Treasurer Curtis Pitt has denied changes the government plans on making to how payouts from the public service defined benefits scheme are calculated will leave any workers worse off, despite Treasury calculating some workers will miss out on a $210,000 "windfall".
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The largely procedural Revenue and Other Legislative Amendment Bill includes a change to the State Public Sector (Superannuation) Act, which would, in effect, give the Treasurer of the day the power to change the multiple that dictates how much money an eligible worker receives from the fund when they go to cash out upon retirement
Currently, the formula is roughly the final salary of the worker multiplied by the multiple, which increases depending on the number of years of service - an increase in salary has an "immediate" increase in the accrued benefit for scheme members. Workers can negotiate to use allowances to increase their overall salary; for example, a public servant with a base wage of $90,000 could negotiate to include $30,000 in allowances in their take home pay, bumping their salary to $120,000.
Under the amendment put forward by Mr Pitt, workers may no longer be able to have their negotiated allowance payments count towards their overall pay, which lowers the multiple used to calculate their pay out from the fund.
When queried during a committee review of the bill, Treasury provided an example, which showed that under the defined benefit changes, a public servant earning $90,000 as a base wage, but adding $30,000 to their overall pay through allowances, would lose $210,000 when retiring after 30 years, through the removal of the "windfall" the allowance negotiation added to their total remuneration.
The Opposition accused the government of attempting to "sneak through" the changes, which have not been spoken about in parliament.
"This will leave core public servants like teachers, police and nurses tens of thousands of dollars out of pocket," shadow Treasurer Scott Emerson said.
"In some cases, this will cost public servants hundreds of thousands of dollars."
But a spokesman for the Treasurer said the proposed change was not "about disadvantaging anyone".
"The proposed change will continue to accommodate rises in superannuable salaries resulting from negotiated or inflationary increases, or salary jumps due to promotions — all of which have always been taken into consideration when assessing the overall liability of the scheme," he said.
"The proposed change is designed to prevent large and unintended increases in payouts usually arising from the bundling of allowances with a member's base salary in a total remuneration package that artificially inflates their superannuable base salary.
"While this is not common, annual assessments by fund actuaries have sometimes detected a large jump in a total salary bill for an employer agency and usually for a small number of employees.
"Currently this is dealt with administratively — the resulting rise in predicted end benefits is paid into the fund by the employer.
"The proposed legislative remedy — the ability to alter the multiplier — means the intended member payout remains intact; i.e. members' accrued entitlements are maintained, in accordance with legislative requirements.
"This is not about disadvantaging anyone. It is about ensuring greater equity among employees and greater certainty for employer agencies"
It's not the first time the Palaszczuk Government has been forced to defend changes it has made to the defined benefits scheme.
It took a "contribution holiday" from the fund in 2015, stating it was over compensated and could handle the break in payments. The following year, it followed through on its hint it would investigate shaving some money off the surplus for debt and infrastructure spending, by announcing it was taking $4 billion from the $10 billion surplus.
Mr Pitt had said the State was following the advice of the independent actuary, but was later made to concede that advice was only offered once the government changed how the fund was managed, with the State Actuary originally advising no more than $2 billion could be safely taken from the fund.
Mr Emerson said the government's proposed changes were to make up for the "raid".
"It is directly targeted at lowering future payouts of public servants, which will protect the fund from going into deficit following the short-sighted raid," Mr Emerson said, a claim Mr Pitt has denied.
The 49,000 remaining members of the closed $30 billion scheme have their payments legislated, meaning no matter what happens to the fund, the government must find a way to pay workers their entitlements.
