Tuesday, 25 August 2020
Treasury Laws Amendment (Your Superannuation, Your Choice) Bill 2019; In Committee
by leave—I move Australian Greens amendments (1) and (2) on sheet 8971 together:
(1) Schedule 1, page 3 (after line 27), after item 4, insert:
4A Subsection 27(1)
4B Subsection 27(2)
Repeal the subsection.
(2) Schedule 1, page 4 (after line 16), at the end of the Schedule, add:
8 Application provision
Despite the repeal made by item 4B, subsection 27(2) of the Superannuation Guarantee (Administration) Act 1992, as in force immediately before the commencement of this Act, continues to apply at and after that time in relation to an employer for an employee if the employer is entitled to a jobkeeper payment (within the meaning of the Coronavirus Economic Response Package (Payments and Benefits) Rules 2020) for the employee during the calendar month.
As I was saying before, the purpose of these amendments is to remove the $450 threshold below which workers don't get paid superannuation. People might recall that back in, I think, 1992 this threshold was inserted. Essentially, if you are a worker who is earning less than that each month you don't get paid superannuation by your employer. The reason that we have long thought that this was inequitable and needs to be removed, which is what the amendment would do, is that it has a disproportionate effect on a number of workers, and in particular it has a disproportionate effect on women workers. We already know, sadly, from many Senate inquiries and many studies, that on average women retire with approximately half the superannuation of their male counterparts. One of the contributing factors to this enormous discrepancy in superannuation balance is this $450 threshold rule. There was a purpose to it originally and it was to align it with what was the then tax-free threshold but that's since increased, as is appropriate. We've also got the low income super tax offset, or LISTO, which also obviates the need for this threshold to continue.
In short, this threshold disproportionately affects women, disproportionately affects casual workers and disproportionately affects workers that have multiple jobs, because the threshold applies per employer. For example, if you are a young person who in this economy is lucky to have a job, or several, and you're earning less than $450 a month from each of those employers, none of them have to pay you superannuation. This is part of the reason why this is an inequitable rule—