Federal Register of Legislation - Australian Government

Primary content

A Bill for an Act to amend the law relating to benefits for members and former members of Parliament, and for certain other persons, and for related purposes
Administered by: Treasury
For authoritative information on the progress of bills and on amendments proposed to them, please see the House of Representatives Votes and Proceedings, and the Journals of the Senate as available on the Parliament House website.
Registered 02 Oct 2014
Introduced HR 02 Oct 2014

 

 

 

2013 - 2014

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

PARLIAMENTARY ENTITLEMENTS LEGISLATION AMENDMENT BILL 2014

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Special Minister of State, Senator the Hon Michael Ronaldson)

 

Parliamentary Entitlements Legislation Amendment Bill 2014

 

OUTLINE

 

The Parliamentary Entitlements Legislation Amendment Bill 2014 (the Bill) amends the Parliamentary Entitlements Act 1990 to:

-          require that if an adjustment to certain travel claims is made or required, a loading of 25 per cent in addition to the full amount of the adjustment will apply; and

-          restrict the 'additional travel for children' entitlement for senior officers to children under the age of 18 from where it currently stands at under the age of 25.

 

The Bill also amends the Members of Parliament (Life Gold Pass) Act 2002 to rename the Act the Parliamentary Retirement Travel Act 2002, and implement reforms to the Life Gold Pass scheme, announced in the 2014-15 Budget, which are to commence from 14 May 2014.  These measures change the name of the entitlement from the Life Gold Pass to the Parliamentary Retirement Travel Entitlement, and reduce, remove, and reform benefits under the entitlement. Specifically, the Bill:

-          imposes time limits , after which a person’s ability to access travel under the Parliamentary Retirement Travel Entitlement expires, unless they are a former Prime Minister;

-          imposes additional limits on access to the entitlement, closing it to people who have not met the qualifying periods before 14 May 2014 and mandating that no person who retires on or after 1 January 2020 can access benefits under the scheme, unless they are a former Prime Minister;

-          provides for future Prime Ministers who had not entered or re-entered the Parliament before 6 March 2012 to become a holder of a Parliamentary Retirement Travel Entitlement;

-          reduces the number of trips available per financial year under the Parliamentary Retirement Travel Entitlement;

-          removes the ability of spouses or de facto partners, other than those of a retired former Prime Minster, to access travel under the Parliamentary Retirement Travel Entitlement; and

-          requires that travel under the Parliamentary Retirement Travel Entitlement be for a purpose that is for the public benefit and not for a commercial purpose or a private purpose.

 

The Bill also implements a further reform to the Parliamentary Retirement Travel Entitlement, from the day after Royal Assent, to remove the entitlement to travel by the spouse or de facto partner of the Prime Minister or a sitting former Prime Minister, who has satisfied the qualifying period for the issue of a Parliamentary Retirement Travel Entitlement.

 

Additionally, the Bill amends the Parliamentary Entitlements Act 1990 and the Members of Parliament (Life Gold Pass) Act 2002 to address the risk that payments made in the course of administering these acts may constitute a breach of section 83 of the Constitution. These mechanisms will include a statutory basis for recovering payments made outside of entitlement.  Mechanisms to address the risk of breaches of section 83 of the Constitution have been included in many other acts, including via the Financial Framework Legislation Amendment Act (No. 2) 2012.

 

Financial Impact Statement 

As announced in the 2014-15 Budget, the Government will achieve savings of $5.0 million over five years by reducing Life Gold Pass, severance and post-retirement travel entitlements for parliamentarians and certain office holders when they leave Parliament.

 

The financial impact of the amendments to the Parliamentary Entitlements Act 1990 is low.

 

Regulation Impact Statement

The Office of Best Practice Regulation (OBPR) has been consulted and advised that a Regulation Impact Statement is not required.

 

Statement of Compatibility with Human Rights

A Statement of Compatibility with Human Rights has been completed in relation to the amendments in the Bill and assesses that the amendments are compatible with Australia’s human rights obligations.  A copy of the Statement of Compatibility with Human Rights is at Attachment A.
PARLIAMENTARY ENTITLEMENTS LEGISLATION AMENDMENT BILL 2014

 

 

NOTES ON CLAUSES

Clause 1          Short title

  1. Clause 1 provides that the short title by which this Act may be cited is the Parliamentary Entitlements Legislation Amendment Act 2014.

Clause 2          Commencement

  1. Clause 2 provides that sections 1 to 4 and Schedule 2 of this Act commence on the day after this Act receives the Royal Assent, and Schedule 1 of this Act is taken to have commenced on 14 May 2014.

Clause 3          Schedule(s)

  1. Clause 3 provides that legislation that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to the Act has effect according to its terms.

Clause 4          Compensation for acquisition of property

4.      Clause 4 provides a constitutional safety net equivalent to section 32 of the current Members of Parliament (Life Gold Pass) Act 2002, to provide a reasonable amount of compensation in circumstances where any provisions in the Bill are found to result in an acquisition of property otherwise on just terms under section 51(xxxi) of the Constitution. 


Schedule 1 – Amendments commencing on 14 May 2014

Part 1 – Main Amendments

Members of Parliament (Life Gold Pass) Act 2002

Items 1 and 2

5.      These items amend the long title and short titles of the Members of Parliament (Life Gold Pass) Act 2002 to remove the reference to Life Gold Pass and substitute the new name for the scheme, the Parliamentary Retirement Travel Entitlement.  The new short title for the Act is the Parliamentary Retirement Travel Act 2002 (PRT Act).  References below are to the new short title (the PRT Act), as effected by this item.

Item 3

6.      This item repeals and replaces the simplified outline in section 3 of the PRT Act to reflect the amendments in the Bill.

Item 4

7.      This item inserts a new section 3A into the PRT Act, which gives effect to the change of the name of the scheme, from the Life Gold Pass to the Parliamentary Retirement Travel Entitlement (the new name). 

8.      New subsection 3A(2) provides that a reference in this Act to the new name includes (if the reference relates to a time before the commencement of this section) a reference to the old name.  As an example of where this subsection would apply, see references in new section 4C to the new name (see item 12, below).

Item 5

9.      This item amends the definition of domestic return trip in section 4.  This will have the effect that all travel under the Parliamentary Retirement Travel Entitlement are subject to the purpose test specified in new section 4AA (see item 9 below), in addition to the previous requirements that the travel be wholly within Australia and on scheduled transport services. 

Item 6

10.  The item inserts a definition of end of a Parliament.  New section 4C places time limits on the Parliamentary Retirement Travel Entitlement for certain persons (see item 12 below).  Some Parliamentary Retirement Travel Entitlements will expire at the end of a Parliament.  This item makes clear that, for the purposes of the PRT Act, a Parliament ends when the House of Representatives is dissolved or expires.  This definition is relevant to the Parliamentary Retirement Travel Entitlement of both former members of the House of Representatives and former Senators. 

Item 7

11.  This item repeals the definition of holder of a Life Gold Pass in section 4 of the PRT Act, which is consequential to the change of the name of the scheme to the Parliamentary Retirement Travel Entitlement.

Item 8

12.  This item inserts a new definition of holder of a Parliamentary Retirement Travel Entitlement into section 4 of the PRT Act, to reflect the change of the name of the scheme, and also provide that it does not include a person who cannot be, or has ceased to be, a holder of a Parliamentary Retirement Travel Entitlement because of new sections 4B and 4C (in addition to the current restrictions in section 4A, see item 12 below).  These new sections apply to all members except for former Prime Ministers: 

a.       new subsection 4B(1) prevents someone who did not satisfy the relevant Parliamentary Retirement Travel Entitlement qualifying period before 14 May 2014 from becoming a holder of a Parliamentary Retirement Travel Entitlement;  and

b.      new subsection 4B(2) prevents someone who retires from the Parliament on or after 1 January 2020 from becoming a holder of a Parliamentary Retirement Travel Entitlement.

13.  This item also inserts a definition of nominal expiry time for a Parliamentary Retirement Travel Entitlement, which is defined in new subsection 18(6) of the PRT Act, and a definition of Parliamentary Retirement Travel Entitlement, which is defined in new section 3A of the PRT Act.

14.  This item also inserts a definition of senior office holder into section 4.  Under the current scheme, former senior office holders are treated identically to former members who were not senior office holders.  However, under these reforms, different time limits and different benefits apply between former members and former senior office holders.

