Libby Coker (Corangamite, Australian Labor Party) Share this | Link to this | Hansard source

Earnings corresponding to balances below $3 million will continue to be taxed at 15 per cent in the accumulation phase, and earnings will remain tax free in the retirement phase. This is commonsense reform. The concession rate applying to future earnings on balances above $10 million will be 40 per cent, and both the $3 million and $10 million thresholds will be indexed.

These reforms maintain the concessional treatment of super but ensure it is provided in a more equitable and sustainable way. Our superannuation system provides concessional tax treatment because super has a clear objective: to provide income for a secure retirement. This government legislated that objective. Concessional tax treatment is justified because it encourages long-term savings for retirement. Importantly, these changes ensure that tax concessions are better targeted and more sustainable.

Labor built Australia's superannuation system, and under this government we are strengthening it in significant and practical ways. We have legislated the objective of super: to provide income for a secure retirement. We have increased the superannuation guarantee to 12 per cent, the culmination of decades of effort. We are paying super on government funded paid parental leave, helping to close the gender gap on retirement savings. We've legislated payday superannuation so that, from July this year, workers will receive their super at the same time they receive their wages—not once a quarter, not when it suits the employer, but every payday. For a 25-year-old on an average wage, that could mean around $6,000 more at retirement.

We have expanded the coverage of the superannuation performance test from around 80 products to more than 800, driving accountability and better outcomes for members. We've announced mandatory service standards and are reforming the retirement phase to ensure Australians are supported as they transition from work to retirement. And today we introduce legislation to increase LISTO and better target super tax concessions. This is a coherent reform agenda. It is a reform agenda that's about fairness. It's about sustainability and it's about confidence in superannuation.

Millions of Australians are approaching retirement over the coming decade. For them, the decision they make at this time is significant and can sometimes be daunting. This bill will help strengthen their confidence in super, knowing it can and will deliver for them. It ensures that low-income workers are not disadvantaged by the tax system. It ensures that concessions are proportionate and responsible. And it does so while maintaining the core concessional framework that has made Australia's super system.

Voting against this bill would be a vote against a fairer super system, and it would be a vote for larger tax breaks for those who already have millions in their super accounts. This is not the choice this government is prepared to make. We believe in a superannuation system that reflects Australian values—a system that rewards work, a system that supports families, a system that provides dignity in retirement and a system that is strong enough and sustainable enough to endure for generations to come.

When I speak with older constituents in my electorate—people who have worked hard all their lives—I see the difference that superannuation makes. I also think about my two daughters, who are part of a generation that will contribute at 12 per cent across their entire working lives. With the right settings, they will retire with greater security than any generation before them. That only happens if we maintain the integrity of the system. That's what this bill is all about: strengthening the system, making it more sustainable and, importantly, making it fairer for all.

This bill will enable the strengthening of superannuation for those on low incomes. It ensures tax concessions are better targeted and it reinforces the legislative objective of super: to provide income for a secure retirement. Our superannuation system is a national achievement, and we should all be very proud of it. This legislation ensures it continues to deliver for millions of working Australians, today and into the future.

Ben Small (Forrest, Liberal Party) Share this | Link to this | Hansard source

The one word missing from this debate is 'sorry'. The Treasurer should be saying sorry to the Australian people, particularly those aspirational Australians who believe in reward for effort and the incentive to strive in this country. Ultimately, we're only here today with a massive policy backtrack from this government because of sustained pressure, led by the coalition and backed in by everyday Australians across this country, to force this Labor government to abandon the taxation of unrealised gains, leading to the indexation of the new proposed threshold, which was a sorry absence from the previous proposal.

It would seem that the government has been found out by everyday Australians. For all of their talk about lower taxes and people keeping more of what they earn, this was a sneaky and devious taxation proposal that would have left Australians poorer, particularly everyday Australians, who ultimately would have been caught by the $3 million threshold in the absence of indexation. Thanks to sustained scrutiny from the coalition, from the superannuation sector itself, from small-business owners—including the farmers from my electorate—and from everyday Australians, Labor have been forced to step back from the most outrageous proposals of this particular policy.

But, let's face it, it is still an unashamed tax grab by a government that is addicted to spending. It was a proposal that was aimed not just at hurting retirees, but at ultimately stealing from future generations—younger Australians—without their knowledge or understanding, because, at the end of the day, things like the indexation of taxation thresholds aren't front of mind for young Aussies, for whom the dream of homeownership in this country has become something of a nightmare.

Having exposed a clear breakdown in the relationship between the Prime Minister and his Treasurer, the original design to tax unrealised capital gains for the very first time in this country—which represented a fundamental break with the longstanding conventions of our tax system in this country—has seemingly been thrown in the bin. Australians have always understood that a fair go, a fair deal with the government, would be that tax is paid when you've got income being realised. If you've got cash in your pocket, it's fair for the government to grab a share of it.

To propose taxing paper gains, particularly in volatile asset classes, wasn't just a minor tweak; this was the abolition of a cornerstone of the taxation system in Australia. We in the coalition believed it was a dangerous precedent, because it was a structural shift that would have led to people in Australia facing massive tax bills without the cash in their pocket to pay them. There's no better example of this than the farmers in my electorate, who are, at the end of the day, small businesses, and who, for a variety of reasons and reflecting the longstanding principles of the superannuation system, have put family assets like the farm into self-managed super funds.

These aren't massively lucrative businesses operating on massive margins, particularly when you look at the pressures in the dairy sector for which the South West of WA is renowned. These are small family businesses who would have faced tax bills in the hundreds of thousands of dollars just because a paper valuation on the family farm had gone up. There's no extra money in the kitty to pay for it, and that's what was so dangerous about this proposal.

The fact that the original $3 million threshold wasn't indexed ultimately led to a situation where everyday Australians earning an average income would have eventually been tangled in this tax—no more so than in the inflationary environment that we see today, which has been made worse by the Treasurer's failure to control spending and indeed his willingness to pour debt petrol on the inflation fire that is raging in this country. Over time, more and more Australians would have been caught, not because they were wealthier in real terms but because inflation simply would have eroded the real value of the threshold.

It's effectively bracket creep by design, the so-called thief in the night given free rein in our community by the Treasurer of Australia. It wasn't just flawed policy; it was a sneaky trick to take more of your hard earned savings, all the while talking about being a government committed to lower taxes and Australians keeping more of what they earned. The government's backdown demonstrates one thing very clearly—that this was never settled policy based on sound principle; rather, it was a blatant tax grab that, when exposed, collapsed under the weight of public scrutiny in Australia.

At the last election, Australians were not presented with a policy to tax unrealised gains in superannuation. They were not told that the longstanding superannuation settings in this country would be fundamentally altered, and they were not warned that indexation would be stripped away. Promises should matter in a democracy like Australia. Major structural tax changes should be put clearly and transparently to the Australian people. Instead, this was a proposal out of left field by a government that has simply run out of money.

With limited consultation and a rushed legislative timetable, it is fortunate that the debate has resonated so strongly with Australians, who instinctively understand when something just isn't fair. When it comes to retirement savings in Australia, the nest eggs that are built over decades of hard work should be sacrosanct, and the bar for legitimate debate should be even higher than normal. Instead, we've seen a government that simply can't be trusted with the hard earned savings of Australians. The Treasurer, addicted to spending as he is, found himself without money. We always know what happens when Labor run out of money; they come after yours.

We were told by this government that they were going to make life easier for families, for young Australians and for those who want to work hard to get ahead. Life has been harder under the Albanese government, and everyday Australians know that—whether they're paying the mortgage, paying the bills, simply leaving the supermarket or opening their power bills after a long hot summer—because they feel poorer. Their real standards of living are declining. The cost of living is rising, and the only thing that isn't is their real wages. The fact of the matter is that inflation is high. Interest rates are high because inflation and government spending are out of control. The government has been beaten by inflation in the economy.

Perhaps most startling of all was that there were Labor voices against this proposal, and they varied. The ACTU's Sally McManus warned:

I do think it's got to be indexed because you've got to make sure eventually people don't end up there—

meaning, of course, those everyday Australians on ordinary wages who would have fallen victim to a $3 million threshold, had that not been indexed. The ACTU's former secretary Bill Kelty said:

I think taxing unrealised capital gains is bad policy. It distorts the effective tax, changes your income flows, and if it was on superannuation generally, there would be a revolution about it. It would destroy super.

It seems that the government has finally listened to some of its own critics, and that is a pleasing result. But, at the end of the day, it doesn't belie the fact that they have a spending problem, not a revenue problem.

There's a structural spending growth in our country that is outpacing sustainable economic growth. Indeed, with the economy stuck in first gear because of regulation, high inflation, high interest rates and the red tape that is crippling private business investment in our country, the reality is that the government is spending beyond its means and so it is reaching for new taxes to fill the gap. The Liberal Party and the National Party are committed, in coalition, to always be the parties of lower taxes. That means we're not supporting this blatant tax grab. Rather than confronting waste, prioritising programs and restoring fiscal discipline, Labor's simply on the hunt for new pools of your money to spend.

As I said, trust is fundamental in tax reform in our country. I think there are many across the chamber who recognise that we should have robust debate about taxation reform in Australia. But, it should be principled, predictable and based on broad consultation. It should be about enabling better economic growth in our country, rather than simply grabbing more of the hard-earned money of Australians and spending it as the government does. Ordinary Australians don't accept retrospective tinkering, ad hoc changes and ideological experiments dressed up as modest adjustments. Indeed, this proposal is simply emblematic of a broader pattern: higher spending first and then new taxes to pay for it later. It's not reform; it's just fiscal mismanagement.

When we consider the additional risks in this new proposal beyond the headline rate and the threshold changes, the legislation introduces serious structural risks. The removal of the effective death tax exemption creates uncertainty for families in Australia at precisely the moment they are most vulnerable. In their darkest hours of grief, surviving spouses who rely on the superannuation balances of a partner to maintain stability after a death in the family shouldn't face additional tax complexity and reduced security.

Total and permanent disability benefit recipients are another cohort whose needs need to be considered carefully. These are Australians who, through no fault of their own, are no longer able to work. Their superannuation is not an abstract investment vehicle or some piggybank to be raided by the government. It is a lifeline. Any change that introduces volatility, reduces predictability or complicates access to those funds carries real and devastating consequences for those individuals.

The reality is that tax policy can't be designed in isolation from the lived reality of those Australians it impacts. When Australians' retirement income settings are destabilised, confidence in the superannuation system overall is eroded. The government's pointed to increases in the low-income superannuation tax offset, the LISTO, as evidence of balance in its proposal. Indeed, any measure that supports low-income earners building their retirement savings is welcomed by the coalition. But we have to be honest about the scale and the timing. The LISTO adjustments, while positive at the margin, do not put money back into household budgets today. Ultimately, from the power of compounding, we understand that Australians who are able to invest today will do better in the decades ahead, and they do not have the ability to do so while grocery bills, power bills and their mortgages are going through the roof.

Australians are facing immediate cost-of-living pressures because inflation is running rampant in this country. A future offset adjustment to super does little to relieve those stressors now and it reduces the ability of Australian families to set themselves up for a prosperous retirement. If the government is serious about helping Australian households, it needs to tackle inflation at its source today. Excessive spending and weak economic growth in Australia are the priorities for economic reform, rather than reshuffling offsets within the retirement income system.

This leaves us looking at a situation where this might well be the beginning of Labor's high-tax, high-spending agenda, where the money is spent first and then they come hunting for the tax grab afterwards.

We can't view this proposal in isolation. It is simply about this government spending more and pouring debt petrol on the inflation fire that is raging in our country. Let's not misunderstand—this is a fire that has been burning out of control since long before the recent events in the Middle East caused further concern with spiking energy prices and the likely impacts on the economy here in Australia. We'll see when the national accounts come out later today, but Australians have very real cause to be uneasy.

Gabriel Ng (Menzies, Australian Labor Party) Share this | Link to 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.

Elizabeth Watson-Brown (Ryan, Australian Greens) Share this | Link to this | Hansard source

This bill, the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026, shows that this country has an absolute mountain to climb when it comes to making our tax system fairer, especially for young working people, who are getting smashed while the richest of the rich have a smorgasbord of tax minimisation options to choose from. The 10 richest super funds in Australia have an average balance of $423 million each. Clearly, superannuation is being used as a tax shelter, and over its 32 years compulsory super has strayed far from its original purpose of providing working people with a dignified, comfortable retirement. This bill is merely tinkering at the edges of this mountainous system. It will not stop superannuation being used for tax and estate planning, and it will not restore super to its purpose of supporting hardworking people in retirement.

Under the changes in this tax bill the 10 richest super funds, each with $423 million in their account, will still face a lower tax rate when they sell shares or investment properties than every single full-time worker in Australia. Even a full-time worker on the minimum wage will pay 30c in every dollar earned while these super funds, each with $423 million in their account, will pay 27c on every extra dollar their super fund earns from capital gains. Our tax system is turbocharging intergenerational inequality, and this bill will not meaningfully change the trajectory that we're on. A super account with $5 million in it will only face a tax rate of 14 per cent on capital gains under this bill while a bartender or a nurse that works part time and earns $20,000 a year faces a tax rate of 16c for every dollar earned.

If you think this new tax system is bad, here's the painful bit: this bill is an improvement. Right now, that $5 million account or an account with $423 million in it, enjoys an effective tax rate of 10 per cent on capital gains. This is a difficult proposition. The tax change is a tiny step forward, but is wholly, almost laughably inadequate to deal with economic unfairness in our tax system. The 10 richest Australians will still pay a lower rate of tax than the nearly three million Australians on the minimum wage. No wonder there's such frustration out in the community, and we've heard it in my electorate where people are working harder but falling behind while they see others already with wealth racing further ahead.

While the Greens will be supporting this super change in the House, we're reserving our position in the Senate. I want to make an important distinction here, because this watered-down super tax was announced alongside a long-overdue increase in the low-income super tax offset. The Greens wholeheartedly support this part of the changes, two-thirds of which will flow to women's retirement.

Kate Thwaites (Jagajaga, Australian Labor Party) Share this | Link to this | Hansard source

The Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 is important legislation because goes to the heart of what sort of superannuation system we want in Australia and what superannuation means for Australians both now and for future generations. Superannuation is absolutely one of the great achievements of the Australian Labor movement. It is a reform that has been grounded in fairness, in dignity and in opportunity. It was built on a simple but powerful idea that, after a lifetime of work, Australians should be able to retire with security, independence and dignity, not with uncertainty.

As superannuation was built, it was never intended to be a vehicle for unlimited tax advantages. It was designed to support working Australians—cleaners, nurses, teachers, retail workers, tradies, carers—to ensure that older Australians could look forward to retirement with dignity and security. This bill strengthens that original purpose. It ensures that our superannuation system remains fair, sustainable and focused on delivering income in retirement, alongside government support, in an equitable way.

It is important to look at the complete picture of what the government is doing to reform superannuation in Australia, first by better targeting superannuation tax concessions so that they do remain sustainable and fair, and second by strengthening retirement outcomes for low-income Australians, particularly women, who have historically retired with less superannuation and less security. I pay tribute to the number of women who have spoken to me about this inequity and who have campaigned for reform in this space, and I'm pleased that this Labor government is bringing this forward.

Superannuation tax concessions represent one of the largest investments governments make in Australians' future wellbeing. These concessions now cost the budget more than $60 billion each year, and without reform they are projected to exceed the cost of the age pension in the decades ahead. That means that we have a responsibility not just to today's taxpayers but to our future generations to ensure that these concessions are properly targeted. At present, a disproportionate share of superannuation tax benefits flow to individuals with very large balances, and go well beyond what's required to fund a comfortable retirement. I have heard from people in my electorate who have very comfortable superannuation balances but say to me: 'We want to see a fairer future for all Australians. We want all Australians to be assured dignity in retirement.'

At the moment, around 38 per cent of super earnings concessions go to the top 10 per cent of income earners, and more than half go to the top 20 per cent. That is not consistent with the purpose of superannuation I outlined at the start of this speech. Schedules one to three of this bill implement modest, carefully designed changes to ensure concessions remain fair while preserving incentives for Australians to save. From the 2026-27 income year, earnings on superannuation balances below $3 million will continue to be taxed at up to 15 per cent, exactly as they are today. Earnings on balances between $3 million and $10 million will be taxed at up to 30 per cent, and earnings on balances above $10 million will be taxed at up to 40 per cent. Both thresholds will be indexed to inflation to maintain fairness over time.

It's important to be clear about what this means. These changes affect fewer than 0.5 per cent of Australians with superannuation accounts. The highest rate applies to fewer than 0.1 per cent. So, for the overwhelming majority of Australians, for the millions of workers out there who are working and saving for their retirement, nothing will change. Their concessions remain intact. Their retirement savings remain supported. What this reform does is make sure that those with extremely large balances are not receiving a tax treatment that is far more generous than what was intended when the superannuation system was created. It strengthens the sustainability of our superannuation system so that it can continue supporting Australians for decades to come. This is the work that Labor governments do, and it is the purpose that we bring to this place, not just to protect the dignity and security of Australians who are retiring now but to protect those to come.

