Jerome Laxale (Bennelong, Australian Labor Party) Share this | Hansard source

It's great to see you up there in the chair, Deputy Speaker Sharkie, and I look forward to addressing the chair as we talk about this TLAB. It obviously has lots of schedules, but I'll be focusing—as you would expect from a Labor member of parliament—on our wonderful reforms to super, not only located in this bill here today but also more broadly. Because here on this side of the House, as a Labor government, we recognise that superannuation is one of the most significant economic reforms ever undertaken in this country. For us, it's not a side policy or a 'nice to have'; for Labor, super isn't an optional extra. We see it as a central pillar of how Australians can fund a dignified retirement after a lifetime of work. It's about fairness, and it's about ensuring that people have that dignified retirement after working so hard.

For most Australians, superannuation is their second-largest asset, after their home, and it represents decades of effort, sacrifice and contribution. And because super is compulsory, because Australians cannot opt out, governments carry a serious responsibility to ensure that the system works fairly, with transparency and in the interests of its members—not for profit, not so that others can jump into it and take it when they need it. It's got to work well for the members. So we have that responsibility, as the government, for members to get the maximum they can from this world-class retirement system.

We built superannuation, but we've always understood that just building it is not enough; it's not just a 'set and forget'. Like most things, it needs to be maintained, it needs to be strengthened and it needs to be modernised as the economy changes, as work changes and as the risks facing workers evolve. This bill is a practical example of that theory. Reforms in this bill are targeted, they're sensible and they improve the experience of how Australians engage with their super at one of the most important moments in their working lives, and that of course is when they start a new job. These reforms improve that experience in a way that supports informed choice, stronger consumer protection and ultimately better retirement outcomes.

In Bennelong we see clearly why the design of the superannuation system matters. Bennelong has lower median super balances than the state and national average, and where there are lower balances there's less margin for error. When accounts are duplicated, where fees accumulate or contributions go unpaid, the consequences in Bennelong are felt more sharply. The median balance of a super fund member in Bennelong is $52,100, compared with the New South Wales median of $61,800. The median balance for Australia overall is $62,100.

But, at the same time, many people in Bennelong, like others across the country, are approaching their age of retirement after many years of working. Their super balances represent decades of steady contribution and in many cases some pretty decent gains year on year. Protecting those balances and ensuring that every dollar owed is paid and preserved and that accumulation keeps going is essential. That's why these reforms improve how people engage with super. Importantly, these reforms that we're rolling out now, as well as the ones we've done in this term and seek to do with legislation introduced yesterday, all have the goal of improving retirement outcomes over time.

Starting a new job is one of the most common moments that Australians are required to make decisions about their superannuation. It's also one of the moments when people are least equipped to do so. Obviously you're starting a new job, you're trying to fit in, you've got to go through your work contracts and understand what's going on there, as well as your pay. You're negotiating hours. You're thinking about probation periods. Superannuation can easily become an afterthought—easily—even though we know that the consequences of that can compound over decades if you make the wrong choice. Too often, super's kind of not considered important, and the result for many employees at a new job is that they just go with the default fund of the employer, which may or may not match with the fund they've got, and that duplicates these accounts. You duplicate account fees, you duplicate insurance policies and workers lose money through those fees, because they've opened unnecessary accounts.

I don't think that's a failure of individual responsibility—there's a lot going on when you start a new job, particularly if you've moved town or if it's your first job. There are things that can happen with the system design that can make that experience a lot easier and a lot better, and that's what schedule 1 of this bill does. It reforms the employee onboarding process to ensure that workers can see and consider their existing stapled superannuation fund earlier, at the point where they're making decisions about their employment arrangements. Stapling means that when a worker starts a new job, their superannuation account is stapled to them and follows them from employer to employer—unless they actively choose a different fund, which is an important aspect of what we believe super to be. Super choice is really important.

Stapling was introduced to stop people unintentionally opening a new super account every time. It was an important first step. But what we're seeing is that when employees onboard—obviously, nowadays usually in a electronic onboarding system where you go online and you fill out all your details—that stapled fund is not being displayed at the point of onboarding. That means that it goes around the intent of what stapling was designed to do. This amendment provides greater flexibilities for employers or their agents to request an employee's stapled fund details from the ATO earlier in the onboarding process, rather than months later or by paper forms, as sometimes happens. If the stapled fund exists then those details are provided at the time that they're filling out that super choice form.

