Warren Entsch (Leichhardt, Liberal Party) Share this | Hansard source

I thank the member for Lingiari for his contribution. His commitment to Defence Force personnel goes back over a lot of years, including when he had portfolio responsibility for our Defence Force. The Australian government is certainly very committed to supporting Australian Defence Force members throughout their service and into their retirement. This legislation is a reflection of that commitment that will be very much supported and greatly appreciated. As the member for Lingiari said, I served in the Defence Force myself. I was in the Air Force for a period of nine years up until 1978. That was a very formative time for me and has never been replicated in any other period of my life.

Recently I again had the opportunity of seeing firsthand the amazing work that is being carried out by our defence forces. I travelled with Senator O'Sullivan and Senator McGrath to the Middle East, where we spent some time with our troops there. We worked with them very closely in the work that they do in carrying out the commitments that have been made in this place. We travelled across to the Middle East from Darwin with a rotation crew that was going there. They generally go there for about six months. We spent a couple of days working with them doing the orientation work. We had the opportunity of going to the air base at which our Hornets and aerial tankers are based. From here they go up into the theatre area where they are operating. It is amazing to see. Those pilots strap themselves into the F18s knowing that they will be away for anywhere from eight to 12 hours and have no capacity to return home with the fuel that they have; they have to refuel not once but up to six times during the course of a particular operation. The work that they do is phenomenal. We participated in the refuelling of aircraft and met many of our troops over there. One thing I can say—and it is one of the reasons why we have to be very supportive of this legislation—is that I now understand comprehensively why middle-aged overweight men are not recruited to the front line in the Middle East. It is very hard work over there. All the time we were there, there were absolutely no complaints about personal circumstances. Everybody wanted to be there.

I want to take this opportunity to acknowledge Major Stuart Roesler. He kept us in tow and provided a fantastic opportunity for us. He was our military escort and he did an outstanding job. I also acknowledge Brigadier Nagy Sorial, the Deputy Commander of the Middle East Area of Operations. He is another outstanding Australian. We greatly appreciated his company and his advice, and nothing seemed to be too much trouble for him. We also went to see HMAS Newcastle, which is doing fantastic work patrolling the Arabian Gulf and down through Somalia and so on. In four operations they have taken close to $2 billion worth of heroin off the market. It is amazing stuff. This is heroin coming out of Afghanistan and going into Pakistan and then being sold to fund the operations of Daesh.

The conditions over there were very difficult. The temperature was up to 55 degrees. When you have a shower, the water temperature is up to 50 degrees. These men and ladies do this with a great deal of enthusiasm. Coming back home, we were with a group that was coming out of there after doing their six months. While they were happy to be getting back to their families, they were equally enthusiastic in their commitment to the job they are doing. I cannot speak highly enough of them. The legislation that we are talking about today is a very small acknowledgement of the commitment that these men and women make when they sign up to the Defence Force. I think we should be very proud of them.

There are two others that I would like to mention. They are both originally from Cairns. Lieutenant Michael Holman is over there on a six-month deployment with HMAS Cairns. His family is still based in Cairns. Squadron Leader Michael Sciberros, who is Squadron Leader Engineer, is stationed at the refuelling base. His job is to keep those aircraft flying. He is from Innisfail originally but was educated at Trinity Bay State High School. It was great to go all the way over there and see these young people from home. One thing I have to say is that, as someone who served in the Air Force for nine years and who left in 1978, it is a very different military now than it was during the time in which I served. Yet, in many ways, it is exactly the same—the camaraderie, the sense of pride and commitment has not changed one little bit, and the only way you are going to get that is to be a member of these forces. It was something that was really driven home to me.

Given the uniqueness of this service, it is important that we acknowledge it through changes such as those we are making here in relation to superannuation. This landmark legislation was introduced on 25 June 2015. Its purpose is to introduce a new military superannuation scheme for all our ADF members, known as ADF Super. It is part of the government's recognition of the unique nature of military service, which I spoke of a moment ago. Accompanying legislation was also introduced to establish ADF Cover—a new scheme that will continue to provide members of the ADF with death and invalidity cover. This groundbreaking legislation will enable ADF members to seek part-time work, subject to defence capability requirements.

