Gabriel Ng (Menzies, Australian Labor Party) Share this | Hansard source

I rise today to speak in support of the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026. As the Australian people know, Labor is the party of superannuation. It was in 1992 under the Keating Labor government that we undertook one of the most significant social and economic reforms in modern Australian history: the introduction of compulsory employer superannuation contributions. It was the Hawke and Keating Labor governments that negotiated the original superannuation reforms through the accord, embedding retirement savings into the wages system and laying the foundation for a retirement system that is now the envy of the world.

Superannuation doesn't just provide for a dignified and safe retirement; it has also made available capital that can be invested into the market to grow Australian businesses and the Australian economy. It was the Rudd and Gillard Labor governments that strengthened superannuation by increasing the superannuation guarantee rate to 12 per cent, expanding coverage and improving fairness for low-income earners through measures such as the low-income super contribution. And now it is the Albanese Labor government that is legislating to make superannuation fairer and more sustainable.

This bill is about strengthening Australia's superannuation system and ensuring it remains fair, sustainable and fit for the future. Superannuation plays a central role in providing dignity and security in retirement, and it is important that the system works for all Australians, not only those with large balances. Through this legislation we are making superannuation fairer from top to bottom, helping workers across the economy build a more secure retirement. It means disability and aged-care workers, retail and hospitality staff, early childhood educators and nurses, who work hard every day, will have the security that their retirement savings will support them later in life.

The bill delivers two key reforms. First, it boosts the low-income superannuation tax offset, or LISTO, ensuring low-income earners receive a fairer tax concession on their super contributions. This makes up part of the government's broader plan to help low-income workers earn more and keep more of what they earn. Second, the legislation reforms superannuation tax concessions so they are better targeted towards very large balances. These changes improve the sustainability of the system while maintaining strong incentives to save for retirement, ensuring superannuation remains equitable and effective for generations to come.

The Liberal and National coalition have always hated superannuation. They opposed it when it was introduced in 1992. They opposed increasing the super rate. The Howard government froze super increases. The Rudd-Gillard Labor government legislated an increased to 12 per cent, as I've said, and that was originally scheduled to start in 2015. Then the Abbott coalition government deferred it by six years. That's millions of dollars in retirement savings that have been forgone because of the coalition's ideological opposition to super. It's only under this government that super contributions have finally reached the promised rate.

Like with Medicare, since the coalition know that the Australian people overwhelmingly support super, they try to hide that they'd love to abolish it. When they couldn't scrap it, they sought to undermine it at every opportunity—death by a thousand cuts. The coalition have seized on every chance to let people raid their super early. That happened during COVID, as emergency payments. One of the scarce bits of policy that they have to address the housing crisis is to let people raid their super. Forget the fact that super compounds and that you can only have a dignified retirement if you have a large enough superannuation balance from when you're young, which builds until when you're older. These kinds of measures will mean that people's superannuation balances aren't enough to sustain them in retirement. Now we have a shadow treasurer, the member for Goldstein, who has said he'd like to abolish compulsory superannuation. They're saying the quiet bits out loud.

While those opposite will always seek to scrap or weaken our superannuation system, this government will always look to protect and strengthen it. With these reforms, from July next year the government will strengthen retirement outcomes for low-income Australians by increasing the maximum low income superannuation tax offset, or LISTO, by $310 and lifting the eligibility threshold from $37,000 to $45,000 from 1 July 2027. Workers earning between $28,000 and $45,000 will see the greatest impact, with eligible individuals receiving an average increase in LISTO payments of around $410 each year. Over the course of a working life, this additional support could mean delivering approximately $15,000 more in retirement savings, depending on income levels and contribution patterns. By making these changes, the government restores alignment and ensures that low-income workers continue to receive an appropriate offset in their compulsory superannuation contributions.

The maximum LISTO payment will increase to $810, reflecting the rise of the superannuation guarantee to 12 per cent. This adjustment ensures that the offset continues to compensate eligible workers for the contributions tax paid on their superannuation, balancing the parity between low-income earners and those on higher incomes, who benefit the most from concessional tax treatment. In updating the maximum payment in line with the higher contribution rate, the reform preserves the integrity of the policy and strengthens retirement balances over time.

