Julie-Ann Campbell (Moreton, Australian Labor Party) Share this | Hansard source

The name of the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 speaks directly to core Labor values—values like equal opportunity for all Australians, values such as inclusive economic growth, values that prioritise reducing inequality and ensuring access to essential services like health and education, and values like security and fairness in retirement. The key word here really is fairness, and fairness is at the very heart of this bill which strengthens our superannuation system and makes it more equitable for all Australians.

People all over the world look at Australia's super system with absolute envy because it's a great system. That's understandable. Labor's superannuation system has helped Australians enjoy retirements that are more secure and more comfortable. Put simply, superannuation is at its core and is every day a Labor success story. Labor introduced superannuation, and we're not content in leaving it where we started. We want to make sure that it gets better, that it gets stronger and that it continues in this modern world to support everyday Australians in saving for their retirement. It is successful because it is grounded in principles of fairness, sustainability and the protection of workers' long-term financial security. It is designed to ensure that all Australians can retire with dignity while reducing long-term reliance on the age pension.

To keep that super system strong, it must be equitable. This means that tax concessions and benefits should not disproportionately advantage high-income earners. We know where the opposition stands on superannuation. When the superannuation guarantee was first introduced in this place, the opposition were crying that the sky would fall in. The opposition voted for less super for people on low incomes, and, as Treasurer pointed out earlier today, the shadow Treasurer wants to completely dismantle the system, a system that so many people in our nation rely on. Those opposite don't like super. They haven't liked it from the start. At every single point they have tried to pull it apart, and today is no exception.

Super is not a bonus. It's not an extra. It's part of people's wages, and that's important. This bill strengthens support for low-income earners and reshapes how superannuation concessions work for large balances. The outcomes will be built in a system that is more fair, more resilient and built to last.

I want to talk about the LISTO, the low-income superannuation tax offset, first. It was developed to help low-income earners, many of whom are women, to save for retirement and to make the superannuation system fairer for people on lower wages. It gives extra support to those who don't benefit as much from the concessional tax rate applied to super contributions. For most workers, money paid into super is taxed at a rate far below what they'd pay if that income were taken home instead. But, for people on lower incomes, the usual super tax settings can actually leave them worse off. That's what the LISTO is designed to combat. The LISTO helps fix that by giving eligible low-income earners a tax refund on their super contributions, ensuring they don't end up paying more tax inside their super than they would if they simply received the same amount in their pay packet.

The Albanese Labor government is increasing the LISTO by $310 to $810. We're also increasing the eligibility threshold from $37,000 to $45,000. These changes will come into effect from 1 July 2027, aligning with Labor's third round of tax cuts for every Australian. Depending on their income and how much they contribute, workers will see up to an extra $810 added to their super each year. The average increase to the LISTO will be $410. Over the course of a person's working life, this added support can translate into roughly $15,000 more in retirement savings—a significant boost. For many, it is a life-changing boost.

It's worth taking a moment to look at who will benefit from this boost to the LISTO. In 2027-28, over 770,000 additional Australian workers will be eligible for the LISTO. This is a big change, and it will have a big impact for those who need it most at a time when we know so many Australians are doing it tough. And 490,000 Australians who are currently eligible will receive a higher LISTO payment. Where this is particularly significant is in the number of Australian women who will benefit. Of the 3.1 million Australians who will be eligible for LISTO under this bill, around 60 per cent are women.

Young people will also benefit, with around 500,000 people under the age of 30 receiving the payment. The boost to the LISTO will directly benefit over 100,000 sales assistants, 50,000 administrative workers and over 50,000 workers in our care economy, the hardworking people who support elderly Australians and people with a disability. Just think about those numbers. Over three million Australians will have a boost to their super and a boost to their retirement, comfort and security as they go forward. This is a reform that Labor is justly proud of, because it builds on everything we have done in the superannuation space to date.

