Brett Mason (Queensland, Liberal Party, Parliamentary Secretary to the Minister for Health and Ageing) Share this | Hansard source

I thank Senator Sherry and Senator Murray for their considered remarks. Sadly, I cannot help the honourable Senator Murray in relation to his questions to me, except to say that, importantly, this measure will affect roughly two million Australians. The Superannuation Laws Amendment (2007 Budget Co-contribution Measure) Bill 2007 will boost the superannuation savings of low- and middle-income Australians by doubling the government’s superannuation co-contribution payable in respect of eligible contributions made in the 2005-06 year. For example, if a person was otherwise eligible for a co-contribution of $1,500 made in the 2005-06 year, they will now receive an extra co-contribution of $1,500, bringing the total co-contribution for that year to $3,000. This provides a substantial reward to eligible low- to middle-income Australians who have saved for their retirement and builds on the already successful government co-contribution. These changes also build on the substantial improvements to superannuation made by the government through the recent Simplified Superannuation reforms.

This government first introduced the co-contribution scheme in 2003-04. It then increased the co-contribution from $1 to $1.50 in the 2004-05 year and raised the upper income threshold from $40,000 to $58,000. From 1 July 2007 eligibility for the co-contribution scheme will be extended to the self-employed, and the income thresholds will be indexed each year in line with the growth in wages. Over 2.7 million co-contribution payments, worth approximately $2 billion, have already been paid under the scheme. This measure will increase payments under the scheme to $3.1 billion.

This is an important budget measure. It has been made possible only because of this government’s very strong economic management. I commend this bill to the Senate.

Question agreed to.

Bill read a second time.