Jackie Kelly (Lindsay, Liberal Party) Share this | Hansard source

The coalition government has consistently worked to provide incentives for Australians to boost their retirement savings. The record of this government on superannuation is exemplary given the 13 years of mismanagement under Labor before the Howard coalition government came to office.

Let me remind you, in light of the amendments to be moved by Mr Griffin, that it was the Labor Party that actually defunded the Defence Force Retirement and Death Benefits Scheme, or the DFRDB. They took all of our veterans’ contributions in DFRDB, rolled them into consolidated revenue and left it as an unfunded Commonwealth scheme. It has been left to this government, in the form of the Future Fund, to come forward, to step up to the plate, to do the hard yards, to say, ‘No, you can’t spend this; no, you can’t spend that,’ to save the money and to build a Future Fund. And now we are looking at a situation where our Commonwealth service public pensions, our public sector public pensions and our Defence public pensions will be funded. They will not be an impost on my children. My children will not be paying double tax for something that the taxpayers of previous generations should have and have already paid for. So my children’s tax will be going to support their standard of living. With the Future Fund that we have reinstated you will see the veterans cared for by their own contributions and their own employer contributions, and that is how it should be.

There was a magnificent announcement yesterday by the Minister for Veterans’ Affairs of a support package worth more than $330 million to index veterans affairs disability pensions with MTAWE. That is something that the veterans community has been asking for. They have asked us to go further in terms of also pegging DFRDB with MTAWE. On our calculations, that is a $6 billion promise. I know Bernie and co. from the veterans community say: ‘No, it’s not that; it’s only $35 million. You can do this for $35 million.’ Heaven help us if the ALP ever get into government because, if they are taking those types of sums, making those types of rash promises and taking out—recklessly—$6 billion per annum, how many hospitals will go unfunded? How many schools will go unfunded? What will that do to our education sector? How do we respond to something like the equine influenza? When some outside shock hits our economy, where do we get the wherewithal to run with that?

The previous speaker was talking about contemporary issues within the veterans community. I have superannuation locked up in MSBS, Military Superannuation and Benefits Scheme, and I would like to see that rolled over. I, like everyone else who did less than 20 years in the military, would like to see our super rolled out. Certainly in the time I have been in parliament I have seen MSBS perform in a manner where, after administration costs, mine actually went backwards, whilst private sector funds were streaming ahead at 10 per cent and 15 per cent. But the cost of doing that is something that needs to be looked at and needs to be considered. It is certainly something that this government is looking at in a responsible fashion. Certainly the amendment which looks at removing the tax increase that applies to members of MSBS as a consequence of the recent Better Super changes is something that I would like to see passed. As for a few of the other issues that have been raised by the opposition in relation to military super schemes, we have restored the reversionary benefit for people who have remarried pre-1979.

The opposition want to implement the same date as that of the civilian schemes. This can be done by other measures. Again, it shows that they really want to use a hammer on an eggshell rather than working through, in a fiscally responsible manner, issues that are put to them by the veterans community and by the people who have funds invested in these unfunded schemes. They go on to a number of other contemporary issues, which no doubt have been canvassed widely amongst the various communities affected.

This government’s track record on superannuation is exemplary, and the opposition’s track record on superannuation is woeful. Every time they have seen a bucket of funds accumulated for people’s super, they have gone and raided the hollow log. Every time. Why would you put them in charge of the cookie jar once again? They have already spent the Future Fund on some broadband infrastructure for the bush or for Australia that we have stimulated the private sector to fund without any recourse to the Future Fund. On several other occasions we have seen the opposition wanting recourse to the Future Fund. Here, again, they are going to have recourse to the Future Fund to allow MSBS and DFA, Defence Families of Australia, to be rollovers. You should see their candidate in Eden-Monaro. He is an ex-military officer. He himself is facing the same fiscal issues that we all do given that we have investments in those schemes, and he has recklessly just proposed the expenditure of $6 billion for his party when he is not even in parliament yet. This is another example of the reckless disregard that the opposition consistently show on these issues.

These are complex issues with knock-on effects. I have no doubt that our veterans deserve an increasing standard of living and that it should keep pace with commensurate schemes in the community, but this should not be done at the cost of services that need to be delivered for our children, for the next generation, in critical things such as health, disability, care for our aged and education. We have slowly made major contributions to that with the establishment of our education fund. We see higher education consistently funded into the future. You are seeing from this government consistent financial investment to allow these matters to run the full course. Labor, on a whim, wish to race in and destroy 12 years of good, solid, hard work. I know our veterans communities can get impatient, but I ask them to bear with us. We will be giving a better service, a truer service over a longer period of time. I urge them to remember the ALP’s raid on DFRDB. That is what put us in this situation. Up until then we had a funded scheme. It was a scheme that would have seen us continue in the future independent of any call on taxpayers. Now we find ourselves in the situation that we are in today.

