Nick Sherry (Tasmania, Australian Labor Party, Shadow Minister for Banking and Financial Services) Share this | Hansard source

Of course, as Senator Carr reminds me, there is no election next year; it is this year. Maybe that is why a bit more attention is being paid in this budget to the basic, battling age pensioner.

The other one-off payment that I want to touch on is the one-off superannuation co-contribution payment of $1,000. Labor supports the co-contribution scheme. If Labor is elected to government, it will continue. It is a watered-down version of Labor’s original co-contribution scheme, which the government signed up to and then dropped. It made a promise it would implement it but dropped it in 1997. Nevertheless, the co-contribution scheme will continue under Labor. Labor welcomes the additional $1,000 going into the individual superannuation accounts of slightly more than one million people. Labor welcomes that extra up to $1,500—the payment varies depending on your income and your level of contribution—but it is going into the superannuation accounts of people who made a contribution in the 2005-06 financial year. It is rewarding past saving. It does not deal with some critical threshold issues that need attention in the co-contribution scheme to encourage future saving.

I note that a number of commentators from the financial services sector have mentioned this. It is not just commentators from the financial services sector; according to an inaccurate budget leak some weeks ago, the Assistant Treasurer, Mr Dutton—to his credit—was purportedly arguing that the parameters of the co-contribution scheme should be changed going forward, particularly to assist under-45s, the younger group in our community. But he obviously got done over by Mr Costello and probably the finance minister, Senator Minchin. What have they come up with? Rather than redesigning the scheme to lift superannuation savings going forward into the future, there is up to $1,500 placed in the superannuation accounts of people who have already saved. Whilst there is an extra $1 billion going into super—that is fine; that is extra moneys—the fundamental design issues of the voluntary co-contribution scheme to give encouragement and incentive going forward were not dealt with, and that is unfortunate.

My colleague Senator Carr is going to comment expansively, I am sure, on some issues relating to the new part of the Future Fund that is being created for higher education. Five billion dollars is being placed in that section of the Future Fund, and the revenue is to be used for various capital purposes at universities. We have seen this before—smoke and mirrors, I call it. We saw it with the first sale of Telstra, where there was an environment fund set up with the proceeds from the first tranche of the Telstra sale. This was to support extra environment expenditure. But what happened on the expenditure side? In following budgets, the Commonwealth government cut expenditure on the environment in other areas. They gave a boost on one side of the ledger and cut environment spending on the other side of the ledger—smoke and mirrors. That occurred after the election, and I suspect we will see something similar if this government is re-elected at the next election. (Time expired)