Tony Zappia (Makin, Australian Labor Party) Share this | Hansard source

I too rise to speak in support of the Temporary Residents’ Superannuation Legislation Amendment Bill 2008 and the Superannuation (Departing Australia Superannuation Payments Tax) Amendment Bill 2008. In short, these bills will ensure that superannuation funds held in super fund accounts for temporary residents who have left Australia without claiming their superannuation entitlements are transferred to the Australian Taxation Office. Temporary residents for whom those super funds were paid will still be able to claim those funds at a later time. In summary, the new arrangements will significantly reduce the compliance costs for the industry; will allow for the insurance cover of temporary residents, as they will continue to fund members while they reside in Australia; will best address the lost member issue; will provide the same superannuation payment arrangements to all employees in a workplace; will allow for the full payment of superannuation to all former temporary residents at any time following their departure from Australia; and will, importantly, still allow Australia to attract foreign skilled workers to assist us to address skill shortages that currently exist.

These bills simplify the whole process currently in place with respect to payment and withdrawal of superannuation contributions made on behalf of temporary residents—a process that has been extremely burdensome for many employers, I might add. As the Minister for Competition Policy and Consumer Affairs and Assistant Treasurer has pointed out, some $12.9 billion representing some 6.4 million lost super accounts is currently held by the Australian government. Much of this money comes from temporary residents who work whilst they are in Australia and then leave without claiming their superannuation entitlements. The administration of six million lost super accounts is, in itself, an administrative workload for employers, the fund managers and the government. Equally, funds are being held in people’s names who probably are not aware that funds had been paid on their behalf and are being held for them.

In a global economy we are going to see an increasing number of people moving from one country to another for temporary employment reasons. We will see people come to Australia from overseas and we will see Australians travel overseas for the same purpose. We are already seeing it happen, with many Australians travelling to the Middle East for short-term infrastructure and construction projects where Australian expertise is in demand. I could refer to many other professions where similar examples are occurring and where Australians fulfil short-term employment contracts in overseas countries. Likewise, Australian industries and employers recruit skilled or professional workers from overseas for short-term purposes.

In my own state and, Mr Deputy Speaker, in your state of South Australia, I am aware of many such examples. One particular example which I want to refer to is the defence industry sector. South Australia, and Adelaide in particular, has established itself as a major defence industry hub in recent years. The Defence Science and Technology Organisation has had a presence at the Royal Australian Air Force base at Edinburgh for decades. In more recent years, firstly with the Australian contract for the construction of the Collins class submarines being won by South Australia and, more recently, with the contract to construct Australia’s three air warfare destroyers, the defence sector has become even stronger and has developed into a major economic driver and employment sector in South Australia.

I am aware, however, that because of the specialist skills often required by companies such BAE Systems, Tenix Defence and SAAB Systems—to name just three—the need to recruit or relocate qualified workers from overseas for a temporary period is common for them. Simplifying the employment process for those companies and reducing the red tape associated with the superannuation payments will undoubtedly be very welcome. In turn, such industries are likely to expand their operations or remain in Australia if the government makes administration of their businesses easier.

I just want to highlight the point I make here. It was not that long ago that I was talking to the CEO of one of those companies. Their concern was simply this: if they are not able, on a short-term basis, to recruit suitably qualified staff from overseas it jeopardises their ability to fulfil contracts here in Australia, and therefore jeopardises the security of them remaining in Australia as an industry and as employers. So the need to allow companies like that, at the times they require, to have suitably qualified, skilled staff come into the country for short-term purposes is going to continue to grow. Let us understand that many of these companies are responding not only to contractual needs of the Australian people and the Australian government but quite often to the contracts they have won in overseas countries. The work is being carried out here, but the final product will be delivered overseas. But, again, those companies may well be reliant on recruiting from overseas.

What is even more interesting is that many of these companies are, in fact, global companies and, as such, for short-term purposes will often transfer or second to Australia someone from one of their operations in another country. Again, they will have to continue to pay them. I understand that quite often where those kinds of transfers happen the payment system may still relate back to the country from where the person comes. But that is not always the case and for short-term purposes they sometimes have to get involved in paying superannuation for those employees whilst they are here in Australia.

The other sector that I want to refer to—and I notice that a number of speakers have already quite rightly done so—is the agricultural and horticultural sectors within Australia. I can assure you, from my discussions with many people in those industries, I have found that anything the government can do to simplify their bookkeeping processes will be very much welcomed and appreciated by them. Since being elected to this parliament I have been contacted by numerous people urging my support for easing Australia’s temporary visa system to allow seasonal workers into the country. I am pleased to see that the Minister for Immigration and Citizenship has now announced that a trial, of some 2,500 seasonal workers from three overseas countries, will be allowed to assist farmers, particularly in their harvesting seasons.

Most farmers or vegetable or fruit growers are not skilled bookkeepers. They have enough to do trying to make their farms viable and simply working their farms without having to worry about complicated bookkeeping systems. As I said earlier, any proposal which makes their lives a little easier would certainly be welcome. The kinds of people that they are asking to be brought into this country are quite often people who will only be here for short-term purposes. As I said earlier, perhaps they will come for harvesting purposes only, and then they will go back to their country. Many of these people, as we all know, will perhaps not even be aware that the employer might be paying superannuation into an account for them, and they may leave without ever being aware that those funds have been held for them. Perhaps that is something that needs to be properly addressed at the time that they are brought into this country to ensure that they are fully aware of their rights and fully aware that, perhaps as part of their employment contract whilst they are over here, there will be a number of benefits that they can access, and they should not leave without at least being aware of what they are entitled to.

I notice that some of the opposition members have raised some concerns that, in turn, have been raised by the superannuation fund industry, and I think the issues that they have raised are quite legitimate—nothing that I would disagree with. Certainly the transfer of these funds very quickly from superannuation funds into the Australian Taxation Office could have an effect on their cash liquidity and also the income that is generated on behalf of their fund members. I also noted that in the last year super fund schemes raised some $75 million in fees from funds held in accounts that had not been transferred to eligible rollover funds and another $170 million in fees from funds held in eligible rollover funds. These fees are not insignificant. These are substantial fees that, without question, would affect the income stream of the super fund holders, so I raise that point. I also suspect that, perhaps, some of the funds’ concerns relate to the fact that they will not be able to access these fees from the $12 billion-plus that is sitting in accounts with them.

On that point, I raise this issue: the question of fees when it comes to superannuation accounts is one that has concerned me and, I am sure, others for some time. It is not unusual for someone who has a small amount of money in superannuation to see that money dwindle away through the fees being charged by the managers of those schemes. As part of the minister’s review of superannuation schemes in this country, I ask that he also consider the question of the fees that are being charged and include that in any review process.

I said at the outset that this proposed legislation will do a number of things which I believe will benefit a whole range of people. Yes, it represents only a technical amendment. I believe it was the member for Aston who said that this measure is pretty much in line with a proposal by the previous Howard government to improve the current super scheme. I therefore support the bills and commend them to the House.

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