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Double dip, backflip and FBT pike

By John Hargreaves - 18 May 2015 19

parliament-house-stock-031214

Sometimes, for this old Laborite, this government just keeps on giving. If my amusement is part of my age of entitlement, then go you good thing!

Was it Hockey and Cormann who said there are lifters and leaners? Was it these ministers and their assistant ministers who said we should all pay our way, share in the pain?

Well now…let’s look at this year’s budget, since we can’t sleep well. The PM promised that the budget would be so ho hum that we would find it boring. I read this as meaning the budget would be an aid to combatting sleeplessness. Maybe not though!

I must put my credentials on the table to explain why I would pass over the complete works of William Shakespeare and my collection of Robert Ludlum novels for the budget. I must explain why I preferred the budget over the Rubaiyat of Omar Khayyam.

The budget often contains little pearls amongst the swine droppings!

When I was in the public service in the last century, parts of my jobs were to write the blurbs you see in the budget papers, and when I was in the assembly, I took a perverse pleasure in being one of the few in that august chamber who could actually read, let alone write, budget papers. My time on the estimates committees (many, many hours and time I won’t get back in my life) was spent trolling through the pages looking for little bits of bait for the unwary minister appearing before my committee.

Back to the budget papers. So the leaners were double dipping into the paid parental leave (PPL) coffers were they? The spokespersons were all saying, with the insinuation that women were doing sneaky, underhand and greedy thievery from public coffers. How embarrassment! Minister Cormann and Assistant Minister Freydenberg were sprung because their wives had received employer-based and government-based PPL! The lifters were doing some leaning.

Their excuse/reason? It is a currently legal entitlement! I reckon their salaries and those of the wives, professionals both, were such that dipping into taxpayers’ pockets was not necessary to survive. Double dip, backflip and pike!

But hey, I got that from the media. But also, the curious in me went for a meander through the budget papers. I didn’t have to look far to find a little passage which gave me an insight into why the age of entitlement is over for us but not for them.

So now we all have to pay to park when we go to work, right? I even have to pay when I do my community stuff. The hoo hah over parking in the parliamentary triangle was front page news. But do all the workers in the Big House have to pay for their parking? It appears not!

Don’t get this wrong though. Ministers get dropped off at the door by Commonwealth cars so parking is an academic question for them. But is it for their staff? And is it for the non-executive MPs?

The thing is that if an employer pays the parking, it attracts fringe benefits tax. One can get an idea of how much pay parking is supplemented by the amount of fringe benefits tax paid.

In the supplementary budget last year, funds were provided to pay fringe benefits tax on parking in the Parliament House precinct but the amount escaped scrutiny. Pay parking came in during April 2015, so supplementation was needed for the period April to June 2015. But what of the post June period?

Here’s how it appears in the budget papers (and this is a direct take):

Portfolio Budget Statement 2015-2016
DEPARTMENT OF THE HOUSE OF REPRESENTATIVES

Section 1: Departmental overview and resources

1.1 STRATEGIC DIRECTION STATEMENT

“From 1 April 2015, as a result of the implementation of paid parking within the Parliamentary triangle, the Department is liable for the payment of Fringe Benefit Tax for employees who access the private car parks at Parliament House. The balance of the additional funding through the budget ($0.828m) will meet the liability from 1 July 2015”

Now, I understand from this that staff who are paid from the coffers of the House of Reps have their parking costs paid by the department and incur an FBT of $828,000 per year. The budget also puts this into the base of the department because there is no extraction in the out years to terminate the arrangement. Hmmmm…

Who is paid by the House of Reps? The clerk and his/her office, attendants, security guards, committee staff, cleaners, pollies and their staff. I don’t know if I have them all but it is the last two that I draw your attention to. They all share in the largesse covered by this FBT. And if some of them are contractors, the share of this fringe benefits tax for non-contractors is even larger.

So let me get this straight and correct me if I’m wrong. Most public servants have to pay for parking in the parliamentary triangle but members of the House of Representatives and their staff don’t. The ordinary taxpayer, who does pay the parking, picks up the fringe benefits tax tab as well as the loss in revenue.

$828,000 is a lot of fringe benefits tax thus it is a lot of paid parking foregone.

One rule for some and another rule for others? I thought the age of entitlement had gone. Not so it appears!

What’s Your opinion?


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19 Responses to
Double dip, backflip and FBT pike
John Hargreaves 11:31 am 19 May 15

dungfungus said :

John Hargreaves said :

dungfungus said :

Hey John, when you were a MLA you would have received a free car park at work (when you were driving, that is).
How was that handled in the Government’s accounts?

Cheap shot in brackets. But I had a carpark in the salary package which was publicly known. Also I got a salary as an aMLA which was an EL2 equivalent also which you know, and worked a lot more hours and was more accountable than any EL2 you have ever heard of. As a minister, I had a carpark, also well known publicly.

Gotta make it personal don’t you?

My point is that this is FBT paid to give selected classes of people free car parking and the public DON’T know. And $828,000 is a lot of parking!

How do you feel about paying for the parking, through access to free parking and thus a loss in revenue paid by others, AND the FBT which goes with it?

