When a highly paid executive parts ways unhappily with the government it’s always the taxpayer that foots the bill.
And that’s how things are shaping in the case of Christine Holgate, the Australia Post CEO who’s been returned to sender by Prime Minister Scott Morrison over watchgate.
Crikey can’t know for sure, but all the clues suggest manoeuvring is well underway for an expensive termination package. Through the media we’ve learnt that Holgate has spent days in tears (“She was devastated. It was awful.”) and that the way she has been treated has been “bloody disgusting”.
Holgate’s lawyer Bryan Belling has said Morrison’s response in question time — saying he was “appalled and shocked” that the CEO had given four executives $20,000 worth of watches for a job well done — was “humiliating” for her.
Holgate had also not been informed “as to why she should be stood down”, Belling, partner at employment law firm Kingston Reid, said in a statement.
Distress. Humiliation. Lack of due process. No clear reasons given. Unfair.
Holgate’s salary is $1.6 million a year, with another $1 million in bonuses (at least) expected.
There’s pain and suffering. Loss of future earnings. Reputational damage. The price of a confidential settlement.
It’s all adding up to one hell of a case against the Commonwealth. Morrison’s dozen or words of outrage — real or confected — might be the most expensive he’s ever uttered.
Well, expensive for the taxpayer that is, given that the government is Australia Post’s sole shareholder.
US import Sol Trujillo set the benchmark for payouts when he left Telstra after only 10 months as CEO, with $3.8 million in termination benefits, taking his total pay to more than $9 million. That was in 2009.
The private sector has produced its share of telephone number payouts: in 2017, Commonwealth Bank CEO Ian Narev left the bank with at least $12 million in shares. At least.
The problem for Morrison is that Team Holgate is a well-resourced and formidable foe. Holgate is a seasoned business operator who has amassed a fortune over the years as CEO of Blackmores health care empire.
In her corner is husband Mike Harding, a powerful figure in Australia’s resources industry.
Harding was on the board of Santos for 10 years and according to the company played a “major role” in its “transformational” liquefied natural gas (LNP) projects.
This, you might think, is an awkward connection for the gas-led recovery Morrison government, especially given the donations which Santos has sent the government’s way over the last several years.
Harding has held other influential roles, including as chair of giant infrastructure company Downer EDI; Horizon Oil Limited chair; and Roc Oil Company Limited chair.
Judging by the favourable publicity, Team Holgate has received some smart PR advice to augment its legal strategy. In The Australian, veteran business columnist Robert Gottliebsen has sketched a conspiracy to remove Holgate so dark that he dares not spell it out. “I can’t reveal the motivation of the Holgate character assassins because that would reveal the identity of the assassins,” he wrote.
Gottliebsen has also taken aim at the Australia Post board, stacked as it is with Liberal mates.
As Crikey reported, the Liberal names include the influential Howard-era operative Tony Nutt, as well as Bruce McIver, who was Queensland LNP state director for seven years.
It all points towards a tremendous barney, with a mashup of leading Liberal party figures, corporate titans, and dueling media spinners from both sides, each trying to portray themselves as the champion of the public good and of what is right and fair. Cry me a river.
Is it a cheap shot to point out that as millionaires and political elites wrestle over the potential millions of dollars in payouts, there are people losing their jobs under a government which can’t even be bothered to measure what constitutes poverty?
Although Holgate’s largesse is definitely inappropriate, for Scott Morrison or anyone else in the Federal Coalition Government to be criticizing Holgate’s antics when it is probably the most corrupt Government I can remember in my lifetime. With sports rorts, and others, jobs for the boys, cash grants to donors, etc. they are certainly not leading by example and fit to accuse others.
The Post Office ‘franchisees’do not want Ms Holgate to leave. In fact they are prepared to chip in and cover the costs of the watches.
Under her leadership she has managed to get the banks to financially compensate them for the banking services they provide. The 2 previous CEO’s had done nothing. Her hard work with her team had improved the bottom line of their business immensely. They want her to stay. The watches were a special bonus to the men who worked very hard to get the banks to pay.
Sure, I think they’re all paid too much, and bonuses are not needed when they are all ready paid too much, but that is a different quarrel. For Scott Morrison to pile on to Ms Holgate, when he overcompensates himself and his mates with our money is obscene hypocrisy.
And I wonder if he would have been so overwrought with fury if it had been a man.
Best summation to date.