This is part of a broader set of reforms that the government is bringing, and I want to talk about some of those other reforms, which are really about lifting outcomes for those who, traditionally, have been at the bottom end of our super system. The low income superannuation tax offset, or LISTO, which means that low-income workers who often pay tax on their super contributions, even when they pay little or no income tax—without the LISTO provision, the system would effectively penalise people on lower incomes for saving for retirement. What we are doing here is correcting that imbalance. We will lift the LISTO eligibility threshold to align it with broader income tax settings and also increase the maximum payment to reflect the rise of the superannuation guarantee to 12 per cent. These are thresholds that haven't kept pace with broader tax changes, and they have meant that many low-income earners have missed out on support that they should rightly receive. I have had a number of people raise this issue with me, particularly those who are advocating on behalf of Australian women, because it is often Australian women who, as the latest gender pay gap data shows us, are earning less and are more likely to be in a position where they are retiring into a more uncertain outcome. So, for those people, this change is going to mean they are looking at a fairer superannuation system.

Again, we're putting in place those principles of having a system that supports people who work hard, who want security and who are looking for dignity in retirement. It's not special treatment; it is about making sure that we are equitable in how we are treating our system and how we are supporting working Australians into the future. I am particularly passionate about this reform in terms of what it will mean for women who are retiring and for the women who are working in aged care and in child care, who do, over their lifetimes, earn lower average wages, who take time out of the workforce to care for children or family members or who may be working part time more often. I know that this benefit will very much strengthen their retirement outcomes and their retirement security.

Of course, it comes along as part of a suite of changes that we have made as a government to support working women including putting superannuation on paid parental leave, acknowledging that this very important payment is something that, just like any other workplace entitlement, deserves to receive superannuation. The work we are doing to drive down the gender pay gap—and I note that, while it is too high, it is heading in the right direction, and that is a direct result of the focus that this government brings to improving the conditions for working Australian women, to improving their wages in industries like aged care and also to improving the security and the dignity they can look forward to when they come to retirement age. We are recognising that the work they are doing in our communities is vital and deserves to be supported into the future.

I am particularly pleased to see this reform as part of the broader work that the government is doing to strengthen our superannuation system and to make sure it is fit for purpose. This is the work that Labor governments do. Superannuation was built by Labor to ensure that Australians have security and dignity in retirement, and it has absolutely served our country well. I know there are many countries around the world that look to copy the Australian system because they have seen the effect it has had for us as a country and for individuals in this country as well. It is our responsibility to make sure that system remains fair and remains something that is supporting all Australians to retire with security and dignity. The people who benefit from these reforms are working Australians—people who work in our shops, the people who are our carers and our administrative staff and, of course, the young people to come and who are just now starting their working lives. These people deserve retirement outcomes that rely on consistent policy settings that support them fairly over time. These reforms will reinforce their confidence that the superannuation system works for everyone and not just for the fortunate few.

I do want to briefly mention that, of course, in bringing these reforms forward the government has consulted widely. We understand that they are changes that will affect people. This is evidence based policymaking, and we thank everyone who's been involved in the consultation to help us get to this point of careful design where we are strengthening retirement outcomes for low-income workers and building a sustainable super system that will deliver for Australians now and into the future.

Pat Conaghan (Cowper, National Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

I'm very pleased but somewhat concerned to rise and speak to the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 and the Superannuation (Building a Stronger and Fairer Super System) Imposition Bill 2026 because these bills represent a fundamental shift in how the government views Australians' retirement savings. For decades we've known that superannuation has been built on a simple understanding that Australians would lock away part of their hard-earned wages during their working lives, invest those savings productively and have in return certainty in the future of a secure retirement.

But unfortunately this government increasingly sees superannuation not as Australians' savings but as a convenient pool of revenue for government spending. That is why we're seeing new taxes, new thresholds and new rules that reduce choice throughout the system. The real problem facing this government is not that Australians are paying too little tax. The real problem is that this government cannot control its spending. When governments run out of fiscal discipline, they start looking for new places to collect revenue, and that is with the taxpayer. Today it's super balances above $3 million. Tomorrow that threshold can change quickly. We know there is a massive Labor deficit, and they have endless wasteful new spending to add to it.

It's worth remembering how we arrived at this point. When the Treasurer unveiled his first superannuation tax proposal, Australians reacted very swiftly, and we, the coalition, opposed it. The community raised serious concerns about the Treasurer's proposal. Even voices on that side—it cannot be denied—raised questions within their own ranks and began to question in. The original proposal crossed a very clear line in our tax system. It would have taxed unrealised gains, paper increases in asset values that existed only on a spreadsheet. No sale, no income received, but what you would have seen is people like farmers and business owners who, under the then rules, would have had to sell off their businesses, carve up their farms or simply walk off the property because of an overreach of this government. Australians rightly pushed back on that. They also noticed something else. The Treasurer had quietly refused to index the threshold meaning inflation would slowly drag more and more Australians into that tax overtime. The way we see inflation growing at its current rate would only expedite that.

The art of taxation, it has been said, is to pluck the goose with the least hissing. Labor thought they could do it here, but Australians have hissed loud enough that even the Prime Minister heard it. So the Treasurer was forced to retreat, but now he's back again with his latest proposal to tax retirement savings. Let us be clear here. This is not the policy the government took to the last election. This is something completely different. In one important respect, it is something much worse, because the original bill explicitly excluded the tax from applying to when someone dies. That safeguard has now very quietly disappeared. Australians abolished death duties in the 1970s because they were widely recognised as unfair, punitive and ineffective, yet here we are in 2026, watching their quiet re-emergence under this Labor government.

Under Labor, Australians are taxed when they work. We all accept that. It pays for our hospitals, our schools, Medicare—all those services that you rightly deserve. They are taxed when they retire, and now you're going to be taxed when you die. At some point we have to ask: when does it stop? I do acknowledge it is easy to see the politics in this proposal. The government says this tax applies only to balances above $3 million and imposes an even higher rate on balances above $10 million. Clearly, in a cost-of-living crisis that is only getting worse under Labor, many Australians would say they're not going to lose any sleep over that. In my electorate, the average super balance is $170,000. I say to the people of my electorate: I get it; I understand. You look at somebody with a super balance over $3 million and you would say, 'Well, they can pay it.' People are focused more on mortgages, rents, groceries and energy bills, not multimillion dollar retirement accounts. I get it; Labor politics—I withdraw that.

It is very tempting to say, 'We'll let this one go through to the keeper,' but where does it stop? The real problem facing this government is not that the Australian people are paying too little tax. The real problem is this government cannot control its spending. Tax receipts today are already at historically high levels as a share of the economy. They are at levels we have not seen since the Howard years, but there's a very important difference there. When the Howard government benefited from strong revenues generated by growing an economy, they returned those revenues to the Australian people, and they did so through broad based tax relief. This government sees historically high tax returns and immediately starts looking for ways to take even more, because this government cannot live within its means.

There is, of course, a small increase to the low-income superannuation tax offset now attached to this bill, and we support that. It's a tax cut, but it's small—only around one-fifth of revenue collected by that tax—and, in a cost-of-living crisis, it is pretty strange that this government didn't choose to deliver more immediate tax relief. That is the stark difference between this government and what was done under the Howard government.

That brings us to a much deeper issue in this debate, and that is the integrity of the superannuation system itself. Superannuation was built on a contract. Australians would set aside part of their wages during their working lives. Those savings would be invested productively across the economy, and, in return, they would have security and certainty in retirement. But that system depends on one crucial ingredient, and that is trust—trust that, if the Australian people followed the rules, the rules would not constantly change and trust that, when people make long-term decisions about saving for retirement, governments won't move the goalposts halfway through the game.

Superannuation is not a short-term investment. People make decisions about their retirement savings in their 30s and 40s that will affect their lives decades later. They structure their investments, they plan how much they contribute and they plan the kind of retirement they want and that they can afford. They do all of that on the assumption that the rules governing the system will remain stable. But what this government has done with these bills is fundamentally change that system. Now we have a different tax rate depending on the size of someone's super balance. It's a wealth tax. There's no denying that. The government says it's about aligning superannuation with what it calls dignified retirement. Dignified retirement is your choice and my choice, not the government's choice.

The problem with the argument by Labor is very simple. As I said, who decides what counts as dignified? Today the government says that the line in the sand is $3 million. But this bill raises around $2 billion a year—that is it. In the context of a $1 trillion debt, that's not a structural solution to the government's fiscal pressures. When $2 billion inevitably proves insufficient, the temptation will be obvious: lower the threshold, expand the tax and bring more Australians into the net. Maybe the line becomes $2 million, maybe $1 million. Maybe they'll just tax all super and give everyone a $20,000 dignified retirement stipend. Who knows?

We simply cannot trust this government and we simply cannot trust this treasurer. Once the government begins to treat superannuation as a convenient revenue source, the pressure to keep expanding that revenue will never go away. We can already see the broader direction of travel. We hear discussions about making changes to capital gains tax and about changes to negative gearing. We hear discussions about trusts. Each time the argument begins the same way. First, they deny they are considering new taxes. Then they say that it will only apply to the rich. But, when the spending pressures continue to grow, the definition of 'rich' inevitably changes. That's why this bill matters.

Once one of the principles established is that retirement savings are simply another pool of revenue for the government to draw from, the integrity of the entire system begins to erode. That has consequences not just for retirees but for the whole of the Australian government. Those superannuation balances Labor is taxing are not sitting idle. They represent capital invested across Australia that is backing businesses and infrastructure and helping companies to expand, hire workers and innovate.

The coalition understands a very simple economic truth: if you want better hospitals, better schools and stronger public services, you need a stronger economy. It is the only way. You cannot cheat your way to prosperity. Governments can't distribute wealth that has not first been created. Prosperity comes from growth, from investment and from people working, saving and building businesses across this great country. That is how living standards rise. It's also how sustainable government revenue is generated.

Superannuation plays an important role in that story, but it only works if Australians have confidence in the system—confidence that their retirement savings will not become a convenient target whenever government finds itself short of revenue. Superannuation is not government money; it's your money. It represents the wages that people earn through decades of work and set aside for their own retirement. The coalition respects that and always will, and we believe governments should control their spending before reaching further into Australian people's savings that they have worked decades to build. For those reasons, the coalition will oppose this bill.

Sam Lim (Tangney, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak to the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 and the Superannuation (Building a Stronger and Fairer Super System) Imposition Bill 2026. These bills deliver more help to low-income workers and reform the superannuation system to make it stronger, fairer and more sustainable.

From 1 July 2027 we are boosting the low-income superannuation tax offset, also called LISTO, by $310 to $810, and the eligibility threshold will go from $37,000 to $45,000. These changes are to ensure that low-income workers receive a fairer tax concession on their superannuation contributions. This aligns with the government's third round of tax cuts, which will take effect in 2027. With these changes, more than 770,000 additional Australians will be eligible for LISTO in 2027-28, and 490,000 Australians will receive a higher LISTO payment. These changes bring the total number of Australians eligible for LISTO to 3.1 million, of which around 60 per cent are women. These changes will have an impact across Australia, including in my electorate of Tangney—especially for women in Tangney.

The gender superannuation gap is worse in Tangney than in many other electorates in Australia, with a 37 per cent gap between men's and women's super savings across all age groups. Unfortunately, this gap only widens with age as people near retirement. The median woman in Tangney aged 50 to 59 has 41 per cent less in super than the median man in Tangney of the same age.

A few months ago I met with a woman in my electorate of Tangney. She is a former educator who later changed careers to work in the aged-care sector. She currently works part time as a support worker in aged care with elderly clients who depend on her and really value all the assistance and care she dedicates to them. Her career has been devoted to serving and caring for others. Her job is not easy, and her salary is not very high. She's one of the women in Tangney who work in the sectors that traditionally have been lower paid and heavily feminised. When we met, we discussed some of the challenges she is facing as she approaches her retirement age, including superannuation. These challenges are all weighing heavily on her shoulders as she decides on when she can afford to retire and what her retirement might look like when she does stop working. After years of hard work and contributions to Australian society and community, she would like to have peace of mind and stability in her retirement. Her story and her words sit with me as we discuss this legislation.

Women's economic equality is a core focus of our government, and I see how these changes will help address the current superannuation gender inequality that we see in our communities. These reforms build on other important changes that we have made since coming to office, including promoting greater equity in women's superannuation, paying superannuation on paid parental leave and introducing payday super. Women currently take the majority of Commonwealth paid parental leave, so this change also helps to address the superannuation gender gap that develops during this period in a family's life. When I think back to my constituents who approached me, I know there are other women in Tangney who are in similar challenging positions. Lifting the LISTO is a step that will help make super fairer for women and help narrow that gap.

The workers who stand to benefit from this change represent an essential part of our workforce. This includes more than 100,000 sales assistants, 50,000 administrative workers and 50,000 aged and disability carers, carers like my constituents who provide important day-to-day support for some of the most vulnerable members of our community. These proposed changes in this bill mean a boost to the super of more than 9,300 low-income workers in Tangney. Of these 9,300 people in Tangney, 62 per cent of the beneficiaries will be women. Depending on an individual's income over their careers, workers could receive a potential benefit at retirement of around $15,000.

I think it is important to talk about who will benefit from these changes and how many people are expected to be impacted. These changes will benefit around 1.3 million Australians, including around 750,000 women and around 550,000 young people under the age of 30. More than 750,000 additional Australians with income between $37,000 to $45,000 will now become eligible to LISTO, including more than 450,000 women, and almost 500,000 Australians with income below $37,000 will receive a higher LISTO payment, including almost 300,000 women. It is also important to note that there are 14 times as many people who will benefit from the boost to LISTO as there are people with more than $3 million in their superannuation.

This legislation also implements the government's policy to better target the tax concessions that are available to individuals whose superannuation balances are greater than $3 million. The legislation maintains the concessional treatments of superannuation for all taxpayers while also making superannuation tax concessions more targeted for those with large balances. It is helpful to go through the background on these changes. Superannuation tax concessions cost the budget more than $60 million a year. They will exceed the cost of the aged pension in 2040. The existing tax breaks strongly benefit a small number of people with high balances that go well beyond what is needed for a comfortable and dignified retirement. Around 38 per cent of the super earning concessions go to the top 10 per cent of income earners, while 54 per cent of the super earning concessions go to the top 20 per cent. In making such changes, superannuation concessions will be better and more targeted. These reforms reflect practical changes to the design and implementation of the original policy and take into account more than two years of feedback.

Starting in the 2026-27 financial year, the tax rate applied to earnings on superannuation balances between $3 million and $10 million will be up to 30 per cent. The tax rate applied to earnings on balances above $10 million will be up to 40 per cent. There will be no change to the taxation of earnings corresponding to balances below $3 million, which will continue to be taxed at up 15 per cent. These changes are expected to affect fewer than 0.5 per cent of Australians with super accounts, and the higher tax rate on balances of more than $10 million will affect fewer than 0.1 per cent of people with super. These changes we are making are consistent with the government's legislated objective of superannuation. That is to preserve savings to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way.

The changes to LISTO have had strong support in my community and in families across all of Tangney. In my conversation with families, women and young people, it is clear these changes are both fair and practical. There are changes designed to ensure people on a lower income are not placed at a disadvantage. These changes provide a fairer tax concession on their super contribution while also making a real difference in efforts to narrow the superannuation gender gap. These changes make sure everyone has concessions to save for retirement through super while also improving the equity and sustainability of the superannuation system by reducing concessions for small numbers of individuals with very large super balances. I support this bill.

Sam Birrell (Nicholls, National Party, Shadow Assistant Minister for Regional Health) Share this | Link to this | Hansard source

I too rise to speak on the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 and the related bill. I think the best thing we could say is that Labor's super mess is back, but this time it's not the original; it's a sequel. I'm trying to forget the original because that was a horror movie. But the sequel's worse. When the original came out, audiences recoiled in fear, not just at the fact that it was an unfair tax grab but at the sheer unworkability of the legislation.

People in my electorate, who work hard and smart to get ahead financially—and a lot of those are farming businesses and family businesses—faced a tax on unrealised capital gains in their superannuation. To propose taxing paper gains isn't a minor tweak; it is a structural shift that would have set a dangerous precedent across the entire tax base. Equally concerning was the government's refusal to index the $3 million threshold. Over time, more and more people would have been caught up, because bracket creep, something that the current government has refused to address, was part of the design. People were going to find themselves in a situation of having $3 million of unrealised capital gains.

