Ross Vasta (Bonner, Liberal Party) Share this | Link to this | Hansard source

My question is addressed to the Treasurer. Has the Treasurer seen reports of opposition to the government’s major superannuation reform? What would it mean if opponents were successful in defeating the government’s changes?

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

I thank the honourable member for Bonner for his question. In this year’s budget the government announced the most significant superannuation changes in the last two decades, and they were very widely welcomed. The Investment and Financial Services Association said:

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

ASFA said:

The 2006 Budget plan could sweep away some of the frustrating complexity of Australia’s superannuation system ...

AMP said:

These initiatives help ensure Australia maintains one of the most progressive and well-managed retirement income systems in the world.

The Institute of Actuaries said:

The Institute strongly applauds the government’s big bang approach to the government reforms.

So we have near universal endorsement of the government’s plan for the greatest reform to superannuation in the last two decades. Who would oppose it and on what grounds? I was very concerned to read in the Age newspaper today in an article titled ‘ALP digs in over no-tax super plan’:

Labor is reserving its right to oppose the Howard Government’s headline-grabbing promise to make superannuation payouts tax-free for workers ...

Yesterday I raised the issue that Labor had been ominously silent—that Labor had not come out and supported this change—and now we see Senator Sherry slipping around to the Age newspaper to tell us Labor’s real plan. Labor’s real plan is to dig in over the abolition of taxes on superannuation.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Assistant Treasurer and Revenue) Share this | Link to this | Hansard source

You don’t have a policy!

David Hawker (Speaker) Share this | Link to this | Hansard source

Order! The member for Hunter is warned!

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

Seeing that we are interested in employee entitlements, let me tell people what Labor’s opposing this superannuation reform will mean for them. If you are a 25-year-old on $1,000 a week and receiving the SG, and if Labor is able to defeat these reforms, you will be worse off in retirement by $7,000 a year. If that same 25-year-old earning $1,000 took his lump sum, and if Labor succeeds in opposing this plan, his lump sum would be reduced by $37,000. Just in case you thought that it was only young people that Labor was against, a 65-year-old retiring with a $400,000 allocated pension under Labor’s system would have their allocated pension reduced by $4,900 a year. If that same 65-year-old took their money in a lump sum, their lump sum would be reduced by $43,000.

The young and the old stand to benefit from this superannuation plan. It has the support of IFSA, ASFA, AMP and the Institute of Actuaries. The only person who does not have the guts to stand up and back the government’s reform is the Leader of the Opposition. He was warned about this by former senator Susan Ryan, who endorsed the government’s plan. Not only did former senator Susan Ryan—a former Labor minister—endorse the government’s plan but she finished off her article in the Australian on Friday, 12 May 2006 by saying:

Maybe faced with the Treasurer’s bold gazumping of Labor’s cherished but slightly shabby super property, the Opposition will find the resolve to get another big picture worked out, and the wherewithal to let voters know about it.

Maybe or maybe not—no big picture, no wherewithal, no leadership, no policy, no credibility and no support.

Arch Bevis (Brisbane, Australian Labor Party, Shadow Minister for Aviation and Transport Security) Share this | Link to this | Hansard source

Mr Bevis interjecting

David Hawker (Speaker) Share this | Link to this | Hansard source

Order! The member for Brisbane is warned!