Chris Ketter (Queensland, Australian Labor Party) Share this | Hansard source

On the issue of equality: we saw a government seeking to legislate for a paid maternity leave scheme involving full payment for those earning $150,000 per year. We saw a government proposing to reinstate the novated lease tax minimisation scheme for vehicles. These are things that were being done for the wealthy. We saw them seeking to protect the financial planning industry from Labor's reforms on financial advice, at the expense of industry clients. And then we saw the government seeking to maintain the tax privileges on superannuation, which overwhelmingly benefit the wealthy and which cost the Treasury $32 billion per annum in the previous year, rising to $45 billion over a three-year period.

But what was this government seeking to do for the poor people in our community? This government was seeking to abolish the schoolkids bonus. It was seeking to impose a tax of 15 per cent on employer contributions to superannuation for those earning up to $37,000 per annum, which impacts 3.6 million low-income workers. It sought, and it went to the election with the proposition, to defer the increase in the superannuation guarantee for two years, and we know that that has now blown out. And of course we know about the application of a co-payment for consultation with a doctor. To cap it all off, the government was proposing to help employers get rid of penalty rates in awards.

That is the track record of this government. It has a very, very clear agenda of seeking to advantage those who are already well advantaged and to attack those of us who are at the lower end of the socioeconomic scale.

When it comes to superannuation, we know that Labor is the party of superannuation. Mr Acting Deputy President, I do not need to tell you about that. It was actually the labour movement which campaigned in the 1970s and 1980s to establish a system of savings for ordinary workers who had not, up to that point in time, had the privilege of having a secure retirement savings system. As we know, our system is the envy of the world. It was the initiative of the ACTU to pursue occupational superannuation as an industrial matter, and it then fell to the unions to argue for the awards to be varied to provide superannuation. I think the default status of industry superannuation funds is another element of our current system which aids retirement incomes, and this is another area where the government is seeking to attack the system.

I am also proud of my very small involvement in the case in Queensland to introduce superannuation into the retail award in my home state—a case needed to be taken to the Queensland Industrial Relations Commission to do that—so I do feel something of a personal attachment to this whole issue of superannuation. I have a fundamental understanding of the importance of this issue to people on low incomes because I know that, in the retail industry, for example, for shopfloor employees—if I can call them that—who did not have access to superannuation, pension funds were very rare and were used by employers largely as a device to encourage or to trap employees with their employer, because they did not receive the benefits of their pension fund unless they stayed with their employer till retirement.

To highlight the differences here, I think it is important to highlight what the Labor government did in 2013 to make the superannuation system fairer for Australians. The government looked at a range of issues. They had already taken the decision to increase the superannuation guarantee from nine per cent to 12 per cent, which was to provide a better standard of living in retirement for 8.4 million Australians. That meant that a person aged 30 on average full-time earnings would retire with an extra $118,000 in superannuation savings.

The government also moved in 2013 to increase the fairness of the concessions provided for superannuation. The low-income superannuation contribution was introduced and benefited 3.6 million Australians on low and modest incomes, including 2.1 million women. It would benefit 30 per cent of workers. The superannuation concession reduction reduced the tax concession that people with incomes above $300,000 per annum received on their contributions from 30 per cent down to 15 per cent. It affected about 128,000 Australians. It was an attempt to address the inequity of the system. There were further reforms that were announced back then, simplifying the design and the administration of the higher concessional contributions cap and a number of other factors. So Labor in government had a very, very proud record of seeking to increase the equity in the system.

Unfortunately, the Abbott government has abolished the low-income superannuation contribution. As Senator Sinodinos has indicated, that was unfortunately collateral damage with the abolition of the MRRT. But that was something which very much impacted on low-income workers and was felt as a very, very great loss there. This shambolic and dysfunctional government has forced through superannuation guarantee changes that could cost Australians billions of dollars. I think I have seen figures to suggest that some of the modelling that was introduced on 16 March this year indicated that the abolition of the low-income earners superannuation contribution, together with some of the other modest measures at the upper end of the income spectrum, combined with freezing the rate of compulsory superannuation contributions, will leave Australians $983 billion worse off by 2055. That, of course, means that more Australians will be reliant on the age pension in retirement, a disgraceful outcome and one over which this government should hold its head in shame.

We know that this is a government which is seriously damaging Australia's superannuation. On average, women will retire with $92,000 less superannuation than men, and Joe Hockey's plan to undermine Australia's world-class superannuation scheme will negatively affect retirement savings, especially for women, and put, as I say, greater pressure on the age pension.

I want to just touch on the comments by Mr Hockey in relation to the utilisation of superannuation for housing. Not content with the cuts to superannuation in the budget, the Treasurer recently had a disastrous thought bubble: that superannuation would be able to be accessed to pay for a deposit on a first home loan. This is a double whammy of stupidity, damaging retirement incomes. First, if a person takes out $25,000 to put towards a home deposit, they would probably have $54,000 less in their superannuation account by the time they retire. Second, the policy does nothing for housing affordability. Everyone at the auction now has their superannuation in their pockets, leading to price rises, and the only beneficiary is the vendor.

If Joe Hockey wants the best policy advice on why early access to superannuation for a deposit on a first home is a bad idea, there are a range of Liberal Party luminaries that can lend him a hand. The finance minister, Mathias Cormann, has weighed in on that issue, as well as former Treasurer Peter Costello. Also, the chair of the financial system inquiry, David Murray, has said the idea is 'inconsistent' with bolstering retirement incomes and that it would need very careful thought. This is a government which cannot be trusted on important national issues such as superannuation and housing affordability.