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The High Cost of Judges: Reconsidering Judicial Pensions and Retirement in an Ageing Population

Published online by Cambridge University Press:  24 January 2025

Brian Opeskin
Brian Opeskin*
Affiliation:
Macquarie University
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Extract

In recent years there has been unprecedented concern about the impact of population change on Australian society. The concerns come from different quarters. Commentators have variously remarked that fertility is too low, immigration is too high, the population is ageing too rapidly, and that uneven spatial distribution is placing too great a burden on the infrastructure of already crowded cities. As further evidence of the growing interest in population dynamics, in 2010 the Australian Government created a new office of the Minister for Sustainable Population to help guide the development of policies to meet Australia’s future population needs.

These are important issues in a national population debate, yet demographic change also affects specific workforces in specific ways, and this has led to a new interest in workforce planning. This article examines how demographic change is likely to affect one aspect of the Australian judicial system in the future, namely, the cost of judges.

Type
Research Article
Information
Federal Law Review , Volume 39 , Issue 1 , March 2011 , pp. 33 - 70
Copyright
Copyright © 2011 The Australian National University

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Footnotes

I would like to thank Rebecca Kang for research assistance. I have had the benefit of advice from judges, demographers and economists in undertaking this research. I am particularly indebted to Ross Chapman, Rebecca Kippen, Nick Parr and two anonymous referees for their incisive comments on a draft of this article. Any remaining errors are mine alone. An embryonic version of this article was presented at the Australasian Law Teachers Association Conference in Auckland, 4–7 July 2010.

References

1 Jacob, S Siegel, Applied Demography: Applications to Business, Government, Law, and Public Policy (Academic Press, 2002) 330–95Google Scholar; Julie, Sloan, The Workforce Planning Imperative (Julie Sloan Management Pty Ltd, 2010)Google Scholar.

2 Australian Government Actuary, The Judge's Pension Scheme: A Report on the Long Term Costs, Carried Out by the Australian Government Actuary Using Data to 30 June 2008 (Australian Government Actuary, 2008) [7.2].

3 Francesco, Billari, ‘Life Course Analysis’ in Paul, Demeny and Geoffrey, McNicoll (eds), Encyclopedia of Population (Macmillan Reference, 2003) 588, 588Google Scholar.

4 Australian Government Actuary, above n 2, [5.14].

5 George, Winterton, ‘Appointment of Federal Judges in Australia’ (1987) 16 Melbourne University Law Review 185, 192–211Google Scholar; Kate, Malleson and Peter, Russell (eds), Appointing Judges in an Age of Judicial Power (University of Toronto Press, 2006)Google Scholar.

6 A R, Blackshield, ‘The Appointment and Removal of Federal Judges’ in Brian, Opeskin and Fiona, Wheeler (eds), The Australian Federal Judicial System (Melbourne University Press, 2000) 400, 426Google Scholar; James, Crawford and Brian, Opeskin, Australian Courts of Law (Oxford University Press, 4th ed, 2004), 63–5Google Scholar; Senate Legal and Constitutional Affairs References Committee, Parliament of Australia, Australia's Judicial System and the Role of Judges (2009) [3.6]–[3.19].

7 High Court of Australia Act 1979 (Cth) ss 6–7; Federal Court of Australia Act 1976 (Cth) s 6(1); Family Law Act 1975 (Cth) s 22; Federal Magistrates Act 1999 (Cth) sch 1 item 1.

8 J W, Shaw, ‘On the Appointment of Judges’ (2000) 74 Australian Law Journal 461, 462Google Scholar; Sharyn, Roach Anleu and Kathy, Mack, ‘Judicial Appointment and the Skills for Judicial Office’ (2005) 15 Journal of Judicial Administration 37Google Scholar, 37–40; Simon, Evans and John, Williams, ‘Appointing Australian Judges: A New Model’ (2008) 30 Sydney Law Review 295, 297–9Google Scholar.

9 Attorney-General's Department, Requisite Qualities for Appointment (5 June 2009) Australian Government Attorney-General's Department <http://www.ag.gov.au>; Senate Legal and Constitutional Affairs References Committee, above n 6, [3.15].