15.  A senior office holder is defined to mean Ministers, the President of the Senate, the Speaker of the House of Representatives, and the Leader of the Opposition in the House of Representatives.  A senior office holder does not include a Prime Minister: the entitlements of former Prime Ministers are separately specified in the PRT Act.  A senior office holder does not include a Parliamentary Secretary, however, former Parliamentary Secretaries may be able to receive entitlements in their capacity as former members.

Item 9

16.  This item inserts new section 4AA, which makes travel under the Parliamentary Retirement Travel Entitlement subject to a purpose test. 

17.  To satisfy the purpose test, a return trip must be for the public benefit, and must not be undertaken for a commercial or private purpose.  The result of this is that the rationale for the trip must be directed to a purpose that is for the public benefit, for the trip to be within entitlement.    Commercial purpose is defined in section 4 as ‘a purpose relating to the derivation of financial gain or reward, whether as a board member, an office‑holder, an employee, a self‑employed person or otherwise’. 

Item 10

18.  This item amends the heading of section 4A to clarify that this section relates to the closing of the Parliamentary Retirement Travel Entitlement to new members, other than to members who become Prime Minister.

Item 11

19.  This item inserts new subsection 4A(1A), which states that nothing in section 4A prevents a former member who has been the Prime Minister from becoming a holder of a Parliamentary Retirement Travel Entitlement.  This item allows for any future Prime Minister to become a holder of a Parliamentary Retirement Travel Entitlement, even where they have not entered, or re-entered, the Parliament before 6 March 2012 (the Life Gold Pass scheme was previously closed to such persons).  This amendment is included for compatibility with the other reforms in the Bill and for consistency between the benefits available to people who have served as Prime Minister.

Item 12

Section 4B

20.  Under existing section 4A, in general terms, the Parliamentary Retirement Travel Entitlement scheme is closed to people who were not a holder of a Parliamentary Retirement Travel Entitlement and who had not entered, or re-entered, the Parliament before 6 March 2012.  This item inserts new section 4B, which places two additional limitations on access to the entitlement.

21.  New subsection 4B(1) has the effect that a person must have satisfied the Parliamentary Retirement Travel Entitlement qualifying period before 14 May 2014.  If they failed to do this, they cannot become a holder of a Parliamentary Retirement Travel Entitlement.  This rule does not apply to a person who has been the Prime Minister.  Under subsection 30(2) of the PRT Act, the qualification periods for a Parliamentary Retirement Travel Entitlement are specified in a determination of the Remuneration Tribunal (currently Part 8 of Remuneration Tribunal Determination 2012/04 – Members of Parliament – Entitlements). 

22.  New subsection 4B(2) has the effect that a person cannot become a holder of a Parliamentary Retirement Travel Benefit if they retire on or after 1 January 2020.  This rule also does not apply to a person who has been the Prime Minister.   

Section 4C

  1. New section 4C imposes time limits, after which a person’s Parliamentary Retirement Travel Entitlement expires (other than a person who has been the Prime Minister).  The effects of expiry are that the person ceases to be able to access benefits under the Parliamentary Retirement Travel Entitlement scheme and can never again become a holder of a Parliamentary Retirement Travel Entitlement (new paragraph 4C(2)(b)), unless they later become Prime Minister (new subsection 4C(3)).

 

  1. The time limits are as follows:

a.       for a former senior office holder (other than a former Prime Minister), who retired from the Parliament on or after 14 May 2008, the earlier of:

                                                              i.      the end of 72 months, starting on the date of their retirement; and

                                                            ii.      the second end of a Parliament to occur after the date of their retirement (subsection 4C(6)); and

b.      for a former member (other than a former senior office holder or Prime Minister), who retired on or after 14 May 2011, the earlier of:

                                                          iii.      the end of 36 months, starting on the date of their retirement; and

                                                          iv.      the next end of a Parliament to occur after the date of their retirement (subsection 4C(7)).

 

  1. If, by applying these rules (in subsections 4C(6) and 4C(7)) a person’s Parliamentary Retirement Travel Entitlement would have expired before the end of 13 May 2014, their entitlement is instead taken to expire at the end of 13 May 2014 (subsection 4C(8)).

 

a.       Example: A member, who had not served as a senior office holder or Prime Minister, retired during the course of the 43rd Parliament and became a holder of a Life Gold Pass (as it was then known) on their retirement.  Applying the rule in subsection 4C(7), they would have ceased to be entitled to Parliamentary Retirement Travel Entitlement benefits on 5 August 2013, which was the date of the next end of a Parliament after their retirement.  The effect of subsection 4C(8) would be that they remained entitled until the end of 13 May 2014.     

 

  1. New section 4C also makes provision to ensure that a former senior office holder or former member who had, as at the end of 13 May 2014, already enjoyed a Life Gold Pass (as it was then known) for at least 72 or 36 months, respectively, will lose access to travel as of the end of 13 May 2014:

 

a.       if a former senior office holder became a holder of a Life Gold Pass (as it was then known) before 14 May 2008 (that is, at least 72 months prior to the commencement of this section on 14 May 2014), their entitlement is taken to expire at the end of 13 May 2014 (subsection 4C(4)); and

 

b.      if a former member (other than a former senior office holder or Prime Minister) became a holder of a Life Gold Pass (as it was then known) before 14 May 2011 (that is, at least 36 months prior to the commencement of this section on 14 May 2014), their entitlement is taken to expire at the end of 13 May 2014 (subsection 4C(5)).

 

  1. New section 4C does not apply to a person who has been the Prime Minister, so the existing arrangements for such persons under the PRT Act continue, subject to other relevant amendments in the Bill.

Item 13

28.  This item amends subsections 9(2), (3) and (4) of the PRT Act to omit the words ‘former member’ (wherever occurring), and substitutes the words ‘former Prime Minister’ for them.  This is a consequential amendment to reflect that, under the amendments in the Bill, the entitlements of a surviving spouse or de facto partner of a holder of a Parliamentary Retirement Travel Entitlement will cease, except in the case of a surviving spouse or de facto partner of a holder of a Parliamentary Retirement Travel Benefit who served as Prime Minister.

Item 14

29.  This item amends subsections 9A(1) and 9B(1) of the PRT Act to include a note stating that ‘spouse or de facto partner entitlements under this Act are limited to a spouse or de facto partner of a retired former Prime Minister’.

30.  Sections 9A and 9B of the PRT Act deal with the entitlement of spouses and de facto partners, and the nomination of a spouse or de facto partner.  The note reflects the fact that, under the amendments in the Bill, these sections will only have relevance to a spouse or de facto partner of a retired former Prime Minister.  Benefits will no longer be available under the Parliamentary Retirement Travel Entitlement scheme to the spouses and de facto partners of other persons.

Item 15

31.  This item amends the table in subsection 10(1).  It reduces the amount of trips that may be accessed by a former Prime Minister, who has retired from the Parliament and is a holder of a Parliamentary Retirement Travel Entitlement.  It reduces the number of trips to a maximum of 30 domestic return trips per year (from the current maximum of 40 domestic return trips per year).

Item 16

32.  This item amends the table in subsection 10(1) to reduce the amount of trips that may be accessed by the spouse or de facto partner of a former Prime Minister, where the former Prime Minister has retired from the Parliament and is a holder of a Parliamentary Retirement Travel Entitlement.  It reduces the number of trips to a maximum of 20 domestic return trips per year (from the current maximum of 40 domestic return trips per year).  Of these 20 trips, the spouse or de facto partner may access up to 10 trips as non‑accompanying/joining trips (that is, trips where the spouse or de facto partner does not accompany or join the former Prime Minister). 

Item 17

33.  This item amends the definition of non-accompanying/joining trip in subsection 10(3), to remove the reference to the travel being for the purpose of accompanying or joining the former Prime Minister.  This is a consequential amendment to remove any doubt about the interaction of this section with the purpose test in new section 4AA (see item 9), but does not change the legal effect of this section.  The new definition is that a trip is a non-accompanying/joining trip where the spouse or de facto partner is not accompanying or joining the former Prime Minister.

Item 18

34.  This item repeals items 1 to 5 of the table in subsection 11(2) and inserts new table items 1 and 2.  This item will have the following effects on the number of trips that will be available in each year to holders of a Parliamentary Retirement Travel Entitlement:

a.       for a person who has served as a senior office holder (but not as Prime Minister), the maximum number of domestic return trips per year will remain at 10; and

b.      for a former member, who has not served as a senior office holder or  Prime Minister, the maximum number of domestic return trips per year will be 5 (reduced from the current maximum of 10 domestic return trips per year). 

