Mark Bishop (WA, Australian Labor Party) Share this | Hansard source

I just want to make three observations in the few minutes that are allocated to me in this debate: firstly, the long and proud record that the labour movement and the government have in the whole field of superannuation; secondly, how we are improving the superannuation system going forward over the next few years; and then, if time remains, just a few pertinent observations as to what is the real policy of the opposition, as expressed by the Leader of the Opposition consistently over a period of some 25 to 35 years—almost his entire time in public life.

I vividly recall the creation of the modern superannuation system in this place. I was an official of a trade union working in Western Australia at the time, and the trade union movement agreed to forgo a wage rise of three per cent that was about to be awarded by the then Conciliation and Arbitration Commission. We determined that it would be more appropriate if the pension system, which was then breaking down, were altered and superannuation, over time, were funded by the workforce so that, when people came to retire, they did not have to benefit only from a relatively miserable pension contribution but rather had a full and adequate retirement funded by themselves through the superannuation system over their working life of 25 to 40 years.

For the period of the mid-eighties through until 1996 or thereabouts, superannuation contributions were greatly increased, from zero to three to up to nine per cent, and that was a halfway house, if you like, in terms of finding sufficient funds to eventually fund retirement for all workers in this country. In the period after the demise of the Hawke and Keating governments, from 1996 through to 2007, there was no change and some of the great gains that had been made—the accumulation of savings, the vesting of savings and the creation of a worthwhile system that would last hundreds of years—did not go into free fall but remained steady.

With the current government we introduced additional changes to the superannuation guarantee levy to increase it from nine per cent to 12 per cent over the next six or seven years. The effect of that will be to boost the retirement savings of 8.4 million Australian—to increase superannuation savings by $85 billion over the period of the next 10 years and by $500 billion by 2035—and, for all of those who are currently in the workforce or starting out in the workforce, to add $108,000 in net present value terms to the retirement superannuation balance of an average 30-year old worker.

One step yet remains to be taken, but 12 per cent funded by employers going forward will essentially fund the retirement benefits of all Australians for the remainder of this century. We say without shame that it is a remarkable achievement, and there is no other effort that the labour movement, the trade union movement and the government have made in this last generation—the last 25 to 30 years—that has been as well received and as beneficial as to cement in a properly and fully funded retirement system, paid in cash upon retirement to every worker in this country when he or she comes to retire. There is no equivocation, no downside—the money goes in every month out of a worker's pay packet. It goes into a registered fund, it accumulates interest paid on market rates from year to year and when everyone in this room comes to retire at the age of 55, 60 or 65—whatever it is—they will have a retirement system that is paid for and funded and allows them not to live in 'frugal comfort'—to refer to another wages system—but to live a full and adequate life with a decent, well-paid, well-funded retirement benefit built from the mid-eighties through the nineties and, right now, up to 2020. It is nothing to be ashamed of; we should all be greatly proud of that development, because not only does it protect individual— (Time expired)