Importantly, both the eligibility threshold and the maximum payment will automatically adjust alongside future changes to income thresholds from the superannuation guarantee rate, ensuring the policy remains viable over time. This ensures that low-income workers continue to receive a fairer tax concession. In 2027-28, more than 770,000 additional Australians are expected to become eligible for LISTO as a result of the higher threshold. At the same time, approximately 490,000 current recipients will receive a higher annual payment due to the increase in the maximum offset.

In total, around 3.1 million Australians will qualify for LISTO once the reforms are in place, with women projected to represent close to 60 per cent of beneficiaries. The workers who stand to benefit most include more than 100,000 sales assistants, over 50,000 administrative workers and more than 50,000 aged- and disability-care workers. Young Australians will also benefit significantly, particularly those under 30, who are in the early stages of building their retirement savings. By strengthening LISTO, schedule 4 of the bill improves equity within the superannuation system and reinforces its core objective: to preserve savings to deliver income for a dignified retirement.

Alongside these measures, schedules 1 to 3 of the bill, together with the accompanying imposition bill, introduce reform designed to make superannuation tax concessions fairer and more sustainable by better targeting generous tax breaks towards their intended purpose. The legislation maintains concessional treatments for all taxpayers while modestly reducing the concessions available to individuals with total superannuation balances exceeding $3 million. From the 2026-27 financial year, earnings on balances below $3 million will continue to be taxed at concessional rates of up to 15 per cent, unchanged from current arrangements. Earnings attributable to balances between $3 million and $10 million will be subject to a concessional headline rate of up to 30 per cent, while earnings on balances above $10 million will face a rate of up to 40 per cent. Both thresholds will be indexed to the consumer price index to maintain their real value over time and ensure consistency with broader superannuation policy.

These changes are expected to affect fewer than 0.5 per cent of Australians with superannuation accounts in 2026-27, with the higher rate applying to balances above $10 million impacting fewer than 0.1 per cent of account holders. Those opposite talk about everyday Australians, but we know that they will always govern for the top end of town, for the elites. By voting against this bill, their true colours are on full display. They don't want low- and middle-income workers to have the benefits of the LISTO. They don't govern for the many; they govern for the few, the vanishingly small few—not even the one per cent but the 0.5 per cent or the 0.1 per cent. It's the stage 3 tax cuts all over again. They wanted to flatten the tax system, with the largest benefit flowing to workers with the highest income. Our stage 3 tax cuts benefited more working Australians, who needed greater tax relief.

Superannuation tax concessions currently cost the budget more than $60 billion annually. They're projected to exceed the cost of the age pension by the 2040s. This is not sustainable. A disproportionate share of tax concessions flows to high-income earners, with approximately 38 per cent of earnings concessions going to the top 10 per cent of earners and 54 per cent going to the top 20 per cent. These reforms are consistent with the government's legislated objective of superannuation: to preserve savings and to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way.

Since coming to office, the Albanese Labor government has delivered a comprehensive program of reform to strengthen superannuation. We have increased the superannuation guarantee, so it has finally reached 12 per cent, which has boosted retirement savings for millions of workers. We are paying superannuation on government funded paid parental leave to help close the gender pay gap in retirement savings and improve economic security for women over the course of their working lives. From July this year, payday superannuation will require contributions to be paid at the same time as wages, which will reduce unpaid super and improve transparency for workers.

We have also expanded the superannuation performance test from about 80 products to more than 800, which has increased accountability and helped Australians achieve better outcomes for their retirement savings. Financial reporting requirements for super funds have also been aligned with those applying to public companies, which has strengthened transparency and confidence in the system. In addition, the government has announced mandatory service standards to improve member experiences alongside ongoing reforms for the retirement phase of superannuation. These measures are designed to ensure Australians receive clearer guidance and better support as they transition from accumulating savings to drawing a sustainable retirement income.

Australia's superannuation system is the envy of the world. This bill builds on that success by delivering more support to low-income workers through an increased LISTO while better targeting concessions to large balances. Together, these reforms ensure superannuation continues to provide a stronger, fairer and more secure retirement for millions of Australians both today and into the future.

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