" Fat Cat " Salaries !

At the same time as many weekend and public holiday workers are losing the full extent of their pay margins for penalty loadings it is revealed that the managing director of Australia Post is enjoying a salary of $ 5.6 million a year.  That is throwing the spotlight on the huge discrepancy between those at the top of the pay pyramid - and those scraping by at the minimum wage.

Ahmed Fahour can claim to have righted what was a sinking ship when he took command at Australia Post.   Under his watch this government entity has returned a profit of $ 131 million in the six months to December 31, from just $ 16 million in the previous corresponding period.

Most importantly, letter deliveries are now at breakeven and that is a recovery from catastrophic losses.   But the recovery did come at a cost.  The price of a postage stamp rose to a dollar and the actual delivery time extended out by several days..   We are paying a lot more for a slower service and in the long term that simply makes the further retreat of the postal service inevitable.  Commerce has switched from sending a bill in the mail to demanding automatic bank payments to settle their bills.

When we examine that profit breakup it reveals that Australia Post has virtually become a leading figure providing a courier service.  Internet shopping has vastly increased the flow of goods from warehouses to private homes and Australia Post has grabbed a significant share of this trade. It is a logical upgrade for an existing delivery service concentrated on letter delivery.

What is causing adverse comment is the fact that the salary accorded to the managing director of Australia Post seems way out of whack with comparison with other leading figures on the Australian landscape.   He gets many times the salary of the Australian prime minister, and that $ 5.6 million seems excessive when compared with just one million drawn by the governor of the Reserve Bank of Australia and the $ 900,000 a year drawn by the managing director of the ABC.

Mr Fahour has now tendered his resignation.  He will receive a massive termination package and he claims to have achieved the objectives he set when he undertook the job - and it is now time to move on and seek new challenges.   It is very clear that whoever succeeds him will not be offered anything near that $ 5.6 million stipend.

Setting the pay for the managing director of Australia Post was at the discretion of the Australian Post board and they acted independently.   That decision will now fall under the control of the Commonwealth Remuneration Tribunal.   That sets salaries with regard to the pecking order and the skills required, but it will be within a framework that is in accord with the rest of the public service.

It will be interesting to see how this salary revision is received in the private sector.   Shareholders and the public have expressed alarm at the escalating amounts paid to chief executives of banks and major corporations and question whether any human being is worth that amount of money.  In many instances it does raise the " value for money " question   !