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Posted: 2022-11-03 02:43:11

The federal government has sought an explanation from government-owned businesses about executive salaries and bonuses worth tens of millions of dollars.

Australia Post has been routinely criticised for offering senior staff generous salaries and bonuses, including Cartier watches, with management arguing they attract and retain experienced staff.

This week, the Australian Financial Review has reported that at least 24 public servants and government-owned business executives earned more than $1 million last year.

This includes senior staff from Australia Post, NBN Co and Snowy Hydro.

The scale of payments has alarmed Finance Minister Katy Gallagher and Communications Minister Michelle Rowland, who have both written to the organisations.

"We appreciate that executive and workforce renumeration is a matter for the board and a complex one, with the need to balance the government's expectations to manage restraint with regard to performance pay with delivering Australia Post's commercial strategy through the attraction and retention of high-calibre staff and leaders," the ministers said in a letter to Australia Post chair Lucio Di Bartolomeo.

"However, we are seeking information from a number of government business enterprises in relation to the application of performance bonus guidance and would like to better understand the basis for decisions on renumeration, including governance arrangements."

The ministers have asked senior management to justify why these salaries are necessary and appropriate within the industries they operate.

Katy Gallagher at a budget press conference
Finance Minister Katy Gallagher has written to government-owned businesses for an explanation on salaries and bonuses. (ABC News: Nick Haggarty)

Assistant Treasurer Andrew Leigh suggested the payments were out of step with community expectations.

"Certainly, it raises an eyebrow or two in the current environment with Australians seeing real wages now lower than they were a decade ago," Mr Leigh said.

"It's a concern and that's why the minister has asked for a full explanation."

Australia Post's annual report reveals it paid an additional $24 million in bonuses to more than 350 non-executive staff, who were already paid more than $235,000.

In 2020, Australia Post scrapped bonus payments for its executive team after a series of scandals.

The letter calls on the board to explain how these payments were possible given that change.

It also said improving transparency around payments and bonuses would be "in keeping with community expectations".

In 2017, Australia Post chairman Ahmed Favour resigned after his $5.6 million salary was criticised by then prime minister Malcolm Turnbull.

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