35.  This item also has the effect that spouses or de facto partners (or surviving spouses or de facto partners) of a holder of a Parliamentary Retirement Travel Entitlement (who is not a former Prime Minister) will no longer be able to access travel under the Parliamentary Retirement Travel Entitlement scheme.

Item 19

36.  This item repeals Part 4 of the PRT Act, which provides for the entitlements of spouses or de facto partners of sitting members.  The effect of this is that the spouse or de facto partner of a sitting member who has served the qualifying period for the issue of a Parliamentary Retirement Travel Entitlement (including the Prime Minister and a sitting former Prime Minister), is not entitled to travel under the Parliamentary Retirement Travel Entitlement scheme.

Item 20

37.  This item amends the simplified outline of Part 5, which deals with pro-rata adjustments.  The simplified outline refers to a pro‑rata adjustment where a person becomes ‘the spouse or de facto partner of a former member or member during a year’.  This amendment changes this to refer to the ‘spouse or de facto partner of a retired former Prime Minister’.  This reflects the fact that, under the amendments in the Bill, the only spouses or de facto partners who will be able to access travel are the spouses or de facto partners of  retired former Prime Ministers.

Item 21

38.  This item also amends the simplified outline of Part 5 to repeal paragraph (c), which is redundant due to other amendments in the Bill, and replaces it with a paragraph that encompasses the new pro-rating mechanisms to deal with situations in which a Parliamentary Retirement Travel Entitlement expires after a certain period under new subsections 4C(6) and (7) (see item 12 above). 

Item 22

39.  This item inserts a heading to improve the readability of section 4.

Item 23

40.  This item amends the table in subsection 14(1).  This amendment is consequential to the amendment in item 18.  It ensures that benefits provided by the amended item 2 of the table in Part 3 are captured by the pro-rating mechanism in section 14.  For former Prime Ministers, members and senior office holders, when calculating the ‘remaining period’ for the pro-rating mechanism in subsection 14(2), that period begins on ‘the day after the day on which the former member retires from the Parliament’.

Item 24

41.  This item amends the table in subsection 14(1).  This amendment is consequential to the amendment in item 18.  The relevant cell addresses the start date for calculating the ‘remaining period’ for the pro-rating mechanism in subsection 14(2) in relation to the entitlements of spouses and de facto partners of former members.  This item amends the cell to reflect that, under these amendments, spouses or de facto partners of former members (other than of retired former Prime Ministers) have no entitlement to travel under the Parliamentary Retirement Travel Entitlement. 

Item 25

42.  This item amends table item 2 of the table in subsection 14(1) to reflect that, under the amendments in the Bill, access to travel under the Parliamentary Retirement Travel Entitlement by spouses or de facto partners of former members (other than of retired former Prime Ministers) is removed. 

Item 26

43.  This item repeals table item 3 of the table in subsection 14(1), which is made redundant by the amendments in the Bill, as access to travel under the Parliamentary Retirement Travel Entitlement for spouses or de facto partners of sitting members (including the Prime Minister and a sitting former Prime Minister) is removed. 

Item 27

44.  This item amends subsection 14(2) to clarify that, for the purpose of item 1 of the table in subsection 14(1), the number of trips to which the former member is entitled during the year in which they retire is simply the number worked out using the formula in subsection 14(2A). 

45.  This item also amends subsection 14(2) to reflect the fact that, under the amendments in the Bill, the access to travel under the Parliamentary Retirement Travel Entitlement by spouses or de facto partners of sitting and former members (other than of retired former Prime Ministers) is removed.  The item therefore removes references to Part 3, under which entitlements of spouses or de facto partners of former members who have not served as Prime Minister were previously provided.  It also replaces references to a spouse or de facto partner of members or former members with references to the spouse or de facto partner of a retired former Prime Minister. 

Item 28

46.  This item inserts a new pro-rating mechanism to address instances where a Parliamentary Retirement Travel Entitlement expires during a year under these amendments (see new subsections 4C(6) and (7)). This mechanism makes appropriate reductions to the number of domestic return trips available to a holder of a Parliamentary Retirement Travel Entitlement in the financial year in which their entitlement would reach its maximum term (the maximum term is 72 months from retirement, in the case of former senior office holders, and 36 months from retirement, in the case of members). 

47.  The Parliamentary Retirement Travel Entitlement of a former senior office holder or former member may, under new section 4C, expire prior to the maximum term:

c.       for a former senior office holder, this will be where the second end of a Parliament to occur after the date of retirement (subsection 4C(6)) occurs prior to 72 months from their retirement; and

d.      for a former member, this will be where the next end of a Parliament to occur after the date of retirement (subsection 4C(7)) occurs prior to 36 months from their retirement.

48.  Because the date of the end of a Parliament is often uncertain, the pro-rating formula is based on the 72 month or 36 month ‘maximum term’ and does not take into account the date of the relevant end of a Parliament.  However, this does not operate to enable a person to access travel under the Parliamentary Retirement Travel Entitlement between the relevant end of a Parliament and the end of their maximum term.  Any travel must be undertaken or commenced before the expiry of a person’s Parliamentary Retirement Travel Entitlement under new section 4C.

Item 29

49.  This item inserts new subsections 18(3), (4), (5) and (6) into section 18 of the PRT Act, which deals with the effect on a person’s Parliamentary Retirement Travel Entitlement where a superannuation order has been made under the Crimes (Superannuation Benefits) Act 1989 (Crimes Super Act), in relation to a person who has been convicted of a corruption offence (and therefore has been disqualified from being a holder of a Parliamentary Retirement Travel Entitlement, or from serving the qualifying period, under section 17 of the PRT Act), and the order is subsequently revoked (as provided for under the Crimes Super Act).

50.  The addition of new subsections 18(3), (4), (5) and (6) are consequential to the reforms relating to the addition of new sections 4B and 4C (see item 12, above), which provide for limitations on becoming a holder of a Parliamentary Retirement Travel Entitlement, and for the expiry of entitlements, respectively, for persons other than the Prime Minister or a former Prime Minister.  In relation to Prime Ministers and former Prime Ministers, the existing rules in the table in subsection 18(2) of the PRT Act continue to apply on their terms, resulting in the restoration of their Parliamentary Retirement Travel Entitlement, or the ability to become a holder of a Parliamentary Retirement Travel Entitlement (where they have served the relevant qualifying period before retirement), at the time that the superannuation order is revoked.

Subsections 18(3) and (4)

51.  New subsections 18(3) and (4) apply to items 1 and 2 of the table in subsection 18(2) of the PRT Act, which cover circumstances where a person’s Parliamentary Retirement Travel Entitlement was cancelled, or they were a holder of a Parliamentary Retirement Travel Entitlement, at the time when a superannuation order was made in relation to them.  Under the terms of the table in section 17 of the PRT Act, in each case where item 1 of the table in subsection 18(2) applies, item 2 of that table would also apply.

52.  New subsection 18(3) specifies that, in relation to a person who is not a former Prime Minister, nothing in items 1 or 2 of the table in subsection 18(2) is to be taken to result in a person resuming being a holder of a Parliamentary Retirement Travel Entitlement, or in requiring a Parliamentary Retirement Travel Entitlement to be restored to the person, where the revocation of the superannuation order takes place after the nominal expiry time for the original Parliamentary Retirement Travel Entitlement of the person (which is the date that the person’s Parliamentary Retirement Travel Entitlement would have expired under new section 4C – nominal expiry time is defined in new subsection 14(6)). 

53.  The effect of this is that a person will not automatically resume being, or become, a holder of a Parliamentary Retirement Travel Entitlement where the superannuation order relating to them is revoked, unless the revocation occurs before the nominal expiry date for their entitlement.  This is consistent with the intention of the other reforms in the Bill, in that the Parliamentary Retirement Travel Entitlement for persons who have not held office as Prime Minister will be for a limited period.  Where a person does not become a holder of a Parliamentary Retirement Travel Entitlement in such circumstances, the Minister may provide compensatory travel under the existing arrangements in section 19 of the PRT Act.

