Peter Dutton (Dickson, Liberal Party, Minister for Revenue and Assistant Treasurer) Share this | Link to this | Hansard source

I move:

That this bill be now read a second time.

As announced in the 2007-08 budget, this bill will make amendments to the Superannuation (Government Co-contribution for Low Income Earners) Act 2003 to double the government co-contribution in respect of contributions made during the 2005-06 income year.

Take the example of a person who earned under $28,000 in 2005-06 and who boosted their retirement savings by contributing $1,000 to superannuation out of their take-home pay. Provided they met the other eligibility criteria they would have already received a government co-contribution of $1,500.

This person will now receive an extra $1,500 government contribution.

They have turned their initial $1,000 into $4,000, turbocharging their retirement savings. This amount will remain invested in their superannuation account, growing over time until they are ready to retire.

In the majority of cases the additional co-contribution will be paid to superannuation funds before 30 June 2007. Remaining amounts will be paid in 2007-08.

This measure will result in an extra $1.1 billion being paid directly into the superannuation accounts of low- to middle-income Australians. This is in addition to the $2 billion of government co-contributions that have already been paid into superannuation under this highly successful scheme.

This time last year the government announced the most significant changes to Australia’s superannuation system in decades, including extending the government co-contribution scheme to the self-employed. In addition, the income thresholds for the co-contribution scheme will be indexed next financial year in line with growth in wages.

These measures are made possible by this government’s continuing strong record of sound economic management.

Full details of the measures in this bill are contained in the explanatory memorandum.

Debate (on motion by Mr Crean) adjourned.

Ordered that the resumption of the debate be made an order of the day for a later hour this day.