PM defends taxpayer funded lump sum payments to failed MPs

Scott Morrison has compared the nearly $1.3m in payouts to failed MPs to private sector redundancies.

At least 20 federal politicians were entitled to the farewell perk after the May 18 election, including Kerryn Phelps, left, and Sarah Henderson, right.

Scott Morrison has defended the right of MPs who lost their seats at the last election to be eligible for $1.3 million in cash payouts, saying they are similar to redundancies workers in the private sector face.

At least 20 federal politicians were entitled to the farewell perk after the May 18 election, in ­addition to MPs who will receive retiring allowances under the pre-2004 superannuation scheme.

The little-known entitlement, which was established in 2006 and has spanned five elections, captures MPs who either lost their seats at an election or failed to win preselection.

The Prime Minister said on Monday the arrangements were no different to similar payouts.

“These are arrangements that were put in place some time ago and I’m sure when anyone leaves a job, not of their own choosing, there are arrangements in place for people to do that,” he said in Western Sydney.

“If you were to be let go, made redundant today and by your news organisation, then I’m sure there would be a contractual arrangement for you to have some support when you left that job not by your own hand.

“All I’m saying is these arrangements exist in the private sector and public sector and they don’t discriminate whether you’re a politician or you’re a journalist.”

Senators who sit in parliament for more than three years and MPs who serve more than one full term are eligible to receive the equivalent of six months’ base salary, worth more than $103,000. Other MPs and senators who lost their seats at the election were ­entitled to three months’ pay, valued at more than $51,000.

MPs eligible for the resettlement allowance include former independent MP Kerryn Phelps and ex-Nationals senator Steve Martin, who entered parliament last year. Former Liberal Democratic Party senator Duncan Spender, who replaced David ­Leyonhjelm earlier this year and only briefly sat in parliament, is also eligible for a three-month payout.

Farewell perks for MPs

Federal MPs and senators who lost their seats at the election were eligible to claim $1.3 million in “resettlement allowances” under a generous remuneration deal for departing parliamentarians.

At least 20 federal politicians were entitled to the farewell perk after the May 18 election, in ­addition to MPs who will receive retiring allowances under the pre-2004 superannuation scheme.

The little-known entitlement, which was established in 2006 and has spanned five elections, captures MPs who either lost their seats at an election or failed to win preselection.

Eleven senators and at least nine lower house MPs were eligible to receive the lump-sum payments, dispersed by the ­Senate and House of Representatives departments.

Senators who sit in parliament for more than three years and MPs who serve more than one full term are eligible to receive the equivalent of six months’ base salary, worth more than $103,000. Other MPs and senators who lost their seats at the election were ­entitled to three months’ pay, valued at more than $51,000.

Susan Lamb was eligible for $51,000.

And so was Jim Molan.

The allowance, which is not a redundancy payment and is fully tax assessable, was set-up to provide “re-skilling and re-employment assistance” to MPs who do not have access to superannuation benefits when they lose ­office.

MPs eligible for the resettlement allowance include former independent MP Kerryn Phelps and ex-Nationals senator Steve Martin, who entered parliament last year. Former Liberal Democratic Party senator Duncan Spender, who replaced David ­Leyonhjelm earlier this year and only briefly sat in parliament, is also eligible for a three-month payout.

Former Labor senators Lisa Singh and Chris Ketter, who lost their seats at the election, are ­eligible for six-month payouts, as are former Coalition MPs Sarah Henderson and Jane Prentice.

Tony Abbott and Ian Macdonald, who were dumped from parliament at the election, would not receive the resettlement allowance, as they are eligible to draw a retiring allowance under the old superannuation scheme. Julie Bishop, Wayne Swan, Christopher Pyne and Jenny Macklin — who retired from politics before the election — are also entitled to the pre-2004 super scheme.

WHO GOT THE MONEY - NEws

Eleven senators were eligible for resettlement allowances, including three who were in line for six-month lump-sum payments. All MPs and senators who were eligible to receive the cash payouts were notified at the end of the 45th parliament.

Claressa Surtees, Clerk of the House of Representatives, confirmed the Department of the House of Representatives was ­responsible for paying resettlement allowances to former MPs but she could not provide further ­detail in relation to how many lower house MPs were paid out.

“Such payments are made by this department on behalf of the Department of Finance,’’ Ms Surtees said.

“The ­reporting which is made by this department is for a total amount of all payments of a ‘salary’ nature and this appears in the annual ­report.’’

Patrick Palmer, secretary to the Remuneration Tribunal, saidthe resettlement allowance was approved on December 22, 2006, following the “government’s interest in the introduction of such an allowance for those senators and members affected by the changes in superannuation ­arrangements”.

Lucy Gichuhi was also eligible for $51,000.

As was Fraser Anning.

“More recent considerations of the allowance can be found in the Review of Parliamentary ­Entitlements Committee report and tribunal’s decision in 2011 to vary the allowance.”

A Department of Finance spokesman confirmed there was currently 18 parliamentarians who entered the parliament ­before October 9, 2004, and were “consequently members of the Parliamentary Contributory Superannuation Scheme”.

“For privacy reasons, we do not provide personal information in relation to superannuation ­arrangements of parliamentarians,” the spokesman said.

A spokesman for Finance Minister Mathias Cormann said “terms and conditions of employment for federal members of ­parliament are determined independently by the independent Remuneration Tribunal”.

Opposition special minister of state spokesman Don Farrell did not respond.