The tussle between executive and judicial power, normally fought on the high plain of human rights, is now being tested by the apparently trivial issue of judges’ superannuation.
But Federal Attorney-General Daryl Williams is rightly treading very gingerly on the question of the way the 15 per cent tax on the superannuation of high income earners will apply to judges.
The trouble is that the Constitution says: “”The Justices of the High Court and of the other courts created by the Parliament shall receive such remuneration as the Parliament may fix; but the remuneration shall not be diminished during their continuance in office.”
Most people will be hit by the tax as it goes in to their fund. If judges were hit this way, then it would be an ordinary tax and they could not complain. It wold be like the rises and falls in income tax and therefore not a diminishment of their remuneration.
But judges (and some others) are in what are called “”defined-benefit” schemes. In these schemes no money goes into a fund to set aside against an individual’s name for later payment. Rather money comes out of consolidated revenue upon the judge’s retirement, disability or death. The amount is defined by such things as length of service, age and income at retirement, disability or death.
Because it is structured this way and new tax surcharge can only be extracted at the end when the defined benefit is paid out. It could mean, therefore, a diminishment of their remuneration and be offensive to the Constitution.
This will depend on whether superannuation is regarded as part of remuneration and whether even in a defined-benefit scheme the surcharge is still just a tax that technically is paid by the judge after the undiminished package has passed through his or her hands.
Those two questions, of course, can only be answered by judges in a court. The judges hearing the case would have to declare their conflict of interest and if challenged by the Government those same judges would then have to rule on whether they should disqualify themselves.
It is an interesting illustration of the ultimate power of the High Court judges in our constitutional system.
Should it be checked, if so, how?
To a large extent the power is checked. If no-one brings a case, the judges can do nothing. (And perhaps no judge will challenge the super surcharge.) Further, at every level of appeal up there are more judges hearing a case. Thus a case goes from one judge in a state supreme court, to three in a state appeal court to five or seven in the High Court. So quite a few judges have to go quite mad before the power is abused.
The other checks on the power of the courts are tradition, peer pressure (of other judges and lawyers), a judge’s view of the law and the need to give written reasons in public following public argument.
Sundry squatters’ and states’ rights people have argued that the High Court went mad and abused their power in the Dams, Mabo and Wik cases, but it required at least a majority of four judges in a each case to create a decision. The requirement that at least four judges have to be suborned, corrupted, abuse power or go mad, makes it that less likely.
It may be that before appointment the states could have a greater say or the legislature could veto an appointment after a parliamentary committee hearing. But once appointed, it would be dangerous to impose any further check on the judiciary as a whole, though individual judges may be removed for proven misbehaviour or incapacity. This is especially so if those checks are to come form the executive. Executive governments are notorious for abusing power. This is especially so because they do so much in secret, unlike the judiciary.
The judiciary is the bastion against abuse of power by the executive. If you have a gripe against the government, you can get it heard fairly, whether you are a refugee, a person accused of a crime, someone who building contract has not been paid by the government or someone whose property has been damaged by government action. True, in Australia it may take a long time and be very expensive but that is a separate issue from the fact that power cannot arbitrarily be abused by government against its own citizens, unlike in, say, China, where the government a party does what it likes according to who is in and out of favor.
This is why the superannuation issue is important. If you can cut a judge’s pay (to nothing) or craftily abolish his job by legislating his court out of existence as in the case with Justice Staples, you destroy judicial power and the executive can do what it likes.
Daryl Williams, in his flat deadpan way, said the question of superannuation was “”a small example of the need to be clear about the concept of judicial independence” and that he had written to the Treasurer advising him of the constitutional position.
In other words, “”back off”.
For people to be confident in the judiciary or the rule of law suggestions of standing over the judges with threats to cut their pensions need to be squashed. On the other hand, giving the judges an exemption from a tax everyone else has to pay might seem like a bribe. The government probably did not think its super surcharge through. The long-term solution if for judges’ superannuation to be contribution bases and taxed like everyone else. In the meantime Williams’ care is well-justified.