Labor failed to understand that, for many farming businesses across Australia and in my electorate of Nicholls, the main asset in their superannuation is the farm. The farm might go up in value, but it won't be realised. The farmers want to keep farming. There will be some years that they make a profit, and there'll be some years that they make a loss. If they make a loss but the farm value has gone up, how are they supposed to pay the tax that would be created for them because, on paper, their asset base has gone up? The agriculture sector has one of the highest retirement ages in Australia, at around 68 years of age. This flawed policy was just a sneaky trick to take their money, to take their hard-earned savings. We on this side often say, 'When Labor run out of money, they come after more of yours.' On this side we fought hard and, with the help of community pressure, we forced Labor to abandon the taxation of unrealised gains and an indexation freeze. Thanks to the sustained scrutiny from the coalition, the superannuation sector, small-business owners and just everyday Australians who could see what a mess this was, we forced Labor to step back from the most outrageous elements of this proposal. The government backdown tells us that this was never a principled policy decision. It was a blatant grab for revenue to prop up their budget.

There's a question of trust here too. At the last election, Australians were not presented with a policy to tax unrealised capital gains in superannuation and here were Labor trying to legislate it. They were not told that longstanding superannuation settings would be fundamentally altered, but it was there in black and white in legislation before the parliament. They were not warned that indexation would be stripped away, but Labor tried to do it anyway.

Superannuation is not a windfall gain. It's a nest egg. We support superannuation. We do.

Peter Khalil (Wills, Australian Labor Party, Assistant Minister for Defence) Share this | Link to this | Hansard source

Really?

Sam Birrell (Nicholls, National Party, Shadow Assistant Minister for Regional Health) Share this | Link to this | Hansard source

Yes, absolutely. I hear those untruths from the other side that we don't support it. We do support it. But the emphasis we have on it is that it belongs to the people who have the superannuation funds. What we worry about is that the Labor Party tend to act like it's their money. It's not the government's money. Superannuation belongs to the people who have the superannuation funds. It comes out of their wages. They earn it. They work for it. On this side of politics, we've always tried to emphasise that, if it's your money, there needs to be a certain amount of freedom about what happens to it.

Many people's superannuation—everyone's superannuation, for that matter—is built over decades and decades of hard work, and the bar is rightly set higher for consent to make substantial changes. It should be. Labor tried to bypass that by making major structural tax changes without putting them clearly and transparently to the Australian people. Instead, this proposal appeared out of nowhere, with limited consultation and a rushed legislative timetable. The Labor luminaries didn't support it. From the ACTU, Sally McManus warned:

I do think it's got to be indexed because you've got to make sure eventually people don't end up there. But that's a very long time in the future.

Bill Kelty and Paul Keating, the father of modern superannuation, didn't embrace it. And now Labor's super policy is back.

I just want to have a think about the mindset of a team that decides that taxing unrealised capital gains is a good idea. I sit in question time here and I hear the Treasurer interject across the chamber, calling people 'geniuses' in a pejorative way—'Come on, genius,' or, 'Yes, genius!' or, 'Ask me another question, genius.' Well, what type of genius comes up with a tax plan to tax unrealised capital gains? There were so many unworkable issues with this. I had people asking: 'Am I going to have to get my farm valued every year or every three years? How are they going to work out what the value is? Do people understand how much it costs to value a farm?'

Peter Khalil (Wills, Australian Labor Party, Assistant Minister for Defence) Share this | Link to this | Hansard source

Unbelievable, Sam!

Mike Freelander (Macarthur, Australian Labor Party) Share this | Link to this | Hansard source

Order! The member is entitled to be heard in silence.

Sam Birrell (Nicholls, National Party, Shadow Assistant Minister for Regional Health) Share this | Link to this | Hansard source

I don't know why they're trying to defend the taxation of unrealised capital gains. It's such a terrible policy. What I'm trying to outline is that the mindset that thinks that is a good idea is designing our taxation settings. That's what's worrying me. That's what's worrying people in my electorate.

Tim Wilson (Goldstein, Liberal Party, Shadow Minister for Small Business) Share this | Link to this | Hansard source

It's going to fund organised crime.

Sam Birrell (Nicholls, National Party, Shadow Assistant Minister for Regional Health) Share this | Link to this | Hansard source

Absolutely. So what's different in this bill? Unrealised capital gains were removed, thanks to the pressure from the coalition and others, and that's a good thing. The government will not be taxing unrealised capital gains, but, by gosh, we had to work hard to get that taken out. Instead, a 30 per cent tax will apply only to realised earnings, actual cash profit for balances between $3 million and $10 million. To address concerns of bracket creep, the thresholds will now be indexed.

But there are new risks in this new legislation. The removal of the effective death tax exemption creates uncertainty for families at precisely the moment they are most vulnerable. Surviving spouses who rely on superannuation balances to maintain stability after the loss of a partner could face additional tax complexity and reduced security. Total and permanent disability benefit recipients are another cohort that must be considered carefully. These are Australians who, through no fault of their own, are no longer able to work. Their superannuation is a lifeline. Any change that increases volatility, reduces predictability or complicates access to those funds carries real human consequence.

There are low-income superannuation offset increases, and they are welcomed. But they are modest, and they don't go anywhere near addressing the cost-of-living pressures—and the cost-of-living pressures, at the moment, for Australian people are manifest. Real wages are going down. Interest rates are going up. Inflation's going up. Energy costs are going up. And why is all this happening? It's happening because of bad policy. Bad policy means that people's standard of living is going backwards, and people's standard of living won't improve unless we get some good policy. Good policy needs to be about growing the economy. A future offset adjustment in superannuation does little to relieve all the cost-of-living stresses now, and the government must tackle inflation at its source.

Labor has a spending problem, not a revenue and tax problem. I heard this debate yesterday. It is relevant, when Labor is proposing a tax, for the coalition to try and shed some light on what it wants to spend the tax on. It's people's money. It's people's own hard work. And, if that money goes towards the Victorian government not managing it properly—on infrastructure bills—and that money finds its way towards corrupt activities, then that is relevant to this debate, because we're talking about taxing people's superannuation accounts. It's their hard work. Where that money goes is relevant, important and absolutely critical.

In my state of Victoria, we're incredibly worried about how much we're being taxed—and this is another tax. But not only are we worried about how much we're being taxed; we're worried about how that money is being spent, and that's a right thing to worry about. Geoffrey Watson SC, in his report on CFMEU corruption, said that the Victorian taxpayers—and the Australian taxpayers, because a lot of the money goes into the Victorian government from the federal government—have had to pay $30 billion extra for infrastructure payments because of corruption in the CFMEU. That is relevant when we're talking about taxation.

Today, it's about superannuation balances above $3 million, but what's it going to be about tomorrow? What's the next threshold? What's the next asset in the attempt to claw more money from Australians? I can't support this bill, and we in the coalition will be holding the government to account on the bad policy, including this policy, that is failing to grow the economy and causing cost-of-living pressures to escalate. We will also be holding the government to account, when they do tax people, on whether the money is spent correctly and wisely, because it's the people's money, not the government's money.

Rowan Holzberger (Forde, Australian Labor Party) Share this | Link to this | Hansard source

I rise in support of the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 and the Superannuation (Building a Stronger and Fairer Super System) Imposition Bill 2026. As a first-term member, I'm always happy to learn from people who've been here for a long time, and I appreciate that now we can address policies which used to exist but don't exist anymore. So I'd like to talk about Fightbackformer prime minister Paul Keating's dog-eared copy used to sit in that very drawer there—and John Hewson's prosecution of Fightback. Mr Hewson talked about a GST on food—here was the LNP pushing a policy of a GST on food in that Fightback document, which used to sit in that very drawer, a policy which was prosecuted by the other side. I'm glad that I can have that lesson in what's actually allowed in the parliament. You're allowed to talk about a point which has absolutely nothing to do with the bill—a fantasy which is being pursued by the LNP. This is what's got the other side into trouble. They're out there pursuing fantasies, pursuing things which the public aren't one little bit interested in. They've got this ideological obsession with certain things that are completely disconnected from reality in the community. That's why they are of ever-diminishing relevance in the Australian political landscape.

I'm very glad that the new shadow treasurer is here. In fact, I can't believe my luck. There are two things that I can't believe. One is that I woke up one morning and the member for Goldstein was the shadow Treasurer. I couldn't believe my luck on that one.

I can't believe my luck now that he actually gets to sit here—unlike the member for Monash, who has had the opportunity to sit through many of my speeches now. I'm just wondering whether the member for Monash engineers it so he's on the speaking list so he can listen to me as a political—

Opposition members interjecting—

Mike Freelander (Macarthur, Australian Labor Party) Share this | Link to this | Hansard source

Order! I just should interrupt. Much as I appreciate the history lesson from both sides, it's not a two-way conversation, please. The member should be heard in silence.

Rowan Holzberger (Forde, Australian Labor Party) Share this | Link to this | Hansard source

Thank you for the protection, Deputy Speaker. I'm not sure the member for Goldstein has had the unique pleasure of listening to one of my speeches, so I feel very lucky that he is here today to listen to that. On my own personal and political journey, one of the many books I read—I live by one of the maxims in that, which is 'Seek first to understand and then to be understood'. Unfortunately, standing up in parliament, despite the opportunity for people to interject, isn't exactly a good opportunity for me to listen to what the shadow Treasurer has to say. I would like to talk a little bit about whether I've got it right—what the shadow Treasurer actually believes. While he may not be able to interject throughout this to set me right, I would like to see whether or not I'm correct on this.

I think I know where the shadow Treasurer is coming from. In many ways, he has a very admirable world view. Even if it is ultra-ideological and totally impractical, I sort of get the theory. There's a little bit of my own story that I'd like to tell through all of this as well. I came into politics quite young, from Broken Hill, a country town.

Tim Wilson (Goldstein, Liberal Party, Shadow Minister for Small Business) Share this | Link to this | Hansard source

On a point of order on relevance, I don't understand what on earth the member is speaking about, so there is no way it could be relevant to this bill.

Mike Freelander (Macarthur, Australian Labor Party) Share this | Link to this | Hansard source

I think that this is a nuanced argument, but I would remind the member for Forde to be relevant to the topic.

Rowan Holzberger (Forde, Australian Labor Party) Share this | Link to this | Hansard source

If it assists the deputy speaker, my point of relevance is this. We have now woken up, and while in some ways—politically—we can't believe our luck that we've got the member for Goldstein as the shadow Treasurer, the dread that Australian workers should feel that the alternative Treasurer in charge of economic policy, in charge of superannuation—

Mike Freelander (Macarthur, Australian Labor Party) Share this | Link to this | Hansard source

Order! I think you do need to be relevant to the topic, in this speech.

Rowan Holzberger (Forde, Australian Labor Party) Share this | Link to this | Hansard source

Thank you, Deputy Speaker. I will obviously take that. The thing is that superannuation has been under threat. At every opportunity that the opposition have had to spike it or to sabotage it, they have. That's why the 12 per cent came in last year. The original 12 per cent was scheduled to come in in 2019, but it was deferred by the previous government—by those opposite. That deferral between 2019 and 2025 would have cost—the actuaries could work it out—billions or hundreds of millions at least. For an individual, it would potentially be a loss of thousands of dollars to an individual's superannuation account. So this bill really does build on the superannuation policies of the government, but really of the Labor Party. What we have at the moment is very much where I see—I do want to absolutely keep this relevant to this debate. For superannuation as a whole, though, I understand that there is a theory out there that individuals should be able to make decisions about their own financial choices on the road to financial freedom.

Tim Wilson (Goldstein, Liberal Party, Shadow Minister for Small Business) Share this | Link to this | Hansard source

Superannuation is a hole?

Rowan Holzberger (Forde, Australian Labor Party) Share this | Link to this | Hansard source

As a w-h-o-l-e—so superannuation as a w-h-o-l-e should be able to make decisions about its financial future. In some ways, when government gets involved in that, it distorts the individual need to take care of one's own finances. I sort of do understand that. But the thing is that, without superannuation, there wouldn't be somewhere around $4.3 trillion in national savings, which people are able to retire into at the moment. Without superannuation, people would be retiring into a bleak future.

One of the things that I learned along the way was this idea of pay yourself first. You should put 10 per cent away so that you can create a pool of savings, which will ultimately act as a buffer if you get yourself into some sort of financial trouble. But sooner or later it will turn into a pool in which you can invest, and then, if you live carefully and frugally and adjust your outgoings so that your incomings match, then you can retire. So I really do understand that if you can take that personal responsibility over your own finances you can achieve financial freedom. I think that is a goal which is achieved on both sides.

Where I think there is a difference of opinion, though, is that there is that ideal, but then there is a reality, and life gets in the way. What compulsory superannuation does is take that 10 per cent—now up to 12 per cent—put it away for people and invest it in something that's not risky and that's sensible so that ultimately people can achieve financial freedom. While it is a noble goal for people to take charge of their own finances, when you actually look at the whole community, individual circumstances mean that that doesn't happen in practice.

That's why I really do implore those on the other side to—they're going to be making decisions about their superannuation policy that they take to the next election. The last policy they took would have been disastrous. It would have meant that people would have raided their balances, it would have pushed house prices up, and it would have been disastrous. For example, in February 2021, when the now shadow treasurer was the chair of the Standing Committee on Economics, an article in the Saturday Paper said:

The Liberal backbencher says that if people could use the money in their super account—all of it, if necessary—they might be able to fund the deposit for a … home.

Tim Wilson (Goldstein, Liberal Party, Shadow Minister for Small Business) Share this | Link to this | Hansard source

Yes.

Rowan Holzberger (Forde, Australian Labor Party) Share this | Link to this | Hansard source

Yes, so there you go. This is a policy which would have had the twin negative of raiding people's retirement balance, which is what superannuation is for, and not letting them pay themselves first and at the same time pushing up house prices in the community. Somehow this policy—which the shadow Treasurer just enthusiastically said yes to, which is a bit of a sign that it might be the policy they take to the next election—would have somehow had two, twin, disastrous outcomes.

This bill really builds on the long history of superannuation. Let's just remember that superannuation is not something which has been gifted to workers. Superannuation, when it was introduced in the nineties was exactly their money—as the shadow Treasurer has just said it, It was exactly their money. It was a tax cut which they forgave back nineties. It was a wage rise which they forgave. It is exactly their money. The shadow Treasurer is shaking his head again. I seek first to understand and then to be understood! But I was there, I was watching it at the time. I know that it was a tax cut which they gave up and put into super, and it was a pay rise, as part of the accord, which they gave up. So it is indeed workers' money. From the very inception there, when it was their money, to the increase of 12 per cent, which the opposition fought against, and to allowing it to be used for things like housing, this bill builds on all of that.

One of the most important things in this bill is what the LISTO does. Here we have an attempt to right that imbalance between the income tax that a worker would pay and what the tax rate is on that superannuation. In Forde, for instance, something like 11,353 people are going to benefit from the LISTO to the tune of something like $4.6 million. That's because the LISTO is about helping lower-income earners, somewhere around 60 per cent of whom, in Forde, are women. It is about lifting up the super balances of lower-income earners, particularly women.

Superannuation is one of those things that, if you look historically at gender pay gap, was only really in the last few years held by women. It rose from below 40 per cent, and it is now it is now into the 40s, but it is still not equal. Measures like the LISTO will go towards fixing that imbalance. In Forde, it is particularly important because in working-class areas like Forde people really have been doing it tough. In fact, for the bottom five postcodes within Forde, the super balance is somewhere around $68,000. The top super balance in Forde is $183,000. When you compare that to a national average of 160 grand, the bottom of five are $66,000, $78,000, $88,000, $92,000 and $95,000. There is a problem that needs to be fixed up, and fixing the LISTO will go some of the way to fixing this problem.

Thank you for the opportunity to talk about super, something which is very important to the Labor plan and to the Labor cause of helping people economically. I urge you to support this bill.

Mary Aldred (Monash, Liberal Party) Share this | Link to this | Hansard source

Too often, I see regional Australians bearing the brunt of unintended consequences at the hands of this federal Labor government. That the government has backed down on its proposal to tax unrealised gains in superannuation tells us one thing very clearly, and that is: it wasn't a very good policy to start with. It's only because of sustained pressure from the coalition, from the superannuation sector, from small-business owners, from farmers and from everyday Australians that the government has been forced to retreat on some of the most outrageous and egregious elements of this proposal.

It was not a minor policy tweak. This has been a fundamental shift in proposing how Australians are to be taxed, and had it not been challenged it would have set a very dangerous precedent across our entire taxation system. The coalition has always stood on principle when it comes to taxation—that Australians pay tax when income is realised, when a gain is crystalised, when the money is actually in hand.

But what this government has proposed is something entirely different. They are proposing taxing paper gains, gains that exist only on paper and may disappear the next day. Anyone who is invested in markets, property or business assets understands volatility. Values rise and values fall. They change with economic conditions, circumstances, interest rates and market cycles. Taxing unrealised gains ignores that reality.

