Hey Seamisty. Just learned about another driver of bad behaviour in our commonwealth public service.
They call it 54-11. Many public servants where never duped into giving up their CSS scheme when the Cth pushed out hard with the PSS. (The social network among the PS in Canberra is very effective and the Con's of switching got out quickly.) Under the CSS a member retiring before 55 can take a huge percentage of their super out in cash. Cash baby. Just quit a month before your 55th birthday.
The amount they get is calculated, I believe, as 7 times Final Average Salary. The average is calculated over the previous 3 years. So senior members of our Cth public service just need to do whatever they need to get as high as they can in the Cth PS and then quit after just three years.
A recipe for a revolving door through the senior high salary positions.
I wonder how many of our ASIC staff are playing this game. Pursuing their dedication to the quiet life and a big fat payout. Fighting off the younger upstarts who want to get into those roles and then actually do something.
This hazard is on top of the moral hazard created by: A) one set of rules for them (Defined benefit of 7*FAS) and one set of rules for us (Market linked investments). B)the Future Fund competing with our Fund Managers for staff and places to invest capital. C)Public Service salaries and the Cth annual contribution to the Future Fund is limited by the tax take. This is helped by keeping the money flowing. Which is helped by converting Capital into Income. Which is what the PIF disaster did. And continues to do - converting our equity into income for Jenny Hutson's flock.
What a stinking bog of moral hazards in this zero sum game.
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