Pat Conroy (Charlton, Australian Labor Party) Share this | Hansard source

I am feeling in a charitable mood so I am going to do a favour to the member for Hindmarsh and just ignore his contribution. Because it was that sad and pathetic, I will just ignore it. Let's go back to what we are talking about here: the superannuation system. It is a very important system, a system where 40 per cent of the concessions go to the wealthiest 10 per cent of Australians, a system where the concessions will soon out-cost the pension. It is an area where we do need to change, an area where we do need to acknowledge that change must occur. We have competing propositions here. We do have a choice here, and that is good. We are here to debate policy, and there is a clear distinction here. We have those on the other side, the coalition government, that had a choice about what concessions they were going to cut, what concessions they were going to attack.

An opposition member: Was it a hard choice?

Not for us, but for them it clearly was not either. They had a choice about the concessions that go to the 475 Australians who have more than $10 million in superannuation. They earn $1½ million in income tax free per year. They could have gone to those concessions or they could have cut the low-income superannuation contribution for 3.6 million Australians. There was a distinct choice here—475 of our wealthiest concession holders or 3.6 million Australians. They chose to cut the assistance to the poorest paid Australians, to cut their concession.

If there is one political party in this place that practices class warfare, it is those on the other side. They engaged in the politics of class warfare to attack the 3.6 million low-paid Australians. It is a disgrace, and I condemn them for their actions. We have got a fair plan, a plan that says, for those 475 Australians who have $10 million in super and who earn $1½ million tax free, you can still earned the first $75,000 tax free but you might pay 15c tax on income after that, so you are paying the same tax as a retail worker. What an extraordinary outcome! Our plan is fair, it is detailed, it will work and it will make our superannuation concession system more sustainable.

I want to go to superannuation governance for a minute. I want to present two separate sectors of this industry.

An opposition member: Compare the pair, Pat.

I will compare the pair. Who thought up that great idea? We have one part of the industry where the fees are $449 million, where they manage 26 per cent of assets but charge 82 per cent of fees, where the average fee per member is $31 and where the rate of return over 10 years averages 4.9 per cent. Compare that to another part of the industry where the funds are $88 million, where the average fee per member is $7—that is $7 versus $31—and where the average rate of return over the last 10 years per annum is 6.7 per cent. So which one do you think needs governance reform: the one that underperforms compared to the other; the one that charges four times the fees of the other; the one that, despite having only one-quarter of the assets under management, charges nearly 90 per cent of the fees? No, of course not. It is the low fees one, the one that constantly outperforms the other. Why? Because it has union representation on the board. That is the only reason.

I support independent trustees, if the board wants it. If the board wants it, that is great. We have got some great super funds that have one-third independent trustees, such as Hostplus. And if they choose that, that is great. What I am opposed to is mandating reducing representation from employers and unions, which is what the coalition government is doing, because the system is absolutely working. I would urge them to have a closer look at their own supporters, their own backers, their financial supporters in the retail funds that charge their related service providers $485 per member, compared to $185 for the not-for-profits.

This is the closest relationship to conflict of interest, and then charge triple the amount if they are in a retail fund where directors often sit on allied bodies. So if those on the other side are serious about reforming superannuation, they will stand up for the 3.6 million low-paid Australians, they will stand up and support industry funds that work, that reward hardworking Australians instead of rewarding their corporate spivs and engaging in class warfare that demeans them, demeans the party that they stand for and, yet again, reminds us that their former Prime Minister said superannuation is a con. This is the party that voted against superannuation when it came into power; this is the part that not only does not understand super, it hates it and it wants to destroy it! (Time expired)

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