Tony Sheldon (NSW, Australian Labor Party) | Hansard source

I rise to speak on the Treasury Laws Amendment (Putting Members' Interests First) Bill 2019. This bill seeks to amend the Superannuation Industry (Supervision) Act 1993 and the Superannuation (Unclaimed Money and Lost Members) Act 1999, allegedly to improve the default insurance arrangements for superannuation. By now, we're all aware of what this bill aims to do. I say 'aims to do' because, as we all know in this place, an aim is not necessarily the same as a result. The bill aims to protect the superannuation savings of younger members and members with low-balance funds from being eroded by insurance premiums. The bill aims to try to achieve this protection by taking away the default life insurance options for these accounts.

Whilst supporting the aim of the bill, the realities are quite different. As was also raised before, this bill has had previous discussion but it requires more discussion. It requires more consideration by the Senate. The bill requires some amendments so that there are no unintended consequences. When this bill was introduced in the Senate in early July, stakeholders were clear that there was some problematic issues and potential unintended consequences in this legislation. But instead of letting the Senate inquiry give further consideration to the issues properly and holding to the original October reporting time, the government, regardless, has shrunk the time frame for submissions and consideration, and there was an unseemly rush to get submissions in by 15 July. That left just 11 days after the bill was referred. This is an incredibly tight time frame on a matter that needs to be properly reconsidered for submitters to compile the further evidence and data that are needed for further consideration of this bill.

Despite this incredibly short time frame, 46 submissions were received. We had submissions from the broad range of stakeholders like regulators, super funds and academics. Regardless of previous consideration, they said the government chaired and government controlled committee did not schedule a single public hearing to ask questions and examine these submissions, because there needed to be further consideration beyond the consideration that had already been given.

Superannuation affects every Australian. Why the unseemly rush? Why the lack of more appropriate public scrutiny? My friends on the other side might say, 'We had a meeting here and a meeting there,' but it requires more public engagement. It requires people to actually be very clear about the consequences and be able to submit their views on the effect of this bill. Despite this whole process being rushed to a conclusion by 23 July, the government has done nothing for months. It's now September and we're finally debating the bill. We could have used this time more genuinely for further consideration, further examination and further reflection, and really allowed the Senate committee to do further work to grapple with the issues raised by all the stakeholders who contributed to this exercise in good faith. And now here in mid-September the government is back in rush mode. Say that to someone who doesn't have insurance, because not only will this impact on somebody under the age of 25 but it will impact on the entire family. The financial burden goes across families and communities.

The government wanted the bill to be operative from 1 October. Funds need to be able to properly inform members of their funds of the consequences of this bill. We note that these deadlines are totally unreasonable. They were unreasonable when they were introduced in July, let alone September. Concerns about the implementation timetable were raised in submissions from the Australian Prudential Regulation Authority. APRA, in its submission, said:

APRA considers an appropriate implementation time frame would be at a minimum six months, but preferably 12 months.

Industry Super Australia also offered their own evidence of the impact on industry super funds of these compressed timelines. They said:

If the Government proceeds with the proposed changes, the implementation date is unimplementable and will result in member confusion and detriment. It is proposed that the commencement date of 1 July 2020 would allow funds to renegotiate insurance contracts on reasonable terms, make relevant system changes and properly inform members, but under no circumstances should it be sooner than 6 months after royal assent.

Australian Super too has made it clear in the past the importance of communicating significant changes to their members. They also said, ' … due to the short time frame for removing cover for inactive members, the response from affected members was overwhelming and our expanded—

Debate interrupted.