Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Hansard source

It is families across Australia buying a new family station wagon or the like, because this government might have a political strategy to demonise the supposedly rich—because that is what they want to do for their political purposes—but, when it comes down to it, their tax increases invariably hurt low- and middle-income earners. And so it is now with superannuation. People out of Mr Shorten's office and the Treasurer's office have been out there busily trying to make the case that there are all these rich Australians who are taking advantage—quasi-avoiding tax, quasi-dodging tax—of tax concessions that are available to those Australians who are doing the right thing by saving to achieve a self-funded retirement.

That is what we have had. Of course, the first thing the government were looking at—and spin doctors out at Mr Shorten's office and the Treasurer's office were quite up-front about it as they were backgrounding off the record—was taxing super payment for over-60s if those payments were taken as a lump sum in the range of $800,000 to $1 million. The Prime Minister was shamed into ruling that out, because she could see that the outcry across Australia from people who have been doing the right thing was so significant. Even Labor people—even people like former Senator Nick Sherry, a highly reputable contributor to the superannuation policy debate over a very long time—started to attack this government for the tax grabs that they were considering, and the Prime Minister was shamed into ruling that particular tax grab out. But that will not stop them from going down the list of all of their other increased tax options that they are currently considering. They are looking at taking more money away from super savers by fiddling with the transition to retirement arrangements. They are looking at lowering concessional contribution caps even further.

A Labor government that looks at doing these sorts of things to Australians doing the right thing by saving for their own retirement should at least be across the facts. Today I asked the leader of the Labor Party in the Senate—the Prime Minister's representative in the Senate, the Leader of the Government in the Senate—whether he was aware how much tax people saving for their retirement pay on any contribution to superannuation above $25,000 a year—and you know what? The minister did not know; Senator Conroy did not know. You would think that a government that was considering whacking on another tax would at least know the facts, because when we talk about concessional contribution caps—when we talk about the 15 per cent tax rate that applies to those Australians who make contributions of up to $25,000 a year—that is not a perk. People that are saving $25,000 are not rich people. That 15 per cent tax rate is an incentive to encourage people to save more now, to lock their money away for 20, 30 or 40 years until they retire so that it is available for them in retirement, along with the earnings on those funds invested.

The government has already reduced those concessional contribution caps from $50,000 and $100,000 down to $25,000 because it is desperate for more cash. It wanted people who were saving more voluntarily to superannuation to pay more tax. That is what this is all about. It wants Australians saving for their retirement to pay the price for its wasteful spending because it cannot balance the books, because it cannot live within its means, because it has had $172 billion of accumulated deficits and because it has already got $120 billion in additional unfunded spending commitments—it has to go after savers across Australia and put its hands into their pockets and try to get some more out of it. There is this $1.34 trillion pot of money. There are $1.34 trillion worth of super savings invested in superannuation and the Labor Party thinks, 'We want a bigger share of it.' Why? Because this Labor Party in government does not know how to manage money, because it does not know how to live within its means and because it has failed to develop a coherent fiscal strategy.

But there is more. Not only has this Labor government considered imposing a tax on super payments for the over-60s, not only is it looking at taking more money away from super savers by fiddling with the transition to retirement arrangements, not only is it looking at lowering the concessional contribution caps even further; I put it to you that the government right now is looking at scrapping the government superannuation co-contribution for low-income earners completely. Even though the Labor Party promised before the 2007 election that they would make no change to superannuation, over the last five years the Treasurer, Mr Swan, has cut government super co-contribution benefits for low-income earners by more than $3.3 billion—and if anyone is interested in the detail, I have a printout here listing all the measures in budget after budget, in Mid-Year Economic and Fiscal Outlook after Mid-Year Economic and Fiscal Outlook. I repeat, this Labor government has cut government super co-contribution benefits for low-income earners by more than $3.3 billion—so far. And I have absolutely no doubt that people in Mr Shorten's office and people in the Treasurer's office are looking at this yet again to make further cuts.

