tribunal in assessing whether or not the transport component is adequate.

The Deputy Speaker has sought an increase in his travel component based on his particular circumstances. The Tribunal understands that the Deputy Speaker has been provided with a motor vehicle to meet his transport requirements.

The Tribunal did not increase the LSA for the 2002 annual review. On this occasion the Tribunal will increase the LSA by the Consumer Price Index i.e., 3.4 percent.

Committee Allowance

The purpose of this Allowance is to remunerate Members servings as Chairpersons on Committees for the extra time and effort required to carry out this role. In previous Determinations this allowance has been increased in line with Members' salary increases.

Member's salaries were increased from 1 July 2002 by 3.3 percent and a further increase of 4 percent will be applied on and from 1 July 2003. In accordance with normal practice, therefore, the Committee Allowance will be increased by 7.3 percent.

Reimbursement of Expenses for Charter Transport for Members of the Legislative Assembly

Electorate charter transport allowances for Members of the Legislative Assembly were reviewed in 2002 when the Tribunal provided for increases of 15 percent to reflect the general increase in fees charged by charter operators since 1998. The Tribunal has again undertaken a review of these costs.

As part of this review, the Tribunal has undertaken a survey of fees charged by air charter transport operators. The results of the survey indicate that there has been a small increase in charter fees. On this basis the Tribunal will not increase the fees for charter transport for Members of the Legislative Assembly on this occasion. Actual amounts and conditions applying in respect of charter transport allowances are specified in the annual Determination.

Travelling Allowances for Recognised Office Holders

The Tribunal has undertaken a review of the travelling allowances paid to Recognised Office Holders. The Tribunal's Determination is based on those rates provided to NSW Public Servants and those deemed "reasonable" by the Australian Taxation Office. In accordance with conditions applicable to other NSW public officials, Recognised Office Holders will only be able to claim actual expenditure for absences from Sydney or their usual place of residence where an overnight stay is involved.

For absences that do not involve an overnight stay Recognised Office Holders may claim reasonable actual expenses. The Tribunal has provided indicative upper limits for travel expenditure. It is proposed that these allowances will be adjusted annually in line with movements to the public sector rates.

Relief Staff for Members of the Legislative Council

Members of the Legislative Council who are not Ministers and/or Crossbench Members are entitled to one staff member. The Presiding Officers have requested the Tribunal consider providing relief staff for these Members when their staff member is absent on recreation leave.

The Tribunal has considered this matter and supports the request on equity grounds. The Determination has been amended accordingly.

4. SUMMARY OF 2003 DETERMINATION

Electoral Allowance	3.4 percent increase (CPI)
Sydney Allowance	3.4 percent increase (CPI)
Logistic Support Allocation	3.4 percent (CPI)
Electorate Mailout Account	No increase
Committee Allowance	7.3 percent increase
Electorate Charter Allowance	No increase
Travel Allowances	Increased generally to public sector rates

Significant Changes to Conditions

Relief staff to be provided to Members of the Legislative Council with one staff member.

Dated this 30th day of June 2003

The Honourable Justice R Boland