Productivity Commission denies ministerial influence
The Productivity Commission has sought to explain why its final report on default funds under modern awards closely aligned with a departmental submission endorsed by the Minister for Financial Services, Bill Shorten, but has denied the ministerial endorsement represented an undue influence.
Questioned during Senate Estimates this week, the deputy chairman of the Productivity Commission and the man who chaired the default fund panel, Mike Woods, acknowledged that the final report did refer to the submission prepared by Treasury and the Department of Employment, Education and Workplace Relations "in several places" but denied this reflected undue influence.
"In some respects our position and the position in that submission are the same and in some respects they are significantly different, and we can deal with both," Woods said.
"In terms of a particular issue that was put forward by the Financial Services Council that the employer should be able to choose any fund - which was our option 1 in our draft - we did not consider that that met the requirement specifically and that continued to be rejected in our final [position] and was discussed with them at hearings."
He said that on the issue of employer discretion raised in the Commission's draft report, the members of the panel had held concerns in several respects.
"One is to get the balance right between having the best interests of the employees as the paramount concern, but making sure that the test on employers was not so onerous that it would never be employed," Woods said.
Further, he said the Productivity Commission had made that point specifically in the draft and had stepped beyond normal practice to request information in its later hearings.
Under questioning from the Opposition spokesman on Financial Services, Senator Mathias Cormann, Woods insisted that the final report had not followed the Government's submission to the letter.
"…the departmental proposal was that funds would be able to put their proposals to a panel of experts which would then make recommendations to the full bench of Fair Work Australia," he said.
"We are adamant that all funds should be able to have standing for this purpose directly to a panel of Fair Work Australia as the final decision maker."
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