Gerard Rennick (Queensland, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister representing the Treasurer, Senator Gallagher. ATO figures show that the median superannuation balance for males aged 60 to 64 is $211,000 and for women $158,000, below the pension asset threshold of $314,000. This means that over 50 per cent of people about to retire will still receive a full pension, the same percentage of retirees when superannuation began in 1992. Superannuation tax concessions cost the budget $50 billion a year plus $30 billion in fees, yet most of these concessions and fees go to the upper 30 per cent of income earners. The pension funds 70 per cent of retirees at a cost of $54 billion. Why does the Albanese Labor government believe that superannuation can provide a good retirement for low-income earners when it clearly isn't achieving that goal?

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

I thank Senator Rennick for the question. I hadn't expected that question from you, Senator Rennick. We are strong supporters of superannuation, but at the same time we recognise that the age pension is an important social safety net and that, at times, people will rely completely on the age pension or they will have a mix of age pension with some superannuation in their retirement years. And, as the superannuation system matures, we expect more people will benefit from higher incomes in retirement through the superannuation system. But we also acknowledge that the age pension is there as a social safety net.

Obviously, we are big supporters of super, and increasing the superannuation threshold is part of that. We have some legislation in this chamber now to decrease some of the concessionality for high-balance super accounts—still highly concessional in the taxation system, but less concessional—and we would like that legislation progressed in the first instance. But we certainly strongly support the superannuation system. The concessions that are around it are around it for a reason. We accept also that the age pension will be an important social safety net for those on low incomes, even if they supplement it somewhat with their superannuation balance.

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

Senator Rennick, first supplementary?

Gerard Rennick (Queensland, Liberal Party) Share this | Link to this | Hansard source

On average, men will retire with approximately 35 per cent more superannuation than women, as many women choose to stay home for some of their career to raise their children. Wouldn't it make more sense to reduce superannuation tax concessions and instead lift the pension and cut tax on low-income earners so that they and stay-at-home parents can live a better life in retirement?

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

Thank you, Senator Rennick. I thank you for the question on women and super, and it is really important and I'm happy to have further discussions with you about what we can do to make it a fairer and better system for women.

Obviously, the passage of the super on paid parental leave bill that passed this place this morning is an important step, as is increasing wages in those highly feminised industries like aged care and early education and care and for workers on the minimum wage because those wage increases will actually flow through and contribute to higher superannuation balances as well. But I'm open to further discussions. Indeed, I met this morning with HESTA, whose membership is 80 per cent women, about improvements that can be made for women's superannuation, because you're right; women on average retire with 25 per cent less super, and women who are older are more economically vulnerable. We are looking at ways to strengthen that.

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

Senator Rennick, second supplementary?

Gerard Rennick (Queensland, Liberal Party) Share this | Link to this | Hansard source

Capitalism only occurs when people manage their own capital. This excludes politicians, corporate executives and superannuation funds, who manage other people's money. However, politicians and corporate boards are at least elected by taxpayers and shareholders. Do the boards of superannuation funds have to be elected by their members; if not, why not? Shouldn't members get a say in who manages their money?

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

The superannuation legislation is clear around the governance arrangements for superannuation funds, and they are accountable to their members and they must act in the best interest of their members. That is a requirement of the legislation. There are very tight laws and governance arrangements through APRA that are there precisely for that reason.

Members of superannuation funds are not often the most engaged with what's happening with their accounts. We would like to see more engagement of people, of course, with their superannuation arrangements, but the reality is that, certainly for large periods of people's careers, they're not, and therefore the laws and regulations and oversight of that industry are really important. I think the balance between APRA, the superannuation legislation and all of the other accountability mechanisms ensure the best interests of members are paramount.