Craig Emerson (Rankin, Australian Labor Party, Shadow Minister for Service Economy, Small Business and Independent Contractors) Share this | Hansard source

Thanks to the coalition? You see, they do not remember anything that happened before 1996. They do not believe or accept that Labor introduced the superannuation guarantee. They do not accept that; they like to rewrite history.

Let us look forward to the future of $3 trillion of superannuation savings, which means an adequate retirement income for many working Australians who would never have had an adequate retirement income if it were for the attitude of this minister, the member for North Sydney, and this minister, the member for Dickson, and their party, which never believed in the superannuation guarantee and opposed it at every opportunity. When under public pressure going into the 1996 election, their party said they would honour the commitments. They lied, broke their promise and called it a budget saving before returning it in part in 2000 as income tax cuts, saying: ‘Aren’t we magnificent? The biggest income tax cuts in Australian history.’ All they were doing was returning the money to the Australian people that they took off them in 1997.

This legislation goes on in its third schedule to propose amendments to a number of the tax acts to extend employee share ownership concessions and related capital gains tax treatment to stapled securities. This is a measure that we support, but I will take the opportunity again, because we are talking here in this legislation about tax avoidance and tax evasion activity, to talk a little about employee share ownership plans that come in the form of executive share schemes.

The Minister for Defence, when he was the Chair of the House of Representatives Standing Committee on Employment, Education and Training, chaired an inquiry into employee share ownership plans. We thought we were genuinely looking at ways of increasing employee share ownership. But what came to light, in a mini version of the Costigan inquiry, was the rampant tax avoidance that was going on through executive management schemes. This meant that executives in Australia could get big tax breaks on their share options, hope and expect that the value of those options would increase over time and get really big tax concessions. Not only do they do that lawfully; they were engaging in avoidance activities that the tax office said at the time were more or less under control because they had managed to detect them. I was at a meeting where we tabled one of the latest plans. The blood drained from the faces of the coalition members of that committee, because it showed that these rorts were still well and truly rampant.

But the most amusing and, in a way, the most disgusting part of this was that one of the key recommendations of the Liberal members of that committee was to institutionalise—legalise—the rorts so that executives would basically be able to take most of their remuneration tax free. That is what Dr Nelson, the current defence minister, recommended. Labor opposed those recommendations. Perhaps that report was better described as ESOP’s fables: employee share ownership plans were supposed to be these wonderful things to increase employee participation in the company through a share ownership, but in fact these rorts had been implemented and were rampant.

Here we have now the minister, who is wounded by the fact that he has presided over this sort of tax avoidance and tax evasion activity in this country—

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