54.  New subsection 18(4) sets out the period of a Parliamentary Retirement Travel Entitlement for persons covered by paragraphs (a) and (b) in new subsection 18(3), in circumstances where the nominal expiry time of the person’s Parliamentary Retirement Travel Entitlement (the original Entitlement) under new section 4C (see new subsection 18(6) below) is after 13 May 2014, and the revocation of the order takes effect before the nominal expiry time (new paragraphs 18(4)(a) and (b)).  Where both of these circumstances apply, the person’s Parliamentary Retirement Travel Entitlement will be restored under item 2 of the table in subsection 18(2) of the PRT Act, and the length of the person’s restored entitlement will be determined by new paragraph 18(4)(c).

55.  Under new paragraph 18(4)(c) the person’s Parliamentary Retirement Travel Entitlement is extended from the nominal expiry time (the time when the Parliamentary Retirement Travel Entitlement would otherwise have expired under new section 4C, see new subsection 18(6) below) for the period that a person was not a holder of a Parliamentary Retirement Travel Entitlement due to the effect of section 17 of the PRT Act.  The maximum period for which a person can be a holder of a Parliamentary Retirement Travel Entitlement under this subsection (including the period to the nominal expiry time and the extension period) is the maximum period that a person with their status would have held an entitlement under new section 4C (i.e. 36 months for a person who has not been a senior office holder or the Prime Minister, or 72 months for a person who has been a senior office holder, but not the Prime Minister).

56.  New paragraph 18(4)(d) specifies that new subsection 14(4) (which deals with the pro-rating of an entitlement where the maximum period of a person’s Parliamentary Retirement Travel Entitlement expires during a year, see item 30 above) does not apply to a person whose entitlement is extended under new subsection 18(4).

57.  New subsection 18(4) does not apply to a person whose Parliamentary Retirement Travel Entitlement expires at the end of 13 May 2014 under new section 4C (see item 12 above).  In these circumstances, a person’s entitlement ends at the end of 13 May 2014, and is not automatically extended under section 18 of the PRT Act.  This is also consistent with the intention of the other reforms in the Bill, in that the Parliamentary Retirement Travel Entitlement for persons who have not held office as Prime Minister will be for a limited period.  Where a person’s entitlement is not automatically extended under section 18, the Minister may provide compensatory travel under the existing arrangements in section 19 of the PRT Act. 

Subsection 18(5)

58.  New subsection 18(5) is relevant to item 3 of the table in subsection 18(2) of the PRT Act, which covers the circumstances where a person was not a holder of a Parliamentary Retirement Travel Entitlement when a superannuation order was made in relation to them, but had satisfied the relevant qualifying period for the issue of a Parliamentary Retirement Travel Entitlement (for example, where a sitting member who would be entitled to a Parliamentary Retirement Travel Entitlement on retirement has a superannuation order made in relation to them before they retire).  In these circumstances, under item 3 of the table in subsection 18(2) of the PRT Act, a person is taken to have resumed satisfying the relevant qualifying period for the issue of a Parliamentary Retirement Travel Entitlement when the order is revoked.

59.  New subsection 18(5) sets the period of the Parliamentary Retirement Travel Entitlement of a person, referred to in item 3 of the table in subsection 2 (other than a former Prime Minister), in circumstances where they have retired from the Parliament before the order is revoked, and the order is revoked before the nominal expiry time under new section 4C of the Parliamentary Retirement Travel Entitlement they would have had if not for the order being in force (the notional entitlement).  In these circumstances, the effect of item 3 of the table in subsection 18(2) is that the person would become a holder of a Parliamentary Retirement Travel Entitlement for the first time at the time that the superannuation order is revoked, subject to the rules in section 4A and new section 4B (which deal with when a person can become a holder of a Parliamentary Retirement Travel Entitlement - see item 12, above, in relation to new section 4B).

60.  Under new paragraph 18(5)(e), the person’s Parliamentary Retirement Travel Entitlement begins on the day when the revocation of the superannuation order takes effect (the start time), and the expiry of their entitlement is set under new paragraph 18(5)(f). 

61.  New paragraph 18(5)(f) provides that a person’s Parliamentary Retirement Travel Entitlement (referred to as the deferred entitlement) expires at the end of the number of days from the person’s retirement from the Parliament to the nominal expiry time for their Parliamentary Retirement Travel Entitlement (the time for expiry under new section 4C, see new subsection 18(6) below).  The effect of this new paragraph is that the person gets a Parliamentary Retirement Travel Entitlement for the same number of days for which they would have had the Entitlement under new section 4C (see item 12 above), had the superannuation order not been in force.  Accordingly, the maximum period of the deferred entitlement in these circumstances is the same as the period that a person with the same status would have had the pass for under new section 4C (i.e. the number of days from the person’s retirement until the earlier of 36 months or the expiry of one Parliament for a person who has not been a senior office holder or the Prime Minister, or the earlier of 72 months or the expiry of two Parliaments for a person who has been a senior office holder, but not Prime Minister).

62.  New paragraph 18(5)(g) specifies that new subsection 14(4) (which deals with the pro-rating of an entitlement where the maximum period of a person’s Parliamentary Retirement Travel Entitlement expires during a year, see item 28 above) does not apply to a person with a deferred pass under new subsection 18(5).

63.  New subsection 18(5) does not apply where a superannuation order is revoked after the nominal expiry time (the time specified in new section 4C for the expiry of the Parliamentary Retirement Travel Entitlement) for a person’s notional entitlement (the Entitlement the person would have had if the superannuation order was not in force).  In these circumstances, the effect of new section 4C (expiry of Parliamentary Retirement Travel Entitlements) will be that the person will not automatically become a holder of a Parliamentary Retirement Travel Entitlement when the superannuation order is revoked.  This is consistent with the intention of the other reforms in the Bill, in that the Parliamentary Retirement Travel Entitlement for persons who have not held office as Prime Minister will be for a limited period.  Where a person does not automatically become a holder of a Parliamentary Retirement Travel Entitlement when the superannuation order is revoked, the Minister may provide compensatory travel under the existing arrangements in section 19 of the PRT Act.

64.  New subsection 18(5) also does not apply to persons who have not retired prior to a superannuation order in relation to them being revoked.  In such circumstances, item 3 of the table in subsection 18(2) will have the effect that they resume satisfying the relevant qualifying period for the issue of a Parliamentary Retirement Travel Entitlement, and the person’s entitlement will be determined under the PRT Act (as amended by the Bill) at the time of their retirement.

Subsection 18(6)

65.  New subsection 18(6) defines nominal expiry time as the time specified in new section 4C for the expiry of a Parliamentary Retirement Travel Entitlement (see item 12 above).  This term is relevant to the calculation of the expiry of Parliamentary Retirement Travel Entitlements under new subsections 18(4) and (5).

Travel where Parliamentary Retirement Travel Entitlement provided or continued under section 18

66.  Where a person receives a Parliamentary Retirement Travel Entitlement under section 18, as a result of the revocation of a superannuation order in relation to them, all travel is subject to the PRT Act as amended by the Bill, including the new limits on the number of trips under Part 2 or 3 (as relevant), and the new public benefit purpose test under new section 4AA (see item 9 above).

Item 30

67.  This item makes a consequential amendment to paragraph 21(a) to reflect that, under the amendments in the Bill, travel under the Parliamentary Retirement Travel Entitlement of all spouses or de facto partners of former members (other than former Prime Ministers) is removed. 

Item 31

68.  For the sake of clarity, this item amends the heading of section 22 to reflect the fact that section 22 is only relevant to stop-overs by the spouse or de facto partner of a former Prime Minister who has retired from the Parliament. 

Item 32

69.  This item amends paragraphs 22(f) and (g) of the PRT Act to remove references to travel being for the purpose of accompanying or joining the former Prime Minister.  This is a consequential amendment to remove any doubt about the interaction of these paragraphs with the purpose test in new section 4AA (see item 9), but does not change the legal effect of these paragraphs.  See also item 17 above.

Item 33

70.  This item repeals sections 23 and 24 of the PRT Act, which address stop‑overs of spouses or de facto partners of former members (other than former Prime Ministers), and of sitting members, respectively.  As the amendments in this Bill remove access to travel under the Parliamentary Retirement Travel Entitlement for spouses or de facto partners of former members (other than former Prime Ministers) and of sitting members, sections 23 and 24 are redundant.     