10 Ronald, Sackville, ‘The Judicial Appointments Process in Australia: Towards Independence and Accountability’ (2007) 16 Journal of Judicial Administration 125, 137Google Scholar.

11 Elizabeth, Handsley, ‘“The Judicial Whisper Goes Around“: Appointment of Judicial Officers in Australia’ in Kate, Malleson and Peter, Russell (eds), Appointing Judges in an Age of Judicial Power (University of Toronto Press, 2006) 122, 135Google Scholar.

12 See Andrew, Goldsmith, ‘A Profile of the Federal Judiciary’ in Brian, Opeskin and Fiona, Wheeler (eds), The Australian Federal Judicial System (Melbourne University Press, 2000) 365, 373–6Google Scholar.

13 Michael McHugh, ‘Women Justices for the High Court’ (Speech delivered at the Western Australia Law Society, Perth, 27 October 2004). See also Law Society of New South Wales, After Ada: A New Precedent for Women in Law (Law Society of New South Wales, 2002)Google Scholar; Barbara, Hamilton, ‘The Law Council of Australia Policy 2001 on the Process of Judicial Appointments: Any Good News for Future Female Judicial Appointees?’ (2001) 1 Queensland University of Technology Law and Justice Journal 223Google Scholar.

14 For an historical account, see David, Weisbrot, Australian Lawyers (Longman Cheshire, 1990) 83–90Google Scholar.

15 Australasian Institute of Judicial Administration, Judges and Magistrates (% of women) (3 March 2011) <http://www.aija.org.au/gender-statistics.html>.

16 High Court of Australia Act 1979 (Cth) s 7; Federal Court of Australia Act 1976 (Cth) s 6; Family Law Act 1975 (Cth) s 22; Federal Magistrates Act 1999 (Cth) sch 1 item 1.

17 In Queensland, 12 years is the norm: Bar Association of Queensland, Criteria for Appointment as Senior Counsel <http://www.qldbar.asn.au/index.php>.

18 A notable example was the appointment of H V Evatt as a justice of the High Court in 1930, at the age of 36: see Peter, Bayne, ‘Evatt, Herbert Vere’ in Michael, Coper, Tony, Blackshield and George, Williams (eds) The Oxford Companion to the High Court of Australia (Oxford University Press, 2001) 251Google Scholar.

19 Australian Constitution s 72.

20 See Ross, M Stolzenberg and James, Lindgren, ‘Retirement and Death in Office of US Supreme Court Justices’ (2010) 47 Demography 269Google Scholar, 292, in which the authors argue that the timing of retirement of US Supreme Court justices is in service to the value of reciprocity rather than economic self-interest.

21 Judges’ Pensions Act 1968 (Cth) ss 7, 9.

22 The more recent examples are reviewed in Enid, Campbell and H P, Lee, The Australian Judiciary (Cambridge University Press, 2001), 101Google Scholar–31.

23 Judges’ Pensions Act 1968 (Cth) s 17.

24 Federal Court of Australia, Annual Report 2009–2010, (Federal Court of Australia, 2010) 71, 89Google Scholar.

25 George, Winterton, Judicial Remuneration in Australia (Australian Institute of Judicial Administration, 1995) 19–31Google Scholar.

26 See Remuneration Tribunal, Determination 2010/03: Judicial and Related Offices — Remuneration and Allowances, 2010/03, 1 April 2010.

27 Remuneration Tribunal Act 1973 (Cth) s 5.

28 Remuneration Tribunal, Statement on 2001 Review of Judicial and Related Offices’ Remuneration, 2001/23, 1 October 2001.

29 Remuneration Tribunal Act 1973 (Cth) s 7.

30 This occurred in 1990: Winterton, above n 25, 52, 55–6.

31 Australian Government Actuary, above n 2, [5.6].

32 A higher rate of salary growth would not only increase the absolute cost of judges’ salaries and pensions but also the proportionate contribution to total cost of those expenditures incurred far into the future (ie pensions) relative to those incurred in the near future (ie salaries).

