Superannuation

Superannuation (Objective) Bill 2016, Treasury Laws Amendment (Fair and Sustainable Superannuation) Bill 2016, Superannuation (Excess Transfer Balance Tax) Imposition Bill 2016

Mr STEPHEN JONES (Whitlam) (13:16): It is my great pleasure to speak on the Superannuation (Objective) Bill 2016 and related bills which concern the provision of superannuation, how it is taxed and how it is managed. I also rise to support the excellent amendment to this bill that has been moved by my friend the member for McMahon and spoken to most eloquently by the member for Rankin, who is in the chamber with us today together with the member for Kingsford Smith, who has spoken passionately about these issues.

 

I want to contrast the position of Labor, when it comes to superannuation, with the chaotic, haphazard approach that this government has taken to superannuation issues since it first occupied a position on the treasury bench after the 2013 election. I ask you to consider this, Mr Deputy Speaker: since the 1980s, when a partnership was formed between Labor in government and the Australian trade union movement to introduce occupational superannuation so that it was not just the managerial class, not just the wealthy, who had access to superannuation in this country, we have seen a clear-eyed and consistent approach to superannuation in this country. From the Hawke and Keating governments to the Rudd and Gillard governments, we have seen a clear and consistent approach to superannuation.

We want to work with the union movement and with businesses to ensure that we can see a steady increase in the percentage of contributions that are made through the compulsory contribution system into a worker's superannuation account. From that very first moment when there was a wage-superannuation trade-off, it has been our mission to ensure that we can steadily increase the contributions that are being made. We have an objective of ensuring that average Australians can approach the position that we privileged people in this place have when it comes to occupational superannuation. Members of the public may or may not know that members in this place attract a superannuation contribution of 15 per cent. Labor believes that that should be a contribution that is available to every working man and woman. Those on the opposite side continue to frustrate our objectives of improving and increasing compulsory superannuation contributions.

That said, significant progress has been made. But, when you look at occupational superannuation and when you look at superannuation accounts, we also have a long way to go. I had the opportunity to do some research and looked at an excellent report by the Association of Superannuation Funds of Australia. It was their most recent report and it included a survey of average contributions, broken down by gender, age and state. It was very interesting reading, particularly when you consider the approaches taken by many members of the government party in the immediate period after the election. Whilst the average superannuation account balance across Australia comes in at just under $160,000, averages belie the actual truth.

I see the member for Dawson is here in the chamber. He championed the human right that would ensure that people could put up to a million dollars or more of post-tax money into their superannuation accounts. It might surprise the member for Dawson that the majority of people in his own electorate—let's not stop at his own electorate—and the majority of people in his own state do not have a superannuation balance that approaches near that, and nor will they ever. In Queensland, the average superannuation balance is $156,000, which is a long way short of what we believe is necessary for a dignified and fair retirement.

I was very interested to hear a senator for Tasmania championing the human right of people to dump up to a million dollars—or more—of their post-tax money into their superannuation accounts, even positing that it was the government's May 2016 superannuation proposals which led to the devastating results for the Liberal Party in Tasmania. This is a man who comes from a state where the average superannuation balance is $31,000 less than the national average. That is right—the average superannuation balance of a person from Tasmania is $128,000.

Of course, averages do not tell the entire truth. If you look at the disparities between men and women, you will see that, of people aged 60 to 64 approaching retirement, males average a median superannuation accumulation of $100,000; females, $28,000. We know, in that instant, that we have much work to do. It is why, on this side of the House, we are still scratching our heads when we consider the fact that, in their first act and in their first budget, when presented with these statistics, when presented with the unavoidable facts that we have massive inequality between men and women and between the wealthiest and the poorest when it comes to superannuation contributions and superannuation accumulation, they went after the poorest people. In their first budget, why did they go after the poorest people by removing the low-income tax offset and by providing massive tax cuts to people with superannuation balances of a million dollars or more? If you were going to address the real problems that we are facing in inequality in superannuation in this country, why would you provide massive tax cuts to the wealthiest—to the people with the largest superannuation contributions—and yet remove the low-income tax offset for people who are on the lowest incomes in this country? In that one act alone, we see the absolute contempt that the government members have for equity in superannuation and for consistent policymaking when it comes to something that requires, nay begs, consistent policymaking.

So we are very pleased that after exploring every possible alternative, the government in some respects is doing the right thing in this bill before the House today, and not before time, by changing the name on the low-income tax offset and reintroducing it—if you like, making amends for the sins of the 2014 budget by reintroducing it in this bill today. Of course, we on this side of the House support these propositions—of course we do; we introduced them in the first place. Of course, we offer our full-hearted support to the government for these propositions. But that does not mean that we are going to be supporting every measure in this bill. It is not just the confusion; it is the fact that there are so many measures within this bill that strike at the heart of any government plan to introduce budget repair that is fair and equitable.

It is for this reason that we will be opposing a number of measures within the bill. For instance, we will not be supporting the measure which will allow catch-up concessional superannuation contributions for individuals with balances that are set out within the bill. We will not be supporting that proposition because we do not believe that it is either fair or equitable. We will be making some amendments to the provisions within the bill—for example, the measure which proposes to replace the controversial $500 lifetime cap in the government's original package. This is the proposition that the member for Dawson and others went war against. We will be amending this proposition. I support the member for McMahon's proposition in that because we believe that there are still problems in the proposition that the government is making. We will be proposing, in our amendments, to reduce the annual concessional contribution cap to $75,000. When it comes to reforming the taxation of concessional superannuation contributions, we are proposing amendments to that as well.

But more than anything, what is needed in this area is certainty. We support the fact that within the bill there is a proposition to set out the purpose of our occupational superannuation scheme. Both the member for McMahon and the member for Rankin have pointed out that every opportunity this government has had and the previous government has had to improve and amend the operation of our superannuation scheme, they have stuffed it up. That is because they do not have a clear understanding of the purpose—as the member for Rankin pointed out and, by my way of thinking, from the contribution of the government's member for Mackellar, who supported that when he pointed out that there was a confusion in previous governments' approaches to this when they have merged estate planning propositions with the original purpose of superannuation, which of course was to provide a pool of savings for a dignified retirement. There is the dual purpose: to ensure that individual Australians could plan for a retirement where they could live in modest comfort on the basis of the earnings from their superannuation savings and, at the same time, ensuring that we were reducing the pressure on the government coffers through the pension payment system. That is the purpose of the superannuation system, not as a means for estate planning, not as a means for tax minimisation, as we have seen over the last couple of decades; it is to provide a dignified retirement savings for ordinary wage and salary earners.

I support the amendments moved by the member for McMahon. We are pleased to see that finally we have a bill before the House that we are able to debate, a bill that we are able to consider. It is an improvement on the proposition that was put before the Australian people, an improvement on the proposition that was introduced in this year's budget, but it requires the amendments that are put forward by the Labor opposition to ensure that superannuation can reach the potential that all Australians who send us to this place rely upon.

The DEPUTY SPEAKER: The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour. The member may have leave to continue his speech if he wishes to use his remaining one minute and 43 seconds at a later hour.

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