Secretaries don’t get paid for outcomes, but their reports do, and some senior public servants still have ‘at risk’ pay for performance.
JULIAN BAJKOWSKI 22 NOVEMBER, 2024 KP ok
Nearly all senior bureaucrats at the Australian Taxation Office are eligible for performance bonuses, now almost extinct across the public service, with second commissioners collecting as much as $65,860 in ‘at risk’ pay. That lived up to its name for some.
Second commissioners Jeremy Hirschhorn (Client Engagement Group) and Kirsten Fish (Law Design and Practice Group) collected their bonus bounty, with recently promoted second commissioner for Frontline Operations David Allen also getting a pro-rata performance payment following an internal restructure of customer-facing roles.
Only second commissioners are eligible for bonuses at the ATO, a system that stems from them being defined as statutory appointments who are dubbed “Principle Executive Offices” and thus have their pay set and governed by the Remuneration Tribunal.
Notably, the ATO commissioner does not get paid a bonus, with the controversial performance incentives for public service chiefs pioneered in the Hawke-Keating era subsequently all but dispensed with under Kevin Rudd.
The Mandarin asked the ATO how the bonus scheme worked and what had to happen to get, or not get, a ‘bonus’, a word that carries distinctly private sector performance connotations with it.
“As Principal Executive Office holders (PEOs), ATO second commissioners are entitled to receive performance pay in accordance with the Remuneration Tribunal’s Guide to the PEO Structure”, an ATO spokesperson said.
“Performance pay is an ‘at-risk’ payment subject to the achievement of agreed performance outcomes which are set annually and include:
-achievement of organisational and individual group strategic objectives and deliverables identified in the ATO corporate plan
-consistent role modelling and championing of the ATO Leadership Strategy key attributes; and
-delivery of government programs and initiatives.”
The ATO has also confirmed that its Senior Executive Service are not eligible to be paid a bonus.
The one second commissioner listed in the ATO’s annual report as not having been paid a bonus is the revenue agency’s former chief information officer, Ramez Katf, who departed the agency in April at the end of his statutory seven-year stint.
Katf was effusively praised by recently appointed commissioner of taxation Rob Heferen when the technologist’s departure was announced; however, no bonus was paid to him this year, unlike last year, when a $63,326 bonus was paid.
“The importance of Ramez’s work and dedication to the ATO cannot be overstated. His highly effective and strategic leadership has been vital to Australia’s well-functioning tax, super, and registry systems, especially in a rapidly changing digital landscape,” Heferen said at the time.
What’s also happened since then is that the CIO role Katf occupied has lost its second commissioner status and was advertised as a Band 3 SES role.
The shift down a rung is a generational one, with the head of technology having been at second commissioner level for at least 20 years and the ATO having long been a trailblazer and pioneer for introducing electronic transactions and online interfaces, starting first with agents and then later consumers through services like eTax.
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Tax administration at ‘critical time’ as ATO intensifies debt collection: IGTO
The Inspector-General of Taxation and Taxation Ombudsman expects the number of complaints relating to debts and tax will increase further amid rising financial pressures.
By Miranda Brownlee • 22 November 2024
In its Corporate Plan for the period of 2025-2028, the Inspector-General of Taxation and Taxation Ombudsman (IGTO) has outlined some of the challenges in the current environment for tax administration and outlined its priorities.
In her first Corporate Plan as the newly appointed IGTO, Ruth Owen said it was "a critical time for the agency and for tax administration" with the ATO counting to ramp up its tax collection and cost of living pressures impacting many Australians.
"Tax and tax administration are never far from the headlines and at a time of significant cost of living pressures for many Australians, getting your tax right or receiving your tax refund is front of mind for many," said Owen.
Owen said it was critical that the public has trust in the tax system in order for it to work effectively.
"That is why it is particularly important at this time that I and my office have the capacity and capability to hold the ATO and the TPB to account, especially as the former ramps up its tax collection and debt management activity," she said.
The Corporate Plan noted that there is significant levels of financial stress within the community, including for small businesses.
"Any individual or business in financial stress usually has some form of tax debt or is relying on the tax or superannuation systems to alleviate other financial pressures," the report said.
"Such conditions are driving increased complaints and requests to provide assurance to taxpayers that they are receiving their correct entitlements such as superannuation guarantee."
The IGTO also expects to see increased demand from the community in relation to resolving tax complaints in relation to debt following the ATO's increased focus on tax collection.
"We need to stay agile to changing priorities and administrative practices of the ATO and focused on the risks of unintended consequences or maladministration on taxpayers," the IGTO said.
In its priorities for 2024-25 specifically, the IGTO said it would look to clear the backlog of outstanding taxpayer complaint cases and develop and implement improvements to streamline the compliant investigation process.
The IGTO has set a target to finalise 99 per cent of the complaints that were received before 1 October 2024 by 30 June 2025.
It also aims to finalise 85 per cent of the complaints received from 1 October 2024 within 100 days.
The Corporate Plan said the IGTO will also develop and adapt a new complaints operating model and refresh its guidelines for working with the ATO on complaints.
The IGTO also plans to increase transparency by designing and sharing structured insights and intelligence from complaints data and trends. It also will provide regular updates to Ministers and officials.