This is an area I have had very strong feedback on from my regional electorate of Monash. I came to this place to make a strong stand on behalf of farming families in my community, who do so much to contribute to our national wealth and prosperity and ask for very little in return. Under this proposal, they would have been punished severely. Many older farmers in electorate have their farms in self-managed super funds, and they have done that with the intention of leaving their farms eventually to their children. That helps generate retirement income for the parents while the next generation looks to build and continue to build the family business—but not under Labor's proposal. We know that land prices have increased quite dramatically in some areas, and that does not always reflect the earning capacity of those businesses. I looked up how many farming families this might affect, particularly those with self-managed super funds. There are around 17,000 accounts that hold farmland, and, of those, 3,500 have more than $3 million in assets. That would severely cripple and hurt and disadvantage fair dinkum, hard-working farming families in my electorate of Monash, and that is why I cannot support this bill. It represents a fundamental break with the longstanding principles of Australia's tax system, and that is why Australians from city to country have reacted so strongly and so vehemently.

Equally concerning is the government's refusal to index the $3 million threshold that I've just spoken of in relation to its impact on regional communities including mine. In an inflationary environment, one that's only been made worse by this Treasurer's unwillingness to address debt fuelled spending and the impact that has on the inflation fire, failing to index those threshold amounts would amount to a silent tax increase. Over time more and more Australians would have been captured by this measure but not because they were wealthier in real terms. Many farming families are what you'd call asset rich but cash poor, and they work really, really hard. I believe that, because inflation would quietly erode the value of the threshold, this is bracket creep by design, and if it was not flawed policy then it would be a sneaky way, by sure, to take more of Australians' hard earned retirement savings. That is not the government's money. That is the money of everyday Australians, who work hard, who save hard and who do the right thing just to get ahead, and they cannot get ahead under this current government.

What we've seen over the last few weeks is a government that's been found out, a government that's retreating under pressure and a government that was clearly not prepared for the scrutiny this proposal would receive. The backdown demonstrates something very important—this was never settled policy grounded in sound economic principles. It was a blatant revenue grab, and once it was exposed it collapsed under scrutiny.

But beyond the policy flaws themselves lies another serious issue, and that is trust. It is the trust the Australian people put in their government to do the right thing, to make sound decisions and to go to elections where they put forward a set of values and policies and say: 'This is our word. If we are elected, these are the things that we will do.' The quiet part is being honest with the Australian people and not, by stealth, trying to creep in new taxes. In this case, Australians were not told of this intention to tax unrealised gains in superannuation. This government was not honest with its intentions, and that is a breach of trust. It is a breach of the compact between the Australian people and the parties of government that seek to represent them—in this case, the Labor Party that went to the last election not being upfront about its future policy intentions.

People were not warned that indexation protections would be removed. Now, promises matter in a democracy. Major structural tax reform should have been clearly put to the Australian people for their review, consideration and ultimate decision-making. Instead, this proposal has appeared suddenly, with limited consultation and a rushed legislative timetable. Australians instinctively understand when something has been slipped in without their consent, in this case at five minutes to midnight. And when it comes to retirement savings, those nest eggs have been built over decades of hard work—hard work by people in my community who spend long hours on their feet and working with their hands to make an honest day's living. The bar for legitimacy must be higher. Superannuation is not a plaything for governments looking for new revenue streams. It represents the lifetime savings of Australians who have worked hard, sacrificed and planned responsibly for their own retirement.

Unfortunately, this episode reinforces a broader pattern we are seeing from this government. Australians were promised that inflation had been beaten. They were promised that interest rates would stabilise. They were promised that life would become easier and fairer and better for Australian families. Yet, the reality for Australians today is a very different story. Families have less flexibility. They have less choice. They are finding it harder than ever to pay the mortgage, pay the energy bills and keep up with everyday costs. I had a woman approach me the other week saying she regularly has to make a decision about whether to buy groceries to put food on the table or to pay her electricity bills on time. That is not a safe, secure, sustainable and prosperous Australia.

Australians deserve better. They have been beaten down by this Treasurer, with his empty promises and silent tax grabs. And when governments lose control of spending, they inevitably start looking for new taxes—and this is exactly what we are seeing here. And it's not just the coalition saying so. Even voices traditionally aligned with Labor have warned about the dangers of this proposal. When you've got Sally McManus, Bill Kelty and Paul Keating all raising concerns about the same policy, you know something has gone pretty badly wrong. The ACTU's Sally McManus warned that the threshold must be indexed, otherwise Australians would eventually be caught. Former ACTU secretary Bill Kelty went further, saying taxing unrealised capital gains is bad policy because it distorts the tax system and disrupt income flows. And the architect of Australia's superannuation system, Paul Keating, has warned that workers would find themselves ultimately caught in this net.

Industry analysis has also made clear that the government's claim this would only affect a small number of Australians just simply doesn't add up. In fact, analysis suggests that up to 1.8 million Australians could eventually be impacted—1.8 million Australians who work hard, save hard and do the right thing to get ahead and live self-sufficiently. And many of those Australians would be small-business owners. Small-business owners in my electorate of Monash have never had to work harder for less and face more risk and red tape. This is just another example on top of the pile, because in Australia small-business owners often hold their assets through superannuation structures as part of their retirement planning.

So despite the government's rhetoric, this proposal was never going to affect only a handful of people. It would have expanded over time, because that is exactly what happens when thresholds are frozen and inflation continues to rise as we have seen under this federal Labor government, where inflation is sitting well outside the RBA's recommended band. But let's take a step back and look at the broader issue confronting our country. Australia does not have a revenue problem; Australia has a spending problem. Structural spending growth is now outpacing sustainable economic growth. We are living outside our means. When governments spend beyond their means, they inevitably begin looking for new taxes to fill the gap. Rather than confronting waste, prioritising programs and restoring the fiscal discipline, which is always a hallmark of every coalition government, Labor has chosen to hunt for new pools of capital to tax. Trust is fundamental when it comes to tax reform. Australians will accept reform when it is principled, predictable and properly consulted on. They will not accept retrospective changes, sudden policy shifts and ideological experiments dressed up as modest adjustments.

There are other risks in this legislation that should concern every member of the House, and I'll go into those shortly. But the name of this bill includes 'building a stronger and fairer super system'. There are many aspects that are not stronger, and they're certainly not fairer. They're having an everyday impact on communities like mine and on constituents like the ones I represent.

I want to briefly tell the story of Jan—I'll say Jan is her name—in my community who approached me last year. Her husband had a terminal illness. He had an account with AustralianSuper. He was eligible for early an payout of those death benefits because he had an imminent, terminal illness. AustralianSuper mucked him around for six weeks. Before he passed, Jan's husband wanted to have a conversation with their children to say: 'Look, this is not going to fix everything, but here is a little bit of money to help you get ahead in life. While I'm here, I want to be able to tell you that in person.' They shifted him from call centre operator to call centre operator, mucked him around and basically made his last few weeks an absolute heartache. After Jan's husband died, she spent nearly nine months trying to get money which was due to her. It was her money. They mucked her around, so I inquired with ASIC whether there is a mandatory minimum payout time on death benefits. And the answer is that, no, there is not. The answer is that it should be paid out as soon as practicable. This is not good enough, because this was Jan's money. It was not AustralianSuper's money.

I think this is a fundamental unfairness—this is a personal view I have—that we have aspects of the superannuation system that do not act fairly and that do not make a stronger system. I will continue to raise my constituent's case on this issue in any context relating to improving Australia's superannuation system, because I feel like this is a gross miscarriage of natural justice and of fairness. This was my constituent's money, and to have a large corporation like AustralianSuper continue to muck her around and, it turns out, thousands of others who are in the same boat, is grossly unfair. I call on the government to consider reforming that aspect so that people are not disadvantaged for months and months in seeking to access what is rightfully theirs.

This is a bad bill. On behalf of the farmers and small-business owners in my electorate, I cannot, in good faith, support it.

Sharon Claydon (Newcastle, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak in support of the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 and the Superannuation (Building a Stronger and Fairer Super System) Imposition Bill 2026. This legislation is about strengthening what is one of Australia's most important social institutions, our superannuation system. It's about fairness, boosting retirement savings for everyday Australians, closing loopholes that benefit the very wealthy and addressing structural inequalities that have left, in particular, many women retiring with significantly less super than they should have.

This bill is a substantial piece of reform and one that reflects core Labor values—fairness, equity and opportunity. Why does this bill matter? Australia's superannuation system is rightly regarded as world leading. It ensures savings for retirement so that millions of Australians do not enter old age solely dependent on the age pension. It underpins retirement security and reduces future pressure on governments and taxpayers. But the system is not perfect, and the bill before us responds to some clear problems and imbalances that have emerged over time.

First, it recognises that the tax concessions in superannuation have been unjustly skewed towards those who are already wealthy. This reform, by introducing a fairer tax structure on very large super balances, particularly through what is known as division 296, ensures that people with exceptionally large super savings pay their fair share. It targets concessions on balances above the $3 million and $10 million thresholds, with tax rates that reflect capacity to pay. This is the basis of our taxation system.

Second, the LISTO is an automatic tax rebate paid into the super accounts of low-income earners to offset some or all of the tax paid on their super contributions, which are taxed at a flat rate of 15 per cent. Because of changes in tax brackets and increases in the superannuation guarantee, some low-income earners are now paying more tax on their super than on their take-home pay. That is plainly unfair. Schedule 4 of this bill lifts the income thresholds from $37,000 to $45,000 and increases the minimum rebate from $500 to $810. In Newcastle alone this will boost the super of more than 8,200 low-income earners, delivering around $3.2 million per year into super accounts across my electorate. Importantly, 55 per cent of these beneficiaries will be women, reflecting the reality that women are more likely to be in lower paid and part-time work and therefore more exposed to inequalities in the super system. Strengthening the LISTO is a very practical step towards closing the gender super gap.

Third, this bill forms part of a broader effort to fix structural problems in the super system, including unpaid super. I've heard some members opposite talking about super being their constituents' money, and in many respects this is true. A lot of my constituents have had their money stolen from them in the form of unpaid super. That is a problem in my electorate, and it has been for some time. We need a remedy. Almost 22,000 workers in Newcastle—that is 27 per cent of workers in my electorate—were not paid their proper superannuation entitlements in 2022-23. That's the last lot of data we have. I want those 22,000 people to have that money in their pockets when they retire. They deserve every cent of it.

We've got to fix this system so that they get their entitlements. If you were wondering what 22,000 workers missing out on super tallies up to, it's $38.8 million in unpaid super across Newcastle in just one year. That is why this bill is before this House. If you think that is just, you need to rethink your position. I would love to see members opposite supporting this bill, but it seems that's not going to be the case. I want you to think about all those workers in your electorates who are being ripped off. There are a lot of them. You can look up the data. I've given you the data for my electorate. You're going to have to explain to the thousands in your electorates why you vote against this bill.

Nationally we know there are 3.3 million Australians missing out on some $5.7 billion in their legal super entitlements in any year. That is money workers earned, and it's money for women who already, as I've noted, retire with significantly less superannuation on average. Unpaid super can compound lifelong financial inequality, and that is why we're linking up initiatives like payday super. It's so critical that that reform is in place. We're ensuring that workers receive their super as part of their pay cycle so there is no more of this waiting three months, six months or nine months to figure out if your employer has been making contributions or not. Those days have ended, thank goodness.

So who stands to benefit from this bill? Well, let me be very clear. This bill is not about penalising everyday Australians. The National Party in particular are going to want to note this. It's about strengthening outcomes for working people and ensuring that those wealthier Australians, many of whom are not living in your regions—I'm a regional seat holder. I know the income levels in my seat. I think that those people that you represent are disproportionately impacted by the current system of super, and they stand to benefit from the reforms here rather than the existing tax concessions that are disproportionately impacting people in your electorates. That is unfair for the vast majority of people that you represent.

I remain forever optimistic for hope and seeing people coming onto a unity ticket here in supporting those typically not-wealthy regional Australians that we represent in this chamber. It's those everyday workers who stand to benefit from this bill, with stronger protections in their super entitlements thanks to reforms like the payday super—a crackdown on unpaid super that costs Newcastle workers, as I've already said, $38.8 million every single year—and enhanced support for low-income workers through the expanded low-income superannuation tax offset. That's the benefit.

If you've got women in your electorate, which I'm sure you have—women and carers—they are big beneficiaries of these reforms. Women will benefit significantly. They currently retire with about 25 per cent less superannuation than men in your electorates—and that's on average, that figure—reflecting the structural realities of the labour market, including lower average wages, higher rates of part-time work and time taken out of work for us to undertake caring responsibilities. That's the burden women carry.

Measures like strengthening the low-income superannuation tax offset ensure that those low-income earners are not being penalised by that flat 15 per cent tax on super contributions, because women are more likely to fall into the low-income brackets or part-time roles. They will disproportionately benefit from this bill. It helps even up that unequal ledger that exits. Reforms such as payday super will also make a real difference for women, ensuring that super gets paid at the same time as their wages, reducing that risk of unpaid or delayed contributions. That's a problem that particularly affects workers in sectors where women are strongly represented, including retail, hospitality, health and care services. You all have them in your electorates.

Taken together, these reforms are practical steps towards narrowing the gender super gap and improving retirement security for Australian women. Most importantly, millions of Australians saving for retirement can be confident that our super system will continue to deliver on its fundamental purpose: a dignified retirement and reduced reliance on the aged-care pension.

Why does this matter for Newcastle? I've already articulated how many people are ripped off by the current scheme, and we need to do better. But I'm a very proud Novocastrian. It's a great community of workers, families, tradies, small-business owners, healthcare professionals, teachers, carers and retirees. Across Newcastle, superannuation matters deeply to these people. Many of my constituents work hard throughout their lives, contribute to our community and rightly expect that, when they retire, they will have a fair and secure nest egg.

This bill delivers for everyday Novocastrians—for those workers—by strengthening protections, ensuring fairer tax rules and making sure that employer contributions are paid properly and on time. It protects the principle that your retirement should be supported by your hard work and contributions, not reliant on an outdated system that allows special treatment for the most advantaged. For Newcastle's small and medium enterprises, reforms like payday super also offer clarity and fairness. Modernising rules that bring super payments into the rhythm of modern payroll is a change that boosts confidence and compliance.

It's worth pausing to reflect on Labor's record on the economy, on wages and on the standard of living, because this bill does not exist in isolation. It sits within a broader coherent approach to strengthening the economy and supporting working families. Labor has unequivocally been supporting wage growth. We championed increases to the minimum wage and supported wage increases that help ensure that work pays. We've stood against calls from those opposite to see stagnant wages and no real improvement in living standards. Three consecutive increases to the minimum wage mean $9,000 going into the pockets of the lowest income earning people in Australia. That's a good thing.

It was, of course, a Labor government that created superannuation. Under prime minister Paul Keating, Labor introduced compulsory superannuation, a reform that transformed retirement in this country and became one of the most significant economic and social achievements in modern Australian history. Before Labor acted, millions of Australians retired with little more than the age pension. Labor's vision was simple but profound: working Australians deserve dignity and independence in their retirement.

Since then, Labor has consistently defended and strengthened super against attacks and attempts to water it down. And you can be sure we will forever do so. We've overseen the gradual increase of the super guarantee to 12 per cent, a historic boost that means everyday workers have put more away in their super accounts than at any other time in history. Now we're acting again, cracking down on unpaid super and strengthening the LISTO to ensure low-income workers are not left behind. This bill continues that commitment, strengthening a cornerstone of our social contract—superannuation—for the long term and for all Australians.

It's also important to examine the alternative—the record from members opposite. For years, the coalition have opposed meaningful reform to superannuation that would improve fairness in the system. It seems like that's going to be the same again this time around, although I keep pleading that members opposite might reconsider. Rather than supporting workers and retirees, their instinct has been to protect tax concessions for those that are already doing very well, even at the expense of a stronger retirement system for ordinary Australians. When proposals were first mooted to address unjust super tax concessions, the opposition decried them as 'super big and super bad'. That's not because they were unfair. It's because the opposition feared that any measure that asks the wealthy to pay a fairer share would be too difficult a step. Even now, when the nation's super scheme has been modernised and protections strengthened for everyday workers, the opposition are digging in their heels rather than offering a constructive solution.

I don't give up hope, though. This is an important bill. It's an important step forward, and I really appeal to members opposite to get on board and support these reforms.

David Batt (Hinkler, Liberal National Party) Share this | Link to this | Hansard source

I rise to speak to the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026. Pressure from this side of the House and our communities across the nation, including regional communities like Hinkler, forced the taxation of unrealised gains to be abandoned. People power had a small win. But it is clear that this government cannot be trusted with tax reform. Labor doesn't have a revenue problem; the government has a spending problem. This is the first tax that Australia did not vote for at the last election, less than 12 months ago. Yet here is Labor, ramming it through.

I represent the people of Hinkler, the regional cities of Hervey Bay and Bundaberg and the country town of Childers. My community is experiencing a decline in living standards. In fact, Australia has had the biggest fall in living standards of household disposable incomes in the developed world. The Nationals know how to get a cheaper, better and fairer deal for regional Australia. As a coalition, we absolutely stand for lower inflation, lower interest rates and lower taxes. In stark contrast, Labor's reckless spending is keeping inflation higher for longer. Regarding this bill, coalition and community pressure forced Labor to abandon taxation of unrealised gains and the indexation freeze. The government, called out again, retreated under pressure thanks to sustained scrutiny from the coalition, from the superannuation sector itself, from small-business owners and from everyday Australians. We forced Labor to step back from the most outrageous elements of this proposal.

