14 August 2017
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Madden and Deirdre McKeown
and Public Administration
In 2017 the Turnbull Government introduced the
most extensive changes to parliamentary entitlements since the current system commenced
This quick guide:
- provides a brief overview of the legislative and administrative
changes to parliamentary business resources (as they are now known)
- updates Parliamentary Library information showing the total
remuneration of members of Parliament, ministers and parliamentary office
holders following the Remuneration Tribunal’s decision to grant MPs a two per
cent pay rise from 1 July 2017 and
- provides links to relevant resources, including Bills Digests and
other relevant Parliamentary Library publications, Bill homepages and Acts.
Business Resources Act 2017 and the Independent
Parliamentary Expenses Authority Act 2017 together provide
an overarching framework for MPs’ business resources, but much of the detail will
be outlined in determinations and regulations. This includes issues such as:
what activities are included under parliamentary business, travel expenses,
travel allowances and work expenses; what public resources may be available; what
an MP has to provide in claiming public resources; and which office holders are
eligible for office holder salary.
A more detailed paper on the administration of, and
legislative changes to, parliamentary remuneration and business resources will
Establishment of the Independent
Parliamentary Expenses Authority
On 13 January 2017 the Prime Minister, Malcolm Turnbull, announced
the establishment of an Independent Parliamentary Entitlements Authority (IPEA). He indicated that the United Kingdom’s (UK) approach would provide the model
for the new independent authority. The announcement came in response to a
controversy over MPs’ travel entitlements that culminated in the resignation of
the then Minister for Health, Sussan Ley, from that position.
As is discussed in a separate Parliamentary
Library FlagPost on the role and powers of the UK Independent Parliamentary
Standards Authority (IPSA), not only are the expenses schemes in Australia and
the UK very different, but ‘the UK IPSA model operates within a stronger
integrity regime in the UK Parliament—including a Parliamentary Commissioner
for Standards and codes of conduct for MPs—than that currently operating in the
The Prime Minister introduced the Independent
Parliamentary Expenses Authority Bill 2017 on 9 February 2017, and
it was passed by both Houses of Parliament the same month. The Independent
Parliamentary Expenses Authority Act 2017 established the IPEA as an independent statutory authority.
The Act includes provision for the establishment by Executive Order of an
interim advisory body, governed by a board which would transition to the IPEA
when it commenced operation on 1 July 2017. The IPEA’s responsibilities
include advising on, administering, and reporting on the work resources and
travel resources (travel expenses and travel allowances) of members of
parliament. The functions remaining with the Department of Finance (DoF) are described
in the relevant DoF
circular as office accommodation and advice on and
administration of non-travel related expenses.
From 1 July 2017, the IPEA has been established as a
Commonwealth statutory authority. Ms Jillian Segal has been appointed Chair of the IPEA.
Other members of the IPEA are Mr John Conde (President of the
Remuneration Tribunal); Mr Gary Gray; Dr Julianne Jaques and Mr Jeffrey Spender.
A Parliamentary Library publication
on the IPEA legislation noted that the administration of
federal MPs’ pay and business resources will now involve the IPEA, the DoF, and
the Remuneration Tribunal (which will continue to determine MP’s pay and work
expenses), and further noted that it was not yet clear how the IPEA and
the DoF would interact.
2017 article raised related concerns, suggesting:
There is already considerable scepticism about the new agency
and what administrative reality will emerge in the months and years to come. If
IPEA simply adds another layer of legitimacy to devious travel expenses that
still don’t sound right when people read about them in the news, it will have
The article includes points made by Andrew McDonald, the
head of the UK’s IPSA from 2009 to 2014, who suggested that the ‘IPEA’s
independence is weakened by the fact it sits within the Department of Finance
and will be funded like any other public service agency’. In addition McDonald
noted that, with the IPEA’s focus on travel expenses, it is entering ‘a crowded
landscape’ with some functions staying with Finance, the minister, and the
Changes to the Life Gold Pass
The Government introduced the Parliamentary
Entitlements Legislation Amendment Bill 2017 on 9 February 2017, and
it was passed by both Houses of Parliament the same month. The Parliamentary
Entitlements Legislation Amendment Act 2017 ended access to the Life
Gold Pass scheme other than for former Prime Ministers and their spouses or de
facto partners. The Life Gold Pass scheme (now titled Parliamentary
Retirement Travel by virtue of the amending legislation) had provided
limited free domestic travel for eligible former members. The Act also imposes
penalty loadings when a travel claim is made in excess of the entitlement and
strengthens the declaration made by senators and members on travel forms.