Let me go through the history of what this government has done on superannuation to give people an understanding of our commitment to people’s savings. We are serious about seeing elderly Australians living on something more than a straight-out pension, which is the very minimum standard below which we want no Australian to fall. We certainly want people who have been in employment all their lives, who have done serious work with the public sector and with the Defence Force, to really see the benefit of their super contributions and their savings over their lifetime and the same for those who, through various circumstances, have been unable to save and have found themselves totally reliant on a support pension in their retirement.

We have introduced a scheme for workers earning less than $28,000 where we contribute $1.50 for every $1 contributed by the low-income earner. That scheme runs up until someone is earning $58,000. Our co-contribution scheme means that $2,500 each year can be contributed to someone’s super and, after a lifetime on a low-income wage, they can retire with substantial savings in excess of a quarter of a million dollars and up to half a million dollars, which will have a significant impact on their standard of living in the future.

One of the important things in the Superannuation Legislation Amendment Bill 2007 is that it also makes provision for the circumstances of marital break-up, in which we frequently see the female severely disadvantaged if she has been in and out of work. We have looked at a tax rebate to encourage individuals to make superannuation contributions on behalf of their low-income spouses—that is, for the wife who stays at home or only has a part-time job so that she has time to look after children. I think one of the most important things that we do in life is take time out to look after our children. If you make the decision that you want to dedicate a substantial amount of your time to that, you should not be penalised by your super scheme. The ability to continue contributions throughout the time that you take out of the workforce so that in retirement you have a consistent and continuous history of super contribution is an important landmark that this government can be justifiably proud of.

There is capital gains tax relief for small businesses when they roll over their small business. That is a major saving. If a small business is rolled out for retirement purposes, it is free of capital gains tax. We have increased the deduction limits for superannuation contributions made by the self-employed. There are dollar for dollar deductions up to $5,000 for self-employed people. We find that a lot of mums work from home and that having their own job or small business allows them to superannuate themselves.

These are relevant issues because they show this government’s continuing dedication to improving the superannuation savings of not just our Public Service, our Commonwealth sector employees and our defence sector employees but the Australian public as a whole. You can trust this bill. You should go with the government on this one. You should ignore the ALP bleatings because in government they do something completely different and really do not manage super at all well. They now have a shadow minister for intergenerational finance. They never even understood it when they were in government. Do you seriously think they even remotely understand it in opposition? They did not even have a charter of budget honesty. They do not even do regular intergenerational reports. We have all of these reports established and reporting to parliament in an ongoing way to continually remind Australians about our ageing population, our financial obligations to those people, how those must be funded and how we can minimise the call on generations that have not yet had the benefit of their tax payments.

We have seen a number of improvements in a number of sectors. I have heard the defence lobby. I obviously have a lot of sympathy for it, given my own financial situation, but I would still stick with the government in coming up with the funds to fund it rather than the ALP’s raid on the Future Fund. That is irresponsible. There are ways of doing this. When Bernie and Keith Tennant and everyone can come up with the rigorous financial investigation into the costings of these things that can really nail it down and we can negotiate things, I think we can deliver for the veterans community in a way the ALP will never be able to. They can make all sorts of wild promises in opposition, but, with 12 years experience in parliament, I know that things are not as easy as the Labor candidate in Eden-Monaro might think they are. He is straight out of the military, obviously. He has realised his pension situation and wants to help his fellow diggers, as we all do. But the opposition amendments are irresponsible. Their promises are erratic and funded out of a mechanism that is just reprehensible. It leaves us in a situation where my children will be continuing to pay for pensions that should have been funded and paid for by the pensioners themselves.

We have a terrific record on superannuation. We have removed the work test for those aged under 65 so that these people can contribute to super at any time after 1 July 2004. We have introduced a new transition-to-retirement policy allowing Australians aged over 55 to access their superannuation as an income stream while remaining in the workforce. We have abolished the superannuation surcharge, giving a greater incentive for higher income earners to contribute to their superannuation. We have allowed superannuation benefits to be split between married couples who separate. That is doing something for females, who traditionally have been less well superannuated than males in our community. We have increased the safety of superannuation entitlements by requiring quarterly superannuation guarantee contributions rather than annual contributions because we were seeing a number of businesses leaving their employees high and dry in the private sector—and that truly was something the ALP did in government in the public sector. They were leaving them high and dry with the promise on the never-never that the future taxpayer would pay their pension for them. That is a serious intergenerational impost that we have corrected. The list on our record on superannuation goes on and on.

I urge the Australian community to understand this government’s rigour, experience, dedication and commitment to the retirement savings of Australians. We are economically sound. We have a proven track record. Why you would consider falling for the very empty promises of the opposition, who, when they were in government, hollowed out the log of the DFRDB, is beyond me. I commend the bill to the House and call for the amendments to be disregarded.

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