Michael Ferguson (Bass, Liberal Party) Share this | Link to this | Hansard source

My question is addressed to the Treasurer and Acting Prime Minister. Can the Treasurer inform the House of the benefits for Australians of superannuation reforms announced in the budget? Treasurer, how have these reforms been received?

Peter Costello (Higgins, Liberal Party, Treasurer) Share this | Link to this | Hansard source

I can tell the honourable member for Bass that the reforms announced in the budget in relation to superannuation have been overwhelmingly received in the positive. That is because this is the largest reform of superannuation we have probably ever had in this country. Some might think that is a big claim, but I draw endorsement for that claim from none other than former Hawke government minister Susan Ryan, who in the Australian on 12 May 2006 praised ‘the Treasurer’s bold gazumping of Labor’s cherished but slightly shabby superannuation property’. She said that ‘it strikes as a wonderful reform’ and ‘the ex-Labor minister backs super moves’. Under this superannuation reform there will be no tax on end benefits coming out of a taxed superannuation fund, there will be no tax on lump sums coming out of a taxed superannuation fund, there will be no tax on pensions coming out of a taxed superannuation sum, there will be no need for reasonable benefits limits, there will be no need for age based limits and there will be no need for quarantining between pre-1983 and post-1983 contributions. IFSA, the Investment and Financial Services Association, said:

The effective removal of end benefits tax and tax on super pensions is a major step towards the simplification of an overly complex superannuation regime.

The AMP said:

The proposals eliminate most of the complexity around end benefits and this will boost confidence and transparency …

Susan Ryan, in her opinion piece in the Australian, said:

Costello’s uncharacteristically bold and effective plan—

I do not agree with everything she said on 12 May—

to simplify super and reduce its taxes should be commended.

These are major changes to superannuation. Susan Ryan wrote in the Australian on 12 May:

“These are the most important changes to superannuation ever,” Peter Costello boasts. They’re even more important, he claims, than the 1992 introduction by the Keating government of compulsory super. The Treasurer can often overstate his case, but this time he’s right.

That is what Susan Ryan said in the Australian on 12 May. These reforms are warmly endorsed. They cut through the complexity of super. They give Australians the chance to save and to know how to deal with their savings. These are bold reforms and we look forward to the Labor Party announcing a position in relation to them.