I take by your attack on me, that younbapprove of this underhand freebie for staffers!

To Mysteryman, the point is that some pay for the parking and some don’t. Those who don’t, get a benefit others don’t get and the taxpayer is paying FBT for that fort to continue.

AND… The FBT of $828,000 was hidden in the House of Reps item and not Finance where you expect.

Sorry about the cheap shot but it got past the moderators so blame them also.
They way I see it is that NO ONE in Canberra should get free or subsidised parking.

We agree on that one. Either everyone or no-one. But… if it is part of a salary increase offset, I see problem. But also… if it is coming out of the public purse, it should be transparent. I know of heaps of private sector firms which give this to their senior staff as a salary offset.

dungfungus 9:38 am 19 May 15

John Hargreaves said :

dungfungus said :

Hey John, when you were a MLA you would have received a free car park at work (when you were driving, that is).
How was that handled in the Government’s accounts?

Cheap shot in brackets. But I had a carpark in the salary package which was publicly known. Also I got a salary as an aMLA which was an EL2 equivalent also which you know, and worked a lot more hours and was more accountable than any EL2 you have ever heard of. As a minister, I had a carpark, also well known publicly.

Gotta make it personal don’t you?

My point is that this is FBT paid to give selected classes of people free car parking and the public DON’T know. And $828,000 is a lot of parking!

How do you feel about paying for the parking, through access to free parking and thus a loss in revenue paid by others, AND the FBT which goes with it?

I take by your attack on me, that younbapprove of this underhand freebie for staffers!

To Mysteryman, the point is that some pay for the parking and some don’t. Those who don’t, get a benefit others don’t get and the taxpayer is paying FBT for that fort to continue.

AND… The FBT of $828,000 was hidden in the House of Reps item and not Finance where you expect.

Sorry about the cheap shot but it got past the moderators so blame them also.
They way I see it is that NO ONE in Canberra should get free or subsidised parking.

justin heywood 8:51 am 19 May 15

John Hargreaves said :

…. I got a salary as an aMLA which was an EL2 equivalent also which you know, and worked a lot more hours and was more accountable than any EL2 you have ever heard of. As a minister, I had a carpark, also well known publicly.

Did no EL2s read this?

When the Assembly last topped up member’s salary in 2014, the base salary for ordinary members was $132,775 per annum. And that’s BEFORE all entitlements, of which there are many. Ministers did much better of course.

Most EL2s don’t earn nearly that much. EL2s are of varying abilities of course, but those who are there from merit (an increasing proportion) are very capable and very well qualified people.

Compare this to the rather modest resume of most members of the Assembly. In my opinion many are lucky to have the gig.

JC 7:24 am 19 May 15

dungfungus said :

JC said :

dungfungus said :

Hey John, when you were a MLA you would have received a free car park at work (when you were driving, that is).
How was that handled in the Government’s accounts?

What is your point? He is talking about free parking being provided to the MP’s staffers etc with the government picking up the FBT liability.

You do realise that the staffers are employees of the member, not the Commonwealth (except departmental staff provided to Ministers), so why should the Commonwealth be funding the FBT liability?

My point is that while John was a minister in the ACT Legislative Assembly he would have driven to work and he would have been supplied with a paid car park unlike his Federal counterparts who were driven to work by Comcar.
How about you let John answer the question?

So what you are saying is the ACt should have something like Comcar so they are alike? Hmm changing your tune a bit b

JC 7:23 am 19 May 15

Garfield said :

JC said :

dungfungus said :

Hey John, when you were a MLA you would have received a free car park at work (when you were driving, that is).
How was that handled in the Government’s accounts?

What is your point? He is talking about free parking being provided to the MP’s staffers etc with the government picking up the FBT liability.

You do realise that the staffers are employees of the member, not the Commonwealth (except departmental staff provided to Ministers), so why should the Commonwealth be funding the FBT liability?

I think you’ll find that staffers are employed by the Department of Finance. They may be selected by the politicians but they are employees of the Commonwealth.

By virtue of the roundabout way the funding comes from finance but not public servants.

John Hargreaves 7:55 pm 18 May 15

dungfungus said :

Hey John, when you were a MLA you would have received a free car park at work (when you were driving, that is).
How was that handled in the Government’s accounts?

Cheap shot in brackets. But I had a carpark in the salary package which was publicly known. Also I got a salary as an aMLA which was an EL2 equivalent also which you know, and worked a lot more hours and was more accountable than any EL2 you have ever heard of. As a minister, I had a carpark, also well known publicly.

Gotta make it personal don’t you?

My point is that this is FBT paid to give selected classes of people free car parking and the public DON’T know. And $828,000 is a lot of parking!

How do you feel about paying for the parking, through access to free parking and thus a loss in revenue paid by others, AND the FBT which goes with it?

I take by your attack on me, that younbapprove of this underhand freebie for staffers!

To Mysteryman, the point is that some pay for the parking and some don’t. Those who don’t, get a benefit others don’t get and the taxpayer is paying FBT for that fort to continue.

