CHAPTER 5
CONCLUSIONS AND RECOMMENDATIONS
It is clear enough from what the chief justices have written
that they think pensions are one of the pillars of independence of the
judiciary. [1]
5.1 The Committee considers that the Commonwealth Judges' Pension Scheme
has a greater role than just being part of a remuneration package for
judges. The pension scheme assists in the underpinning of judicial independence.
The Committee believes that secure and adequate judicial remuneration,
during retirement as well as during service, is essential to judicial
independence.
5.2 In the recruitment of judges, the pension scheme plays an important
role. While remuneration is only one factor in a prospective judge's decision
about whether to accept an appointment, it is true that, for many, judicial
appointment entails a considerable financial sacrifice.
5.3 The Committee considers that senior barristers will remain the primary
source of recruitment to the judiciary, at least for the foreseeable future.
While the Commonwealth cannot match remuneration levels common at senior
levels of the bar, the judges' pension scheme clearly assists in making
judicial appointment more attractive.
5.4 In relation to the unfunded nature of the scheme, the Committee accepts
the Australian Government Actuary's view that the relatively small size
of the scheme means that it is not necessary to make the scheme fully
funded. [2] The Committee is simply not
persuaded that funding is an important issue, or necessarily relevant,
in relation to this scheme.
5.5 Nor does the Committee consider appropriate the replacement of the
scheme with an accumulation style superannuation fund. This would give
rise to sensitive issues, such as the investment of judges' superannuation
monies, which might be perceived to affect the independence of judges
in deciding cases having economic consequences.
5.6 Clearly , the scheme is not ideal for all judges in all situations.
What scheme possibly could be? However, the Committee is satisfied overall
that the scheme is appropriate, and that no major transformation is warranted.
Conclusions and Recommendations
Conclusion 5.7:
The Committee concludes that the judges' pension scheme should be retained,
with minor amendments as recommended below.
Conclusion 1.43:
The Committee takes the view, on the evidence it has received, that the
judicial pension scheme does indeed have a greater role than just being
part of a remuneration package. The Committee recognises that judicial
independence is a guarantee of the impartiality of the judiciary, which
underpins the federal nature of the Commonwealth, and the protection of
individual rights. The Committee shares the widespread view that secure
and adequate judicial remuneration, during retirement as well as during
service, is essential to judicial independence.
Recommendation 3.1
The Committee recommends that the Judges' Pensions Act 1968 be
amended to provide for an actuarially reduced life pension to be paid
to a judge who retires under age 60 after ten or more years service, but
who has attained the age of 55.
Recommendation 4.1
The Committee recommends that survivor and invalidity benefits continue
to be paid to beneficiaries of the judges' pension scheme. However, as
in the case of the parliamentary scheme, the Committee considers that
the rules under which these benefits are paid should be reviewed to ensure
they are in accordance with community standards.
Recommendation 4.2
The Committee recommends that the Judges' Pensions Act 1968 be
amended to provide for an option for a judge to elect to have his or her
pension commuted on retirement, or on death before or after retirement,
to the extent that would provide a lump sum equal to one year of the yearly
pension to which the judge was entitled at the date of the retirement
or death.
If such an election is made, any pension subsequently payable to the
judge, spouse or dependant, is actuarially reduced by the value of the
commutation so that the total value of benefits paid is the same as if
there had been no election.
(signed)
Senator John Watson
Chairman
Footnotes
[1] Evidence, Justice Davies, p. 39.
[2] The Actuary noted that the costs of the
judges' pension scheme "actually is of no great financial consequence
in the context of the Commonwealth's revenue" (Evidence, p. 86).
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