This was not a proposal that was just aimed at hurting retirees; this was aimed at hurting future generations, stealing the future of younger Australians away from them without their knowledge or understanding. The original design to tax unrealised gains represented a fundamental break with longstanding principles of the Australian tax system. Aussies know that tax is paid when income is realised, when a gain is crystallised and when cash is at hand. To propose taxing paper gains, particularly in volatile asset classes, was not a minor tweak. This was a structural shift that would have set a dangerous precedent across the entire tax base.

Equally concerning was the government's refusal to index the $3 million threshold. In an inflationary environment being made worse by this Treasurer and his willingness to pour debt petrol on this inflation fire, failing to index thresholds was a silent tax hike. Major structural tax changes must be put clearly and transparently to the Australian people. Instead, this proposal appeared out of nowhere with limited consultation and a rushed legislative timetable. The people of my electorate of Hinkler were told by this government that they were going to make life easier for families. The reality is less flexibility and less choice.

Life has been harder for hardworking Australians—to pay the mortgage, to pay the bills, to pay the power bill and to make ends meet. Labor has a spending problem, not a revenue problem. Under Labor, Australians' real wages are falling while costs are rising. Trust is fundamental in tax reform. Australians accept reform when it's principled, predictable and based on broad consultation. What they do not accept is retrospective tinkering, ad hoc changes and ideological experiments dressed up as modest adjustments. What faces us today reinforces a broader pattern: higher spending first then new taxes to pay for it later. That is not reform; that is fiscal mismanagement.

Beyond the headline rate and threshold changes, the legislation introduces serious structural risks. The removal of the effective death tax exemption creates uncertainty for families precisely at the moment they are most vulnerable. Tax policy cannot be designed in isolation from lived reality. When retirement income settings are destabilised, confidence in the entire system is eroded. Regional Australians must get a fair go into their future, and we must help them now. A future offset adjustment in superannuation does little to relieve the stresses of today. If the government is serious about helping households in Hinkler, it must tackle inflation at its source—excessive spending and weak growth—rather than reshuffling offsets within the retirement income system.

This proposal should not be viewed in isolation. Today, it is superannuation balances above $3 million. Tomorrow, it may be another threshold, another definition or another asset class. Once the principle of taxing unrealised gains is entertained, it does not remain neatly contained. Is this Labor government opening a new chapter in a high-tax, high-spending approach to governing? All the evidence points to it from what I see. That is why the coalition will not be supporting this bill.

Sally Sitou (Reid, Australian Labor Party) Share this | Link to this | Hansard source

At its heart, the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 asks a simple question: what and who is superannuation for? Is it for ordinary working Australians—our teachers, nurses, early educators and police officers—who are putting aside a little each fortnight so they can retire with dignity and security? Or is it a vehicle for unlimited tax concessions for balances so large they far exceed what anyone would need to fund a dignified retirement? This legislation answers that question clearly. Superannuation exists to deliver income for a dignified retirement for everyday Australians, not to provide indefinite, uncapped tax advantages. This legislation strengthens that principle responsibly and proportionately.

Labor built Australia's superannuation system, and it remains one of the most significant economic and social reforms in modern Australian history. It reshaped retirement in this country. It lifted retirement incomes, it reduced reliance on the age pension and it created one of the largest pools of national savings in the world. We ought to be incredibly proud of it. Most importantly, it gave working Australians a retirement they could look forward to with financial security. Before compulsory superannuation, too many Australians faced retirement with little more than the pension. Today, millions retire with a combination of superannuation and government support and with greater financial independence.

We on this side of the House are proud to have created superannuation. We are proud to defend it whenever it's attacked by those opposite. We're proud to strengthen it at every turn and at every opportunity because we understand something that those opposite too often forget. Superannuation is not a bonus, it's not a windfall and it's not some spare change. It's deferred wages. It's income earned through hard work set aside to provide security in retirement. It should always work to serve ordinary working Australians.

The difference between the two sides of this House on superannuation could not be clearer. Under those opposite, superannuation was treated as negotiable. They froze the superannuation guarantee at 9.5 per cent for years, denying workers thousands and thousands of dollars in retirement savings over their lifetimes. They fought against increasing it to 12 per cent. They described compulsory super as a burden on business. They entertained policies that would have allowed super to be raided in ways that risk permanently eroding retirement balances. Some on their side have even questioned the very foundations of compulsory superannuation itself, including the newly minted Leader of the Opposition and the shadow Treasurer. They presided over a system where unpaid super became a systemic problem. By contrast, Labor has increased the superannuation guarantee to 12 per cent. We are paying super on paid parental leave. We are introducing payday super so that workers are paid what they are owed when they are owed it. Through this bill, we are continuing that work.

This bill is the latest part of our suite of reforms to make sure that our superannuation system remains world class. We are taking steps to make it even better, fairer and stronger. Superannuation tax concessions cost the budget more than $60 billion each year. This is not a small figure, and it is projected to grow. At this current rate, that figure is projected to exceed the cost of the age pension itself in the 2040s. That is a structural budget reality that demands responsible stewardship.

Right now, those concessions are heavily skewed towards top income earners. Thirty-eight per cent of super-earning concessions go to the top 10 per cent of income earners, and 54 per cent go to the top 20 per cent. That is not what superannuation was designed for. This bill better targets concessions where balances exceed $3 million. For 2026-27, earnings on balances between $3 million and $10 million will be taxed at up to 30 per cent. Earnings on balances above $10 million will be taxed at up to 40 per cent. Let me say this really clearly: there is no change to the taxation of earnings on superannuation balances below $3 million—none. Those earnings will continue to be taxed at up to 15 per cent. This reform affects less than 0.5 per cent of Australians with superannuation accounts. The higher rate of 40 per cent above $10 million affects less than 0.1 per cent of Australians. That's less than one in 1,000 Australians. In the vast majority of cases, even under these reforms, this will still end up being a concessional tax treatment. It's still under the top marginal personal income tax rate. The thresholds of $3 million and $10 million will be indexed to CPI. Earnings will be calculated using established income tax concepts and realised gains. Defined benefit schemes will be treated in a similar way. Superannuation funds will calculate and report relevant earnings to the ATO to ensure integrity.

So, when we hear scare campaigns claiming retirement tax grabs from those opposite, the numbers tell a different story. This is not radical. This is targeted, it's measured, it's proportionate and it reflects more than two years of consultation and feedback. This is careful policy and it is restoring balance in our superannuation system. It preserves concessional treatment for the overwhelming majority of Australians and it recognises that, when balances reach $5 million, $8 million or $12 million, we are no longer talking about retirement adequacy. We are talking about wealth accumulation supported by large taxpayer subsidies. Taxpayers are entitled to expect that those subsidies are proportionate, fair and reflect a reasonable boundary. The superannuation system must remain credible for the prosperity of Australians, and credibility depends on fairness. When concessions grow without limits at the very top, public confidence in the system erodes.

But fairness is not only about what we better target at the top. It's about who we lift at the bottom as well. We are strengthening the low-income superannuation tax offset, the LISTO. We are increasing it from $500 to $810, and we are lifting the eligibility threshold from $37,000 to $45,000 from 1 July next year. Without LISTO, some low-income earners effectively pay more tax on their superannuation contribution than they do on their wages. This undermines the whole purpose of concessional rates of tax for superannuation. This isn't fair or aligned with the principle of concessional treatment. This reform corrects that. This reform ensures low-income workers receive a fairer concession, coming at the same time as the government's third round of tax cuts this next year.

Under this Labor government, Australians are continuing to earn more and keep more of what they earn. That principle applies here as well. Put into real terms, workers will receive up to $810 per year into their super, and the average increase will be at about $410. Over time, that would mean about $15,000 more at retirement. From 2027 to 2028, over 770,000 additional Australians will be eligible for LISTO. Around 490,000 Australians will receive a higher payment and, in total, 3.1 million Australians will be eligible for LISTO. Around 60 per cent will be women. That's around 750,000 women who will benefit. Around 550,000 young Australians will also benefit. Many of the people benefiting from LISTO—this increase—will be those who are working and juggling family and caring responsibilities. There are 14 times as many people who will benefit from this boost to LISTO as there are people with more than $3 million in super—14 times as many people will be better off.

Ultimately, this legislation is about protecting and strengthening the integrity of superannuation. We believe super belongs to everyday Australians. Under Labor, it is improved, safeguarded and anchored to its purpose. Under the coalition, it was undermined, weakened and questioned. We strengthen superannuation; they stall it. We lift retirement incomes; they freeze it. We make sure that super works for each and every Australian. They want to transform it into a wealth accumulation tool for the privileged few. This bill draws that difference clearly. This is not radical reform; it is responsible and fair reform which supports hardworking, ordinary Australians—predominantly women and young Australians—who deserve a fairer deal. Labor built superannuation, Labor are strengthening it with this bill and Labor will always defend it from those who seek to undermine it because we are proud of our superannuation system.

In 2009 I was part of an Australian volunteer program working for a Chinese NGO. As part of that program, I got to deliver a talk to a range of people in China, including Chinese government officials and people working in the NGO sector, about Australia's three-pillar retirement system of the age pension, private savings and, key to all of it, the superannuation system. I was extraordinarily proud to talk about the advancements that we have made when it comes to retirement incomes. Subsequent to that presentation, I was then invited to talk about it at an ageing conference at Montana university in the United States.

This is an example of great policy entrepreneurship that Australia developed many decades ago that is being looked at by other countries around the world and is being adopted. We are proud of that legacy. We will continue to strengthen that legacy. I look forward to the coalition getting on board with finally recognising the importance of the superannuation system.

Angie Bell (Moncrieff, Liberal National Party, Shadow Minister for Youth) Share this | Link to this | Hansard source

The member for Reid says that this is not radical policy reform, but how is moving the goalposts on Australians' superannuation accounts not radical policy? It undermines certainty in the whole system of superannuation across Australia. The Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2016 is a bill—make no bones about it—that goes to the heart of Australians' retirement savings, to the trust that they, or you, place in this parliament, in this 'all roads lead to tax' government that we now have running our country, and to the principles that have underpinned our tax system for generations. We know that the more you tax, the less you get. The government spin about earning more and keeping more of what you earn evaporates when inflation goes up, by the way—it's gone; it's all spin and no substance.

Let's be very clear, from the outset, that the coalition and community pressure forced Labor to abandon its most egregious elements: the taxation of unrealised gains—that's paying tax on money that you don't actually have; that's how dangerous this so-called non-radical reform is—and the freezing of indexation. The government has been found out, and it's now retreating under pressure. It was not of its own volition that it reconsidered these measures. It was because of sustained scrutiny from this side—from the coalition—from the superannuation sector, from small-business owners who hold up this country, from financial experts and from Australians who understood instinctively that something was deeply, deeply wrong. This was not simply a proposal aimed at hurting retirees; it was aimed at hurting young people, the future of our nation. It was quietly stealing from younger Australians without their knowledge or consent in the future. I give warning to all young Australians: this Labor government was going to tax you at that level. It sought to change the rules of the game for retirement savings in a way that would have echoed for decades.

In the course of this debate, we also expose what appeared to be a clear breakdown between the Prime Minister and his Treasurer—a lack of clarity, a lack of unity, a lack of principle in the design of this policy. The original proposal to tax unrealised gains represented a fundamental break with longstanding principles of the Australian taxation system. Australians have always understood a simple truth: tax is paid on income realised. That makes sense to Australians, doesn't it? You pay the tax when you've actually earned the money. In other words, you don't have to sell your house in order to pay a tax that the government is wanting to collect. You can see how retrograde that is. Australians have always understood that simple truth, to tax when a gain is crystallised, when cash is actually in hand. To propose taxing paper gains—not real gains, gains that are on paper, gains that exist only on a balance sheet and can evaporate overnight, particularly in volatile asset classes—was not a minor tweak. This is not a minor tweak. It was a structural shift that they were proposing. It would have set a dangerous precedent across the entire tax base. It's not modest reform.

Equally concerning was the government's refusal to index the $3 million threshold. In an inflationary environment that's about to get more inflationary, made worse by this Treasurer's willingness to pour debt petrol on the inflation fire, failing to index thresholds is a silent tax hike in itself. This government is addicted to spending, and it will tax in order to spend. That means the government will come after your money when it runs out of your money. Over time, more Australians would have been captured not because they were wealthier in real terms, not because they'd become tycoons, but because inflation eroded the value of the threshold. That is bracket creep by design. That is what 'bracket creep' means. That is flawed policy in itself, and if it wasn't flawed policy, then it was a sneaky trick to take more of Australians' hard-earned savings.

The government's backdown demonstrates one thing clearly: this was never settled policy grounded in principle. It was a blatant revenue grab that collapsed under scrutiny. At the last elections Australians were not presented with a policy on tax to unrealised gains on superannuation. They were not told that longstanding superannuation settings would be fundamentally altered. They were not warned that indexation would be stripped away. Promises matter in a democracy. Major structural tax changes should be put clearly and transparently to the Australian people. Instead, this proposal appeared out of nowhere, with limited consultation and a rushed legislative timetable.

Australians instinctively understand when something has been slipped in without their consent. You can't get much past Australians. They know when they can smell a rat, and when it comes to retirement savings, their nest eggs built over decades of hard work—decades and decades of hard work, sacrifice and deferred consumption—the bar for legitimacy must be higher. We were promised by Labor and by this Treasurer that inflation had been beaten—remember that? We're on the other side of inflation now! We were promised that high interest rates were under control—remember that? Then interest rates went up again. We were told that life would be easier for families around this country. We were promised a $275 reduction in our electricity bills. How did that work out for the government, with electricity prices up 40 per cent? Instead, families have had less flexibility, less choice and more and more and more pressure piled on them by this government's mismanagement of the economy. It's harder to pay the mortgage, it's harder to pay the bills, it's harder to pay the energy costs, it's harder to make ends meet.

The fact of the matter is inflation is high and interest rates are high and have been beaten by this Treasurer and this government. Inflation and interest rates have beaten the government; the government hasn't beaten them, which is what it's supposed to do for all Australians. When the government overspends and loses control of inflation, it starts looking for new revenue sources. So they're addicted to spending, perhaps there are fewer people working, so there is less tax coming in. So then they've got to find other ways of getting money in so that they can send it out into the economy and push inflation up.

It is not only the coalition that have raised concerns. Prominent voices from Labor's own ranks, from within their own ranks, warned against this approach. When Sally McManus, Bill Kelty and Paul Keating say this is a bad idea, that means it's probably a pretty bad idea. Sally McManus said it must be indexed and warned that without indexation people would eventually be captured. Three million dollars in super doesn't sound like much now. But think 10 or 20 years ahead to when young people will retire, and then it is a big problem, because that's probably how much you will need to retire at that time.

Bill Kelty called taxing unrealised capital gains bad policy and said it would distort income flows and undermine superannuation itself. Paul Keating, the architect of the system, warned that workers would be caught up. Industry suggests that up to 1.8 million people could eventually be impacted. Small businesses were rightly alarmed. So many Australians who own small businesses hold their assets in their superannuation. This proposal would have forced complex liquidity decisions and would have potentially compelled asset sales based on paper gains. What does that mean? It means you have to sell something to pay the bill. You have to sell an asset that you've worked for your whole life to pay a tax bill.

If it wasn't already clear, it is now. Labor has a spending problem, not a revenue problem. The structural issue confronting our country is spending growth that is outpacing sustainable economic growth. We need to grow the economy, not grow the spending from the government. The more they spend, the more inflation goes up. Does everyone understand that? It's a basic principle that everyone seems to understand, and pay for, except for this government. When governments spend beyond their means, they inevitably reach for new taxes to fill the hole, and that's precisely what we are witnessing. Rather than confront wasteful spending, rather than prioritise programs and rather than restore fiscal discipline, Labor has chosen to hunt for new pools of capital to tax. Trust is fundamental in tax reform.

Australians accept reform when it's principled, when it's predictable and when it's based on consultation. What they do not accept is retrospective tinkering, ad hoc changes and ideological experiments dressed up as modest adjustments. This proposal reinforces a broader pattern from the government: spend first and tax later. That is not reform; that is fiscal mismanagement at its worst, and beyond the headline changes lie new risks. The removal of the effective death tax exemption introduces uncertainty for families at precisely the moment they are most vulnerable. Surviving spouses that rely on super balances to maintain stability after the loss of a partner could face additional complexity and reduced security.