Item 34

71.  This item amends the reference to a ‘surviving spouse or de facto partner of a former member’ in subsection 28(2) to a reference to a ‘surviving spouse or de facto partner of a retired former Prime Minister’.  This is consequential to the fact that the amendments in the Bill remove access to travel under the Parliamentary Retirement Travel Entitlement by surviving spouses or de facto partners of holders of a Parliamentary Retirement Travel Entitlement, other than those of retired former Prime Ministers.

Item 35

72.  This item adds a note to subsection 29(1), stating that spouse or de facto partner entitlements under the PRT Act are limited to a spouse or de facto partner of a retired former Prime Minister.  This is consequential to the removal of spouse or de facto partner travel under the Parliamentary Retirement Travel Entitlement, other than for those of retired former Prime Ministers, by the Bill.

Items 36 and 37

73.  These items repeal Schedule 1 to the PRT Act, and the section of the PRT Act that gives effect to that Schedule (section 34).  Schedule 1 relates to a transitional period that began on 30 December 2002 and ended on 30 June 2003.  It is now spent, and so, in the interests of clarity, these items remove it.  However, to avoid doubt, item 41 of the Bill retains the rule in item 9 of Schedule 1 to the PRT Act that prevents a person from carrying forward entitlements that they had in relation to the transitional period.  

Part 2 – Other amendments

Members of Parliament (Life Gold Pass) Act 2002

Item 38

74.  This item amends the whole of the PRT Act (other than section 3A) to omit each reference to Life Gold Pass and substitute the reference to Parliamentary Retirement Travel Entitlement, the new name of the entitlement under the PRT Act.

Part 3 – Other provisions relating to the amendments

Item 39

75.  This item contains a number of definitions for the purposes of the application provisions in Part 3 of the Bill (see items 40 to 42 below).

Item 40

76.  This item contains provisions relating to the application of the amendments in Schedule 1 of the Bill.

77.  Subitem 40(1) provides that the amendments in Schedule 1 apply in relation to domestic return trips undertaken after the commencement time (defined in item 39 as the start of 14 May 2014).  The amendments commence from this date because they were announced by the Government in the 2014-15 Budget on 13 May 2014.  Persons whose benefits were affected by these amendments were informed of the Government’s announcement and the effect it would have on their eligibility to access Life Gold Pass (as it was then known) benefits from 13 May 2014.

78.  Subitem 40(2) provides an exception to the commencement of Schedule 1 amendments from 14 May 2014 for return trips that a person had started to take before 14 May 2014.  The effect of this is that where, prior to 14 May 2014, a person had taken or started to take a return trip that was within their pre-14 May 2014 entitlements, their entitlement to that trip is not affected by the amendments in the Bill.  However, such trips are counted toward the number of trips that that person could access during the remainder of the 2013-14 Financial Year, under these reforms.

79.  Subitem 40(3) provides that travel a person took, or started to take, under table item 1 or 2 in the table in subsection 12(2) of the PRT Act, between 14 May 2014 and the day after the Bill receives the Royal Assent, is taken to have been in accordance with the PRT Act as amended by this schedule.  The effect of this subitem is that any travel by the spouse or de facto partner of the Prime Minister or a sitting former Prime Minister before the Bill receives the Royal Assent is not outside of entitlement due to the repeal of Part 4 of the PRT Act by this Schedule.

80.  Subitem 40(4) specifies, to avoid doubt, that the amendments in Schedule 1 apply to all persons who, before 14 May 2014: were a holder of a travel entitlement (defined in item 39 as a Life Gold Pass, or, from the commencement of the Bill, a Parliamentary Retirement Travel Entitlement); had satisfied the relevant qualifying period for the issue of a travel entitlement; or, were such a person’s spouse or de facto partner.  It also clarifies that the amendments apply to persons (and where relevant, their spouse) who would have been a holder of, or satisfied the qualifying period for a travel entitlement, but for section 17 of the PRT Act.  Section 17 of the PRT Act deals with the suspension of a travel entitlement, or suspension of the ability to serve the qualifying period for the issue of a travel entitlement, where a person is subject to a superannuation order, under the Crimes (Superannuation Benefits) Act 1989.

Item 41

81.  Schedule 1 to the PRT Act, which is now redundant, is repealed by items 36 and 37 of the Bill.  However, to avoid doubt, this item retains the rule in item 9 of Schedule 1 to the PRT Act that prevents a person from carrying forward entitlements that they had in relation to the transitional period.   

Item 42

82.  This item provides that from 14 May 2014 (the commencement time), a reference in an instrument to the old travel entitlement name (Life Gold Pass) is taken to be a reference to the new entitlement name (Parliamentary Retirement Travel Entitlement).


Schedule 2 – Amendments commencing on the day after Royal Assent

Parliamentary Entitlements Act 1990

Item 1                        

  1. This item inserts a definition of claim into section 3 of the Parliamentary Entitlements Act 1990 (PE Act).  It provides that claim means a claim or request for a benefit that is made to the Commonwealth. 

Item 2

84.  This item amends subparagraph (b)(i) in the definition of dependent child in section 3 of the PE Act, which is defined in relation to a Senior Officer.  Currently, a person who is receiving full-time education at a school, college or university, and is wholly or substantially dependent upon the Officer is considered a dependent child if they are at least 16 but under 25.  Item 2 changes this to such persons who are at least 16 but under 18.

85.  This will have an effect on the entitlement of a Senior Officer (other than a Parliamentary Secretary) to certain travel for their dependent children. This entitlement is found in item 4 of Part 2 of Schedule 1 to the PE Act.  For the purposes of this entitlement, a Senior Officer includes a Minister (but not a Parliamentary Secretary), the Leader or Deputy Leader of the Opposition in the House of Representatives or the Senate, the President of the Senate or the Speaker of the House of Representatives (see definitions of Senior Officer and Opposition Office Holder in section 3 of the PE Act).

86.  This amendment does not affect the family reunion travel entitlement, available to parliamentarians, currently under Remuneration Tribunal Determination 2012/04: Members of Parliament - Entitlements.

Item 3

87.  This item provides that the amendment made by item 2 applies to travel undertaken after the commencement of that item.  This means that, under the travel entitlement of Senior Officers, no travel may be undertaken by a dependent child who is aged 18 and over, but under 25, from the day after the Bill receives the Royal Assent.  Where travel is commenced but not completed by such a dependent child prior to the day after the Bill receives the Royal Assent, the travel may be completed under the entitlement.

Item 4   

88.  This item inserts the following new definitions into section 3 of the PE Act, which are relevant to other amendments made by the Bill:

a.       definition of prescribed travel benefit.  Prescribed travel benefit is defined to mean a benefit covered by a determination under section 10B, which is a new section inserted by this Bill (see Item 7, below). 

b.      definition of provides goods, services or facilitiesThis definition ensures that a reference to the Commonwealth providing goods, services or facilities in the PE Act extends to situations where the Commonwealth pays for the provision of the goods, services or facilities by another person (whether or not pursuant to an arrangement between the other person and the Commonwealth). 

c.       definition of Secretary.  Secretary is defined to mean the Secretary of the Department.  It is intended that, by operation of subsection 19A(3) of the Acts Interpretation Act 1901, the Department referred to is, at the commencement of the Bill, the Department of Finance. 

Item 5   

89.  This item inserts a new Part and Division heading, to assist with the readability of the PE Act.

Item 6   

Section 7A

90.  This item inserts a new section 7A into the PE Act.  Subsection 7A(1) creates a statutory obligation in relation to the making of claims for benefits under the PE Act (see definition of benefit in section 3 of the PE Act).  The obligation is to not make a claim for a benefit in excess of entitlement (either wholly or partly).

91.  Subsection 7A(2) states that, in determining whether a claim is made in contravention of subsection (1), section 10A is to be disregarded.  Section 10A, which is a new section inserted by this Bill (see Item 7 below), contains a mechanism designed to address the risk of breaches of section 83 of the Constitution, but does not extend the boundaries of the benefits which may be provided to a parliamentarian under the PE Act.  Therefore, in determining whether the obligation in subsection 7A(1) has been contravened, section 10A should not be taken into account.  Subsection 7A(2) puts this beyond doubt.    

92.  Subsection 7A(3) provides that a contravention of the obligation in subsection 7A(1) does not of itself prevent the provision of a benefit pursuant to the claim.  This subsection is a technical provision that is intended to address any suggestion that a claim in contravention of section 7A is void for the purposes of, for example, clause 3.1 of Remuneration Tribunal Determination 2014/16: Members of Parliament - Travelling Allowance, which requires a claim to be made for travelling allowance to be paid.  If the Department were to pay an amount to which a person was entitled, despite errors in the claim form, then, without subsection 7A(3), the result could be that even the amount to which a person was legitimately entitled would be recoverable under  proposed paragraph 10A(1)(c).  Subsection 7A(3) will ensure that this unintended result is avoided.

