Bert Van Manen (Forde, Liberal Party) Share this | Hansard source

As you well know, Mr Deputy Speaker, I always enjoy rising in this place to speak about matters of superannuation. But I look at this bill and I rise to speak with a sense of trepidation. If we go through this bill there are a number of schedules, and some of those are quite innocuous, shall we say. But, as is the want of those opposite, as always, it is never the headline you look at with this government; it is always the detail, because, as the old saying goes, the devil is always in the detail. Tonight I want to focus on the first three schedules of the bill. As I said, the other schedules make some sensible changes, but the first three schedules of this bill are extraordinarily problematic.

The reason they are extraordinarily problematic starts with the fact that, first and foremost, this government, in the lead-up to the last election, promised the Australian people they wouldn't make any changes to superannuation. This bill, as a consequence, with changes that are proposed—and it's good to see the shadow minister here in the chamber—is diametrically opposed to that. This actually makes a fundamental change to our superannuation system, and in making a fundamental change to our superannuation system it directly undermines the strength and benefit of it.

My concern with this bill has been further illuminated by a comment that I will attribute to the assistant minister at the table about superannuation being a honeypot. This is not a honeypot. Superannuation is not a honeypot for the government; it is people's hard-earned savings. It is not a honeypot for industry super funds to support the Labor Party or undertake a variety of other activities that this government are pushing to now undermine the veracity and strength of the ASX through other bills that are before this place and other matters. Industry super is becoming like a leviathan with tentacles everywhere, being aided and abetted by this government to extend those tentacles through our economy to have complete and utter financial control.

As we look at this bill, this is a clear indication that the government and those that back the government—that is, the industry super funds—have a pathological dislike for self-managed superannuation, because it is possibly self-managed superannuation funds and their trustees that are going to face the biggest consequences of the impact of this bill. At the very time when we are wanting people to be financially self-sufficient in retirement in order to minimise the cost on government—and our intergenerational reports have shown over a number of years the growing cost of age pensions with an ageing population—what is the greatest avenue for people to accumulate wealth in order to do that? It is superannuation.

Yet we see here in this bill a direct attack on those people who have put in the time, effort, forethought and planning to accumulate assets in super to ensure that they are going to minimise—or completely eliminate, in this case—the need to draw an age pension. People with $3 million in super are not a burden on the taxpayer in retirement. They are not drawing the age pension. That's exactly what we want our system to be, and that is the incentive for superannuation—that you put your money in there during your working life and you pay a concessional tax rate because you will not have that money until your preservation age, such that at retirement you can access those funds and draw a pension or draw a lump sum, if you need to buy a new car or whatever the case may be. But the trade-off is that, in these cases, the people that this bill affects also are not a burden on the Australian taxpayer. So, not only have you done the right thing during your working life, in working hard and building wealth and building assets, and paying taxes along the way, but you have done the right thing by saving for your retirement such that you are not a burden on the Australian taxpayer. Is that not the system we want? Yet here we have a government that is trying to undermine that. They're trying to undermine it by introducing a punitive tax on people with superannuation balances above $3 million. In particular, the most egregious part of this bill is the component that taxes unrealised capital gains.

Many in this place would know that, prior to being here, I had a life in financial planning. I used to talk to my clients, along with their accountants, and there was many a client who had a small to medium business and was maybe looking to purchase a property to run their business from or was looking to upgrade the property they were running their business from. In conjunction with their accountants, many of those people finished up with self-managed super funds that held the building assets that their business would operate out of. That was in the late 1990s and in the 2000s. I would suggest that, with the effluxion of time and the success of many of those businesses, those people would have well more than $3 million in their superannuation funds. But, as I said earlier, they've done the right thing by the Australian people. They've run successful businesses. They've employed people. They've paid taxes. They've also done the right thing by building an asset portfolio that will sustain them in retirement. Yet now they're in the situation where they have an illiquid asset in that fund. As the member for Hughes rightly pointed out earlier, this could apply equally to farmers and a whole range of people who have illiquid assets in their superannuation funds and who have a good year.

Now, if they have a substantial number of illiquid assets in the fund, which is not against the law, it's their responsibility as a trustee to ensure that they generate the best returns possible for the members. They might have to sell that illiquid asset to fund a tax bill if they've had a good year and that asset has gone up substantially in value. There is no other place in our tax system where we tax unrealised capital gains. If they buy shares in a listed property trust, which would have the same profile of investments maybe, or a listed property trust that has investments in a range of commercial properties in one of our local industrial estates, do they have to pay tax at the end of the financial year on their unrealised capital gains?

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