Politicians' perks: High Court will hear former MPs' bid for bigger pensions

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Former Defence Minister John Moore is one of four former MPs in a High Court bid for better taxpayer-funded retirement ...

Former Defence Minister John Moore is one of four former MPs in a High Court bid for better taxpayer-funded retirement benefits.

A group of retired politicians trying to claw bigger pensions and more free travel from the taxpayer will get their day in court next month.

The High Court has agreed to hear the challenge by four former federal MPs – Labor’s Barry Cunningham, Tony Lamb and Barry Cohen, and Liberal John Moore – seeking a big boost to their entitlements.

While the federal government has sought to have the case thrown out, the court’s full bench will convene to hear the case on June 16, putting politicians’ perks back in the spotlight just two weeks before the July 2 election.

Former Labor MP Barry Cunningham is one of four former MPs in a High Court bid for better taxpayer-funded retirement ...

Former Labor MP Barry Cunningham is one of four former MPs in a High Court bid for better taxpayer-funded retirement benefits.

If the case is successful it could benefit up to 350 former politicians and 100 spouses, adding millions of dollars to the $40 million pension bill taxpayers already pick up every year. Most MPs who entered Parliament before 2004 are entitled to generous pensions under a defined benefits scheme.

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The four plaintiffs already receive annual pensions worth between $80,000 and $118,000 a year, not including bonuses, and up to 10 free business-class return flights a year, but believe they’re entitled to even more.

They’re using section 51 of the constitution – made famous in the classic Australian comedy The Castle – to challenge legislative changes that have slowed the growth of their retirement allowances.

The High Court may be forced to abandon its tradition of holding hearings across the country.

The High Court may be forced to abandon its tradition of holding hearings across the country. Photo: Michele Mossop

They say their allowances should be based on a percentage of the full salary of current backbench MPs, which is about $199,000.

Under the Gillard government changes, their allowances are instead based on a percentage of pre-2011 salaries – about $154,000.

They claim the changes were an unlawful acquisition of their property by the Commonwealth – the same argument the Kerrigan​ family used to fend off developers who wanted to take their home in The Castle. Under section 51, the Commonwealth can only acquire property on “just terms”.

Former Labor minister Barry Cohen is one of four former MPs in a High Court bid for better taxpayer-funded retirement ...

Former Labor minister Barry Cohen is one of four former MPs in a High Court bid for better taxpayer-funded retirement benefits.

But in its submission to the court, the government argues the plaintiff’s claims “fail at several levels”. It says the payments do not meet the definition of property and Parliament has the right to make changes.

Such decisions are made with “regard to a wide range of factors including the Commonwealth’s fiscal and economic circumstances and community concerns”, the government says.

It also points out that “each plaintiff has already received vastly more by way of retiring allowance than they contributed during their service in the Parliament”.

It singles out Mr Lamb, revealing he paid just $35,297 into his super account during his nine-year parliamentary career – but has so far been paid $1.3 million in retirement benefits.

As at June 2014, there were 332 politicians drawing on the scheme. At least an extra 20 retiring politicians will be entitled to it after they leave Parliament at the July 2 election, including former Speaker Bronwyn Bishop. She is expected to get up to $255,000 a year for the rest of her life under the scheme.

Former Labor MP Tony Lamb is one of four former MPs in a High Court bid for better taxpayer-funded retirement benefits.

Former Labor MP Tony Lamb is one of four former MPs in a High Court bid for better taxpayer-funded retirement benefits.

While the pension scheme is not available to anyone elected after 2004, more than 177,000 Australians have signed an online petition in recent months calling for it to be scrapped altogether.

Mr Cohen and Mr Moore are also mounting a further challenge to resurrect the original version of the Life Gold Pass, which entitled them to take an unlimited number of domestic flights at public expense.

Changes in 2012 limited the controversial scheme to 10 return flights a year but they want the changes rolled back so they can once again travel with no restrictions. Mr Cohen was a minister in the Hawke government and Mr Moore was a minister in the Fraser and Howard governments.

Mr Cunningham and Mr Lamb were both Labor backbenchers.



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