Federal Politics

EXCLUSIVE

Diplomats' allowances on the chopping block as Julie Bishop orders review

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The age of entitlement for Australia's jet-setting diplomats could soon be coming to an end.

Foreign Minister Julie Bishop has secretly ordered a review of the generous allowances and entitlements paid to federal government employees when they're on overseas postings, Fairfax Media can reveal.

The review is targeting all 28 agencies with staff stationed overseas, not just Ms Bishop's Department of Foreign Affairs and Trade.

A range of payments are understand to be on the chopping block as a result of the review, the first of its kind in more than a decade.

It is assessing whether the payments are in line with community expectations – in other words, whether they pass the "pub test".

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Ms Bishop ordered the review shortly before the election and the government is expected to consider its findings in the coming months.

Diplomats get a vast array of entitlements to supplement their salaries when they're living abroad.

While the details of the allowances system is a closely-guarded secret, most get free accommodation and the majority of their bills and household expenses – including staff such as maids and drivers – covered by the taxpayer.

The cost of educating their children, often in exclusive and expensive international schools, is also borne by the taxpayer.

Officials are also entitled to charge for childcare and babysitting – just like former treasurer turned US ambassador Joe Hockey has done.

Diplomats also get transfer, posting, cost of living and hardship loadings, depending on where they go.

They also get entertainment and travel allowances and some senior officials even get annual clothing entitlements.

Australia's overseas missions typically spend about $5 million a year wining, dining and entertaining.

And that does not include months of full-time language training. Some also get significant tax advantages.

Spending at DFAT has come under scrutiny in recent months, particularly after it was revealed it spent more than $200,000 sending 22 officials to Paris for a conference on how to save money. The two-day junket included business-class airfares for all the officers who attended. The group stayed at a Mercure Paris Centre Eiffel Tower where rooms start from $530 a night. Another two-dozen Europe-based Aussie diplomats also attended, adding tens of thousands of dollars to the total.

Ms Bishop was said to be furious about the spending, however she ordered the review well before the story broke in October.

The Abbott government's controversial national commission of audit recommended a review of overseas conditions and allowances.

"Overseas postings are a significant part of DFAT's costs and that of other agencies," the 2014 report said."The range of allowances and other support provided to personnel being posted overseas appears generous in comparison to that offered by major corporations and there would be merit in benchmarking the allowances paid by all agencies."

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