33 Statutory and Other Offices Remuneration Act 1975 (NSW); Salaries and Allowances Act 1975 (WA).

34 Remuneration Act 1990 (SA) ss 18, 19.

35 Supreme Court Act 1887 (Tas) s 7.

36 Judicial Salaries Act 2004 (Vic) s 5(4); Judicial Remuneration Act 2007 (Qld) s 5.

37 Queensland, Parliamentary Debates, House of Representatives, 17 October 2007, 3665–6 (K Shine, Attorney-General).

38 Remuneration Tribunal, Major Review of Judicial and Related Offices’ Remuneration (Remuneration Tribunal, 2002)Google Scholar [5.4.5].

39 Judicial Salaries Act 2004 (Vic) s 5(4) (effective 1 July 2007); Judicial Remuneration Act 2007 (Qld) s 5 (effective 14 March 2008).

40 Australian Bureau of Statistics, Legal Services, Australia, Cat No 8667.0 (Australian Bureau of Statistics, 2009) 9–10Google Scholar.

41 Remuneration Tribunal, Determination 2010/10: Remuneration and Allowances for Holders of Full-Time Public Office, 16 February 2011.

42 Federal Magistrates are subject to a separate regime: see Federal Magistrates Act 1999 (Cth) sch 1 pt 2.

43 Judges’ Pensions Act 1968 (Cth) s 6.

44 Ibid s 6A(4).

45 Ibid ss 6A, 6B.

46 The superannuation guarantee charge was a tax levied on the superannuation contributions of high income earners from 1997–2005. In 2003 the High Court held that the tax was invalid in its application to state judges: Austin v Commonwealth (2003) 215 CLR 185. The surcharge was abolished in 2005 but accrued liabilities remain. The effect of the tax is that a federal judge can face a significant lump sum liability upon retirement; and the later the retirement, the larger the debt.

47 Supreme Court Act 1933 (ACT) s 37U(4); Judges’ Pensions Act 1953 (NSW) s 4; Judges (Pensions and Long Leave) Act 1957 (Qld) s 4; Supreme Court (Judges Pensions) Act 1980 (NT) s 4.

48 Constitution Act 1975 (Vic) s 83(1). A similar rule applies in the County Court: County Court Act 1958 (Vic) s 14(2).

49 Judges’ Salaries and Pensions Act 1950 (WA) s 6.

50 Judges’ Pensions Act 1971 (SA) ss 5–6.

51 Retirement Benefits Act 1993 (Tas) s 5 (for appointments after 1 July 1999). See Alan Blow, ‘Judicial Pensions and Superannuation’ (Paper presented at the Eighth Colloquium of the Judicial Conference of Australia, Adelaide, 1–3 October 2004).

52 Department of Finance and Deregulation (Cth), Parliamentary Contributory Superannuation Scheme Handbook (Department of Finance and Deregulation, 2010)Google Scholar.

53 Mercer Australia, Parliamentary Contributory Superannuation Scheme: Actuarial Investigation as at 30 June 2008 (30 June 2008) Department of Finance and Deregulation <http://www.finance.gov.au/superannuation/parliamentary-superannuation/long-term-cost-report.html>. The PCSS had 545 members at that date (including current contributors, former member pensioners, and spouse pensioners); the federal judges’ pension scheme had less than half that number (270 current judges and pensioners).

54 Judges’ Pensions Act 1968 (Cth) ss 4AC, 4AB, 4(1).

55 Ibid s 8(1).

56 Ibid s 9(1), 10.

57 Constitution Act 1975 (Vic) s 83(2); Judges’ Salaries and Pensions Act 1950 (WA) sch 2 item 2; Supreme Court Act 1933 (ACT) s 37U(4); Supreme Court (Judges Pensions) Act 1980 (NT) ss 5, 6.

58 Judges’ Pensions Act 1953 (NSW) s 6 (but only 25 per cent of judicial salary if the judge had served less than ten years); Judges (Pensions and Long Leave) Act 1957 (Qld) ss 7, 8.

59 Judges’ Pensions Act 1971 (SA) s 8.

60 Australian Bureau of Statistics, Social Marital Status by Age and Sex, 2006 Census Tables, Cat No 2068.0 (Australian Bureau of Statistics, 2007)Google Scholar.

61 Australian Bureau of Statistics, Marriage, Australia, 2007, Cat No 3306.0.55.001 (Australian Bureau of Statistics, 2008)Google Scholar, tables 6, 7.