Item 7   

93.  The item inserts new sections 10A, 10B, 10C and 10D into the PE Act. 

Section 10A

94.  New section 10A introduces a mechanism to address the risk that payments made in the course of administering the PE Act may constitute a breach of section 83 of the Constitution.  This mechanism reflects those introduced into other acts, including via the Financial Framework Legislation Amendment Act (No. 2) 2012, to address this risk.  It also includes a statutory mechanism for recovering payments made, and the cost of benefits provided, outside of entitlement.

95.  Section 10A authorises the Commonwealth to pay an amount to a recipient, purportedly as a benefit, entitlement, or amount where the Commonwealth does not otherwise have power under the PE Act to make a payment, and provides that such an amount is recoverable from the person receiving the benefit. This provision would have the effect that payments made, purportedly as or for benefits, but outside the boundaries of an entitlement, would attract the coverage of the standing appropriation in section 11 of the PE Act, thereby mitigating the risk of breaches of section 83 of the Constitution. 

96.  However, Section 10A does not extend the boundaries of any benefits that a person is entitled to under the PE Act.  Paragraphs 10A(1)(c) and 10A(2)(c) ensure that the cost of a benefit provided outside the boundaries of an entitlement under the PE Act will be recoverable from the person receiving the benefit.  Under these paragraphs, the amount of the payment made to the person, or the amount of the payment of the costs of providing goods, services or facilities to the person, is a debt due to the Commonwealth.  This amount is recoverable in a court of competent jurisdiction.

97.  Subsection 10A(1) addresses payments made directly to the recipient.  This will cover benefits under the PE Act that are provided in the form of cash payments to the recipient, such as travelling allowance.

98.  Subsection 10A(2) addresses entitlements under the PE Act that are provided in the form of goods, services or facilities to the recipient, such as flights and office requisites and stationery.   The definition of provides goods, services or facilities, inserted by Item 4 (see above), clarifies that this includes situations where the Commonwealth pays for the provision of the goods, services or facilities by another person (whether or not pursuant to an arrangement between the other person and the Commonwealth). 

99.  Subsection 10A(3) provides that the reference in subsection 10A(2) to the Commonwealth not having the power to provide goods, services or facilities purportedly by way of benefit includes a reference to the Commonwealth only having power to provide lower-cost goods, services or facilities.  This will ensure that the mechanism in subsection 10A(2) will apply where a person is provided with a benefit in the form of a good, service or facility that is at a cost which is greater than the cost of that to which they were entitled under the PE Act.  This will ensure that, in these circumstances, the risk of a breach of section 83 is addressed, and the difference in cost between what was provided and what the person was entitled to is recoverable from the person.  

100.   Subsection 10A(4) provides an alternative means of recovery of a debt under paragraph 10A(1)(c) or 10A(2)(c).  It gives the Secretary of the Department of Finance the discretion to direct that a debt may be recovered from an amount that is payable to the recipient by way of benefit.  However, before making such a direction, the Secretary is required to consult with the recipient (10A(5)).

101.   Subsection 10A(4) specifically only applies to amounts payable to the recipient as a benefit (subsection 10A(4)(b)).  Benefit is defined in section 3 of the PE Act to mean a benefit provided by or under the PE Act, which includes a benefit provided under the Parliamentary Entitlements Regulations 1997, determined by the Remuneration Tribunal under section 7 of the Remuneration Tribunal Act 1973, or in Schedule 1 to the PE Act.  This allows deductions to be made from payments of benefits that are to be made directly to the person, which currently includes travelling allowance (under Remuneration Tribunal Determination 2014/16: Members of Parliament - Travelling Allowance) and private vehicle allowance (under Remuneration Tribunal Determination 2012/04: Members of Parliament – Entitlements).

102.   Subsection 10A(4) does not allow a deduction from benefits that are not provided by or under the Parliamentary Entitlements Act 1990.  In particular, it does not enable deductions to be made from a parliamentarian’s salary, which does not fall within the definition of a benefit, and is not provided under the PE Act. 

103.   Subsection 10A(6) is included to address situations in which a benefit is provided to a parliamentarian under the PE Act that relates to the PE Activities of another person.  This is to avoid doubt on the application of section 10A to, for example, family travel and staff travel benefits that are provided under the PE Act to parliamentarians.  Benefits provided under the PE Act include those provided under the Parliamentary Entitlements Regulations 1997, determined by the Remuneration Tribunal under section 7 of the Remuneration Tribunal Act 1973, or in Schedule 1 to the PE Act.  Subsection 10A(5) provides that, to avoid doubt, any benefits for a parliamentarian that are accessed by another person, are benefits of the parliamentarian.  Therefore, for the purposes of section 10A, any overpayment of such a benefit is recoverable from the parliamentarian.

Sections 10B, 10C and 10D – 25% Loading in Relation to Adjustments 

104.   New sections 10B, 10C and 10D establish a 25% loading in relation to adjustments to prescribed travel benefits.

Section 10B

105.   A new division heading is inserted before section 10B.

106.   New section 10B provides for the Minister, by legislative instrument, to determine that a specified benefit in respect of travel is a prescribed travel benefit (subsection 10B(1)).  The loading established by new sections 10C and 10D only applies in relation to prescribed travel benefits.

107.   In an instrument under this section, a benefit may be specified by reference to the specific provision or provisions under which it is provided.  Alternatively, a benefit may be specified through a description of its characteristics.  Subsection 10B is not intended to constrain the ways by which a benefit may be specified in a legislative instrument under this section.

108.   Subsection 10B(2) provides that a benefit may be specified by reference to a determination of the Remuneration Tribunal as in force at a particular time or as in force from time to time.  This establishes a contrary intention to subsection 14(1) of the Legislative Instruments Act 2003 which relevantly provides that legislative instruments made under legislation may only incorporate by reference non-disallowable legislative instruments (which include determinations of the Remuneration Tribunal) as in force or existing at the time when the legislative instrument takes effect.

109.   Subsection 10B(2) will ensure that a legislative instrument, made under section 10B will continue to be effective, despite amendments or changes to a Remuneration Tribunal determination to which it refers, to specify a prescribed travel benefit.

110.   Subsection 10B(2) is not intended to be an exhaustive statement of the ways in which a benefit could be specified.

Section 10C

111.   New section 10C applies a penalty of a 25% loading for contraventions of the obligation in new section 7A in respect of travel benefits prescribed in an instrument made under section 10B.  The loading applies where a person makes a claim for a prescribed travel benefit and a payment is made by the Commonwealth which exceeds their entitlement, provided that the overpayment is not attributable, to any extent, to administrative error within the Department of Finance (new subsection 10C(1)).

112.   The 25% loading applies to the amount that is paid outside of entitlement to a person (the excess), less any repayment made within 28 days of the claim (subsection 10C(3)).  Where only part of the amount paid outside of entitlement is repaid within the 28 day period, the loading applies to the amount outstanding at the end of the 28 day period.

113.   The following examples illustrate the scope of the loading provisions:

Example 1: A parliamentarian is entitled to a prescribed travel benefit relating to 2 overnight stays away from their home base, but submits a claim for 3 overnight stays.  A prescribed travel benefit in relation to 3 overnight stays is paid by the Department of Finance.  No repayment is made within 28 days of the claim.  The loading would apply in this situation, as the payment was made in accordance with the claim and the excess payment is not attributable, to any extent, to administrative error within the Department.  The value of the loading will be 25% of the payment for 1 night of the prescribed travel benefit (the amount paid outside of entitlement).

Example 2: A parliamentarian is entitled to a prescribed travel benefit relating to 2 overnight stays away from their home base, but submits a claim for 3 overnight stays.  A prescribed travel benefit in relation to 3 overnight stays is paid by the Department of Finance.  The Parliamentarian makes a repayment within 28 days of the claim.  The loading may apply in this situation, as the payment was made in accordance with the claim and the excess payment is not attributable, to any extent, to administrative error within the Department.  The value of the loading will be determined by how much of the overpayment was repaid by the parliamentarian within 28 days – if the full amount of the overpayment was repaid, no loading applies, however if the parliamentarian made a partial repayment within 28 days, the loading will apply to the outstanding balance of the overpayment.

