Question Time

PUBLIC SECTOR LEAVE ENTITLEMENTS

The Hon. D.W. RIDGWAY (Leader of the Opposition) (14:30): I seek leave to make a brief explanation before asking the Minister for Public Sector Management a question about long service leave cash payouts.

Leave granted.

The Hon. D.W. RIDGWAY: As members will recall, the Public Sector Bill went through the parliament in early 2009. The new act came into effect at the start of February last year, that is, February 2010. Embedded in this significant piece of legislation was a variation in long service leave arrangements. In the old act, only executives could take cash payouts in lieu of long service leave. In the new act, and therefore from 1 February last year (2010), any Public Service employee has been able to apply to the chief executive for a cash payout of their long service leave.

It was indeed a rare and positive gesture to a public sector workforce which, since that time, has endured a great deal of disappointment. In looking back over the debate on the bill, it is interesting to note that little attention was paid to this clause, given the significance of the variation from the old act. I wondered whether cabinet had realised the financial implications of what it was offering to the public sector.

The opposition has received some information via FOI. According to a memo from the Under Treasurer to the former treasurer, the implications were certainly not clear. In his memo dated 13 January 2010 (I indicate prior to the election), he explains to the treasurer that the long service leave liability to the general government sector had already reached $1.3 billion. He goes on to explain to the unknowing treasurer that even if 10 per cent of the public servants took up the offer—and he notes that there is already a lot of interest in the measure—it would cause a significant debt of some $130 million.

If you do the simple maths, it works out that if all the public sector employees took up the offer it would be a $1.3 billion liability that would become a debt. On that same day (13 January 2010), the treasurer wrote a minute to the then minister, the Hon. Jay Weatherill, and I quote from that minute:

I am concerned that this significant change in employee entitlements does not appear to have been brought to the attention of Cabinet during the approvals process. To this end was this significant broadening of the payout arrangements intentional or an oversight in the drafting of the legislation? If it was intentional what was the motivation?

I am advised that at the agency level employees have shown significant interest in cash payouts.

At 30 June 2009 the general government sector long service leave liability was $1.3 billion; even if there is only a small take up rate for payments there is potential for a significant impact on net debt at a time when we can least afford it.

His final paragraph states:

I recommend that action be taken to limit the application of this provision, and that in the longer term—post election—the clause be removed from the PS Act for both executive and non executive employees.

My question to the minister is: can the minister confirm that cabinet was not made aware of this clause and its implications and that measures were clearly taken to conceal the change in policy prior to the 2010 election?

The Hon. G.E. GAGO (Minister for Regional Development, Minister for Public Sector Management, Minister for the Status of Women, Minister for Consumer Affairs, Minister for Government Enterprises) (14:34): I was waiting for a question the honourable member might know that I am able to answer, because he knows all too well that in fact any consideration and all deliberations of cabinet are confidential. We take oaths in respect of that, as the honourable member would know. He knows that only too well, and he is using this as an opportunity to besmirch this government.

We have made some tough budgetary decisions which we have been extremely open and transparent about. They were difficult decisions to try to bring our state back into a long-term sustainable economic future. As I said, he knows all too well that the considerations and deliberations of cabinet are completely confidential.