62 These figures are based on the author's calculations using the Reed-Merrell method for determining the probability of dying between exact ages. They correspond closely with the ABS estimates: Australian Bureau of Statistics, Life Tables, Australia, 2006–2008, Cat No 3302.0.55.001 (Australian Bureau of Statistics, 2009)Google Scholar.

63 For comparability with previous paradigms, future life expectancy and expected life span have been calculated for a 60 year old, which is the youngest age at which the judicial pension vests.

64 The contour plot was generated using the Lexis 1.1 software developed under the auspices of the Max Planck Institute for Demographic Research: K, Andreev, Demographic Surfaces: Estimation, Assessment and Presentation, with Application to Danish Mortality 1835–1995 (PhD Thesis, University of Southern Denmark, 1999)Google Scholar.

65 Population Reference Bureau, 2009 World Population Data Sheet (Population Reference Bureau, 2009) 10–13Google Scholar.

66 Ibid 10.

67 Population Reference Bureau, ‘The Future of Human Life Expectancy: Have We Reached the Ceiling or is the Sky the Limit?’ (Research Highlights in the Demography and Economics of Aging No 8, National Institute of Aging, March 2006).

68 Jay, Olshansky, Bruce, Carnes and Christine, Cassel, ‘The Future of Long Life’ (1998) 281 Science 1611, 1612Google Scholar.

69 Ronald, Lee, ‘Predicting Human Longevity’ (2001) 292 Science 1654Google Scholar.

70 Jim, Oeppen and James, Vaupel, ‘Broken Limits to Life Expectancy’ (2002) 296 Science 1029, 1029Google Scholar.

71 Australian Bureau of Statistics, Population Projections, Australia 2006 to 2101 Cat No 3222.0 (Australian Bureau of Statistics, 2008)Google Scholar 3 (ABS, Population Projections).

72 Ibid 20–6.

73 A J, McMichael, ‘Social Class (as Estimated by Occupational Prestige) and Mortality in Australian Males in the 1970s’ (1985) 9 Community Health Studies 220Google Scholar; Australian Institute of Health and Welfare, Australia's Health 2008 (Australian Institute of Health and Welfare, 2008), 125–8Google Scholar.

74 ABS, Population Projections, above n 71, 22–3.

75 It can be shown using the 2007–09 ABS life tables that if life expectancy at birth is 94 years, then life expectancy at age 60 will plausibly lie between 34–39 years, giving a total life span of 94–99 years. The outcome depends on the assumptions made about mortality of those below age 60. If under–60 mortality is assumed to be unchanged from 2007–09 levels, then life expectancy at age 60 will be 39 years. (A life expectancy at birth of 94 years can be achieved only by relatively lower mortality of those above age 60). If under–60 mortality is assumed to be zero, then life expectancy at age 60 will be 34 years. (A life expectancy at birth of 94 years can be achieved only by relatively higher mortality of those above age 60.) Trends in mortality (especially for children) suggest that the latter is a more reasonable assumption. I am grateful to Rebecca Kippen for this analysis.

76 Judiciary Act 1903 (Cth) s 48A, as inserted by Judiciary Act 1926 (Cth) s 3, repealed by Judges Pensions Act 1948 (Cth) s 5.

77 Judges’ Pensions Act 1948 (Cth) ss 6–9, repealed by Judges’ Pensions Act 1968 (Cth) s 3.

78 Judges’ Pensions Act 1968 (Cth) s 6, later amended by Parliamentary and Judicial Retiring Allowances Act 1973 (Cth) s 35.

79 Crawford and Opeskin, above n 6, 27–9. See also SirGarfield, Barwick, ‘The State of the Australian Judicature’ (1977) 51 Australian Law Journal 480, 495Google Scholar.

80 Treasury (Cth) ‘Intergenerational Report 2002–03’ (Budget Paper No 5, Treasury, 14 May 2002).

81 Charter of Budget Honesty Act 1998 (Cth) s 21. The two subsequent reports are: Treasury (Cth), Intergenerational Report 2007 (Treasury, 2007) and Treasury (Cth), Australia to 2050: Future Challenges (Treasury, 2010).

