Michelle Rowland (Greenway, Australian Labor Party) Share this | Hansard source

I am very pleased to speak in support of the Tax Laws Amendment (2011 Measures No. 2) Bill 2011. It is very satisfying to speak on bills such as this one because they reinforce some very responsive and progressive reforms that this government is pursuing. I thank the Assistant Treasurer and Minister for Financial Services and Superannuation for his commitment to creating a better future for all Australians. This bill demonstrates the commitment of the government to fulfilling its election promise of increasing the level of education for Indigenous Australians. This bill also takes steps towards fulfilling the government's election commitment to the creation of a stronger and fairer superannuation industry. Both measures are an investment in the future, the former by assisting Indigenous Australians to achieve educational equality and the latter by ensuring the provision of a comfortable retirement for all Australians, including many in my electorate of Greenway.

This bill does a number of important things and I would like to focus on three of them. The bill grants deductible gift recipient, or DGR, status to two educational trusts designed to support Indigenous education. It enables the regulation of investments by trustees of self-managed superannuation funds to ensure that there is no misuse of superannuation assets and it allows the use of tax file numbers by trustees of superannuation funds and retirement savings account providers to locate and consolidate member accounts. These important measures will result in a better future for all Australians by increasing the level of Indigenous education and by providing a comfortable retirement for working Australians.

Schedule 1 of the bill adds two organisations to the list of DGR recipients. These two organisations are the Charlie Perkins Trust, for children and students, and the Roberta Sykes Indigenous Education Foundation. The Charlie Perkins Trust was established in 2002 in memory of the late Dr Charlie Perkins AO. Dr Perkins was an inspiration to both Indigenous and non-Indigenous Australians alike. In a life full of achievements, Dr Perkins was responsible for the organisation of the famous Freedom Ride, which exposed the discrimination suffered by Indigenous Australians, in 1965. He was the first Indigenous person to graduate from university, in 1966, and he was appointed to a number of influential roles, such as Commissioner of the Aboriginal and Torres Strait Islander Commission and Secretary of the Department of Aboriginal Affairs, before being awarded the Order of Australia in 1987.

The Charlie Perkins Trust seeks to continue the inspiring work of Dr Perkins by providing for the advancement and education of Aboriginal and Torres Strait Islander people. The trust provides scholarships for overseas study at institutions such as Oxford, Cambridge and Harvard, which provide Indigenous students with the opportunity to access their unlimited potential and which will undoubtedly pay dividends to Australia in the future.

The second organisation is the Roberta Sykes Indigenous Education Foundation, which was established in 1990. Dr Sykes was another inspirational Australian whose legacy will surely be long. Dr Sykes was a poet and author who was heavily involved in the Aboriginal land rights movement and who, among other roles, was the Executive Secretary of the Aboriginal Tent Embassy in 1972. Among her many achievements, Dr Sykes was the first Indigenous Australian to attend an American university, receiving a PhD from Harvard. She was later awarded the Australian Human Rights Medal, in 1994, in recognition of her tireless campaigning for Aboriginal rights. The Roberta Sykes Indigenous Education Foundation also aims to advance the education of Aboriginal and Torres Strait Islander people and specifically provides additional assistance to female Indigenous scholars undertaking programs overseas, such as assisting with relocation costs for partners or family.

By being specifically listed as DGRs, the Charlie Perkins Trust and the Roberta Sykes Indigenous Education Foundation will be in a significantly better position to attract private and corporate donors. The increased donations will allow these great organisations to help even more Indigenous Australians to reach their potential. I am very proud to support these measures which will provide such a tangible benefit to Indigenous Australians and the future of our country. It is a strong demonstration of the commitment of this government to the advancement of the education of Indigenous Australians. It is very important for my electorate of Greenway as the Blacktown local government area is home to the largest Indigenous population in New South Wales, something which is not very well known.

Another feature of the bill I would like to comment on is being implemented as part of the government's election commitment to a fairer, stronger and simpler superannuation system. With this measure the government lays the foundation to regulate SMSF investment in collectables and personal use assets. SMSFs account for 99 per cent of all superannuation funds in Australia, numbering approximately 430,000. They hold over 30 per cent of all superannuation assets and, in recent years, they have enjoyed an annualised growth rate of 20 per cent. These statistics are very real and they can be found in APRA's Annual Superannuation Bulletin, published on 19 January this year.