It’s the moral hazard catastrophe that was always going to happen the moment professional hustlers like ‘Chainsaw’ Al Dunlap appeared on the scene: the short-term, strip-and-clip, pump-and-dump, pay-myself-first, arm’s length hired mercenaries/consultancy culture of the eighties. These monorail flim-flammers both advocated and personified the heart of the ‘neoliberal’ revolution, which has turned out to be nothing to do with its own nominal arguments: ‘efficiency’ and ‘productivity’ and ‘innovation’ as ‘incentive’ and ‘driver’ of ‘sustainable growth’, all that ‘greed is good’ garbage. Actually – banally and predictably – it was just a way to re-weaken the material link between executive remunerative reward, and executive leadership, responsibility and material outcome. ‘Neoliberalism’ was an ugly, disjointed and willful series of street hustles, to slowly jimmy loose and then liberate Moral Hazard from centuries of painstaking regulatory and moral progress in bulwarking capitalism’s structural flaws and taming our greedy instinct for driving it periodically into self-destructive excess. The whole thing was a long con, intended to enable and normalise obscene rip-offs of exactly this kind; the kind of ‘perfectly legal’ daylight theft we cop daily now, from the shifty, the shameless, and the charlatan suits in the upper suites.
Dunlap himself largely ripped off the witless tool shareholders and gullible tool owners of the private sector (ie like K. Packer and R. Pratt), but of course neoliberalism’s Moral Hazard pox got quickly shared around the public sector by cheaply biddable political tarts (especially super-spreaders like Paul Keating and Jeff Kennett). And soooo…here we are. Awash in a swampy corporate culture run by grotesquely overpaid, embarrassingly under-capable and odiously entitled feather-bedders, in which this kind of noxious thieving bullsh*t is the standard everyone is sprinting fast towards. There’s not a single executive (good, bad or meh) in the upper echelons of the private, public or, ‘sweet spot’ public-corporation sectors who doesn’t know exactly what the careerist game is all about now. It’s the dirty open secret of international senior executive management, AKA the Moral Hazard Senior Executive class.
Here are the cohort rules:
Senior Executives
Board members
I say let Holgate sue. She is probably in the right here, tbh. It was a foolish and panicky ScoMo over-reaction. (In fact, so dismally ham-handed it was that it smells a bit fishy…why, could this possibly be like that movie where two sexy teens and their schoolteacher conspire to set up a fake abuse scam and split the teacher’s eventual lawsuit/compo money?!) Holgate herself seems like a cookie cut-out Moral Hazard Senior Executive, but as I’ve said before, perversely in this case the Oz Post executives who actually put together the Bank@Post deal did OK and probably earned a back pat at least. I suggest we should let Holgate sue, and then get Scooter as our shareholder to counter-sue the Oz Post Board for its recruiting failures. And if he won’t, then we should launch a Class Action against Morrison.
If you can’t beat them on this public-private sector line-blurring Moral Hazard caper, join them.
You recon they could be splitting the spoils?
Only plausible explanation I can think up, given such a ludicrous brain fart from Morrison. I think Holgate will skip cheerfully away with a monster payout. She’s unlikely to keep this gig or pick up another similarly juicy one.
Undisclosed payout, of course. Moral Hazard, yet again. The system is now simply…criminal.
Too right Jack, the rot set in a long time ago. Have always wondered why people who are highly paid also get bonuses. I worked in Remuneration for many years, right through the period that Nick Greiner introduced salary packaging and bonuses into the NSW public sector. It never made sense, but was straight out of that MBA textbook theoretical bull they feed them.
FWIW, while bonuses themselves are a self-corrupting pudding, the real problem is in setting the KPIs. I have been saying for 25 years, since first having my eyes opened to this managerial theft, that nobody is smart enough to set KPIs that won’t lead to perverse outcomes. Think banks and their unethical and illegal activities from the Royal Commission. Humans are too complex to set silly little milestones. Set your KPI, only one, as “do your freaking job and do it well, you’re getting paid enough.”
And for the proliferation of management speak, strategic alignment, change management, culture shifting, and all the rest, they are weasel phrases, all of them immeasurable, which is sure handy when it comes time to measure how they went. It’s all utter bollocks.
Rolexes to Ministers vs Cartiers to Public Servants.
Why do politicians always cop the cream while Public Servants get the trickle down? 😉
..cheques in the mail..and because some of my best friends are..at least she’ll never have to hock herself down at the local privatized dole knock shop…the emotional experience would be unaffordable..