82 Burke, Shartel, ‘Pensions for Judges’ (1928) 27 Michigan Law Review 134, 150–1Google Scholar.

83 Judicial and Statutory Officers Remuneration Legislation Amendment Act 1989 (Cth), raising the salaries of Family Court judges to equal those of Federal Court judges.

84 Winterton, above n 25, 28.

85 Senate Select Committee on Superannuation, Parliament of Australia, The Parliamentary Contributory Superannuation Scheme and the Judges’ Pension Scheme (1997) pt B ch 1 [1.2] quoting Evidence to Senate Select Committee on Superannuation, Parliament of Australia, Canberra, 1 May 1997 (Justice Davies).

86 Chief Justice Murray Gleeson, ‘A Changing Judiciary’ (Paper presented at the Fifth Colloquium of the Judicial Conference of Australia, Uluru, 7–9 April 2001) 3.

87 For judicial consideration of the equivalent ‘Compensation Clause’ in the United States Constitution, see United States v Hatter, 532 US 557 (2001).

88 Australian Constitution s 51(xxxi). See Doug, Drummond, ‘A Proposal for Cancelling Judicial Pensions’ (2009) 29 Proctor 23Google Scholar, 23.

89 Gerard, Carney, The Constitutional Systems of the Australian States and Territories (Cambridge University Press, 2006) 343–9Google Scholar.

90 Blow, above n 51, 4–5.

91 Dame Sian Elias, ‘Judicial Retirement Benefits: Superannuation’ (Paper presented at the Eighth Colloquium of the Judicial Conference of Australia, Adelaide, 1–3 October 2004) 1. There have been subsequent changes to the contribution rates.

92 Blow, above n 51, 8; ibid 3.

93 For a fuller account, see Brian, Opeskin, ‘Constitutions and Populations: How Well Has the Australian Constitution Accommodated a Century of Demographic Change?’ (2010) 21 Public Law Review 109, 127–30Google Scholar.

94 Australian Constitution s 72(ii).

95 Waterside Workers’ Federation of Australia v J W Alexander Ltd (1918) 25 CLR 434 ('Alexander's Case’).

96 Ian, McAllister, Malcolm, Mackerras and Carolyn, Brown Boldiston, Australian Political Facts (Macmillan, 2nd ed, 1997), 108Google Scholar.

97 Commonwealth, Parliamentary Debates, House of Representatives, 17 February 1977, (Michael Hodgman), 220 (Maurice Neil).

98 Commonwealth, Parliamentary Debates, House of Representatives, 17 February 1977, 206 (Lionel Bowen).

99 Age Discrimination Act 2004 (Cth). See Human Rights and Equal Opportunity Commission, Age Matters: A Report on Age Discrimination (Human Rights and Equal Opportunity Commission, 2000) 39–43.

100 The same committee had recommended a judicial retirement age of 70 years in 1976, leading to the referendum the following year: Commonwealth, Report on Retiring Age for Commonwealth Judges, Parl Paper No 414 (1976).

101 Senate Legal and Constitutional Affairs References Committee, above n 6, [4.16], [4.21]–[4.26].

102 Of the 58 fixed tenure judges, five went ultimately to the High Court alone.

103 Constitution Act 1975 (Vic) s 83(1). The pension is also payable at any age after 20 years of service.

104 Invalid and Old-Aged Pensions Act 1908 (Cth) s 15. The Act stipulated a qualifying age of 65 years for all persons, but allowed a lower age of 60 years to be set for women by proclamation. The proclamation was made on 19 November 1910. See also Australian Bureau of Statistics, Year Book Australia 1988, Cat No 1301.0 (Australian Bureau of Statistics, 1988), 379–83Google Scholar.

105 Treasury (Cth), ‘Budget Measures 2009–10’ (Budget Paper No 2, Parliament of Australia, 2009), 241.

106 Ibid.

107 Law Council of Australia, LCA Brief: Snapshot of the Legal Profession (Fact Sheet, Law Council of Australia, September 2009).

108 Constitution Act 1975 (Vic) s 83(1).

109 See, eg, Grollo v Palmer (1995) 184 CLR 348.