Example 3: A parliamentarian submits a claim for a prescribed travel benefit as a non-Minister.  The prescribed travel benefit is paid by the Department of Finance to the parliamentarian at the higher rate which applies to Ministers.  The loading would not apply in this situation, as the excess payment is attributable to administrative error within the Department.

Example 4: A parliamentarian is entitled to a prescribed travel benefit relating to 2 overnight stays away from their home base.  The parliamentarian submits a claim for a prescribed travel benefit for 3 overnight stays; however, the Department of Finance pays the prescribed travel benefits for 4 overnight stays.  The loading would not apply in this situation as the excess payment is attributable, to some extent, to administrative error within the Department.

114.   Subsection 10C(5) provides that the amount of the penalty is a debt due to the Commonwealth by the recipient and may be recovered by action in a court of competent jurisdiction. 

115.   Subsection 10C(6) provides an alternative method of recovery of the loading via a reduction in amounts payable by way of benefit to the recipient. This subsection is equivalent to new subsection 10A(4), including that the Secretary is required to consult with the recipient before directing that a debt may be recovered from an amount that is payable to the recipient by way of benefit (see item 7 above).

Section 10D

116.   New section 10D applies where a voluntary repayment is made relating to a claim for a prescribed travel benefit (as determined by the Minister under new section 10B), in circumstances where there is no finding that benefits in excess of entitlement have been provided – in such cases, new section 10C does not apply (paragraph 10D(1)(e)).  It provides that, where a parliamentarian makes such a repayment, a loading of 25% of the repayment amount will apply, provided the repayment is not made within 28 days of the claim (paragraph 10D(1)(c)) and is not attributable, to any extent, to an administrative error within the Department (paragraph 10D(1)(d)).  The loading amount is recoverable by a reduction in future amounts payable by way of benefit, which operates in the same way as for new section 10A (see above).

117.   New subsection 10D(4) provides that the amount recoverable by reduction of future benefit under subsection 10D(2) is reduced by any amount of payment in respect of the loading amount, which is made directly to the Commonwealth.

Item 8

118.   This item inserts a new Part heading, repeals and replaces section 11, and inserts new section 11A into the PE Act.

Section 11

119.   New section 11 deals with the appropriation of the Consolidated Revenue Fund for the payment of benefits under the PE Act, and expands the appropriation in the previous section 11 (which also dealt with the appropriation of the Consolidated Revenue Fund) to also include the making of payments  in the course of the administration of the PE Act (new paragraph 11(b)).  This paragraph addresses the risk of section 83 breaches in circumstances where there is an inadvertent or mistaken payment of an amount that does not result in a parliamentarian receiving a benefit to which he or she is not entitled under the PE Act.  Examples of such situations would be an inadvertent or incorrect payment to a service provider.

120.   Although new paragraph 11(b) does not refer to recovery of amounts, any amounts paid under this paragraph would be recovered from the service provider using the Commonwealth’s legal rights under contract or common law.

Section 11A

121.   New section 11A provides the Secretary of the Department of Finance with the power to delegate all or any of the Secretary’s powers under the PE Act to an SES employee, or an acting SES employee in the Department of Finance (subsection 11A(1)).

122.   This will apply to the Secretary’s powers to deduct a debt or a 25% loading from future benefits under new subsections 10A(4), 10C(6), and 10D(2) of the PE Act.

123.   Subsection 11A(2) provides that, in exercising powers under a delegation, the delegate must comply with any directions of the Secretary.  However, it does not require the Secretary to provide such directions. 

 

Parliamentary Retirement Travel Act 2002

Item 9

124.   This item repeals the existing section 31 (Appropriation) in the PRT Act, and inserts new sections 30A and 31.

Section 30A

125.   New section 30A introduces a mechanism to address the risk that payments made in the course of administering the PRT Act may constitute a breach of section 83 of the Constitution.  This mechanism reflects those introduced into other acts, including via the Financial Framework Legislation Amendment Act (No. 2) 2012, to address this risk.  It also includes a statutory mechanism for recovering payments made for travel outside of entitlement.

126.   Section 30A authorises the Commonwealth to pay an amount to a recipient, purportedly by way of an entitlement of a person to travel at Commonwealth expense where the Commonwealth does not otherwise have power under the PRT Act to make a payment, and provides that such an amount is recoverable from the person receiving the entitlement.  This provision would have the effect that payments made, purportedly by way of such travel entitlements, but outside the boundaries of an entitlement, would attract the coverage of the standing appropriation in section 31 of the PRT Act, thereby mitigating the risk of breaches of section 83 of the Constitution. 

127.   However, Section 30A does not extend the boundaries of any entitlements that a person is entitled to under the PRT Act.  Paragraph 30A(1)(c) ensures that the payment will be recoverable from the recipient of the travel.  Under this paragraph, the amount of the payment is a debt due to the Commonwealth by the recipient of the travel.  This amount is recoverable in a court of competent jurisdiction.

128.   Subsection 30A(2) provides that the reference in subsection 30A(1) to the Commonwealth not having the power to make a payment of an amount purportedly by way of an entitlement of a person to travel at Commonwealth expense includes a reference to the Commonwealth only having  power to make a payment for lower cost travel.

129.   Subsections 30A(3) and (4) address the interaction between the debt provision in new paragraph 30A(1)(c) and the existing debt recovery regime in section 33 of the PRT Act.  This subsection will ensure that an amount cannot be recovered twice.  If an amount is recovered under subsection 33(2), the amount cannot be recovered under paragraph 30A(1)(c) (subsection 30A(3)).  If an amount is recovered under paragraph 30A(1)(c), it cannot be recovered under subsection 33(2) (subsection 30A(4)). 

Section 31

130.   New section 31 deals with the appropriation of the Consolidated Revenue Fund for the payment of the costs of travel under the PRT Act, and expands the appropriation in the previous section 31 (which also dealt with the appropriation of the Consolidated Revenue Fund) to also include the making of payments in the course of the administration of the PRT Act (new paragraph 31(b)).  This paragraph addresses the risk of section 83 breaches in circumstances where there is an inadvertent or mistaken payment of an amount that does not result in an entitled person receiving travel to which he or she is not entitled.  Examples of such situations would be an inadvertent or incorrect payment to a service provider. 

131.   Although new paragraph 31(b) does not refer to recovery of amounts, any amounts paid under this paragraph would be recovered from the service provider using the Commonwealth’s legal rights under contract or common law.

 


 

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 

Parliamentary Entitlements Legislation Amendment Bill 2014

 

This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

 

Overview of the Bill

The Bill amends the Parliamentary Entitlements Act 1990 to implement the reforms to parliamentary entitlements announced by the Government on 9 November 2013 by:

 

  • imposing a 25 per cent loading on travel claims submitted that require subsequent adjustment; and
  • limiting the travel entitlement provided to the dependent children of Senior Officers to those who are less than 18 years of age.

 

The Bill also amends the Members of Parliament (Life Gold Pass) Act 2002 to implement the reforms to the Life Gold Pass scheme, including those announced in the 2014‑15 Budget.  These measures change the name of the entitlement to the Parliamentary Retirement Travel Entitlement, and reduce, remove, and reform the entitlements under the scheme.

 

The Bill will also amend the Parliamentary Entitlements Act 1990 and the Members of Parliament (Life Gold Pass) Act 2002 to address the risk that certain payments may constitute a breach of section 83 of the Constitution (including establishing statutory bases for recovering overpayments).

25% loading on certain adjustments to travel claims

 

The Parliamentary Entitlements Legislation Amendment Bill 2014 (the Bill) amends the Parliamentary Entitlements Act 1990 to require that if an adjustment to certain travel claims is made or required, a loading of 25 per cent in addition to the full amount of the adjustment will apply. 

 

Loading where there is a breach of a statutory obligation

 

The Bill includes a new obligation that a person must not make a claim for a benefit that is in excess of entitlement (whether wholly or partly).  This obligation only relates to benefits provided under the Parliamentary Entitlements Act 1990.  It does not apply to benefits provided under other acts, such as the Members of Parliament (Staff) Act 1984.  

