Anne Urquhart (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

Mr President, my question is to the Minister representing the Minister for Financial Services and Superannuation, Senator Sherry. Can the minister outline to the Senate how the Gillard government is ensuring a better deal for Australia's superannuation fund members? How will the Gillard Labor government's policies make superannuation transactions easier, cheaper and faster for members? How will these far-sighted reforms improve oversight of the industry?

Nick Sherry (Tasmania, Australian Labor Party, Minister Assisting the Minister for Tourism) Share this | Link to this | Hansard source

Thank you, Senator Urquhart, for your question. It is a very important issue, Australia's superannuation. The Gillard government is delivering on the promises it took to the last election and delivering better superannuation reforms and stronger superannuation reforms. My colleague the minister for superannuation, Mr Shorten, has announced the key elements of the Stronger Super reforms. They include creating a MySuper product, which is simple, low-cost default superannuation without commissions. The regulators will be given stronger tools to improve their oversight of our superannuation system and there will be improvements in the administration and the management of super accounts through what is known as SuperStream, which will use technologies to reduce costs and improve efficiencies.

What do these reforms mean for members? It is estimated that the reforms could reduce the fees paid by members by up to 40 per cent, a very significant saving in fees if you compound those savings over the long term. I will give you an example: a 30-year-old worker on a full-time average wage can expect to save up to $40,000 more in retirement after these reforms are implemented. As I have said, there will be commission-free superannuation for the first time. That is a very important reform.

These reforms come on top of other reforms that we have announced. We have announced the increase in the superannuation guarantee from nine to 12 per cent. We have also announced the effective abolition of the 15 per cent contributions tax on the savings of some 3½ million Australians. These particular savings will result in an increase in a member's superannuation balance on average of $110,000. So with these two sets of reforms we have savings of $110,000 and $40,000 over the long term. (Time expired)

Anne Urquhart (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. How do these reforms make it easier for members to locate and consolidate multiple and lost accounts?

Nick Sherry (Tasmania, Australian Labor Party, Minister Assisting the Minister for Tourism) Share this | Link to this | Hansard source

As senators know, I have spoken about lost accounts quite frequently in this place and I am very pleased to announce that the Labor government—

Eric Abetz (Tasmania, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

And lost policies!

Nick Sherry (Tasmania, Australian Labor Party, Minister Assisting the Minister for Tourism) Share this | Link to this | Hansard source

This is one policy, Senator Abetz, that I certainly welcome because of the interest I have taken in it. Today we have $18.8 billion in lost accounts—$18.8 billion spread across 5.8 million accounts. Importantly, when figures were first published back in 1999, there were just 2.6 million accounts containing $3 billion. So we have seen an extraordinary increase in lost accounts, both the number and balance. What is disappointing for millions of Australians is that they never receive this money. So Labor is presenting a very important reform involving the use of TFNs, tax file numbers, and what is known as autoconsolidation. I would point out that those opposite were in government for almost 12 years and they did nothing about enabling Australians to find their lost accounts.

Anne Urquhart (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. Is the minister aware of any alternative policies and do those alternative policies pose obstacles or risks to the Gillard government's historic reforms of the superannuation system?

Nick Sherry (Tasmania, Australian Labor Party, Minister Assisting the Minister for Tourism) Share this | Link to this | Hansard source

Thank you for that question. It is very important. I have just highlighted lost accounts. The former Liberal government had almost 12 years to find an effective solution and they did nothing. That theme has continued and I will continue to highlight it. A large part of the proceeds from the mining tax, which this government will be proudly presenting to this parliament and which the Liberal Party have said they are going to repeal, will be going to supporting the increase in the superannuation guarantee, which will result in an increase in the retirement savings on average of $110,000. Part of the mining tax proceeds will be going to effectively remove the contributions tax from 3½ million Australians. What are the Liberal Party going to do? They are going to give the mining tax revenue back to the mining companies, who actually want to pay it to the government, and at the same time increase the contributions tax on 3½ million Australians' superannuation. (Time expired)