Michael McCormack (Riverina, National Party) Share this | Hansard source

I commend the member for Throsby on this motion and also the members for Bradfield and Cunningham for their speeches on it. It is very difficult to represent people who have been ripped off and people who have had their superannuation nest egg taken away in unfair and illegal circumstances. Tonight gives me the opportunity to speak about important superannuation matters and I agree that the government should be working with regulators to enhance fraud detection and prevention in the superannuation schemes.

The Trio inquiry has highlighted the considerable financial losses and the physical and dreadful emotional toll suffered by hundreds of Australian investors who were defrauded in the largest superannuation fraud in this nation's history, costing them $176 million in retirement savings. The parliamentary joint committee inquiry has also exposed the failure of key checks and balances in the Australian regulatory system, with regulators missing some important signals or failing to identify the fraud or to act rapidly enough to shut it down and protect investors. The coalition has welcomed the release of the committee's report on the collapse of Trio Capital and has called on the government and regulators to act on its recommendations. We expect the Australian Securities and Investments Commission, the Australian Federal Police and the Australian Prudential Regulation Authority to act decisively and seek justice on behalf of those investors who have suffered greatly due to the collapse of Trio Capital.

The government needs to provide ASIC with appropriate funds to enable the liquidator of Trio to properly investigate the various offshore companies into which the Trio funds were invested. The government must also appropriately resource the AFP to establish a dedicated superannuation fraud squad which will provide valuable protection for Australians in the superannuation system from criminal activity in the future. We heard from the member for Bradfield about the potential for international theft of the $1.5 trillion pool of superannuation funds.

I spoke today with Trevor Ion, a financial planner from Wagga Wagga, about his thoughts on this motion and superannuation matters. He advised me he has been in the industry since 1986 and has seen many different types of fraud and collapses with investments within the superannuation environment as well as with investments outside the superannuation environment. The questions Mr Ion asks about any scheme are ultimately about the structure, the cost, whether there choice to opt in and how much will the scheme cost to administer. His company gives choice to clients who are prepared to pay the cost to protect their investments from market volatility. Therefore, should trustees have the choice to pay these costs? Mr Ion advised me that they have clients who are trustees of self-managed super funds with secure investments who would object to paying for a cost they may not benefit in and thus subsidise the trustees who have higher risks.

The government also needs to stop playing with people's superannuation. Only last month there was a report in the Australian about the government's plans to ramp-up taxes on self-managed super even further. People who have done the right thing by working hard and saving to achieve a self-funded retirement so that they are not a burden on the public purse are being penalised by this government. We should be supporting these people and encouraging them; not raiding their retirement savings. The government should not be placing tax grabs on people's retirement savings to try to get some cash to make up for deficits, the $120 billion in unfunded promises and the collapse of the mining and carbon taxes.

As of 30 June 2011 there were 442,528 self-managed super funds with a total of 841,283 members. Indeed, self-managed super funds held 30 per cent of all assets in superannuation at the same time. This is a total of about $407 billion. When in government, the coalition worked hard to protect Australians' superannuation and to ensure they understood the benefits of superannuation and that they had options. We removed the confusing and discriminatory reasonable benefit limits and simplified the superannuation laws. We introduced reforms to allow Australians to choose their own superannuation fund, including the freedom to choose a self-managed fund. We increased contribution caps to allow people to voluntarily save for their retirement at a stage of their lives when they can better afford additional contributions and when they are more focused on their retirement needs. We also encouraged superannuation saving for low- to middle-income earners through the co-contribution scheme.

We have unfortunately seen increased taxes, however, on voluntary savings by changing concessional contribution caps from $50,000 to $100,000, down $25,000 across the board. Anyone who wishes to save more than $25,000 per annum, which includes the compulsory contribution, has to pay more tax. This is an important motion. I commend the member for Throsby for introducing it, because people should not have their nest eggs ripped off through fraud.

Debate adjourned.

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