Tuesday, 11 February 2020
Treasury Laws Amendment (Reuniting More Superannuation) Bill 2020; Second Reading
My remarks on the Treasury Laws Amendment (Reuniting More Superannuation) Bill 2020 will not be brief, as some members may wish them to be, because this is an incredibly important piece of legislation for the security of the retirement of millions of Australians, whether they're retired now or are seeking to retire in comfort in the future. We know that at the last election retirement security was core to the reason this coalition government, led by Scott Morrison, was re-elected. At the heart of it the Morrison government's focus is to make sure that every Australian, at no matter what stage of life, has the best opportunity to build a success of a life—to get a job and a good education, to have a family and build and own a home and to make sure that they can retire with dignity and security at the latter stages of their life.
That's one of the reasons we oppose the $387 billion in new taxes put before us by the opposition. It's why we stood up against their insidious retiree tax that sought to raid the retirement security of millions of Australians for no purpose other than their own benefit—to give them more resources should they be elected to government and to splurge as they see fit. At the heart of it, the Australian Labor Party does not look at Australians as individuals with dignity and a sense of purpose and choice in how they live their own lives. The Australian Labor Party looks at Australians as though they're a piggybank ready to raid. In the end, they don't respect hard work and sacrifice. In the end, they don't understand the pride and dignity that comes with standing on your own two feet. In the end, the Australian Labor Party has nothing but contempt for Australians and our way of life.
The point of this legislation is to respect the effort of hardworking Australians who have put their money in superannuation on trust that when they go back to collect their funds on retirement or before, or if they seek to roll their money from duplicate accounts into single accounts, it will still be there, and if there is a low balance it won't simply be eaten away by fees—that it will be there so that they can roll it into funds and be in a position to hold the value of the work and their retirement security.
It might shock some people to know that during the Economics Committee hearings into the superannuation sector we uncovered a disturbing and worrying truth. As chair of the committee, I was asking questions of various superannuation funds, particularly industry funds, and talking about what it is they do when there is a low-balance inactive account. The current law says that that money should be rolled into the Australian Taxation Office so that it can be reallocated and reunited with its recipient. But it can't become yet another piggy bank to be raided by industry funds, through fees, through insurance premiums and through a loss of retirement security, to the benefit of the few.
What we uncovered in our Economics Committee hearings when we grilled industry superannuation fund and retail funds was that some were using an eligible rollover fund, a system designed to protect consumers, as an opportunity to roll the funds into a new account, which effectively reactivated them, which enabled the industry super funds to then go on and charge a new round of fees and exempt themselves from the law. It is one of the most disgraceful things that I have ever seen—a deliberate and malicious attempt to circumvent the law, to the benefit of organisations that are supposed to be entrusted with money. At the time I called it the equivalent of a 'fees for no service' moment for the industry super industry, and I don't take a single step back.
That's why I am so glad this government is closing this loophole, among many others that should be closed in the superannuation system. The advantage is not felt from having eligible rollover funds as a pathway to reactivate accounts for Australian superannuants, for people who are saving, for people putting themselves forward and standing on their own two feet. The only benefit is to those funds and their capacity to take from people's savings in order to increase their cashflow. What we are requiring is that rather than allowing this pathway where industry funds can roll money into eligible rollover funds or, equally, for the small number of retail funds to do the same, that money should be reunited through the Australian Taxation Office with the people who own it. It's a pretty basic expectation, and that reunification, whether it's through multiple or duplicate accounts, will help build the strength of the system so that when Australian retirees turn to their funds at the end of their working lives, it's still there and hasn't been squirrelled away without their knowledge. Frankly, it's disappointing that we have to pass laws along these lines. But that is not our choice; it is our responsibility in confronting the misconduct that has been occurring. That's why this legislation matters.
But it sits across a backdrop of many other pieces of legislation, debates and topics around superannuation that deserve further scrutiny. Why? Because people should want, and Australians do want, a superannuation system with integrity, a superannuation system that enables choice and a superannuation system that doesn't unnecessarily raid the wages of Australians. On the other side of this chamber, they are completely married to the idea that there is no cost consequence on wages from increasing superannuation rates and the compulsory superannuation guarantee. They are literally staring at facts and evidence and expert opinion and denying the link. And when the evidence is presented before them, their only response is slurs and slander, because they have no argument left. You just need to look at research produced only recently by the Grattan Institute. It highlights that, when they actually went down and did the analytical research about the impact of superannuation, it came at the cost of deferred wage increases. So, Australians today, in their hip pocket, are poorer because of deferred wages in the superannuation system.
