It has become apparent that the opposition had agreed with the government that it was wrong to saddle former Governor-General Michael Jeffery with a punitive and inequitable tax surcharge.
So before Joe Hockey demanded an explanation from the government, he should have checked first with his colleague, the responsible shadow minister, who had actually cleared it..
In the meantime it has been appalling how some people have tried to damage, without any justification whatsoever, the reputation of a fine man who has served his country in peace and in war.
And incidentally, it should have also been made clear that the General receives no pension for his service as Governor of Western Australia, and that his military pension has been rolled into his Governor-General’s pension.
This pension, unlike those under most superannuation schemes, is fully taxable.
Above all, the Governor-General has not sought to escape any tax payable by other Australians.
The following letter to the editor of the West Australian has been made public. The West Australian has not yet published this.
Dear Sir,
In respect of Andrew Proban’s article in your paper of 11 December, I would like to correct some serious anomalies in it.
Exercising my right as a taxpayer and based on expert legal and financial advice, I raised with the Department of Prime Minister and Cabinet, various anomalies in the way my superannuation surcharge had been calculated.
Firstly, it was based on the full value of my pension under the Governor-General Act accruing to me on my first day in office, whereas in reality I did not receive any superannuation benefit until I left office.
Second, the debt was calculated as if the surcharge rate of 14.5% that applied when I was appointed applied for my full term in office. As it happens, the surcharge was reduced to 12.5% in 2004-05, and abolished completely on 1 July 2005.
Finally, while the debt was calculated over the expected term of three years, it grew even further because I remained in office for a further two years.
The Minister for Finance and Deregulation recognised the anomaly in the situation and with the agreement of the opposition Shadow Minister responsible, exercised his discretion to waive part of the surcharge debt.
My debt is now the correct amount that would have been payable if the pension that I now receive had been subjected to the various rates of surcharge that applied over the course of my term in office, as is the case with the public generally.
You might also like to know that I had earlier sought written assurance from my financial adviser as to whether the proposed method of revised calculation of my liability was the same for those members of the general community who were also liable under the Superannuation Surcharge Tax regime. I received written assurance from him that this was the case.
I remain convinced of the appropriateness of my actions in both moral and legal terms.
Michael Jeffery
Yarralumla ACT