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Legislative Assembly for the ACT: 1997 Week 13 Hansard (2 December) . . Page.. 4296 ..

MRS CARNELL (continuing):

The committee's second recommendation is that the Government report to the Assembly on the short- and long-term options for addressing the emerging and accruing costs of superannuation, taking account of the relevant recommendations of the 1996-97 and 1997-98 Estimates Committee reports. The Government agrees with this recommendation. The Government is committed to developing a long-term strategy to address the issue of unfunded superannuation liabilities for the ACT Public Service, that is, the ACTPS, and in the shorter term to developing alternative superannuation agreements for new ACT Public Service employees from 1 July 1998. The CSS was closed to new entrants in 1990. The Commonwealth announced on 23 September 1997 that it will close the PSS to all new entrants from 1 July 1998.

Recent actuarial estimates show that, for the ACTPS, current unfunded liabilities are around $700m and were projected to increase to approximately $1,600m by the year 2013 had the PSS remained the principal scheme for new entrants and there was no change to the present funding policy. The annual costs will increase from the 1997-98 level of $16m to over $120m by the year 2027, that is, in 1997 dollar values. It is against this background that a review of the ACTPS superannuation agreements foreshadowed in the 1997-98 budget will take place. The review has been initiated and I think the tender documents went out last month and are in place. The outcome should be available to the Government by the end of March 1998.

The final committee recommendation is that the Government seek to reach agreement with the Auditor-General on interpretations of accounting standards and advise the Assembly during the December 1997 sittings of the Assembly on the outcome. The Government agrees with this recommendation; but the timeframe is a bit funny. The Government respects the views of the Auditor-General and his interpretations of accounting treatments. In many instances, the Government agrees with his views; and, in others, it has acquiesced or deferred to his judgment. Recent examples of this include the ACT fleet lease arrangements being classified as a finance lease rather than an operating lease, as originally interpreted and advised by the Macquarie Bank.

Ongoing discussions have been held, and will continue to be held, with the Auditor-General on the reforms that have been put in place to date, as well as the remaining aspects of the reforms that are yet to be implemented, to reach agreed interpretations of accounting standards. This recommendation is ongoing as interpretation of accounting standards is something that changes over time. Obviously, it would not be possible to table this in the December sittings as we are in them right now, but we do believe in principle that we should reach agreement with the Auditor-General wherever possible in this area. I trust that this information is of assistance to the Public Accounts Committee and to all other members of the Assembly.

MR WHITECROSS (4.23): Mr Speaker, I rise as chair of the committee to respond to some of the comments made in the Government's response to the report of the Standing Committee on Public Accounts. I might start at the end. Mrs Carnell seems to think it is somewhat amusing that she be asked to report to the December sittings on the outcome of discussions with the Auditor-General, given that we are now in the December sittings.

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