There's an entirely legitimate case to be made for compulsory superannuation. We can have philosophical debates about whether it should be where it is or not, but to deny that reality, as many members on the opposition benches do—in fact I suspect all of them do in unison, because dissent or difference of opinion are not allowed. One of the first preconditions of joining the Australian Labor Party is to take a full frontal lobotomy in terms of your opinion and conform to the collective. It's to deny that reality. Only last week the Reserve Bank of Australia and the governor appeared before the almighty Economics Committee. When asked about these issues, the governor again confirmed, as did other deputy governors, that increasing the compulsory superannuation guarantee would cost Australian wage growth. So, if you're an Australian in a job today, you will have slower wage growth over future years because the compulsory superannuation guarantee is increasing.
Again, it's a pretty straightforward proposition of economics, but it's denied by the Australian Labor Party. They come into this chamber and lecture every member on this side—and anybody else who bothers to waste their time listening to their rhetoric—that they are standing up for higher wages while concurrently actively promoting a pathway to make sure wages don't go up. That is hypocrisy writ large, and it goes to the heart of the empty rhetoric and ideas that sit at the heart of the modern Australian Labor Party. In the end, this isn't a debate about retirement security for them and for the members of the opposition. Just as we saw with this piece of legislation and how industry funds are conducting themselves around eligible rollover funds, it's about power for them—how they can amass and accumulate the wealth and savings of the Australian population within their influence and in their hands. Anybody who doesn't understand that fundamentally misunderstands the approach.
These days the Australian Labor Party never stands up for workers. They never stood up against Bill Shorten and negotiating lower wages for casualised staff in certain retail sectors. They never stood up against that. Whenever there's been some sort of misbehaviour by one of the unions, they don't stand up against that either, including when it affects the health and welfare of unionised labour. But watch them spring to their feet as soon as there is any threat to the cash cow and the influence they have through industry super. I have never seen anybody move so fast as many members of the opposition. And earlier in the chamber, we saw the member for Kingsford Smith do exactly that. Of course, amongst the grand rhetoric that he threw out about various members in this chamber and how awful they all were, the dark heart of what he was speaking about is how to protect the interests of themselves and the Australian Labor Party in spite of the interests of the Australian people.
That's why this bill matters: it stops them raiding the retirement savings of millions of Australians for their own benefit—to accumulate wealth and position that they control. That's why the minister deserves to be congratulated for bringing this piece of legislation to this parliament. It is a nefarious agenda that has been run, and the way they have sought to use low-balance, inactive accounts to roll over and to reactivate so they can take more fees and more income is not just inconsistent with the spirit of the legislation, although it is, and it isn't just that it's irresponsible, although it is; it's that it's morally wrong, and they know it. The law is not always a good guide to morality, but, in this case, closing down the pathway for various superannuation funds to exploit the interests of Australian savers and workers who are building their own future is morally right. That's why this bill matters. That's why it enjoys the support of the government and so many members in this place.
My only hope is that the Labor Party will start to recognise that and support this legislation. If they don't, the clear intent and the loud message that will resonate outside of this chamber is that they would put themselves ahead of the interests of the Australian people yet again. This won't come as a shock to many Australians, particularly the millions of people who voted for members to sit on this side of the chamber, but we need to call it out, because this is the conduct that Australians elected this government to stand up against. This is the conduct for which we must hold the opposition and their interests to account. That is the basis on which I support this bill.
We are not supporting the second reading amendment moved by the opposition to the Treasury Laws Amendment (Reuniting More Superannuation) Bill 2020. I want to thank all those members whose have contributed to the debate. As has been outlined so eloquently by members on this side, the bill will facilitate the exit of all eligible rollover funds from the superannuation system by 30 June 2021. This builds upon the policy intent of the Protecting Your Super reforms to reunify lost and unclaimed super with its rightful owners. Importantly, it also gives effect to recommendation 5 of the Productivity Commission's inquiry into super. This bill will contribute to the government's work on building a stronger, more efficient superannuation system and of course improving outcomes for all members. We don't support the amendment. I commend the bill to the House.
The original question was this bill be now read a second time. To this the honourable member for Whitlam has moved as an amendment that all words after 'That' be omitted with a view to substituting other words. The immediate question is that the amendment moved by the member for Whitlam be agreed to.