Total and permanent disability recipients must also be considered. These Australians, through no fault of their own, are no longer able to work, and their superannuation is not an abstract investment; it's a lifeline. Any change that increases volatility, reduces predictability or complicates access carries real human consequence. Tax policy cannot be designed in isolation from lived reality. When retirement income settings are destabilised, confidence in the entire system is eroded. The government points to increases in the low-income superannuation tax offset as evidence of balance. Any measure that supports low-income earners building retirement savings is of course welcome, but let us be honest about scale and timing.

The low-income superannuation tax offset adjustments do not lower grocery bills today. They do not ease mortgage repayments today. They do not reduce electricity costs today or tomorrow. Australians are facing immediate cost-of-living pressures now. A future offset adjustment in superannuation does little to relieve those stresses now. If the government is serious about helping households, it must tackle inflation now for everyone, for every single Australian. Inflation impacts your everyday spending because you get less in your shopping basket every time inflation ticks up. The government must tackle inflation at its source, not reshuffle offsets with the retirement income system.

This proposal should not be viewed in isolation. It's about enabling more spending. That's what it's about. It's about pouring more debt petrol on the inflation fire. When spending accelerates without structural reform, governments reach the limits of conventional revenue sources. They test new boundaries: thresholds left unindexed, new bases for taxation, new definitions of income. Today, it is superannuation balances above $3 million. Tomorrow? Who knows. It could be another threshold, another definition, another asset class. Is the family home next? Will Labor tax your family home when they run out of money to spend? That's a question that all Australians should be asking, because it's a slippery slope with this government. Once the principle of taxing unrealised gains is entertained, it does not remain neatly contained.

Australians deserve clarity with their investments and for their future, especially young Australians. As the shadow minister for youth, I stand up for young Australians and I say: 'Watch this government. They are coming after your money. And not just now, but into the future.' Or is it the opening chapter of a high-tax, high-spending approach to governing? What about revenue raising? It's like parking tickets and the local council, isn't it? 'Let's raise some revenue. How can we tax our constituency?' This debate, this proposal, this retreat under pressure is what life under a Labor government looks like into the future. Have a look into the crystal ball.

The coalition will always stand for a tax system grounded in principle, for retirement savings that are stable and predictable, for fiscal discipline that protects future generations rather than quietly taxing them. We forced this government to retreat once, and we will continue to hold them to account for the sake of retirees, for the sake of small businesses and especially for the sake of young Australians. Those opposite say they support our young Aussies, but the truth is that their future savings are at risk of being stolen by this big-spending, big-taxing Labor government.

Meryl Swanson (Paterson, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to speak in support of the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 and the Superannuation (Building a Stronger and Fairer Super System) Imposition Bill 2026. These bills are about fairness. They are about dignity in retirement. But before I talk in depth about those, I just cannot help but pick up on what the opposition are saying when they talk about fairness and taxation. Remember, this is an opposition that rejected both tax cuts that have been provided by this government. They voted against them. Never forget it. They are about making sure the superannuation system in Australia, the system built by Labor, is unfair.

This bill is about fairness. Superannuation is a bit like compound interest; it is one of the modern marvels of investment in the future. It builds upon itself. Superannuation is about working for every Australian. It works for millions of Australians who rely on it, not just for a very few who have extraordinarily large balances. In my electorate, very few people have more than $3 million in their superannuation accounts. Nationwide, it's about 87,000 people out of a population of nearly 29 million. I just want to say that again: around 87,000 people in Australia have a balance of more than $3 million. And good luck to them. They've worked hard and they've accrued that, but it is a very small number across a population of 29 million. It's less than half a per cent.

Superannuation provides working Australians with choices—choices as to how and where you live in retirement and how you choose to spend your retirement savings. It might be with your family; you might join the grey nomads; or you might simply enjoy the garden that you've worked on throughout your working life and will now have more time to spend in it. The Australian superannuation system is designed to ensure that your quality of life does not diminish when you finish your working life. I was 22 when superannuation was introduced as compulsory, and I'm very grateful to have been a recipient of this incredible legislation and forethought. My generation's retirement wealth has increased significantly due to this fair and significant legislation that creates a secure retirement for all working Australians.

Like all legislation though, it must be amended for the challenges and changes of our time. We have to be nimble in government, with an eye to the future too. That's why, since we've returned to government, we have increased the superannuation guarantee to 12 per cent, in keeping with inflation. We've legislated the objective of superannuation—'to preserve savings to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way'—to ensure that your personal super works for you. We've committed to paying super on paid parental leave, and that's massive. It's so that women are no longer left behind simply because they take leave to have a family and support that family. We've introduced payday super—that's such an important thing too—so that workers are paid their entitlements when they earn them, to ensure that they're the beneficiaries of those earnings from the moment they earn them. And now, through this legislation, we are better targeting super concessions and delivering more help to low-income workers. This is careful reform, it's principled reform, and it's reform that's grounded in fairness—the very basis of the superannuation system.

Let's be clear about what this bill does and, quite frankly, what it doesn't do. Balances under $3 million will continue to have earnings taxed at up to 15 per cent—exactly as they are now. I say to everyone in my electorate: have a look at the balance of your super today. To clarify, if you have less than $3 million in your super, there will be no change. This is the case, and, if you're like me, it does not change. It does not change the concessional treatment of superannuation for you, which means that you won't pay any more tax than you do now. Don't believe some of the mistruths that are being peddled around on this. It does better target concessions for those very, very few Australians who do have a very large super balance—those that have more than $3 million in their account. If this is not you, then you don't need to worry about that.

Super tax concessions cost the budget more than $60 billion a year, and that figure is projected to exceed the cost of the age pension in the 2040s. That means that those really-high-income earners with a huge amount of superannuation are paying the same tax as you. Around 38 per cent of super earnings concessions go to the top 10 per cent of income earners. That just doesn't seem right to me, and it probably doesn't seem right to those people that aren't earning that as well. Fifty-four per cent of those concessions—that's more than half—goes to the top 20 per cent of earners, and that's just not fair. If we want to ensure superannuation and a comfortable retirement for everyone, then that's not suitable either.

Put simply, superannuation was not designed to reduce the taxation of the wealthy—it just wasn't—banking their excess funds in low-taxing safety nets. That is not the premise of superannuation. It is meant to be fair. It was designed to provide a fair go for workers who work hard, pay their tax every week and strive to have a better life for themselves and their family. That is truly what superannuation is about. It's not about being a tax shelter.

For the 2026-27 income year, earnings on superannuation balances between $3 million and $10 million will be taxed at up to 30 per cent. Earnings on balances above $10 million will be taxed at up to 40 per cent. Earnings on balances below $3 million will remain taxed at up to 15 per cent. In my electorate, the number of people impacted by this measure could comfortably fit inside the front bar of the Commercial Hotel in Morpeth. Meanwhile, the benefits of a stronger, more sustainable super system flow to millions—flow to many.

That is not about punishing success either—it really isn't; good luck to those people with those big balances—but it is about making sure that the system is sustainable, designed to deliver retirement income and used for exactly that purpose. Superannuation is about providing income for a dignified retirement, not about warehousing tens of millions of dollars in concessionally taxed environments.

These changes are simply about ensuring that superannuation is used for what it's designed for and that it's not a gateway to avoiding paying your fair share of tax. Australians are a proud people. We are diverse, we are humble and we value a fair go—'fair shake of the sauce bottle,' someone once said. I want to ensure that superannuation is fair, that it works and that it remains sustainable for my children and my grandchildren—and for everyone else's in this country, to be honest. While a very small number of Australians with very, very large balances will be required to pay a minimal increase to their concession, affecting their overall wealth minimally, it will mean that those with lower incomes, like childcare workers, nurses and police officers, will receive a boost, meaning that they will be able to retire well with less reliance on the Commonwealth system.

From 1 July 2027, the low-income offset will increase by $310, from $500 to $810. The eligibility threshold will rise from $37,000 to $45,000. This will ensure that low-income workers receive a fairer tax concession on their super contribution, aligning with the government's third round of tax cuts. Remember those tax cuts—the ones that the opposition did not support and did not vote for? What does this mean in practice? It means that a worker can receive up to $810 per year paid into their super account. On average, affected workers will receive around $410 more. Over a working life, that's around $15,000 extra at retirement. That may not seem like a lot to someone who is very wealthy, but, to someone who isn't wealthy, $15,000 can be a game changer. It can be the difference between choosing to turn on your air conditioner on a 40-degree day and upgrading to solar power to reduce your electricity bills. In communities like mine, $15,000 can mean the difference between financial stress and financial stability or between relying entirely on government support and having a little bit of your own savings to draw on.

We also need to acknowledge that there is a gender gap in super. Women retire with significantly less super than men, often because part-time work and time out of the workforce caring for children or elderly parents make their average wages lower. By boosting the income offset, paying super on paid parental leave and strengthening the system overall, we're addressing structural inequality. This is not just economic reform; it is social reform, and it's important. It recognises that care work, paid and unpaid, has real value—and I want to thank the women in my community who do so much work that goes unpaid. It ensures that women who have contributed so much to our families and our communities aren't left behind in retirement. Women in their 50s are the most likely to become homeless in Australia and are the most likely to find it difficult to find work in our ever-changing times. Their super balances are significantly smaller than their male counterparts. If all is okay, it is likely that they will be working into their 70s to ensure their super balances will sustain them, yet they're the most likely to have worked full time since their teens. Most have done unpaid work, and many have volunteered more than most. We can fix this for future generations, and therefore we should. And it's really that simple.

If we're serious about protecting superannuation for future generations, we must ensure its sustainability. Tax concessions are a form of government support, and, like all government support, they should be targeted where they are needed most. 'Self-funded' can be an oxymoron if, by that simple term, you are forgetting that tax concessions are in fact a form of support. Let's not sugar-coat that. I want nothing more than to be a self-funded retiree and pay my fair share, and I want other generations to be able to do that too. I'm Labor like that; I believe in fairness. You need to work hard and pay your way, but you should get what you're entitled to as well. That's what we believe in. This bill does this. It preserves concessions for everyone saving for retirement, it improves equity by reducing concessions for a very small number with extremely large balances and it strengthens the budget in a responsible way, because, if we don't take measured and sensible action now, the cost of super concessions will continue to balloon, placing pressure on future budgets and limiting our ability to invest in essential services. We can support retirement incomes, we can support fairness and we can support fiscal responsibility all at the same time. That is what this legislation does. It ticks all the boxes of what it means to be Australian: proud, fair and generous.

When I speak to people in my electorate, they don't ask for special treatment. They ask for fairness. They ask for security. They ask for the opportunity to retire with dignity after decades of hard work. And, let me tell you, in my seat I've got some of the hardest working people in some of the toughest industries that generate the most income and wealth for our nation. I see them driving to work and doing that work every single day, and I respect them for it. This legislation reflects my values and it reflects their values. They are, largely, Labor values. These values mean that the system should work for ordinary Australians, that concessions should be targeted fairly, that women and low-income earners deserve support and that sustainability of the system really matters over the long term.

Superannuation is one of the greatest achievements of modern Australia. It has transformed the retirement of millions and, quite frankly, those superannuation funds have changed the trajectory of the investment of our nation as well. They are an incredible wealth for our country. We must continue to refine it and strengthen it, to ensure that it serves its core purpose.

These bills do exactly that. They deliver more help to more people. They better target concessions. They strengthen equity. They safeguard sustainability. For the factory worker, for the aged-care worker, for the young apprentice working to be a tradie, for the enrolled nurse, for the hospitality worker, for the shiftworker, for the miner, for the part timer and for the casual, these bills are changing Australia for the better. It's a reform that builds a stronger, fairer super system and I commend it to the House.

Colin Boyce (Flynn, Liberal National Party) Share this | Link to this | Hansard source

I rise to make a few brief comments on the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026. Instead of regurgitating all the talking points that we all get given on both sides of the House, I would like to draw my comments from some personal experiences in my life as a businessman, and what it actually means for real Australians.

The biggest issue that most Australians face at the moment is what we loosely term the cost-of-living crisis. The fact is that our grocery bills are going up, our electricity bills are going up, our insurance bills are going up and the cost of educating our children is going up. These are all issues that average Australians have to deal with on a daily basis. To me, the reality of that is that it is all, literally, connected to energy policy. As the price of energy goes up, businesses and so forth pass their costs on to the consumer. The people who work in these businesses, the wage earners and so forth, are the ones who are suffering most when it comes to having to pay their daily bills.

Way back in the early nineties, then treasurer Paul Keating introduced the superannuation regime, which we now live under. It has got good merit and good principle. However, Mr Keating is on the record that he does not support the changing of these superannuation tax proposals by the government. I'd like to make a few comments in respect of the taxing of unrealised profits on superannuation, which has now been abandoned by the Labor government. That had huge ramifications for people's lifetime savings. How can you possibly tax something that people haven't got? That's the reality of it. Why are we changing and shifting the goalposts on tax policy and financial strategy that average Australians have used over their lifetime to build wealth for their retirement? That is why a lot of people are seriously concerned about where this is going.

Many of the speakers from the other side have pointed out in their contributions that this will make it fairer for the low-income earners and the average Australian. That is arguable, but I would argue that, with inflationary pressures and interest rate pressures, which were all brought about by the financial mismanagement of the government, that will erode any sort of gain that they could possibly get. The old adage is: when the government runs out of money, they're going to come after yours. If you have built any sort of a wealth nest egg in your lifetime, that is what they're coming after. I understand that it is a small percentage of people in Australia, who are deemed to be wealthy—one per cent, I've heard some of the speakers say. Well, that's all very well, but the reality is: why should those people have to suffer further and higher tax costs because they played under the rules and under the system?

What the government is proposing to do is tax over-$3 million thresholds at a rate of 30 per cent and over-$10 million thresholds at a rate of 40 per cent. That is an extraordinary rate of tax in this day and age. I came to work this morning and on the bridge down there where we all drive past in the cars when we come to work was a big sign from one of the protesters—'tax wealth, not workers'. That, to me, says that people who are wealthy don't work, and nothing could be further from the truth. People who accumulate wealth over their lifetimes, you will find, are extremely prudent and hard workers. They are people who have managed the system. They've invested wisely in our capitalist society that we all live under. They are the ones that should enjoy the rights and benefits that that provides, not somebody else. That is what this government is doing, as I've said—when they run out of money, they come after yours. A government who has bad fiscal policy, has bad monetary policy and is overseeing increasing inflation and increasing interest rates will take away any gain that the lower-income earners might get out of this 'fairer and stronger' system that the government is proposing. I put it to you that this whole idea that this is going to make it better for the average Australian is nonsense.

Claire Clutterham (Sturt, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to speak in support of the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026. Australia's superannuation system is a savings system for retirement, and it is the envy of the world. It has a simple foundation. Over your working life, your employer puts money on top of your wages into a super account which stays invested until you retire. It's pretty clear: the more savings you've invested, the more you have to live on in retirement.

As of 1 July 2025, the minimum amount—called the superannuation guarantee—is 12 per cent of an employee's wage. Our national superannuation rates have increased from three per cent, when the modern super system was established in 1992, rising incrementally to nine per cent by 2002 and then significantly higher in July 2025.

There are two main reasons super is such a powerful way to save for retirement. Firstly, it is taxed concessionally at a lower rate than other forms of taxable income. Secondly, super is reinvested and compounds over time, meaning that, in some cases, up to 75 per cent of the final balance at retirement has been generated by earnings rather than employer contributions.

Super was created to boost the financial security of Australians in retirement. Its objective, as stated in section 5 of the Superannuation (Objective) Act 2024, is:

… to preserve savings to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way.

It's now compulsory, but it wasn't always so. In the 1970s, most Australians relied on the aged pension in retirement, and only about one-third of the workforce, mainly public servants and white-collar males, received super. It wasn't portable, and the payment was restricted to workers who retired with the employer controlling the fund. In the 1980s, the Australian Council of Trade Unions began a concerted effort to extend the benefits of superannuation to their members, which included blue collar workers, and a concerted effort to ensure that contributions were well managed and governed in funds that were designed to benefit members.

When the Hawke Labor government took power in 1983, they had as a key objective the creation of a universal superannuation system so that all Australians, not just some, could benefit. Labor is and always has been the party of working Australians, and benefits to workers after they conclude their working life are a natural extension of this. A decade later in the early 1990s, the superannuation guarantee was passed, and all workers became entitled to minimum superannuation rates of three per cent. Coverage grew over time, and by 2019 national superannuation coverage increased to just under 80 per cent. Today it is over 90 per cent.

Super is now the key driver of retirement savings. It's there together with the aged pension and personal savings and assets, but it's the key driver. All three of these pillars work together, and there will be a different mix for everyone. But super not only provides the bulk of retirement savings. It boosts living standards and drives investment. Other features in place to make it equitable and sustainable in accordance with its objective include tax concessions and the practice of paying super into employer default funds, all of which must be MySuper compliant. This is important so workers who are perhaps not financially literate or just not interested—and there are some—still receive employer contributions. Stapling and performance benchmarks set by the Australian Prudential Regulation Authority are also key elements underpinning the integrity of the superannuation system together with the equal representation model, where profit-to-member boards comprise an equal number of employer and worker representatives, keeping a focus on the best interests of members.

