Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister for Communications, Information Technology and the Arts, representing the Minister for Revenue and Assistant Treasurer. Will the minister inform the Senate of how the government is improving the retirement income system for the benefit of all Australians? Is the minister aware of support for the government’s reform?

Helen Coonan (NSW, Liberal Party, Minister for Communications, Information Technology and the Arts) Share this | Link to this | Hansard source

I thank Senator Parry for his question and for his longstanding interest in superannuation policy. Senator Parry, together with everyone in this chamber no doubt, is aware that Australia is currently enjoying one of the longest sustained periods of economic growth in its history. Due to the Howard government’s management of the Australian economy, unemployment is at a 33-year low, real wages are growing and over two million new jobs have been created since 1996. We are now building upon Australia’s prosperity to lock in the gains for future generations. A key feature of locking in future prosperity is the superannuation reforms that this government have introduced to assist people to save for their retirement. The changes to superannuation will ensure that Australia maintains one of the most advanced and well-managed retirement income systems in the world. These changes in superannuation would simply not have been possible without the strong economic management of this government over the past 12 years. The reforms also boost incentives to work and to save. For example, by making superannuation payments tax-free for those aged 60 and over, a person’s assessable income will be lower—reducing the tax paid on their other income, including their employment income. Importantly the reduction in superannuation taxation increases the reward for making voluntary payments to superannuation. Under the superannuation co-contribution scheme, the government contribute $1.50 for every $1 of after-tax superannuation contributions made by employees earning up to $28,000 to a maximum co-contribution of $1,500 per year.

Opposition Senators:

Opposition senators interjecting—

Paul Calvert (President) Share this | Link to this | Hansard source

Senator Evans, there is too much noise on my left. The minister deserves to be heard in silence.

Helen Coonan (NSW, Liberal Party, Minister for Communications, Information Technology and the Arts) Share this | Link to this | Hansard source

To reward people for saving for their future, the government have announced that, as part of the 2007-08 federal budget, we will pay an additional one-off sum to double the co-contribution of the 2005-06 year. This means an eligible person who contributed up to $1,000 during the 2005-06 year will receive a co-contribution of up to $3,000 from the government for that year which will be paid before 30 June this year.

I was asked by Senator Parry about community support for the government’s super policy. I am pleased to say that industry, analysts and superannuants have all warmly welcomed the government’s reforms. Money magazine’s Paul Clitheroe stated that the changes to simplify super are really quite amazing. Former ALP minister Susan Ryan has labelled the Treasurer as a ‘superhero’ for his bold and effective plan to simplify super and reduce taxes. Garry Weaven, the former ACTU notable and now industry fund advocate, said, ‘The government’s recent budget initiatives have proved that the Liberal Party is now the official party for superannuation.’ He could not have put it any higher. These comments have simply belled the cat on Labor’s abject failure while in government to provide Australians with reward for their efforts. Australians are now paying less tax. They now have a chance of a real job. They have a government which has paid off $96 billion of Labor’s debt, saving taxpayers $8 billion per year in interest payments. Now, in lieu of a big share of the nation’s debt, all Australians can share in the prosperity only made possible by the Howard government’s strong economic management.