ADF Super fixes one of the longest running grievances of the veteran and ex-service community—namely, the lack of flexibility and portability of members' superannuation benefits. The government has worked with stakeholders such as the RSL, the Defence Force Welfare Association and the Australian Defence Association in developing these policies. All major stakeholders support these important reforms. Again, it was great listening to the member for Lingiari's contribution. He was there very much at the beginning, working both sides closely together to develop this legislation. It is great to have a piece of legislation here that is embraced so comprehensively by all sides of the chamber. It is great to see, and I am sure it will be greatly appreciated. There is no doubt that these reforms will improve conditions of service for members of the ADF.

The Australian Defence Force Superannuation Bill 2015 introduces new, modern, flexible arrangements for people joining the ADF on or after 1 July 2016. The new military superannuation scheme, which will be a fully funded accumulation scheme, will be known as ADF Super. The current Military Superannuation Benefits Scheme, the MSBS, will be closed to new members from July 1, 2016. Importantly, current serving and contributing MSBS members will not be compelled to move to ADF Super, though they may choose to do so.

For the first time, ADF members will be able to join a superannuation fund of their own choice. A default military superannuation scheme will also be established, as it is required under law. In recognition of the unique nature of military service, ADF service members will receive a generous employer contribution rate of 16.4 per cent, regardless of the superannuation fund that they choose. This rate is higher than is offered to Australian public servants, 15.4 per cent, and significantly higher than the 9.5 per cent available to the majority of Australians through superannuation guarantees. Again, that is very much in recognition of the unique nature of the service that is given by our people from all areas of the ADF, and I think it is important that we recognise that service. There will be no requirement for the ADF Super members to make an employee contribution to their superannuation and, as a result, serving MSBS members who currently contribute a minimum of five per cent of their salary and choose to become ADF Super members will immediately receive a five per cent increase in their take-home pay.

Importantly, current serving MSBS members will not be compelled, as I said, to move to ADF Super. After 1 July 2016, all DFRDB scheme retirement pay recipients who re-enter for further service will be able to choose which superannuation fund they belong to, noting that they will not be able to rejoin the DFRDB scheme, because that will be closed at that time to any further membership. Likewise, those members currently receiving an MSBS pension who re-enter for a further period of service will also continue to receive their pension during that period of service, while accumulating further superannuation benefits.

A single employer contribution rate simplifies the administrative arrangements, including for ADF Super members. ADF Super is being established to provide members of the ADF with a modern and flexible accumulation superannuation scheme. It is great to see that, as I said earlier, under this scheme they will be able to have freedom of choice as to which way they go.

This is certainly not a savings measure, nor should it be; it is just recognition of the uniqueness of the service. ADF Super has forecast a total cost of about $433 million over the forward estimates to 2018-19 and some $3.196 billion over the decade. Some are asking if anyone will be worse off, and ADF Super fixes one of the longest grievances of veterans and ex-service community members, namely the lack of flexibility and portability for a member's super. There are numerous benefits. Australian Government Actuary modelling confirms that ADF personnel who serve less than 15 years will especially benefit under the new superannuation arrangement. Approximately 80 per cent of ADF personnel separate after serving less than 15 years, this is generally the trend. The introduction of ADF Super does not affect the government's delivered election commitment to provide new indexation for DFRB and DFRDB military superannuation pensions.

In summing up it is important to note that this is something that has been a long-time coming. I know there have been some issues as we waited for delivery of the bill, but it very clearly shows that this government and this parliament is steadfastly committed to supporting ADF personnel and these reforms will help boost Defence capability. More importantly, these reforms will clearly improve conditions of service for members and those members who leave the ADF. We need to be very appreciative of the outstanding service of these wonderful Australians.

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