Super in Australia is good policy and good politics. It is essential that the objective of super remains front of mind and that improvements and adjustments are made fairly and transparently to further those critical objectives of equity and sustainability. At its heart, this bill speaks to the objectives by making Australia's super system stronger by examining those foundational principles of equity and sustainability. In terms of equity, the bill operates to boost the low-income superannuation tax offset, or LISTO, so low-income workers receive a fairer tax concession on their super earnings. From July 2027 the maximum LISTO payment will increase by $310 to $810, and the eligibility threshold will increase from $37,000 a year to $45,000. The number of low-income workers, mainly women, who are eligible for LISTO, will increase to over three million working Australians, with each of those receiving an average LISTO increase of $410, resulting in an average extra $15,000 in retirement. This will depend, of course, on the trajectory of the person's career, but an extra $15,000 will make a difference. Importantly, the LISTO eligibility threshold and maximum payment amount will automatically adjust in line with any future changes to income tax thresholds and the superannuation guarantee rate.

Another key feature of this bill is the reduction of tax concessions available to people with balances over $3 million. This feature can be found in schedules 1 to 3 of the bill. Under this arrangement, the headline concessional tax rates applying to superannuation earnings are as follows. Firstly, for superannuation balances up to $3 million—that's almost every single working Australian—the concessional tax rate will remain at 15 per cent on earnings. This is unchanged. Secondly, for superannuation balances between the $3 million large superannuation balance threshold and the $10 million very large superannuation balance threshold, it's up to an overall 30 per cent on a percentage of earnings equal to the percentage of the individual's total super balance between these thresholds. Thirdly, for superannuation balances above the $10 million very large superannuation balance threshold, the rate is up to an overall 40 per cent on a percentage of earnings equal to the percentage of the individual's total superannuation balance above $10 million.

The amendments in schedules 1 to 3 reduce the tax concessions by imposing additional tax of 15 per cent on earnings based on the percentage of the total superannuation balance exceeding the $3 million threshold and a further 10 per cent on earnings based on the percentage of the total superannuation balance exceeding $10 million, with the thresholds being indexed to CPI each year. We've heard statistics quoted in this House today that this will affect about 0.5 per cent of the working Australian population.

This bill is instructive of the way governments seek to maintain sustainability and equity. The difference in financial position between someone with an annual taxable income of $45,000 and someone with a total superannuation balance of $3 million or $10 million is stark. Whatever bucket you fall into or whether you fall somewhere in between, like most Australians, you've worked hard to get there, and the government respects that. You've worked hard to build a nest egg of whatever size to seek to provide for yourself in retirement and to enjoy a retirement as dignified and fulfilling as possible. The government respects that and, in crafting this bill, respects that but also, in this instance, places the weight of sustainability and equity of the superannuation system on those best placed to bear it.

Risks and burdens are part of equity and sustainability and should be borne by those best placed to manage them. That is the fairest way to ensure the sustainability of our superannuation system. Managing risks and burdens is an essential consideration in every aspect and in every transaction, because risk determines whether a transaction is viable, and it is always a component of the total overall cost of any transaction. The effective allocation of risks and burdens reduces the likelihood of failure. Poorly or unfairly balanced risk allocation, by contrast, can increase cost, deter participation, lead to unintended consequences and frankly defeat the purpose of the objective—in this case, a dignified retirement for all Australians founded on equity and sustainability. Systems and transactions can never be completely devoid of risks and burdens entirely, but these can be managed intelligently if the aim is to fairly allocate each risk to the party best placed to control it or bear it.

When this reform to large and very large superannuation balances was being floated, I was contacted by a small but concerned group of individuals in my electorate of Sturt who had concerns with initial suggestions that earnings on large and very large thresholds would not be indexed and that unrealised gains would form the basis upon which the new headline concessional rates would be applied. I thank those residents who wrote to me and came to see me for a number of reasons. Firstly is for civic engagement. My door is always open to people who wish to share feedback and have a constructive, courteous and professional discussion with me, and pleasingly that was the tone of every discussion that I had on this topic.

Secondly, I thank those residents for explaining patiently the genuine consequences—what might happen—if their concerns were realised, and the genuine arguments against some of the initiatives that were being floated. I listened to those and passed those concerns on, as did a number of my colleagues, which has resulted in a bill that is fairer, is built on solid principles and is justifiable. That is civic engagement at work.

Thirdly, what really struck me in all of these conversations that I had, particularly with two gentlemen, Paul and Nigel, both of whom had built successful careers and businesses—along with others who came to see me, they absolutely understood and in fact accepted that they were best placed to bear the risks and burdens associated with the ongoing equity and sustainability of the superannuation system. Did they love extra tax on their large super balances? Of course they didn't. But they understood and accepted the rationale for it. And this came across to me very clearly in every discussion I had and in most of the email correspondence that was sent to me on this topic.

Many speakers in this House have spent most of their time talking about unrealised capital gains and the lack of indexation. They have asked a lot of questions about that, instead of spending their speaking time discussing what's actually in this bill. What's not in the bill is the taxing of unrealised capital gains. It's not there. What is in the bill is indexation of thresholds. That is there. So neither of those concerns remains justifiable; they are not in the bill.

This bill is the product of genuine consultation with communities like mine, and it reflects the collective spirit of Australians who want to see the superannuation system become stronger and even fairer so that it continues to deliver a more secure retirement for millions of working Australians today and into the future, and not just some working Australians. Of the three pillars of retirement savings in this country—the age pension, super and personal savings and assets—super needs to be maintained as the driver, and this bill is part of the reform necessary to further the objective of an equitable and sustainable system, providing all working Australians with a dignified retirement. I commend the bill to the House.

Scott Buchholz (Wright, Liberal Party, Shadow Minister for Skills and Training) Share this | Link to this | Hansard source

To my fellow Australians: in speaking on the Treasury Laws Amendment (Building a Stronger and Fairer Superannuation System) Bill 2026—for those in the gallery, I want to draw your attention to the very carefully crafted title of this bill, and I want you to focus on the word 'fairer'. I'm going to make a contribution, and I'm going to ask you to adjudicate from the gallery as to whether or not, at the completion of my small contribution, you think that you can make a judgement—let's pretend you're going to be down here voting on this bill—that this is in any way fairer. That's what I'm going to ask you to consider.

I know from a business perspective, having been a business owner before coming to this place, that only too often, when the Australian Labor Party run out of their money, they'll come looking for yours. Superannuation is one of those little buckets that is just too tempting to those on the other side for them to keep their hands off it. You were promised, with the creation of super—your wealth, your money—that it would stay with you and it would never be raided. What you are not hearing from those on the other side during this debate is that this bill is a revenue raiser, and its intention is to raise over $2 billion in the forward estimates. They are snipping at your superannuation and they are masking it as being fair. 'It's fair to take your money. It's fair to raid the superannuation system. It's just fair.' I tell you this is anything but fair. A good opposition is vital because, if they had had their way, it would have been much, much worse.

The largest contributor to GDP in my electorate is agriculture. They're humble people—sophisticated with technology use, but humble people. I'm going to give you an example of what would have happened if it weren't for us intervening. I'm going to give you an example of a simple farmer, Joan, whose husband, Ron, passed away. She's got a couple of boys and they have a small 100-acre farm. The farm was handed down to them from Joan's husband and, before that, it was Ron's parents' farm. There are many stories like this across my electorate. Those opposite will have you believe that it only touches half a percent, that it's only the rich and the extravagant that are going to be affected. A couple of years ago that farm was worth about $1 million. Today it's worth over $3 million. Back in the late eighties, there was an accounting practice in the district where the accountants dealt with succession planning for farms and transferring family assets. They put stuff into self-managed super funds. Joan was going to get caught out here; this was an unintended consequence of this bill until we made sure that it was retracted.

They farm their 100 acres. They grow potatoes; they grow carrots—it's very labour-intensive. They've got high input costs with fuel, fertiliser, water and irrigation licensing. They drive old machinery because there is not enough money, after they pay their expenses, to update the machinery they have on the place. It's ageing, as the margins from the retailers become less and less. They have a net profit of about $50,000 a year after expenses, but they're asset rich. They have an asset in their self-managed super fund which is $3 million. If your place used to be worth $1 million but is now worth $3 million, that's $2 million in unrealised capital gain. Under this bill, these guys are saying: 'Let's clip your ticket, and we're going to do it under the presumption of fairness, because it's fair for us to take your money. In fact, we're going to take that capital gain. We're going to tax it at the rate proposed in this bill, which is 30 per cent—$2 million at 30 per cent is $600,000. Write out a cheque to the tax office.' Labor is calling that fair!

Where does Joan get the $600,000 from? She doesn't have it; she earns $50,000 a year. She's flat out putting food on the table. She's not eligible for any Centrelink payments or any government support because she doesn't meet the asset test, so the only thing she can do is sell the farm. 'But it's only half a per cent; wave it through. Don't worry, because we're doing it under the auspices of fairness.'

It reminds me a poem, 'First They Came' by the Lutheran pastor Martin Niemoller. This is an adaptation of his very famous poem:

First they came for the rich, and I didn't speak out—because I wasn't rich.

Then they came for the self-funded retirees, and I never reached out—because I wasn't a self-funded retiree.

Then they came for the trusts, and I never spoke out—because I didn't own a trust.

Then they came for the working class, and I never spoke out—because I wasn't working class.

Then they came for me—and there was no-one left.

The original poem was penned almost a hundred years ago, but it's still very salient today when we look at the fairness test of what this government is building. They're running out of money. It's a revenue-raising bill. It creates $2 billion over the forward estimates. At face value, they're saying, 'Only the wealthy are going to pay for this, and we call that fair.' At the same time, they're spending.

My advice to the Labor Party is don't bring to this place bills that cost people money. Bring to this place spending reductions. Spending has expanded under this government to around 26.4% of GDP. That's over $727 billion in total payments, well above the long-run average. That means they are spending at a rate much greater than previous governments. And what's happening?

There's a thing called structural spending. The spending happening under their watch is what economists would refer to as spending that is being baked into our system. That cannot be unpicked. That's spending on things like the National Disability Insurance Scheme, health costs and interest costs. They continue to outpace the revenue that we are bringing in in the form of receipts. So, it is incumbent on them to bring bills to this House that raid your superannuation to compensate for their incompetent spending, and they're disguising it as being fair.

The coalition and the community pressure forced Labor to abandon the taxation of unrealised capital gains. That's something that we're extremely proud of. This is a government that's been found out and is now retreating under the pressure, thanks to sustained scrutiny from our opposition, from the superannuation sector, from the small-business sector and from everyday Australians. We forced Labor to step back from the most outrageous elements of this proposal.

This was not a proposal that was just aimed at hurting retirees. This was aimed at hurting future generations, stealing the future of a young Australian away from them without their knowledge or even their understanding. The original design to tax unrealised gains represented a fundamental break with longstanding principles of the Australian tax system. To propose taxing paper gains, particularly in volatile asset classes, was not a minor tweak. This was a structural shift that would have set a dangerous precedent across the entire tax base. This was a desperate government, running out of money, looking for ways to create new revenue streams.

In an inflationary environment being made worse by this Treasurer, and his willingness to pour debt petrol on the inflation fire, failing to index households was a straight-out silent tax hike. Over time, more Australians would have been captured, not because they were wealthier in real terms but because inflation eroded the value of the threshold and the bracket crept by design. It's flawed policy. Basically, we made sure, with the support of some Labor luminaries, in the way of Bill Kelty, Paul Keating and Sally McManus—none of them suggested that the indexation on that $3 million should not be adjusted. It wasn't a flawed policy. It was a sneaky trick to make more money and to capture hardworking Australians.

At the last election, Australians were not presented with a policy to tax unrealised capital gains in super. They were not told that longstanding superannuation settings would be fundamentally altered. They were not warned that indexation would be stripped. Promises matter in a democracy. Major structural changes should be put clearly and transparently to the Australian people. Instead, this proposal appeared out of nowhere, with limited consultation and a rushed legislative timetable.

I remember, early on, Labor had a round table. The best and brightest minds were brought. I don't remember this being an outcome of those best and brightest minds, where we say: 'Let's raid super. Let's raid the wealthy. Let's call it a robin hood tax and take from the wealthy and give to others.' It's disguised as that, but really it's a revenue raiser.

We have a government that can't be trusted. We were promised by Labor—by this treasurer—that they'd beaten inflation and high interest rates. Well, that's not the case. The inflation dragon is breathing down their necks. Normally, from a business perspective and for most on this side, we have buffers in our businesses. We have retained earnings. When things get tough and when economic choppy waters present themselves, as they do through the economic cycle—whether it's every five years, seven years or whatever it might be, you can predict when you're going to have those choppy waters—prudent businesses make sure they've got capacity to deal with those choppy times.

Well, fellow Australians, can I say that there are choppy times in front of us in the international geopolitical space in the Middle East, and we should have a management that has got that capacity to deal with the buffer. Instead, we have a very poor government whose economic rationalism is to provide the Australian public with deficits as far as the eye can see. That doesn't mean a lot to people who don't think they're going to have to pay the money back, but I'll tell you how it affects you when you're backing a government that has got deficits as far as the eye can see.

There's an inconvenient truth that one day the people that we borrow our money from want that money back. The interest rates also get higher and higher and higher. To tickle my fellow Australians' interests as to how much interest we're serving on debt at the moment, it's just under $30 billion a year. As that debt gets higher, that interest component gets higher. When you say, 'Well, that debt doesn't mean anything to me,' it may not mean anything to you until you're not getting that hospital or until you're not getting that road. This is a government who has lost its way when it comes to bringing fairer legislation to this House. I'd ask this government to rethink.

Jo Briskey (Maribyrnong, Australian Labor Party) Share this | Link to this | Hansard source

This legislation is about a promise. It's about a promise that, after a lifetime of work and after years of showing up, contributing, caring for your family, volunteering in your community and paying your taxes, you retire with dignity—not just scraping by and not just surviving, but secure, independent and able to enjoy the years you've earned. That promise has a name. It's called superannuation, and it exists because Labor made it law.

Before compulsory superannuation, retirement security in this country was not universal. It was selective. If you were in the right job with the right employer or born into the right circumstances, you might retire comfortably. If you weren't, you retired almost entirely on the age pension. Labor believed working Australians deserved better than that, so, in partnership with the union movement, Labor built a system that changed the country. We made retirement savings a right, not a privilege. We embedded the principle that every worker, no matter their industry or income, should accumulate savings in their own name. It was one of the great nation-building reforms of modern Australia.

Like all great reforms, it must be maintained, protected, and, when necessary, refined. That is what this bill does. It strengthens the integrity of the system and better targets concessions so they flow where they are actually needed. It lifts support for low-income workers and ensures the long-term sustainability of a system that is now one of the largest pools of retirement savings in the world. This is not radical; it is the next chapter in a proud story.

Since coming into office, this government has treated superannuation as the national asset it is. We lifted the superannuation guarantee to 12 per cent, which delivered on what working Australians were promised. We enshrined the objective of super in law to ensure it remains focused on providing income in retirement—not being distorted for other purposes. We legislated superannuation on paid parental leave, because women should not be penalised in retirement for having children, and we are delivering payday super so workers receive their contributions at the same time as their wages. This ends the quiet scandal of unpaid super that has cost Australians billions. This bill continues that work, but let us be honest about why it's necessary.

Superannuation tax concessions now cost the budget more than $60 billion every year. Treasury projections show that without reform that figure will overtake spending on the age pension within two decades, and those concessions are not evenly distributed. About 38 per cent of super earnings tax concessions flow to the top 10 per cent of income earners, and 54 per cent flow to the top 20 per cent. That means more than half the benefit goes to the highest earners. Meanwhile, millions of Australians with modest balances—the very people this system was designed to serve—receive only a small share. That's not balance, that's not fairness, and that is not sustainable. A system built to deliver dignity in retirement should not become a vehicle for a very large tax preferred wealth accumulation at the top end. This bill restores that balance.

From 2026-27, earnings on superannuation balances between $3 million and $10 million will be taxed at up to 30 per cent. Earnings on balances above $10 million will be taxed at up to 40 per cent. Even at those rates, super remains concessionally taxed—below the top marginal income tax rate. These are still concessions. They are simply better targeted. It is critical to say clearly that nothing changes for the overwhelming majority of Australians. Balances below $3 million will continue to have earnings taxed at up to 15 per cent, which is exactly as it is now, but thresholds will be indexed over time. The people affected by this change represent less than half of one per cent of Australians with superannuation accounts at the $3 million threshold and less than one-tenth of one per cent at the higher threshold. So, for 99.5 per cent of Australians, there's no change at all.

In my electorate of Maribyrnong, the numbers tell a very clear story. The median super balance is about $69,000. For residents approaching retirement, those in their 50s, the median is approximately $192,600. These are hardworking people: retail workers, carers, teachers, tradespeople, office staff and small-business employees. They have contributed consistently over decades. They are not sitting on multimillion dollar balances. They are building what they can—often while juggling mortgages, rent, school fees, caring responsibilities and rising living costs. They deserve a system that protects their savings, not one that directs disproportionate concessions to accounts holding more than most Australians will ever accumulate in total wealth.