As a popular vehicle for superannuation management, which forms such a significant portion of the superannuation industry, it is vital that SMSFs maintain a high standard of governance. Indeed, one of the key messages from the Cooper review and the government's Stronger Super response relates to the importance of these high levels of governance amongst SMSFs. The bill implements measures which will ensure that SMSF trustees do not derive any current day benefits from investments in collectables and personal use assets. These new measures will ensure that SMSF assets cannot be misused by an SMSF trustee, for example, by 'collecting' and then driving high-end sports cars or 'investing' in expensive artwork which is then displayed in the trustee's home. The government recognises that investment in collectables and personal use assets can be a legitimate investment for some SMSF trustees. Accordingly, the measures implemented by this bill do not call for a blanket prohibition on SMSF investment in collectables and personal use assets.

The government is certainly aware that to completely prohibit such investments would unreasonably prejudice certain industries, such as the significant art industry in this country. Instead, in fulfilment of the government's election promise, the measures allow the investment in collectables and personal use assets to continue, but remove the ability of the SMSF trustee to derive any current day benefit from such investment. The bill does this by allowing the creation of specific regulations regarding collectables and personal use assets with which SMSF trustees will need to comply. The regulations can relate to the making, holding or realising of such investments, and may prescribe penalties for noncompliance. These new measures will ensure that, as the number of SMSFs grows, their standard of governance will remain high. In this way the government is fulfilling its election commitment to create a fairer, stronger and simpler superannuation system for the future.

The third measure under this bill I would like to discuss fulfils another election promise of this government. Under schedule 3 of the bill, the government proposes to amend legislation and grant to superannuation fund trustees and retirement savings account providers the ability to use the TFNs of members to locate and consolidate the superannuation contributions of those members. This initiative is also consistent with the government's commitment to the creation of this fairer, stronger and simpler superannuation system.

This is an extremely important item. There is currently some $18.8 billion in lost superannuation in some 5.8 million lost superannuation accounts. While lost superannuation is still held on trust by the trustee of an eligible rollover fund, or in some cases the trustee of a superannuation fund, the lost super moneys are not being managed at the direction of the member for whose benefit they are held. It is vital that every Australian is able to enjoy a secure, comfortable retirement. Ensuring every working Australian is in full control of their superannuation is critical to achieving this outcome.

An efficient way of tracking down lost superannuation is by using the TFN of a fund member. However, while many account holders supply their TFNs to superannuation funds, it is actually against the law for trustees to use a TFN as the primary search method for lost accounts. This is a significant impediment to efficient administration of the superannuation industry. This new initiative will allow a trustee to locate and consolidate lost accounts using the TFNs of superannuation fund members without first needing to exhaust all other avenues. This will improve the administrative efficiency of the superannuation industry, which in turn will result in better returns to members.

It is also important to note that privacy safeguards will not be compromised by this initiative. It will remain voluntary for individuals to provide their TFN to their superannuation fund or retirement savings account provider, and TFNs will not replace account numbers as primary identifiers. These amendments are consistent with the provisions of the Privacy Act 1988, the National Privacy Principles contained in that act as well as the TFN Guidelines. To ensure that the account consolidation process is carried out in the most efficient way, regulations will again be developed in consultation with industry. Among other requirements, member consent will be required for the consolidation of accounts, and processes and procedures will be created which superannuation fund trustees and retirement savings providers must follow before beginning the consolidation process.

There are several benefits associated with this bill which I have sought to highlight. With the passage of this bill it is evident that many Australians will achieve a tangible benefit from these measures to be implemented. These actions are also a genuine reminder of this government's commitment to policy delivery and fulfilling its vision for the future of Australia. It is a great example of the Assistant Treasurer and the Minister for Financial Services and Superannuation, and the people on this side more generally, listening to the needs of our constituents and responding to important policy issues. The bill delivers on multiple election promises that will undoubtedly have a very positive impact on sectors such as Indigenous communities throughout Australia and will assist in addressing some of the very real challenges facing the superannuation industry now and in the future. I commend the bill.

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