The other thing that I am led to believe Mr Shorten and the Treasurer are looking at is to lower the threshold from which the increased 30 per cent contributions tax would apply. That is the measure that was in the last budget, when the government said they would impose a 30 per cent tax on contributions for anyone earning more than $300,000. By the way, that was supposed to come into effect on 1 July 2012. We have not seen any legislation yet because the government is too incompetent even to process their tax grabs through this parliament. Do you know why? Because they have not found a way yet to sort out the implications for politicians and public servants. They are embarrassed that they are imposing one rule on Australians out there while living with another rule for themselves. They are quite quick at imposing additional taxes and cutting benefits for low-income earners, for the middle class. They are not quite as quick when it comes to imposing additional hardship on themselves.

The other thing I am absolutely convinced about is that, whatever Labor say before the election, after the next election a re-elected Labor government would scrap the low-income super tax offset because Labor cannot afford it. Whatever their rhetoric before an election, they do the opposite, every time, after the election. Remember this promise in 2007: 'We won't make any change to superannuation'? In successive budgets the Treasurer cut concessional contribution caps, pushing up the tax that people who save more have to pay. They cut the super co-contribution benefits for low-income earners by more than $3 billion. In total, they have imposed more than $8 billion in additional taxes on those Australians doing the right thing by saving for their retirement—Australians doing the right thing by trying to get themselves into a position where they can look after their own retirement needs rather than being a burden on the public purse. We know that there is more to come because all of those tax grabs in the past were not enough.

The reason Labor will have to scrap the low-income super tax offset if re-elected is because they have attached it to the minerals resource rent tax—and what a fiasco that was. Only a Labor Treasurer can come up with a complex new tax targeting an important industry for our nation which hardly raises any revenue at all. In fact, only the Labor Party can come up with a complex new tax targeting an important industry for Australia which leaves the budget worse off. Right now, the government has spent more on administering the minerals resource rent tax than what the tax has raised in revenue. It is just a complete joke, a complete fiasco. Yes Minister gave us the hospital without patients. Slim Dusty gave us the pub with no beer. And Mr Swan gave us the shrinking, secret, mining tax with no revenue. How incompetent do you have to be? No wonder this government cannot live within its means. No wonder this government is all over the place when it comes to its fiscal and economic strategy.

The mining tax is a complex, distorting, highly inefficient, costly to administer, costly to comply with tax which hardly raises any revenue at all. The government have already spent all of the money they thought it would raise, and more. And guess what? Everyone in the Labor Party is so embarrassed about what a mess Mr Swan has made of the mining tax that they are scrambling around wanting to cover up the costly consequences of his incompetence. He came up with a complex new tax, the ATO is spending more than $50 million to administer it so far and the smaller miners are spending more than $20 million complying with it so far to prove that they actually do not have to pay it. It has raised hardly any revenue at all, certainly no meaningful revenue, and the three biggest miners who signed the deal with the government have not paid any mining tax at all.

Clearly, everyone from the Prime Minister down in the Labor Party is severely embarrassed. So what do they do when people ask: how much revenue have you raised? They duck for cover. Do you know what they tell us? They say: 'We're not allowed to know how much it is because it is secret. If we told you how much revenue this tax had raised, somebody would have to go to jail.' That is the advice that was tabled by the government earlier today. If somebody from the ATO told the Treasurer how much his failed mining tax had raised, that tax officer would have to go to jail. How ridiculous is that? A government that comes up with a new tax, makes predictions on how much it is going to raise and spends all the money they think it is going to raise should be accountable for whether or not it has raised what they predicted it would at budget time. That is basic common sense. That is basic accountability of the executive government to the parliament—but not for this government. They say, 'You're not entitled to this, this is secret.'

I say again: this is a government that has made a complete mess of things from the Prime Minister down, but I would say the weak link in particular is the Treasurer. It was the Treasurer that stuffed up the initial mining tax. It was the Treasurer that stuffed up the second version of the mining tax. I have to say if I was Mr Rudd I would be rather upset because it was Mr Swan who made a mess of the mining tax and it was Mr Rudd who got the sack. It was Mr Swan who stuffed up the mining tax and, while Mr Rudd got the sack, he got a promotion. This government has made a complete mess of things. This Treasurer has made a complete mess of our budget, he has made a complete mess of the mining tax, and if he had any decency he would resign.