The other part of this bill concerns necessary and responsible changes to superannuation concessions—necessary because each year the budget forgoes more than $60 billion in revenue through superannuation tax concessions. By the 2040s, these concessions are projected to cost even more than the age pension. The problem is that these tax advantages are not shared evenly and not shared where people need them the most. A large share of the benefits flows to a relatively small group of people with very high super balances—balances that are far above what anyone would reasonably need for a comfortable retirement. In fact, about 38 per cent of all super earnings concessions go to the top 10 per cent of income earners. More than half of these—54 per cent—benefit the top 20 per cent. This means that the system is heavily skewed towards those already in the highest income brackets rather than supporting Australians more broadly.

Labor governments are committed to standing up for working Australians, and a major part of that commitment is making sure our superannuation system remains fair and financially sustainable for everyone in our community. This bill better targets the super tax concessions available to individuals who have superannuation balances bigger than $3 million.

The bill also reflects two years of feedback on the Albanese Labor government's original design for better-targeted super concessions, and here's how it will work. From 2026-27 onwards, earnings on superannuation balances between $3 million and $10 million will be taxed at a rate of up to 30 per cent. For those with balances exceeding $10 million, the tax rate applied to earnings will increase to up to 40 per cent. Importantly, there will be no change to how earnings on superannuation balances below $3 million are taxed. These earnings will continue to be subject to a rate of up to 15 per cent, maintaining existing settings for the vast majority of Australians. Both the $3 million and $10 million balance thresholds will be indexed to the consumer price index over time so that they can continue to align with the transfer balance cap, and this ensures that these thresholds remain consistent and maintain their intended purpose as the system evolves and as time goes on.

Earnings will be calculated using established income tax principles and will be based on realised gains, providing a clear and familiar framework for determining taxable amounts. The policy will also extend to members of defined benefit schemes with equivalent arrangements applied so that these members are treated fairly and so that they're treated consistently with those in standard superannuation funds. Superannuation funds will be responsible for working out how much of their earnings relate to any member covered by these rules. They will then report that calculated amount to the ATO, ensuring the reporting process aligns with the intent and requirements that are set out in this legislation before us today. It's important to note that these changes will apply to less than 0.5 per cent of Australians who hold superannuation accounts in 2026-27, and the higher rate of tax for accounts with balances over $10 million will only affect less than 0.1 per cent of Australians with super accounts.

What these changes do, though, is ensure that the administration of the superannuation system is aligned with the legislated objective of superannuation, and this is to enable savings for a dignified retirement in a way that is both fair and sustainable. We've made no secret of our agenda to strengthen the superannuation system, and I'm proud of this government's accomplishments when it comes to superannuation and when it comes to protecting the retirement and future of all older Australians. We've defined the purpose of superannuation in law, ensuring it is clear and protected. To be clear, it is to save money for a dignified retirement, supported by government in a fair and sustainable way. It is not a reserve of funds to be dipped into whenever the coalition feels like it.

We've bolstered the system with a profound social reform: the introduction of superannuation on paid parental leave. Paid parental leave will reach a total of 26 weeks by the end of this very year, and, in July last year, the Albanese Labor government began paying superannuation on publicly funded paid parental leave. This reform tackled a longstanding inequality where women's earnings fall, on average, by about 55 per cent in the first five years of raising children. Paying superannuation on parental leave helps reduce that impact. Once parental leave reaches 26 weeks, a participant will accumulate about $3,000 in superannuation contributions during their leave period. This makes a difference. For the first time, it drives equality for women in the superannuation space.

I've recently spoken about the introduction of payday super. This reform is aimed squarely at fixing the ongoing problem of unpaid superannuation. The ATO estimates that $5.2 billion of workers' super was never paid in 2021-22 alone. That's roughly $100 million every single week that employees earned but didn't receive. Under the new payday super laws passed last year, superannuation must be paid at the same time as wages because that's what they are. This ensures workers can track their super more easily and spot missing payments early. Unpaid super disproportionately harms younger workers and those in casual or insecure work. Supporting people who are struggling to build retirement savings helps make our superannuation system more fair.

Deputy Speaker, I'd like to leave you with a statistic that demonstrates the purpose of this bill. There are 14 times as many people who will benefit from the changes to the LISTO as there are people who have over $3 million in super. It is now time for those opposite to put their support behind a fairer super system, and I urge them to vote for Australians on low incomes, not to vote for bigger tax breaks for the few who have millions in their super funds.

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