This bill ensures that the public support is directed where it makes the greatest difference. That includes strengthening support at the other end of the income scale, because this is about making sure our system is not only sustainable but fairer from top to bottom. The low-income superannuation tax offset, LISTO, exists to ensure that low-income workers do not pay more tax on their super contributions than they do on their wages. Under this reform, the maximum LISTO payment will increase from $500 to $810. The income threshold will rise to $45,000 from July 2027. That means there's more support for people who need it most. These are not abstract policy adjustments; they are tangible improvements in the retirement savings of real people.

In Maribyrnong, more than 7,600 low-income earners are expected to benefit from these changes, and nearly 70 per cent of those payments will go to women. That matters, because the gender super gap remains one of the most persistent economic inequalities in Australia. It reflects a lifetime of structural disadvantage, lower average wages, higher rates of part-time work, career interruptions for caring responsibilities and historical inequities in pay. Women retire with significantly less super on average than men. That is not a reflection of effort; it is a reflection of inequality. The government is addressing this directly through LISTO, through paying super on paid parental leave, through closing the gender pay gap and through strengthening secure work. Each measure matters on its own, but together they begin to shift the trajectory.

There is another critical reform embedded in our broader superannuation agenda: payday super. Too many workers have been short-changed. Unpaid super is not a technical glitch; it is wage theft by another name. In Maribyrnong alone, more than 23,000 workers were underpaid super in a single year, losing around $35 million from their retirement savings. That is $35 million that should have been compounding for their future. By aligning super payments with wages, payday super closes the loopholes that have allowed contributions to be delayed, avoided or quietly lost. It strengthens enforcement, it restores trust and it ensures that what workers earn is what they actually receive.

There has been opposition to these reforms. This is not new. The history of superannuation in this country is a history of Labor building it and those opposite opposing it. When compulsory super was introduced, it was opposed. When the superannuation guarantee was increased, it was opposed. In 1996, the Howard government froze the scheduled increases. In 2014, the Abbott government froze them again, arguing that money would flow into wages instead. Shock, horror, it didn't. Wages did not rise to compensate, but retirement balances were permanently lower. Independent analysis at the time estimated that freeze cost the average worker thousands of dollars in retirement savings. Then, during the pandemic, the early access scheme allowed Australians to withdraw up to $20,000 from their super. Around three million Australians accessed the scheme; approximately $38 billion was withdrawn. For many people facing immediate hardship, it was a difficult but understandable decision, but the long-term cost is real. More than half a million Australians reportedly withdrew their balances to zero. For young workers especially, that means decades of compound growth lost. That means lower retirement savings and higher reliance on the age pension in the future.

Superannuation is not a rainy-day account; it is long-term savings designed to compound over a lifetime. When we treat it casually, the consequences echo for decades. Even now, there are calls to weaken the system. There have been suggestions of cutting the superannuation guarantee and proposals to allow large withdrawals for housing deposits—arguments to dilute the objective of super. Each proposal chips away at the same principle—that superannuation exists to provide income in retirement. Labor rejects that erosion. We believe that superannuation is a pillar of both personal dignity and national strength. It reduces pressure on the age pension, it funds long-term infrastructure investment, it gives millions of Australians a direct stake in our economy and it gives individuals independence in retirement. These bills strengthen that pillar. They say clearly that superannuation concessions are designed to support retirement income, not unlimited tax preferred wealth accumulation. They ensure sustainability, they improve fairness and they protect the integrity of the system for future generations.

When I speak to people in Maribyrnong, they're not asking for special treatment; they're asking for fairness. They're asking for a system that protects their contributions, a system that does not tilt towards those already at the very top and a system that keeps faith with the promise made many decades ago: if you work hard and contribute, you will retire with dignity. This legislation honours that promise. It reflects Labor's values, spreading opportunity, strengthening security and backing working people. It ensures that the benefits of superannuation are better targeted, better balanced, better for everyone—better and fairer from top to bottom. That's why I commend these bills to the House.

Simon Kennedy (Cook, Liberal Party) Share this | Link to this | Hansard source

Let's be clear on what this debate on the Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 and the Superannuation (Building a Stronger and Fairer Super System) Imposition Bill 2026 is really about. This isn't a narrow, technical adjustment to superannuation settings. This is not a small tweak of superannuation. This is a question of trust with the Australian people. It's a test of principle. It's a test of whether this government really believes retirement savings belong to Australians, everyday Australians, or whether it believes they're simply another revenue source to be mined and to be taxed.

Over recent months, Australians have watched this piece of legislation and this proposal unravel. What began as a somewhat bold attempt to fundamentally rewrite longstanding tax principles has been scaled back and has collapsed under pressure—pressure from the coalition, pressure from the superannuation sector, pressure from small-business owners and pressure from everyday Australians, who instinctively understood that something stunk about this proposal.

The government has retreated, and this retreat tells its own story. The original design of this proposal was anything but modest. It was not incremental. It represented a fundamental break with how Australia has approached taxation over the last 100 years. For 100 years or more, Australians understood a simple principle: you pay tax when you recognise income. When a gain is crystallised, when you actually have that cash in your hand, you pay tax on it. Treasurer Chalmers wanted to upend this principle and our entire taxation system.

The government's initial plan was to tax unrealised gains—paper increases in asset values. This would have torn at the very foundation of our taxation system, particularly in very volatile asset classes such as venture capital, farms or, in the right environment, even housing. Taxing paper gains is a complete structural shift. It creates liquidity pressures where people have to keep a certain amount of the fund in cash and it introduces artificial volatility. Once that precedent is set in one part of the system, there's a danger and a risk that every Australian should be alive to: what unrealised gain are they going to come after next? It's a very dangerous path. I don't know of another Western nation that does it. There may be some, but I've looked high and far and I can't find one.

More concerning than that was the refusal to index the $3 million limit. Inflation has been above the band for this government's entire time in office. The Reserve Bank is forecasting it to be above the band for this entire term, which will make it six years above the inflationary band. In an inflationary environment, failing to index thresholds is not neutral; it's a silent tax increase every single year. That's what they were doing. They were baking in an annual tax increase that was a little bit sneaky. Over time, more and more Australians would have been captured, not because they were wealthier but because inflation devalued that threshold. This is bracket creep by design. That's another thing we have with this Treasurer and this government. It's a government addicted to bracket creep. We had it in superannuation and we have it in income tax.

That is the reason 42 per cent of Australia's taxation revenue comes from income tax. The OECD average is just 23 per cent. We have a tax on Australian aspiration. When Australians work more, this government taxes more. On this side of the House, when Australians work more, we want them to get more. You should be rewarded. The more effort you put in, the more you take out. This wasn't accidental. This flawed policy design was a deliberate attempt to expand the tax base over time. But this government's backdown demonstrates something important. This wasn't settled policy grounded in principle or grounded in the Henry tax review. This didn't even mention the Henry tax review. The Henry tax review has a lot of fantastic ideas that have never been implemented. This government reached into its bag of tricks and pulled this out because what this really is is a revenue measure—how do we get more money?—and it collapsed under scrutiny.

At the last election, Australians were not told that our longstanding superannuation tax settings would be fundamentally redesigned and disrupted. They were not told unrealised gains could be brought into the taxation system. They were not told indexation would be stripped away from superannuation balances. Major structural taxation changes such as this should be transparently taken to the Australian people so they can make informed decisions. They should be debated openly, and they should be consulted on thoroughly. My worry is that this is pattern behaviour. We've got a government addicted to spending and, like all addicts, they keep this poor pattern behaviour going. What is next? Is it CGT discounts that aren't being taken to the Australian people and are being snuck in? Is it carbon taxes? Is it cash flow taxes? What is coming next?

Every Australian should worry, because we're going through a cost-of-living crisis where disposable income is getting stripped away. The average family is paying $21,000 more on a mortgage since Labor came to office. On top of that, the money you have left over—that increasingly small bundle of money you have left over that's being eroded away by inflation—is the target of further taxes. Australians are, rightly, protective of their retirement savings. These are nest eggs built over decades, through overtime shifts, small-business people taking risks, delayed holidays and disciplined saving. The bar for legitimacy in retirement income policy must be higher.

Prominent Labor figures criticised this proposal. Paul Keating—Labor royalty—was critical of this. Graham Richardson was critical of this. And it was not just him. Ken Henry was critical of this. Ken Henry has done thorough work on taxation. It sits on the shelf, gathering dust—actual, real taxation reform that could make this economy more competitive and that could see the speed limit lifted on this economy. Right now, this economy is unable to grow any faster than two per cent per annum, and, when it does, you get poorer through inflation because we don't have that structural reform. Instead of attacking Ken Henry's reforms—of which there are many—we've got this cash grab.

This isn't a fringe concern. Industry analysis suggested the impact could expand well beyond the narrow cohort initially described. People were projecting that, in 30 years, up to 50 per cent of the population could be captured by it. We know many small-business owners legitimately hold assets within superannuation structures. For them, it wasn't theoretical. This was about real questions. It was about valuation, volatility, liquidity and compliance risk.

Beyond the design flaws, there is a deeper flaw at play. Australia doesn't have a revenue crisis that we need to fix with more taxation; it has a spending discipline crisis. Right now spending as a percentage of GDP is 26.9 per cent. What does this abstract figure mean? This abstract figure is the highest percentage of federal government spending in 40 years outside of the pandemic. In 40 years, outside of the pandemic, spending has never been higher than today. The only day at risk of being higher than today is tomorrow, because it is not forecast to come down. This structural spending growth is running far ahead of our sustainable economic growth. When governments expand their spending commitments without corresponding reform, we get inflation—persistent inflation. When we get inflation, we get higher interest rates. When we get higher interest rates, Australians get poorer. That is the cycle we are living through right now—increased government spending, increased inflation, increased interest rates, Australians getting poorer—and we are rinsing and repeating that cycle.

Rather than restoring fiscal discipline, rather than making tough choices on prioritising programs, attacking rorting or waste in the NDIS or attacking large grant programs, like the HAFF program—the housing fund building 900 houses with $11 billion—rather than actually going after these big buckets of money, we are instead attacking Australians' retirement savings income. Spend first, tax later. This is pattern behaviour, not reform.

Taxation trust is central. You have Australians, you have businesses and you have international investors making decisions based on trust. When they are allocating capital to superannuation, which is often over many decades, they are doing this believing that it will not be taxed differently retrospectively. This initial piece of legislation was violating that trust. Australians will accept change. They accepted the GST when we took it to an election. We debated it out in the open. We had the to-and-fro. It's been a very big success when it's principled, predictable and properly consulted on, but what Australians won't accept is retrospective tinkering, ad hoc structural shifts and ideological experimentation dressed up as some modest adjustment.

These bills raise additional structural concerns that deserve further scrutiny. The removal of the longstanding protections around the death benefit taxation introduces new uncertainty for families at precisely the moment they are at the most vulnerable, when they lose a loved one. When a mourning spouse is adjusting to loss, the last thing they need to confront is added tax complexity or instability on their retirement income base. Similarly, Australians receiving total and permanent disability benefits rely on superannuation not as an abstract investment vehicle but as a lifeline. Changes that increase volatility or reduce the predictability carry human consequences. These are disabled Australians and mourning spouses who are struggling to continue on with their lives.

The government points to adjustments to the low-income superannuation tax offset as evidence of balance, and we welcome that. Any measure that supports low-income Australians building retirement savings is welcome, particularly in this cost-of-living crisis, but these adjustments do not fix the cost-of-living crisis. They don't lower mortgage repayments. They don't ease electricity prices. In this cost-of-living crunch, a future superannuation tax offset does not relieve everyday Australians struggling to make ends meet, struggling to pay school fees and struggling to pay electricity bills. Renters don't benefit from the home battery program or this long-term superannuation tax offset. They need relief here and now. If the government is serious about households, it must tackle inflation at its source—tackle excessive government spending that's increasing demand, increasing inflation, increasing interest rates and crushing Australians.

The experience Australians have had over recent years has been sobering. We were told inflation was under control. It wasn't. We were told relief was around the corner. It wasn't. We were told life would be easier. For families and many families in my electorate, it's become so much harder—harder to service a mortgage, harder to pay your energy bills, harder to buy a house, harder to find a rental, harder to pay your school fees and harder to get ahead. In that environment, confidence in the retirement system matters more than ever. Superannuation is built on long-term trust—trust the rules won't shift unpredictably, trust that thresholds will not be quietly eroded with inflation and trust that core principles of our taxation system will be adhered to. Undermining that trust carries long-term costs. You lose the trust of the Australian people. You lose the trust of outside investors who want to invest in Australia, invest in our energy grid, invest in our manufacturing companies, invest in our cities and our data centres, and invest in AI.

The coalition believes in a superannuation system that's stable, predictable and principled so that Australians can make long-term investment decisions and that international investors can make those long-term investment decisions. We believe in a stronger Australia for each of those people, not a weaker Australia that's marred by increased spending, a higher cost of living and opportunistic tax grabs. I would ask this government to rein in government spending and address the problem at its source rather than steal from hardworking Australians and their retirement incomes.

Sarah Witty (Melbourne, Australian Labor Party) Share this | Link to this | Hansard source

Superannuation is not a privilege; it's a promise. It is the promise that if you spend a lifetime working, contributing, caring and building this country you will not be faced with insecurity at the end of it. That promise was not accidental. It was built. It was built by the union movement, built by working people who knew that dignity in retirement should not be reserved for the fortunate few, built by Labor governments who were prepared to back working Australians with a system that endures. The Treasury Laws Amendment (Building a Stronger and Fairer Super System) Bill 2026 and the Superannuation (Building a Stronger and Fairer Super System) Imposition Bill 2026 not only defend that promise; they strengthen it. Super has a purpose. It is not ambiguous. It is not optional. It is not whatever the market decides it is. The objective is to preserve savings to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way. That purpose matters, because systems only endure when they stay true to why they were created. If super is used to build up excess wealth instead of being used to provide income in retirement, confidence erodes, and, when confidence erodes, working Australians pay the price.

This bill restores that confidence. It does that in two clear ways. First, it better targets tax concessions for those with very large balances. Second, it strengthens support for low income workers so that super works for the people it was meant to serve. Super tax concessions are deliberate policy choice. They exist to encourage people to save for retirement. They exist so that ordinary working people can build for their retirement over time. But those concessions must be sustainable, they must be justified, and they must be targeted fairly. Right now, too large a share of earning concessions flows to those at the very top end of the system. This bill adjusts the concession tax treatment for super earnings on amounts above a very high limit.

From the 2026-27 income year, earnings on super balances below $3 million will not change. Earnings on balances between $3 million and $10 million will be taxed at up to 30 per cent. Earnings on balances above $10 million will be taxed at up to 40 per cent. I want to say this clearly because it matters. If you have less than $3 million in super, this change does not apply to you. If you have less than $3 million in super, nothing changes—not the rate you pay on earnings, not the treatment of your contributions and not the structure of super for you or your family. This reform is targeted at the very top end of the system, and it is modest. It affects less than half of one per cent of Australians with super accounts. That is what we are debating.

It is easy in this place for debates to become abstract. It is easy for the loudest voices to turn a targeted adjustment into a cultural war. This is a question of purpose. This is a question of legitimacy, because, if a system built for working people becomes skewed towards the already secure, it loses public confidence, and super must never lose public confidence. Super was designed for dignity. It was designed so that a person who works hard, who pays rent and bills and who shows up year after year can retire without fear. It was designed so that ordinary working Australians can build security over time—week by week, pay by pay, year by year. That is the moral foundation of super, and this bill protects that foundation.

The second part of this bill matters just as much, and in many ways it matters more for the community I represent. This bill strengthens support for low-income workers through the low-income super tax offset, LISTO, and it exists for a reason. It exists because low-income workers can end up paying more tax on their super contributions than they pay on their wages. That is not fair, and for too long the threshold settings have not kept pace with broader tax and super settings. From 1 July 2027, the entitlement threshold will rise to $45,000. This aligns with the top of the second income tax bracket. The maximum payment will increase to reflect increases in the super guarantee. This means more people will receive support, it means more low-income workers will keep more of what they have earned, and it means retirement savings will stay in the accounts of the people doing the work. That is what equity looks like in a tax system.

I am honoured to represent the electorate of Melbourne. It is a city of shift workers, students who work while they study, casual and part-time workers, carers, nurses, researchers, teachers, hospitality staff, retail workers and early childhood educators. It is a city built on contribution. When I am in the community I hear it constantly. I hear it from women in their 40s and their 50s who have worked for decades and still feel insecure about retirement.

Sharon Claydon (Newcastle, Australian Labor Party) Share this | Link to this | Hansard source

The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour. The member will have leave to continue speaking when the debate is resumed.