Parliamentary business resources
In his second
reading speech on the IPEA Bill (discussed above) the Prime Minister foreshadowed
that the Government would present ‘a further significant bill’ to the
Parliament which would ‘improve the legislative and administrative framework of
the ... work expenses framework—further encouraging transparency, accountability
and value for money’.
Business Resources Bill 2017 and the Parliamentary
Business Resources (Consequential and Transitional Provisions) Bill 2017 were both introduced into the House of Representatives on 30 March 2017.
The Bills were passed by both Houses of Parliament in May 2017 and received
Royal Assent on 19 May 2017, but the Acts have not yet commenced.
These Acts will streamline the framework into a single Act—the Parliamentary Business
Resources Act 2017 (PBR Act)—rather than the eight that
underpin the existing scheme. The Parliamentary
Business Resources (Consequential and Transitional Provisions) Act 2017 (PBR (CTP) Act) will repeal the Parliamentary Entitlements Act 1990 and
the Parliamentary Allowances Act 1952 and remove from other relevant
Acts those provisions relating to members remuneration and work expenses.
The Parliamentary Library’s Bills
Digest noted that the legislation implements a principles-based framework
that delineates between parliamentarians’ remuneration and work expenses, as
recommended by numerous reviews and audits. The PBR Act will:
- introduce a ‘dominant purpose test’ as a purpose-based
eligibility criterion for all work expenses, allowances and other public
resources, which means that MPs can only use public resources for the dominant
purpose of conducting parliamentary business
- define ‘parliamentary business’ to include four streams:
parliamentary duties, electorate duties, party political duties and official
- provide that MPs have to ensure value for money in incurring
expenses or claiming allowances or other public resources and
- introduce new obligations on MPs to use public resources
appropriately, in good faith and ethically, and be accountable for their use.
Financial penalties will be able to be imposed for contravention of these
The PBR (CTP) Act will:
- make consequential amendments to the legislation governing the
IPEA to provide an additional function relating to rulings on travel resources
- provide transitional provisions to facilitate the move from the
existing scheme to the new scheme.
Former head of the UK IPSA, Andrew McDonald, has also commented
on the dominant purpose test, suggesting that deciding the dominant purpose
of travel could be difficult in practice. McDonald also noted that consistency
of the IPEA’s rulings could become an issue over time.
As at time of publication of this quick guide, the Acts had
not commenced and the regulations that will underpin them had not been
promulgated. Until this occurs, the IPEA will continue to operate under the
existing entitlements scheme. The PBR Act will commence on the
sooner of a day fixed by Proclamation or 20 May 2018.
On 22 June 2017 the Remuneration Tribunal announced its
decision to increase remuneration by two per cent for public offices in its
jurisdiction, with effect from 1 July 2017. This includes the base salary of MPs.
In its June 2017 Statement, 2017
Review of remuneration for holders of public office, the Remuneration
Tribunal stated that this ‘represents an increase of 1.6 per cent per annum
over the 18 months since the last general increase decided by the Tribunal,
effective from 1 January 2016’.
Remuneration Tribunal Determination 2017/12 states that the base salary of an MP will increase from $199,040 to $203,030
per annum from 1 July 2017. The table, Remuneration
of members of parliament, parliamentary office holders and ministers of state, updates the base salary for members of parliament, ministers and parliamentary
Sources and further reading
All hyperlinks are correct as at August 2017.
Acts and Bill homepages
Parliamentary Library publications
- C Madden and D McKeown, ‘Independent Parliamentary Expenses Authority’, FlagPost, Parliamentary Library blog, 7 February 2017.
- C Madden and D McKeown, ‘Independent Parliamentary Expenses Authority Bill 2017 and
Independent Parliamentary Expenses Authority (Consequential Amendments) Bill
2017’, FlagPost, Parliamentary Library blog, 14 February
- C Madden and D McKeown, Parliamentary Business Resources Bill 2017 [and] Parliamentary
Business Resources (Consequential and Transitional Provisions) Bill 2017, Bills digest, 97, 2016–17, Parliamentary Library, Canberra, 2017.
- C Madden, Parliamentary Entitlements Legislation Amendment Bill 2017, Bills digest, 62, 2016–17, Parliamentary Library, Canberra, 2017.
- C Madden and D McKeown, Parliamentary remuneration and entitlements: 2016 update, Research paper series, 2015–16, Parliamentary Library, Canberra,
– Note: the entitlements system described in the above publication is
still current as at the date of publication of this quick guide.
For copyright reasons some linked items are only available to members of Parliament.
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