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Chief and Senior Executives - Performance Pay

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					Chief and Senior Executives - Performance
Pay
Policy 6-2                                                                         Version 2
Date Approved: 28 July 2009                         Company Secretary…………………



1.     Application

       This policy applies to Chief and Senior Executives of NQBP.

2.     Policy

       A performance pay scheme will be implemented for executives at the discretion of the
       Board.

       The scheme will apply to NQBP's performance in each financial year. Assessment of
       performance will be made annually. There will be no "sacrifice" of existing salary to enter
       the scheme.

       Process for Senior Executives

       The CEO will recommend to the Board, through the relevant Board Committee,
       arrangements to determine performance pay for senior executives. The scheme will
       comply with the government’s expectations in relation to performance payment
       arrangements for Government Owned Corporations (GOCs), as reflected in the principles
       included as Attachment 1.

       Corporation-wide performance criteria and targets will be set at the beginning of the
       period, including weighting for different criteria, and methods of measurement.

       Criteria and targets may be drawn from the following areas, but are not limited to these:

       •      Financial Performance
       •      Environment/Safety Performance
       •      Corporate Governance
       •      Community Relations
       •      Effective Management of Assets

       A pro-forma example of performance criteria, targets and weightings is included as
       Attachment 2.

       In addition, individual performance targets will be agreed between the relevant executive
       and the CEO.

       At the end of the period, the CEO will assess Corporation-wide performance against the
       criteria and, based on this, a level of performance pay to be recommended for Board
       approval through the relevant Board Committee. In recognition of the collegiate nature of
       the management in achieving Corporation-wide objectives a common percentage across




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       scheme participants will be applied for this component. The individual component will be
       determined by the CEO.

       Process for CEO

       The performance pay scheme (if any) will comply with government expectations (see
       Attachment 1) and operate consistent with the CEO’s employment agreement.

       Effect of Leave on Performance Payments

       The general position is that leave should be taken and scheduled to allow the
       performance targets to be achieved. Stated the other way, in any given period normal
       quantities of leave should be anticipated. Where leave is to be taken for substantially the
       whole of the period eg long service or maternity leave, the performance pay scheme will
       be suspended for that period for the employee (ie performance payments would be on a
       pro-rata basis).

       Resignation or Termination

       In the event of the termination of the employment relationship occurring as a result of
       action taken by either an employee or NQBP, no performance payment will be made for
       the performance pay period during which employment terminates. [Examples: If an
       employee terminates on 1 June; no performance payment will be due for that financial
       year. If an employee terminates in July; the employee will be entitled to performance pay
       for the immediately prior financial year (ending June 30) even though the payment may
       not be determined by the Board until August.]

       Superannuation

       NQBP will ensure it meets the minimum superannuation obligations as required by the
       Superannuation Guarantee (Administration) Act 1992 while complying with individual
       superannuation fund rules.

       New Employees

       New employees will need to have worked at least three months in the relevant
       performance pay period and still be employed at the end of the performance pay period to
       qualify for any performance payment. In addition, a performance payment will not
       become an entitlement until the employee's probationary period ends and the employee is
       confirmed as a permanent employee.

       At the discretion of the CEO, the probationary period may or may not be counted as time
       within the performance pay scheme.

       The performance payment due is a pro-rata (of recognised time in the scheme compared
       to an officer in the scheme for the whole financial year).

       Employee Status

       Where a scheme participant is not working full time, the performance pay percentage will
       be applied to the paid total fixed remuneration (ie not to the full time equivalent salary
       rate).

       Notification to Shareholding Ministers

       NQBP will provide notifications through quarterly reports to shareholding Ministers on
       payment of annual performance bonuses including an assessment of corporate and
       individual’s performance.




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3.     Policy Review Date

       This policy should be reviewed by 30 June 2010.


4. Definitions

     NQBP: means North Queensland Bulk Ports Corporation Limited ACN 136 880 128 and its
     related bodies corporate including Ports Corporation of Queensland Limited ACN 126 302
     994 (PCQ) and Mackay Ports Limited ACN 131 965 707 (MPL).

     Contractors: means contractors or consultants engaged by NQBP under a personal
     services consultancy agreement or other similar arrangements.




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Attachment 1

Relevant principles outlining the expectations of government in relation to performance
payment arrangements for GOCs

•      The performance payment arrangements will have an organisational rather than individual
       focus and align with short, medium and long term goals of NQBP as outlined in the annual
       Statement of Corporate Intent and five year Corporate Plan. Performance indicators
       incorporated in the performance payment arrangements should focus on operational
       issues such as productivity, service delivery and safety and not be directly linked to
       NQBP’s financial performance. There should also be a clear link to compliance with
       relevant government policies and a statement to the effect that chief and senior
       executives are required to support the Board in meeting its responsibilities to
       shareholding Ministers.

•      Performance payments are not to exceed 15% of total fixed remuneration. No new or
       revised chief and senior executive employment contacts are to contain performance
       payments which exceed 15% of total fixed remuneration.