AND… The FBT of $828,000 was hidden in the House of Reps item and not Finance where you expect.

housebound 7:14 pm 18 May 15

Finally, an ALP ex-staffer and ex-politician has admitted what we were all saying in the mid-1980s when the then-ALP government introduced this very arrangement for FBT: the end result would be that the politicians would not have to pay a cent (in the eventuality of pay parking). The taxpayer would foot the bill.

Of course, we were a bit younger and unaware of staffers and the like, and the nuances of those arrangements, but the general observation stands.

Now John, since you’ve finally seen the light, and you’re blaming the Liberals for the situation, what are you going to do to convince your ALP colleagues to do about it when they’re next in power?

dungfungus 5:44 pm 18 May 15

JC said :

dungfungus said :

Hey John, when you were a MLA you would have received a free car park at work (when you were driving, that is).
How was that handled in the Government’s accounts?

What is your point? He is talking about free parking being provided to the MP’s staffers etc with the government picking up the FBT liability.

You do realise that the staffers are employees of the member, not the Commonwealth (except departmental staff provided to Ministers), so why should the Commonwealth be funding the FBT liability?

My point is that while John was a minister in the ACT Legislative Assembly he would have driven to work and he would have been supplied with a paid car park unlike his Federal counterparts who were driven to work by Comcar.
How about you let John answer the question?

Garfield 5:03 pm 18 May 15

JC said :

dungfungus said :

Hey John, when you were a MLA you would have received a free car park at work (when you were driving, that is).
How was that handled in the Government’s accounts?

What is your point? He is talking about free parking being provided to the MP’s staffers etc with the government picking up the FBT liability.

You do realise that the staffers are employees of the member, not the Commonwealth (except departmental staff provided to Ministers), so why should the Commonwealth be funding the FBT liability?

I think you’ll find that staffers are employed by the Department of Finance. They may be selected by the politicians but they are employees of the Commonwealth.

Mysteryman 5:01 pm 18 May 15

Now, I understand from this that staff who are paid from the coffers of the House of Reps have their parking costs paid by the department and incur an FBT of $828,000 per year.

Wrong. It’s one or the other. Either somebody pays for the parking OR there is an FBT liability associated with it. It’s not both.

Regarding the paid parking situation – it’s a difficult one at Parliament House because the car park is a private one. The reasons (the deceitful reasons the greedy Labor government gave us, as opposed to the actual reasons – $$) for making the other car parks in the triangle paid parking don’t really apply at Parliament House, but thanks to a law that uses distance to paid parking as it’s measure, there is an FBT associated with it if they keep it a free car park.

The other complexities are that each staffer has a separate employer (either a Senator or a Member), as well as the three different departments that operate in the building, and the other contractors (IHG, cleaning services, etc, etc). Nobody has yet come up with a reliable and equitable method of charging for car parking, so no system has yet been implemented.

But do all the workers in the Big House have to pay for their parking? It appears not!

Wrong again, John. As I mentioned, there are literally hundreds of employers that access that building, and there are at least 5 private car parks in question – only 1 of which is addressed by the snippet you took from the budget papers.

JC 4:09 pm 18 May 15

dungfungus said :

Hey John, when you were a MLA you would have received a free car park at work (when you were driving, that is).
How was that handled in the Government’s accounts?

What is your point? He is talking about free parking being provided to the MP’s staffers etc with the government picking up the FBT liability.

You do realise that the staffers are employees of the member, not the Commonwealth (except departmental staff provided to Ministers), so why should the Commonwealth be funding the FBT liability?

dungfungus 3:06 pm 18 May 15

Hey John, when you were a MLA you would have received a free car park at work (when you were driving, that is).
How was that handled in the Government’s accounts?

dungfungus 3:04 pm 18 May 15

MERC600 said :

John you say “One rule for some and another rule for others? I thought the age of entitlement had gone. Not so it appears!”

Entitlement has been renamed resettlement . ie our Kate received $30,600 as a ‘resettlement’ payout.

A single mum gets over $30,000 a year in family welfare (sorry, family assistance).

vintage123 1:35 pm 18 May 15

Ah good old car parking. It is interesting to observe the power and influence of paid parking. I recall undertaking a strategic review of operations into an organisation one time only to discover the most influential and powerful factor was that of a tactical nature – car parking. Note this was free car parking and more about who had reserved car parks and who had to walk extra distances from non reserved spots to their place of employment. In short the argument was over an extra 50m, yet this was enough to nearly cripple a large well known australian organisation. I think canberra is lucky to have reasonable rates for car parking in comparison to other capitals. Last week in ventured into sydney cba for a 5 hr meeting and yes forked out, along with the rest of the attendees the $250 parking fee. So let’s not get too bogged down about the paid parking in canberra and how much it cost and who is and isn’t entitled. Unless of course we think it is the factor crippling the nation. Which it may well be?

MERC600 12:54 pm 18 May 15

John you say “One rule for some and another rule for others? I thought the age of entitlement had gone. Not so it appears!”

Entitlement has been renamed resettlement . ie our Kate received $30,600 as a ‘resettlement’ payout.

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