April 2011

Comment

The ALP afterlife

By Julian Morrow
Former Labor leader Mark Latham turned reporter for '60 Minutes', 2010. © Gary Ramage / Newspix / News Limited

When the New South Wales people finally euthanised the state ALP government in March, the few MPs who hadn’t already jumped ship moved one step closer to the great afterlife of modern Labor. It’s the professional politician’s light on the hill: a lucrative role as a ‘special adviser’ to the big end of town. The post-parliamentary careers of an ever-growing cohort of Labor MPs are an instructive symbol of the erosion of Labor’s identity and core values – as if there aren’t enough of those already.

Within a week of resigning as Finance Minister, as well as accepting an academic posting Lindsay Tanner became a special adviser to “pre-eminent financial advisory and asset management firm” Lazard. At Lazard, he may well work with the firm’s “Chairman, Corporate Advisory International”, Paul Keating.

Former Queensland premier Wayne Goss is now the Australian chairman of Deloitte, a firm of “dedicated professionals … [who] provide audit, consulting, financial advisory, risk management, and tax services to selected clients”. Steve Bracks joined auditing firm KPMG within three months of resigning as Victorian premier. He remains a senior adviser to National Australia Bank and KPMG, and has a similar role with “risk and insurance advisory” firm Jardine Lloyd Thompson Australia.

Former NSW Premier Neville Wran showed more entrepreneurial initiative, founding his own investment bank together with Malcolm Turnbull and the notorious Whitlam 2.0, Nicholas. Wran famously described working with Whitlam and Turnbull at their eponymous bank as his first experience of being the smallest ego in the room.

The list really does go on. And then, of course, there’s “Richo”.

The après-MP activities of these Labor figures stand in stark contrast to the predicament many faced when the parliamentary pension scheme was introduced by Ben Chifley in 1948. Chifley told a no-doubt receptive audience in the House of Representatives that when many MPs left parliament their “careers were interrupted, earning power lost and private means reduced”.

Like Chifley, former Labor Prime Minister John Curtin never faced the question of what career to pursue after his term. He died, most literally, in office at the Lodge. But it’s hard to imagine him having retired from public life to found John Curtin Pty Ltd – Corporate Advisory Services. It’s less surprising to learn that both John Dawkins Financial Services Pty Ltd and John Kerin and Associates Pty Ltd are real ventures of former Labor federal treasurers in recent years. Say what you like about the commercial careers of Hawke, Keating and Rudd government ministers, at least they didn’t star in TV commercials like iconic Labor Prime Minister and Leggo’s pasta sauce salesman Gough Whitlam.

None of this is to say that Labor politicians, or politicians of any stripe, should forever don a hairshirt after leaving public office. After signing up for relatively low salaries and the relentlessly scathing scrutiny of media and political opponents (sometimes on the other side of the chamber), it’s hard to bemoan anyone a few years of discreet corporate self-enrichment. Arguably, it’s good for the country to have a Labor perspective articulated in the boardrooms of the nation – if that’s what the ex-MPs are doing. Based on the Rudd/Gillard government, it’s possible Labor MPs do a better job articulating the party’s values in private than they do in public life.

It’s true that most former politicians do not do commercial work exclusively. But the prevalence of lobbying and corporate positions that have nothing whatsoever to do with moving working families forward – or even pretending to – is telling.

Industry superannuation funds, commonly not-for-profit but nevertheless seriously big business, are perhaps the best examples of commercial enterprises that resonate with Labor values. Alumni in this field include former Hawke ministers Susan Ryan (president of the Australian Institute of Superannuation Trustees, 2000–2007) and Ralph Willis (chairman of Cbus, 2000–2009), who was succeeded by Steve Bracks.

But even those participating in activities at the worthy end of the corporate scale have one key thing in common with the ex-ministers who take positions as PR trinkets and government doormen for big business: none of the jobs require former politicians to surrender any of their parliamentary pension.

An especially grotesque feature of the system is that it effectively creates an incentive for our pensioner-pollies to undertake highly paid work in the private sector rather than continue to contribute to public life. The parliamentary pension is offset against other income received from the public purse. An “office of profit under the Crown” will reduce your parliamentary pension but an office of profit under Crown Casino – lobbying former colleagues to increase the profitability of gambling – will not.

