Politicians receive pay rise

Politicians will immediately receive a two per cent pay increase, the independent Remuneration Tribunal announced last Thursday.

The tribunal noted that it had received an increased number of submissions calling for a pay rise “based at least in part on private sector remuneration”.

The average cabinet minister will see their pay increase to $350,209, while opposition MPs will receive a salary of $253,775. Backbencher MPs will enjoy an increase of $3980, with their salaries moving to $203,020 a year.

The Prime Minister, who already received a healthy $517,504, will now be paid $527,852 a year, while Treasurer Scott Morrison’s salary will rise to $380,662. Opposition Leader Bill Shorten also received a salary bonus, with his annual pay increasing to $375,587.

This is only the third pay rise politicians have received since 1 July 2013, and the tribunal noted that public service office holders often receive lower salaries than those in the private sector as they “serve for the public good”.

In making its decision, the tribunal looked at wage growth, pay rises for public servants, budget position and the general state of the economy. It stated: “The tribunal considers it important that remuneration for offices in its jurisdiction be maintained at appropriate levels over the longer term to attract and retain people of the calibre required for these important high level offices.

“The tribunal is conservative in its approach to annual increases and in this case is conscious of the government’s policy of wage restraint for the Australian Public Service and non-Australian Public Service government agencies.”

The pay rise comes just a week before the end of the Budget Repair Levy, which will see high income earners receive a two per cent tax cut on income they receive over $180,000 per year. This means that based on their politician’s salary, cabinet ministers will receive an extra $3404 per year and the Prime Minster an additional $6957 a year.

Read the 2017 Annual Review at remuneration.gov.au

Read more at smh.com.au

Opinion: Pensioners struggle while politicians party

While justification for the increase enjoyed by politicians may, on the face of it seem reasonable, there’s no question that the perks enjoyed by politicians far outweigh any salary.

A two per cent salary increase is only part of the tale. Also released at the same time as the tribunal’s findings, was the list of expenses claimed by politicians past and present. John Howard is the biggest spending ex Prime Minister, with travel and office costs of $150,000 for the six months to December 2016. Malcolm Turnbull spent more than half a million dollars on overseas travel during the same time, with Foreign Minister Julie Bishop spending $300,000.

Frontbencher Dan Tehan had the biggest internet and phone bill at $12,000 and former MPs racked up $115,000 worth of domestic flights in just six months using their Life Gold Pass.

All these expenses, pay rise and tax cuts paints a very rosy picture of life as a politician, and let’s not forget the remuneration that many receive due to their own business interests and seats they hold on the boards of private companies. It is, indeed, in stark contrast to the increases ‘enjoyed’ by those on the Age Pension – the people the country’s budget can afford to keep paying a pension to.

The last Age Pension increase saw a single person on a full Age Pension receive an extra $10.40 per fortnight or $270.40 per year. Throw in the increase to the pension Supplement and you can call it $310.60. Hardly a bumper pay day for those most in need.

In figures about to be released in YourLifeChoices July Retirement Affordability Index, we know that pensioners are certainly feeling the pinch, especially on housing costs and power bills. Yet our politicians continue to be able to afford two, three or even more houses when some people can’t even afford one.

What do you think? Do politicians deserve their pay increases? Should the Budget Repair Levy have been kept under Budget 2017/18? Would it be a better use of budget money to increase the Age Pension, where every dollar received is likely to be a dollar spent in the local economy? 

Related articles:
Pension increases – 20 March 2017
Minimum wage increase not all good news

Written by Debbie McTaggart

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