Dennis Jensen (Tangney, Liberal Party) Share this | Link to this | Hansard source

I wish to draw the attention of the House to an important issue, namely superannuation reform.A policy called 'Super for HELP' has been put to me by Ernst and Young economist John Adams. This superannuation reform plan proposes that individuals have voluntary access to their super to contribute to their HELP debt.This scheme would allow individuals to pay off this debt and increase their disposable income at significant moments in their lives.It is no secret that many Australians, particularly families within my electorate, are struggling with the cost of living.2It is particularly difficult for individuals who are at an age when major life events are occurring—events like buying a first home, getting married and/or starting a family.

I would like to put on record my unequivocal support for this proposal. It benefits families by providing more disposable income. It benefits the government by allowing g overnment debts to be repaid at an earlier time . This in turn helps and strengthens small businesses within my electorate. Many Australians have taken on personal debt in the face of rising living costs. According to the RBA, household debt as a proportion of disposable income is now exceeding 180 per cent. The level of debt currently contained in non-government sectors poses a real risk to both Australians and the broader economy.

Super for HELP is about allowing individuals with a HELP debt to draw on their existing super to pay off their HELP loan amount. The amount paid off can be specified by the individual. Senator Back and John Adams sought costings from the PBO to ensure understanding of this scheme. The PBO provided several rounds of analysis, examining various aspects of the policy, including design schemes. The policy design scheme which is most viable is where an individual will be required to repay their withdrawn super, including the forgone earnings, with after-tax income from the point of withdrawal up until preservation age. This means that, at preservation age, there would substantially be no difference between the superannuation of those who did participate and that of those who did not. This scheme will benefit the Australian people and the federal government while also providing public and private benefit. Individuals will have their disposable income boosted, and the government will have a greater ability to repay the hideous amount of debt and deficit left over by the previous Labor government. I must stress that this scheme is distinctly different from the previously proposed super for housing scheme. They are completely different policies and should both be judged on their own merits.

The Labor Party have shown that they do not care, but we cannot and must not ignore that the cost of living is the No. 1 issue faced by Australians. Thanks to the mess we inherited from Labor, we are now trying to resolve the deterioration of the government's financial position. We cannot afford to lose our AAA rating. We cannot afford to increase spending. We cannot afford to increase debt. This policy will strengthen Australia's current fiscal position. As stated by JFK, the time to fix the roof is when the sun is shining.

Even at a low uptake rate, the PBO has indicated that this scheme will provide significant revenue for the government. A suggested implementation proposal has been put forward as part of this proposal, which would be administered by the Australian Taxation Office. This proposal will allow families to pay off their debts with their money. This is a strong and sensible measure that will provide families with more disposable income to work, save and invest.