Thursday, 25 February 2021
Treasury Laws Amendment (Reuniting More Superannuation) Bill 2020; Second Reading
First, I would like to thank those senators who have contributed to this debate and I acknowledge my engagement with Senator Hanson and other senators around the chamber. This bill, the Treasury Laws Amendment (Reuniting More Superannuation) Bill 2020 on eligible rollover funds, is a very important bill. It's part of a broader arc of very successful reforms that this government has undertaken. We know that our superannuation system has served Australians well, yet it is highly imperfect. There still remains a proliferation of duplicate accounts, fees are way too high, insurances have been inappropriately applied and there remains a tail of underperforming funds.
The government's arc of reforms over the last two to three years has been slowly but surely, and very intentionally, chipping away at these inefficiencies. Our first legislation was around protecting your super. That addressed the disproportionate erosion of low-balance accounts, capped fees on low-balance accounts and proactively reunited lost and small balances with individuals' active accounts. That was so successful that it successfully consolidated around $3.7 billion that was held in unintended multiple accounts on behalf of almost two million Australians. I want to remind the chamber that Labor opposed that reform. The putting members' interests first bill, which was passed on 19 September 2019, implemented further protections from erosion due to the application of unnecessary insurance, particularly for those who are under 25, allowing them to opt in rather than automatically opt out of insurance. The number of accounts below $6,000 with insurance has gone from around three million accounts to around 1.5 million accounts on 31 May 2020. Again, that was a very sensible reform that Labor opposed. The your super, your choice legislation, which passed last year, extended the choice of fund to enterprise agreements and workplace determinations. That started in January just this year. It's estimated that around 800,000 employees, representing around 40 per cent of the workforce that is covered by a current enterprise agreement, are now able to freely choose where their hard-earned retirement savings are invested. Again, it was a very sensible, common-sense reform that Labor opposed. The superannuation guarantee amnesty, which was passed on 24 February 2020, was so successful that 28,000 employers took part and a total of $760 million was paid into the superannuation accounts or banks of 700,000 employees. Again, it was a sensible reform that Labor opposed. In fact, the only legislation in superannuation that we have passed so far with Labor's support was for the early release of superannuation. Again, it was a highly successful program that ensured the financial stability and security of millions of Australians. For that, I thank Labor for their support.
I thank Labor for their support of this bill, which is a very sensible and common-sense reform that will facilitate the exit of eligible rollover funds from the superannuation system by 31 January 2022. It will also allow trustees to transfer amounts to the ATO where it's in the best interest of the person to do so. This bill is highly consistent with recommendation 5 of the Productivity Commission's inquiry into superannuation and builds on the policy intent of the protecting your super reforms to reunite lost and unclaimed super with its rightful owners. Through these changes, the government is building a stronger and more efficient superannuation system and improving outcomes for members.
Yes, Senator Sheldon is right, it may well have been a Labor government that invented compulsory superannuation but, make no mistake, it has taken a coalition government to reform it. I commend this bill to the Senate.
Question agreed to.
Bill read a second time.