Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

My question is to the Minister representing the Treasurer, Senator Gallagher. Will an increasing number of Australians be subjected to Labor's new doubling of the super tax due to the government's refusal to index its new threshold?

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

I welcome the question on the government's modest change to the superannuation arrangements that we announced last week. Thank you very much for the opportunity. It is important that we explain it. The $3 million threshold strikes the right balance between incentives to save for retirement and strengthening the super system by making it more sustainable over time. The evidence is from the superannuation sector itself. ASFA estimates that, for a comfortable retirement at 67, you need $545,000 if you're a single person and $640,000 if you are a couple. A $3 million balance will be more than sufficient for an adequate retirement for most people for many years to come.

Many parts of the tax system aren't indexed—for example, personal income tax levels. And, as I said, the former government lowered the contribution tax threshold, division 293, without indexation—

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

A point of order on relevance: it was a very simple question about indexing the threshold. The minister hasn't got anywhere near that topic after a minute.

Penny Wong (SA, Australian Labor Party, Minister for Foreign Affairs) Share this | Link to this | Hansard source

As the Senator got to his feet to raise the point of order, the minister was in fact talking about precisely that. I think there is no point of order.

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

The senator has gone to the issue of your question, Senator Canavan. I will continue to listen carefully.

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

In 30 years, Treasury projects that roughly only the top 10 per cent of earners will retire with superannuation balances of around $3 million or more.

Opposition senators interjecting—

In 30 years time. That is the estimation of Treasury. I would say that this is a modest change to the 0.5 per cent of people that are coming in. Of the 80,000 affected, the average balance is $5.8 million. I would say again: this is a modest change we are making in response to having to deal with the budget repair that is required from the economic vandalism of your decade in government.

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

Senator Canavan, first supplementary.

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

Given the government obviously has done modelling, why didn't you tell the Australian people last week that, in fact, 10 per cent of Australians could be affected by your change, not the modest half a per cent you're telling lies about today?

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

In 30 years time, Senator Canavan.

Hon. Senators:

Honourable senators interjecting—

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

Order!

Thank you, Senator Ayres. When I call order, that's what I expect.

The same on my left, Senator McKenzie.

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

As I answered earlier: many parts of the taxation system aren't indexed. The income tax thresholds aren't indexed. The division 293 threshold, which you set, which affected a lot more people, isn't indexed. We are being very up-front about the policy that we took that we announced last week. We are being very clear about it. It affects a very small number of people in this country. Eighteen million people are unaffected. Listen to it. It raises a very modest amount by tightening a concession, that remains concessional, for those who are fortunate enough to have $3 million. I would say this to you: the average Australian has $150,000 in their superannuation, so how about you think about them— (Time expired)

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

Senator Canavan, a second supplementary.

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

Given the government has revealed their secret modelling today, how much extra tax on average will those 10 per cent of Australians pay over their lifetime because of your doubling of the super tax?

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

It's a concessional rate of tax, let's not forget this, for those fortunate to have $3 million or more in their superannuation account—mindful of the fact that the estimates are you need in the order of $500,000 to $600,000 for a decent retirement, and mindful of the fact that average Australians have $150,000 in their super. How about you have the same level of concern for them? How about you have the same level of concern for them as you are feigning at this point in time?

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

Minister, please resume your seat.

The:

I've got Senator Canavan on his feet.

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

Senator Wong, please resume your seat. I need to hear the senator first.

Opposition senators interjecting—

Order! Order on my left. I have Senator Birmingham on his feet.

Simon Birmingham (SA, Liberal Party, Shadow Minister for Foreign Affairs) Share this | Link to this | Hansard source

President, on a point of order and in defence of your position of President: Senator Wong is the first in this chamber to ask for respect to be shown to you as chair. You said, while Senator Wong was attempting to make her statement, that you had to give the call to Senator Canavan because he was on his feet with a point of order first, yet Senator Wong chose to ignore what you had said and move ahead with her motion. I ask you to call the point of order please, President.

Penny Wong (SA, Australian Labor Party, Minister for Foreign Affairs) Share this | Link to this | Hansard source

President, I'm in your hands. I thought you were calling me because of the precedence issue. I understood that Senator Gallagher had finished. Senator Canavan is not entitled to take a point of order after the minister has finished.

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

Senator Wong, I'm not sure whether the minister had finished, but I did see Senator Canavan on his feet. I did go to him, and then you stood. I will seek advice on where we're up to. Senator Canavan, I am going to go to your point of order.

Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

The point of order was on relevance. The question only went to the average extra tax paid for by the secret modelling that Labor has done. In the 36 seconds that the minister was speaking, there was not even an attempt to answer that question.

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

Thank you, Senator Canavan. The minister has been expansive in her answers, and I believe she was being relevant.

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

Yes, I was finished.

Penny Wong (SA, Australian Labor Party, Minister for Foreign Affairs) Share this | Link to this | Hansard source

I ask that further questions be placed on the Notice Paper.