PUBLIC servant superannuation costs have sky rocketed by 15 per cent to $6.34 billion.
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The Budget also shows that between now and 2084 the scheme will cost Tasmanians $20 billion, even though it was closed off to new entrants by the former Bacon government in 1999.
This monster scheme keeps growing. It costs the Budget about $450 million a year in payments to retiring public servants – before a cent is spent on any other function.
Previous governments contributed $1.5 billion towards a fund to off-set the liability, but the previous Labor government spent the money to prop up the budget, so that now departments make a contribution each year towards occasional retirements.
The grand total liability in 2016-17, for departments and other government agencies, such as Metro and Hydro, is $7 billion, or almost $14,000 for every Tasmanian.
A defined benefits superannuation scheme is the gold card of super. Unlike other super schemes that take a hit from economic shocks such as the global financial crisis, a defined benefits scheme pays out what was promised to a rooky public servant, regardless of fluctuations on the share market, and the economy.
Credit rating agencies frown on Tasmania’s giant superannuation liability and previously have described the liability as a debt to taxpayers.