 

This loading may apply where a person breaches the obligation, in respect of a prescribed travel entitlement, and a subsequent adjustment is required.  Where this obligation is contravened in respect of a prescribed travel entitlement, and an amount is paid in excess of entitlement, pursuant to the claim, a loading of 25% will apply to that amount.  If the loading is not repaid, the loading may be recovered as a debt due to the Commonwealth in a court of competent jurisdiction.  The loading may also be recovered by a deduction from a future benefit that is payable.  This ability to deduct only extends to benefits that are provided under the Parliamentary Entitlements Act 1990.  Deduction from a parliamentarian’s salary will not be enabled by this provision.

 

The loading does not apply if the amount is repaid within a 28 day grace period.  It also does not apply if the payment in excess of entitlement is attributable, to any extent, to administrative error within the Department of Finance.

 

Loading in other circumstances where a subsequent adjustment is made

 

The loading also applies in circumstances where a person voluntarily makes a subsequent adjustment to a payment of a prescribed travel benefit, where there is no finding of a breach of the statutory obligation.

 

However this loading is only recoverable by a deduction from a future benefit that is payable.  This ability to deduct only extends to benefits that are provided under the Parliamentary Entitlements Act 1990.  Deduction from a parliamentarian’s salary will not be enabled by this provision.

 

The loading does not apply if the amount is repaid within a 28 day grace period.  It also does not apply if the repayment is of an amount that is attributable, to any extent, to administrative error within the Department of Finance.

 

Additional travel for children entitlement

 

The Bill restricts the 'additional travel for children' entitlement for Senior Officers to children under the age of 18.  In specified circumstances, the entitlement currently extends to children under 25 years of age.

 

For the purposes of this entitlement, a Senior Officer includes a Minister (but not a Parliamentary Secretary), the Leader or Deputy Leader of the Opposition in the House of Representatives or the Senate, the President of the Senate or the Speaker of the House of Representatives (see definitions of Senior Officer and Opposition Office Holder in section 3 of the Parliamentary Entitlements Act 1990).

 

 

Amendments to the Life Gold Pass scheme

 

The Bill will also amend the Members of Parliament (Life Gold Pass) Act 2002 to implement reforms to the Life Gold Pass scheme, including those announced in the 2014-15 Budget.  These measures rename the entitlement to the Parliamentary Retirement Travel Entitlement, and reduce, remove, and reform benefits under the scheme. 

 

The measures that were announced as part of the 2014-15 Budget apply retrospectively from the end of 13 May 2014 (the day of the Budget announcement).  The other reforms in the Bill commence, or have effect, the day after Royal Assent.  At the time of the announcement, affected people were written to about the impacts the reforms would have on their eligibility to access travel from 13 May 2014.  The measures do not affect the validity of return trips commenced up to the end of 13 May 2014.     

 

Time limits on the Parliamentary Retirement Travel Entitlement

 

The Bill imposes time limits, after which a person’s ability to access the Parliamentary Retirement Travel Entitlement expires.  For a former member, this time limit is the lesser of 36 months or the next expiry of a Parliament after they retire.  For a former senior office holder, this time limit is the lesser of 72 months or the second expiry of a Parliament after they retire.  The time limits do not apply to a person who has served as Prime Minister. 

 

Consistently with these new time limits, a person who retired 36 or more months prior to 13 May 2014, or 72 or more months prior, if they are a former senior office holder, is no longer able to access travel benefits from the end of 13 May 2014. 

 

A senior office holder is defined as a Minister (other than the Prime Minister or a Parliamentary Secretary), the President of the Senate or the Speaker of the House of Representatives, or the Leader of the Opposition in the House of Representatives. 

 

Further limits on access to the Parliamentary Retirement Travel Entitlement

 

Under existing section 4A of the Members of Parliament (Life Gold Pass) Act 2002, in general terms, the Life Gold Pass scheme was already closed to people who were not in Parliament on 6 March 2012.  In addition, this Bill provides that, except for a person who has been or becomes Prime Minister:

-           the Parliamentary Retirement Travel Entitlement is closed to a person who has not met the qualifying period for the Parliamentary Retirement Travel Entitlement before 14 May 2014; and

-          a person who retires on or after 1 January 2020 cannot access benefits under the Parliamentary Retirement Travel Entitlement.

 

Reduction in number of trips available under the Parliamentary Retirement Travel Entitlement

 

These amendments also reduce the benefits available to a person under the Parliamentary Retirement Travel Entitlement.  For a former member, the entitlement is reduced from a maximum of 10 domestic return trips per year, to a maximum of 5 domestic return trips per year.  For a person who has served as a senior office holder, the maximum annual number of domestic return trips per year will remain at 10.  The maximum annual number of domestic return trips per year of a retired former Prime Minister will be reduced from 40 to 30.

 

Spouses or de facto partners (or surviving spouses or de facto partners) of a holder of a Parliamentary Retirement Travel Entitlement (or of a sitting member who has satisfied the qualifying period for a Parliamentary Retirement Travel Entitlement, including the Prime Minister or a sitting former Prime Minister) will no longer be able to access benefits under the Entitlement.  The entitlement of a spouse or de facto partner of a retired former Prime Minister will be reduced from 40 to 20 domestic return trips per year.

 

Travel under the Parliamentary Retirement Travel Entitlement subject to public benefit test

 

As a result of these amendments, all travel under the Parliamentary Retirement Travel Entitlement will be subject to a public benefit test.  Currently, travel must not be taken for a commercial purpose.  Under these amendments, a holder of a Parliamentary Retirement Travel Entitlement (or an entitled spouse) may only undertake travel for a purpose that meets the public benefit test.  The public benefit test is satisfied if the person undertakes the trip for a purpose that is for the public benefit and is not for a commercial purpose or a private purpose.

 

Administrative Measures

 

The Bill also amends the Parliamentary Entitlements Act 1990 and the Members of Parliament (Life Gold Pass) Act 2002 to address the risk that payments made in the course of administering these acts may constitute a breach of section 83 of the Constitution.  These mechanisms each include a statutory basis for recovering payments made outside of entitlement.  Mechanisms to address the risk of breaches of section 83 of the Constitution have been included in many other acts, including via the Financial Framework Legislation Amendment Act (No. 2) 2012.

 

Human rights implications

This Bill does not engage any of the applicable rights or freedoms. 

Statutory Obligation

The new statutory obligation does not create a criminal offence.  This is on the basis of both the definition of ‘criminal offence’ in Australian Law and the definition of ‘criminal offence’ in International Human Rights Law.  Therefore, it does not engage the rights and freedoms in Article 14 of the International Covenant on Civil and Political Rights [1980] ATS 23.  In any case, the obligation, and the recovery and application of the loading, are subject to the review of the courts, and to the norms of administrative law.

Amendments to the Life Gold Pass scheme

Article 5 of the International Convention on the Elimination of all Forms of Racial Discrimination ([1975] ATS 40) obliges states to ‘guarantee the right of everyone ... to equality before the law’ in the enjoyment of ‘the right to own property alone as well as in association with other’.  Article 16 of the Convention on the Elimination of All Forms of Discrimination Against Women ([1983] ATS 9) also references the right to ‘ownership, acquisition, management, administration, enjoyment and disposition of property’, in the context of the equal enjoyment of this right by men and women.

The Bill does not engage these rights to own property.  In particular, the amendments to the Life Gold Pass scheme do not affect the equality of people before the law to the enjoyment of the right to own property alone as well as in association with others. Rather, the Bill reduces, and in some cases removes, the gratuitous benefits afforded to certain persons under the Life Gold Pass scheme. 

Article 7 of the International Covenant on Economic, Social and Cultural Rights ([1976] ATS 5) obliges states to ‘guarantee the right of everyone to the enjoyment of just and favourable conditions of work’.  Article 5 of the International Convention on the Elimination of all Forms of Racial Discrimination ([1975] ATS 40) guarantees ‘the right of everyone ... to equality before the law in the enjoyment of the rights ... to just and favourable remuneration’.  Although Life Gold Pass benefits are provided to people who have served in the Parliament for a certain period, the reduction and removal of those benefits by these amendments cannot be said to infringe upon any right to just and favourable conditions of work and remuneration.  Life Gold Pass travel is not in the nature of remuneration; rather it is more properly characterised as a gratuitous benefit.  Even if these benefits could be said to be in the nature of remuneration, their removal would not deprive the remuneration of parliamentarians of its character as just and favourable, for the purposes of International Human Rights Law.

 

Conclusion

This Bill is compatible with human rights as it does not raise any human rights issues.

 

Senator the Hon Michael Ronaldson

                                                Special Minister of State