Laws to strip criminal MPs of taxpayer funded pension due

Legislation to strip jailed former NSW minister Eddie Obeid of his taxpayer-funded parliamentary pension is set to be introduced to Parliament within weeks.
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But it is unclear if the legislation will apply to another former minister facing a prison sentence, Ian Macdonald, who was on Thursday found guilty of two counts of misconduct in public office over awarding a lucrative mining licence to a union mate.

In December, Obeid was sentenced to a maximum five years’ jail for misconduct in public office in relation to lobbying over commercial leases at Circular Quay in which his family held an interest.

The then premier Mike Baird immediately announced he would legislate to ensure MPs convicted of a serious offence during their time in office would lose their parliamentary pension, even if they quit before charges are laid.

Presently, MPs convicted of a serious offence – punishable by at least five years’ imprisonment – can keep their pensions if they are not charged while in office.

Obeid was charged after he left Parliament in 2011. The change will ensure he is stripped of his lifetime annual pension worth more than $120,000 a year.

But it is unclear whether the legislation would apply to Macdonald, as it is not known if he took his pension in a lump sum upon leaving Parliament.

MPs qualifying for the scheme, which ended in 2007, have the option of claiming 10 times the annual benefit upfront, instead of drawing an indexed annual payment for life.

Documents released to Fairfax Media under access to government information laws show Macdonald was entitled to an annual, indexed pension of $135,545 when he quit in 2010.

This means Macdonald could have claimed more than $1.3 million as a lump sum. If he did, there is a possibility that the government will be unable to claw it back.

However, during his trial mid-last year the court was told Macdonald was “only on a parliamentary pension and was having trouble funding his defence”.

It is understood preparation of the legislation is well advanced and could be introduced to Parliament as early as next week.

If not, the next available opportunity would be when Parliament resumes in the first week in May.

After Obeid’s sentencing, Mr Baird also announced the government would claw back more than $280,000 in legal assistance the former minister was given for representation at ICAC.