This anomaly has been long recognised. After an inquiry into Commonwealth MPs’ remuneration in 1959, the Richardson Report (authored by a very different ‘Richo’) found the difference between the treatment of income from the private sector and pay for government work “too drastic”, and suggested this “should be modified”. The response was to reduce the amount pensions are scaled back as a result of government work rather than what is obviously required: income testing for parliamentary pensions.

Without a modest income test for parliamentary pensions, the conditions are ripe for the ultimate ‘public–private partnership’ – combining big earnings in private commerce with a lifelong parliamentary pension calculated at a percentage of a minister’s departing salary.

It should be noted that the corporate trend is far from uniform in Labor ranks. After leaving politics, former Justice Minister Michael Tate gave up his appointment as an ambassador in Europe to become a Catholic priest. Former Indigenous Affairs Minister Robert Tickner is another notable exception; he is the current CEO of the Australian Red Cross. The work of John Della Bosca, former NSW Education Minister, as campaign director for the National Disability and Carers Alliance is also laudable. If the benefits of their parliamentary pension made the decision to work in the humanitarian sector easier, then the public interest has been served.

Former Western Australian Premier Geoff Gallop has pursued academic and community interests. Former Attorney-General and Foreign Minister Gareth Evans, and former Health Minister Neal Blewett have, in addition to the occasional political appointment, worked with distinction in the public sector in the areas of their portfolios after leaving parliament. One-time Social Security Minister Peter Baldwin co-founded Debategraph, a social enterprise that has developed “a debate visualisation tool” that aims “to increase the transparency and rigour of political debate around the world”. Debategraph’s mission is “to make the best ideas and arguments on all sides of any contentious public issue freely available to all and continuously open to challenge and improvement by all”. It has been taken up by the White House, the British Foreign and Commonwealth Office, CNN and the Independent newspaper.

I’m far more comfortable with a parliamentary pension making possible an obscurely noble geek venture such as Debategraph than it just providing the base salary for someone advising Macquarie Bank’s Investment Banking Group “on policy and strategic issues”. This is despite the fact that the appointment of former NSW Premier Bob Carr to that role was a “valuable contribution to the development of Macquarie’s global businesses” according to the bank’s now CEO, Nicholas Moore. (Nick Moore – the best name for an investment banker ever.)

It’s hard to begrudge former Pacific Island Affairs Minister Gordon Bilney income from his role as a contributor to the Sydney Morning Herald’s “Word Watching” column over six years. Begrudging Mark Latham the $15,000 fee he reportedly earned as a 60 Minutes journalist – while he can also draw, for life, 50% of a backbencher's salary (plus a small loading for the 14 months in which he served as Labor Opposition leader) – is easier. An income test would not catch those little earners, for better and worse respectively.

This problem will die out, eventually: John Howard introduced a not-so-super parliamentary superannuation scheme in 2004 for incoming MPs, who will only be able to access the 9% of their wages the Queen now puts aside for their dotage. In doing this, Howard adopted the then Opposition’s policy – it was Mark Latham’s most significant contribution to public policy, and extreme hypocrisy. The latter, at least, is quite an achievement.

But as some health experts will tell you, managing the end of life can be unduly expensive. Despite the tabloid appeal of treating MPs no better than the rest of us, politicians should get a better deal, more like the old system. No matter what their motivation or net worth, the public life a politician chooses is modestly remunerated and fraught with uncertainty and risk: a low chance of achieving high office is coupled with a high chance of public judgement, cynicism and ridicule. But a functioning democracy requires people to make the borderline-insane decision to enter public life. A generous pension scheme encourages people to enter politics. A decent pension after leaving parliament is fair recognition of the significance of representing the people. It might even encourage former representatives to continue working in the broader public sphere, rather than simply doing corporate bidding.

Julian Morrow
Julian Morrow is a comedian, writer, television producer and broadcaster. He is a co-founder of the Chaser comedy team and the executive producer of The Hamster Wheel.

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