Andrew Bragg (NSW, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister representing the Treasurer, Senator Gallagher. How will the new super tax apply to defined-benefit schemes?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

Thank you for that question, from the senator who is so positive about super, who has a lifelong interest in super.

Opposition Senator:

An opposition senator interjecting—

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

Yes, I will—and we're doing it exactly the same way that you did it when you announced your 2016 changes. There are a couple of areas that we need to consult upon further, which we will do. Because of the nature of defined benefits, they will be included in the scheme, and we announced that when we announced the measure. Our announcement accounted for that. It was clear, in the announcement by the Treasurer, that we would consult with the sector, which is the same process—because I remember it—as when you introduced it in your 2016-17 changes, which of course went much further than the changes that we are talking about today. We expect that the changes will definitely cover defined benefit schemes, and there are a couple of areas that we are going to consult on and that we want some industry advice on. As people know, the defined benefit schemes work differently to accumulation schemes, and they are complex. So there are some further consultations we would like to do, as the Morrison government did back in 2016-17.

Sue Lines (President) Share this | Link to this | Hansard source

Senator Bragg, first supplementary?

Andrew Bragg (NSW, Liberal Party) Share this | Link to this | Hansard source

Thanks very much for that, Minister. Can you guarantee that there will be equitable treatment between the ordinary superannuation schemes and the generous defined benefit schemes?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

We are including them under the same arrangements, so, yes, they will be treated equitably. As I said, there are two areas that we would like to consult industry on: the valuation of a defined benefit scheme for the purposes of assessing a person's superannuation balance against the $3 million threshold; and the approach to taxing the equivalent of earnings in relation to balances above $3 million. We will consult closely on this with funds that have defined benefit schemes. These are exactly the same arrangements that you put in place when you lowered the $300,000 division 293 threshold to $250,000. Those changes weren't indexed, by the way; I'll just throw that in. When you put those arrangements in place, you also undertook a process around defined benefits schemes. We are doing exactly the same thing.

Sue Lines (President) Share this | Link to this | Hansard source

Senator Bragg, second supplementary?

Andrew Bragg (NSW, Liberal Party) Share this | Link to this | Hansard source

Did the five cabinet ministers, including the Prime Minister, who will have access to generous defined benefit schemes declare their personal interests before or during the cabinet deliberation on Labor's new doubling of the super tax?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

ALLAGHER (—) (): The Cabinet Handbook was followed, and I can assure the senator that we are an orderly, adult, responsible government. We take matters of integrity and honesty very seriously. We don't introduce illegal schemes like robodebt, which pursued vulnerable people in the name of budget repair. Remember that? It was going to raise $4 billion and repair the budget. What you didn't say was: 'It's illegal. We're going to hound vulnerable people who don't owe us money. We're going to threaten to send them to jail.' That's what happened over here. We are not that type of government. All arrangements as set out in the Cabinet Handbook, including declarations of relevant conflicts, are followed in accordance with those arrangements.