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The Reserve Bank of Australia, already under fire on multiple fronts for its continued rate hikes to hit inflation, has now admitted it has underpaid former staff over the past seven years.
In a rather unfortunate embarrassment amid intense current scrutiny, the Australian Financial Review has revealed that the Reserve Bank of Australia, the country’s leading economic arm, has bungled its accounts over the past seven years and underpaid a number of current and former staff. , with PwC to help clean up the debacle.
The news follows Deloitte calling the RBA public for fiscal mismanagement due to continued rate hikes.
According to AFR reporter Michael Read, a member of the Canberra press gallery and a former RBA economist, the central bank recently emailed former staff that it had identified historical issues relating to annual leave, long service leave and RDO payments, which are understood to have been revealed for the first time Financial Sector Union (FSU). The discrepancy concerns those who paid their claims when they left the bank.
“We take paying our people correctly very seriously and regret that these issues have occurred,” the bank said in an email, with RBA deputy governor Michele Bullock adding that the arrears were a result of the “complicated nature of our industrial arrangements.” and their interpretation’ and that the RBA is currently ‘undertaking a comprehensive review to address them and simplify our future procedures’.
PwC assists in the assessment
Regarding the number of former and current staff potentially affected by the accounting oversight and an indication of the cost of repayments, an RBA spokesman told the AFR it was currently conducting a compression review, with PwC having since been brought in to assist. with assessment. “The work is still ongoing and therefore we are unable to provide the specific details requested at this time,” the spokesperson said.
FSU National Secretary Julia Angrisano was less ambiguous in her response, stating that it “beggars belief that the manager of the national economy was not able to competently navigate his own business deal”.
He told the AFR: “The RBA has a duty to ensure legal compliance with its workplace agreements and will actively resist any attempt to weaken that agreement in the upcoming negotiations to circumvent those obligations.”
The news comes as the RBA is feeling the heat on many fronts, including the federal government, for a series of interest rate hikes in a bid to combat runaway inflation that dates back to Bullock’s frosty reception at an earlier Senate committee hearing on the matter and has been growing ever since through a series of volatile reactions. Deloitte’s rather uncharacteristic public criticism of the RBA last week added fuel to the fire.
While the RBA may have temporarily suspended its program of 10 consecutive rate hikes after its latest meeting, Deloitte Access Economics partner Stephen Smith threw down the baton and expressed his view that the previous two hikes were completely unnecessary and that the central bank was tempting fate. puts the economy on a “knife’s edge” by offering potentially the weakest rate of economic growth since the recession of the early 1990s, which Australia infamously “had to have”.
“An additional 50 basis point increase earlier this year was unnecessary and led to further downgrading of Australia’s growth outlook. “A ‘consumer recession’ is now forecast in 2023,” Smith said in the firm’s latest report. “With a cash rate of 3.6 per cent, most Australians will be fine. However, many will not. In just ten months, the cost of servicing the average $600,000 mortgage will increase by more than $14,000 per year.”
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