With the rollout of electronic payroll systems, single-touch payroll, the ATO playing the role they play in superannuation compliance, and Payday Super coming in, it should be pretty easy for those software providers to update their coding so that they can chat to the ATO and get that detail right at the time when they need to fill out their super choice form and the employers can know where to pay their super. This will mean workers can make an informed decision. It astronomically reduces the risks of duplicate accounts, and it ensures that employers have accurate information rather than just defaulting to the employer's default fund. Importantly, this reform doesn't limit choice. Employees have the right, as they should, to choose any super fund they wish. They can open a new one, they can make sure their super payments go in their stapled fund, or they can go with the employer's default fund.

Schedule 2 of the bill reforms it even further, and introduces a targeted ban on advertising superannuation products during employee onboarding. For those that have electronic onboarding, what has found its way into the system is some super funds—you can't blame them, they've tried to exploit a loophole here, and employees are getting are advertisements during the onboarding process, enticing them at that critical time, perhaps, to either go with a product that doesn't suit them or open a new fund which may have those issues of duplication and extra fees. Onboarding is a critical decision point, and it's when workers provide sensitive information and make financial decisions. Something like that shouldn't be treated as a marketing opportunity where advertisers seek to take advantage of that decision point and maybe encourage employees not to make the best decision in their interests.

A review of earlier reforms found that onboarding software providers were being paid to advertise superannuation products—often products linked to the provider—during the onboarding process. We believe that creates a bit of a conflict of interest. This bill cleans that up a bit, bans advertising during onboarding, but allows sensible and tightly controlled exceptions. Employees will still be able to see their stapled fund, their employer's default fund and certain MySuper products that must meet strict conditions, including passing the performance tests and being accompanied by clear disclosures. It's about protecting informed choice and advertisers not taking advantage of the situation where they're onboarding. These are two more reforms to super as part of a broader, deliberate agenda by the Labor government to strengthen the Australian superannuation system so it works in the interests of members across their working life.

We've legislated the objective of superannuation for the first time, with the ultimate aim of preserving savings to deliver income for a dignified retirement. We saw, at every opportunity, the Liberals and Nationals try and attack super and erode the concept of that accumulation. There was their failed policy of super for housing, and then, during COVID, making younger workers in particular raid their super just to get by during a worldwide pandemic was just an awful policy by a government that got so much wrong during that COVID response. The impacts of young Australians wiping 20 grand or 30 grand out of their super will be borne not only by them individually but by the taxpayer when those people come to retirement and have lost tens of thousands of dollars in returns because the Morrison government allowed them to raid their super during a national emergency. We've had to come in and legislate that objective of superannuation for the first time so that the Liberals and Nationals can't unpick it at their whim. The objective provides a clear benchmark against which future changes must be judged.

Also under Labor the superannuation guarantee has reached 12 per cent after a long time. It was meant to be 12 per cent, I think, in the first term of the Howard government, in 1996. It's a long time since 1996, and we finally got to 12 per cent not only after it was delayed by the Howard government but then also after increases were delayed by the Abbott, Morrison and Turnbull governments as well.

We're also addressing longstanding inequities in the system. Paid parental leave will now be subject to super. We're boosting the low-income superannuation tax offset. LISTO is my favourite abbreviation, Deputy Speaker Swanson. 'Go down to the pub and talk about the LISTO' sounds like something we on this side would say, because increasing superannuation contributions for our lowest paid workers so they too can have more funds when they need them in retirement is a great policy. Our reforms to the LISTO will help those on lower incomes, including thousands of workers in Bennelong, and it was great to see the Treasurer introduce those reforms in the House this week.

At the same time, we're also strengthening accountability and performance. We've expanded the superannuation performance test. We've lifted reporting standards. We've introduced the financial accountability regime to ensure that funds are delivering for their members, We're improving system integrity by requiring super to be paid at the same time as wages, finally, through payday super. I hope this reform doesn't stop here. We know that we need to keep on changing super to make sure it's performing for members. The Treasurer also introduced some really important tax concession reform to make super fairer and more sustainable over the long term.

I know a great union, the SDA, has got a great campaign about getting young people superannuation. If you're under 18, you don't get paid super, which made a lot of sense a long time ago, when superannuation amounts were so small and you had to process payments manually, write a cheque and post it to the super fund that had to cash that cheque. It made a lot of sense for small super amounts not to be paid, but in 2026 there's payday super. With electronic methods of super payment, where the cost of transferring money electronically is next to zero, I think the SDA have a very strong case for future reform—reform, obviously, to be done by a Labor government, because we know what those opposite do with super.

I commend this bill to the House. Labor created super; we'll always stand to protect it.

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