Deborah O'Neill (Robertson, Australian Labor Party) Share this | Link to this | Hansard source

On behalf of the Parliamentary Joint Committee on Corporations and Financial Services, I present the committee's advisory report, incorporating a dissenting report, on the Superannuation Legislation Amendment (Service Providers and Other Governance Measures) Bill 2012.

In accordance with standing order 39(f) the report was made a parliamentary paper.

I ask leave of the House to make a short statement in connection with the report.

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

Is leave granted?

Tony Smith (Casey, Liberal Party, Deputy Chairman , Coalition Policy Development Committee) Share this | Link to this | Hansard source

Leave is granted.

Deborah O'Neill (Robertson, Australian Labor Party) Share this | Link to this | Hansard source

I thank the member representing the opposition there, who is, indeed, a member of the committee.

On behalf of the Parliamentary Joint Committee on Corporations and Financial Services I present the committee's advisory report on the Superannuation Legislation Amendment (Service Providers and Other Governance Measures) Bill 2012, together with the evidence received by the committee. This is the fourth tranche of legislation implementing the MySuper and governance measures of the government's Stronger Super reforms. This tranche will implement further recommendations of the Cooper review and will make amendments intended to ensure that the first three tranches of legislation operate effectively. This bill is part of a significant reform to Australia's superannuation system which this Labor government has implemented.

From 1 July this year, our reforms will replace existing default superannuation products with a simple, low-cost alternative product called MySuper. This means that Australian superannuation customers will be actually able to choose a default product that is simple, transparent and equal across providers. Further, from 1 October employers must make contributions for employees who have not made a choice of their fund to a fund that offers a MySuper product in order to satisfy their superannuation guarantee requirements. This is about making it simpler and easier for Australians to participate in managing their superannuation for the future.

Our reform agenda will strengthen the governance and the integrity of the superannuation system. Significantly, the governing rules of a superannuation fund will no longer be able to mandate that a trustee use a particular service provider. This will ensure that when entering into arrangements the trustee will be able to exercise its discretion and act in the best interests of the fund's members—and that is really at the heart of all of the four tranches of legislation that have been put before this House. This simply is the fourth one, proposing to make sure that everything is in order as we move forward to get the best results for the Australian people.

The bill also provides for the Australian Prudential Regulation Authority, better known as APRA, to issue infringement notices for straightforward contraventions of the Superannuation Industry (Supervision) Act.

During the hearings, we heard from many participants in the sector that infringement notices will be a very simple way of helping APRA—who know about what is going on with the different superannuation agencies—to make sure that the material gets to the right people at the right time and helps them respond in a way which will ensure that people are getting their fair share of the returns from superannuation. This is in addition APRA's enforcement toolbox, and it will provide a simple, less costly and less time-consuming alternative to court proceedings.

The government has also included extra protections for super funds and their members against frivolous and vexatious legal actions. This legislation, once passed, will mean that fund members are more informed about decisions that affect them. What is new is that trustees will have to provide reasons for their decisions on complaints.

The time limits for lodging claims with the Superannuation Complaints Tribunal will also be increased. We are doing this to allow more claims to be considered through a fair, economical, informal and quick service. If you are a worker like Sandra in my electorate—a hairdresser who has really missed out on her super because the old system did not provide her with adequate protection or enough time to make her way through that system to lodge a complaint—this change will be most welcome.

This inquiry has added in its own way to the already extensive consultation that has been undertaken for the government's MySuper reforms. The quality of this consultation process has been widely acknowledged throughout the industry and, on many occasions, in testimony given to the committee. For example, at a recent hearing of the committee, the representative the of the Australian Institute of Superannuation Trustees stated:

AIST acknowledge the preparedness of government and Treasury to consult with the industry about all of the Stronger Super changes and in particular the matters that are contained within this bill. That is reflected in the changes between the consultation draft and this bill, and it is also reflected in the overwhelmingly positive comments that we and others have made about the legislation in our submissions.

That means we are consulting with industry to achieve very clear goals which are at the heart of this Labor government's mission. Those goals are to protect super; to improve, through that protection of super, the lives of ordinary working Australians; and to ensure for ordinary working Australians, through that protection of super, dignity in retirement.

Those opposite may do a whole lot of searching for headlines—and maybe the headlines tell the stories they want to hear—but at this government's heart are the heartlines which connect us with care to the people we are here to represent. We are here to talk about real solutions, but what those on the other side have in mind are real reductions. Nonetheless, this piece of legislation will stand the test of time and make sure that Australians get a fair go out of their superannuation system.

On behalf of the committee, I commend the government and the Treasury for their ongoing engagement with the industry. I note that Treasury has recently met again with stakeholders to discuss remaining issues, such as the product dashboard, to ensure that the right outcome is achieved. The product dashboard is essentially a tool to help people who find the whole concept of superannuation so overwhelming that they just get their letters and put them in the bottom drawer. Without help, that pile might grow and people might not engage. We know that that is the case for far too many Australians. A product dashboard is simply a device to enable people to make a comparison across the different players in the superannuation sector—to help them find the product which might be best for them.

As a committee we have been responsive to the concerns of stakeholders and have made recommendations about the drafting of certain provisions. The recommendations made by the committee are intended to improve the day-to-day operation of the bill but do not deviate from the intent or principles which underpin the reform this government is delivering.

This is a bill which further supports the work this government is doing to provide a better superannuation product to Australians. I thank the industry for their assistance and their support in these measures, and I thank them for their ongoing and very full and fruitful participation in the hearings of the committee.

This bill provides further measures that add to the reform agenda to improve the integrity and governance of the superannuation industry. That means a better future for ordinary working Australians, who can be confident that this Labor government, in the tradition of the Labor government which established super, is now governing to make sure that legislation is in place to ensure their dignity in retirement after their many years of working and contributing to the country. I commend the report to the House.