•      Performance payments for GOC chief and senior executives can be approved by the
       GOC board, so long as each of the individual performance payments do not exceed the
       15% cap (where appropriate) as outlined in Principle 2 and shareholding Ministers have
       reviewed the board approved policy underpinning the performance payment system.

•      GOC boards are to provide timely advice to shareholding Ministers in written
       correspondence within one month of a performance payment being made to a chief or
       senior executive. This notification must include the performance payments approved by
       the board for GOC chief and senior executives including an assessment of each chief and
       senior executive’s individual performance and contribution to corporate performance.
       GOC boards are also to include this information in the relevant quarterly report.

•      Where a GOC proposes to revise it performance payments policy, the revised policy must
       comply with these principles. GOC boards are to provide a copy of the revised board
       approved policy including a list of differences from the previous policy to shareholding
       Ministers for their information. If the revised Board approved policy falls outside of the
       expectations as outlined in these principles, GOC Boards will be requested by
       shareholding Ministers to amend the policy.

•      No new performance payment schemes are to be introduced in GOCs without the prior
       written approval of the shareholding Ministers.

•      Where GOCs enter into new employment agreements with chief and senior executives or
       revise existing employment agreements, GOC boards are to provide copies of the
       executed employment agreements to the Office of Government Owned Corporations.

•      Shareholding Ministers approval of performance payments may be reintroduced if
       decisions are made by GOCs that are contrary to government policy. Where a GOC has
       recently made a significant decision that is contrary to government policy they will need to
       demonstrate a period of compliance with government policy before more liberal
       arrangements would apply.




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Attachment 2

LEADERSHIP TEAM PERFORMANCE ASSESSMENT

               Performance Weighting for Evaluation of Leadership Team

      Key Corporate Performance Area                                      Performance Weighting
         Capital Development                                                       15%
         Profitability / Return on Assets                                          15%
         Staff Management                                                          15%
         Maintenance                                                               10%
         Implement Government Reforms                                              10%
         Port Operations and Land Use Planning                                     10%
         Environment                                                                5%
         Workplace Health & Safety                                                  5%
         Security                                                                   5%
         Customer / Stakeholder Service                                             5%
         Risk Management & Governance                                               5%

      TOTAL                                                                             100%



CORPORATE PERFORMANCE TARGETS

Note: Key Corporate Performance Areas are presented in the same order as the Statement of
Corporate Intent for consistency, rather than in order of performance weighting.

CAPITAL DEVELOPMENT
Performance Weighting: 15%
Objectives                                  Strategies and Targets
Deliver large port expansions to            <Determined annually prior to the period>
meet user needs and assist the
state's economic development.

Complete capital projects on time
and within budget.
Assess Projects As Part of a
Continuing Improvement Process

MAINTENANCE
Weighting: 10%
Objectives                                  Strategies and Targets
Maintain Equipment           and    Port    <Determined annually prior to the period>
Infrastructure

ENVIRONMENT
Performance Weighting: 5%
Objectives                                  Strategies and Targets
Ensure high environmental                   <Determined annually prior to the period>
standards are maintained in the
ports




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WORKPLACE HEALTH & SAFETY
Performance Weighting: 5%
Objectives                 Strategies and Targets
Ensure NQBP workplaces and <Determined annually prior to the period>
public areas are safe.


SECURITY
Performance Weighting: 5%
Objectives                                  Strategies and Targets
Maintain Effective Port Security            <Determined annually prior to the period>
Arrangements

CUSTOMER/ STAKEHOLDER SERVICE
Performance Weighting: 5%
Objectives                     Strategies and Targets
Consult with Stakeholders over <Determined annually prior to the period>
NQBP Activities

PROFITABILITY AND RETURN ON ASSETS
Performance Weighting: 15%
Objectives                          Strategies and Targets
Ensure profitable operation of      <Determined annually prior to the period>
NQBP
Increase Trade Through the Ports
and    Facilitate    New      Trade
opportunities

STAFF MANAGEMENT
Performance Weighting: 15%
Objectives                                  Strategies and Targets
The value of employee effort                <Determined annually prior to the period>
increases

NQBP is an employer of choice.

IMPLEMENT GOVERNMENT REFORMS
Performance Weighting: 10%
Objective                      Strategies and Targets
Implementing        Government <Determined annually prior to the period>
Reforms

RISK MANAGEMENT AND GOVERNANCE
Performance Weighting: 5%
Objectives                          Strategies and Targets
Ensure risk is managed effectively  <Determined annually prior to the period>
Ensure Appropriate Governance
Arrangements are in Place
Ensure      Effective     Emergency
Response Arrangements
Ensure      oil    spill   response
obligations are fully met




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PORT OPERATIONS AND LAND USE PLANNING
Performance Weighting: 10%

PORT OPERATIONS
Objectives                                  Strategies and Targets
Maintain Efficient and Profitable           <Determined annually prior to the period>
Port Operations.

Develop new business
opportunities in the ports.

LAND USE PLANNING
Objectives                                  Strategies and Targets
Maintain Effective Land Use Plans           <Determined annually prior to the period>
Plan for future port development
                                                                                         E09/28800




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