Senate debates

Wednesday, 16 June 2021


Treasury Laws Amendment (More Flexible Superannuation) Bill 2020, Treasury Laws Amendment (Self Managed Superannuation Funds) Bill 2020, Treasury Laws Amendment (Your Future, Your Super) Bill 2021; Second Reading

7:53 pm

Photo of Andrew BraggAndrew Bragg (NSW, Liberal Party) Share this | Hansard source

I simply make the point that superannuation is the greatest bet that Australia has ever made in terms of forcing people to put almost 10 per cent of their salaries and wages into a scheme for the past 30 years which has not worked. This is a scheme that was created by ideology without any proper framework for its success, and here we are 30 years later with a scheme that costs more than it saves, a scheme that will never return a net positive position to the budget and a scheme that, in 2050, will still have almost every Australian on the pension. This is a failed scheme. It was put in place by ideologues 30 years ago. In fact, I'll quote the Treasury official, Paul Tilley, who wrote a history of the Treasury department, in which he said, 'In the early 1990s, Treasury was not actually well equipped to do the necessary long-term work and that the modelling done for super was done on the back of an envelope, which was subsequently thrown out and lost to history.' The whole thing was created without a framework.

That means that, 30 years later, we are coming in with a proposal to try and put a proper framework in place so that the scheme will actually work, because we're not wreckers on our side. We believe this idea could work for Australia and for Australian workers, and we want to fix it. We don't want to throw it in the bin. So the Your Future, Your Super bill is really all about putting that proper framework in place. It's not just me saying that the system is broken. This is the advice of the independent people like Grattan, Treasury and Choice. They're all saying that it's broken.

The problem with this debate—and it's been very good to come in and hear some of the contributions already—is that almost everyone who has a view about super is conflicted. They have been bought out and owned by the wall of money which is super. This is a scheme that receives $100 billion of workers' money each and every year. They open the door and the money just pours in, and they take out $30 billion in fees every year. A hundred billion dollars comes in and $30 billion comes out in fees. With that money, they buy power and influence. They buy power and influence in the financial sector, in the union sector and in employer groups. We saw this week the Ai Group, which has received $1 million from AustralianSuper in the past year, disgustingly come out and defend the system without even declaring their conflict. So it shows that the big super industry can buy anyone.

This is not about sectoral gains. It's not about comparing the finance sector or the union sector or whatever. This is about Australian workers getting the best possible value for their own money. Of course, we are heavily invested in this scheme as taxpayers, as people and as citizens. This scheme is costing the budget $40 billion a year in forgone income tax revenue. So we actually want the scheme to work. Otherwise, it is, as I say, the biggest bet we've ever made that has no prospect of ever really paying off.

So this bill is a really important structural change. It will improve the system. It will do three things: it will put in place a stapling regime so that people have one super fund for life unless they choose to do something else; it will put in place a best financial interests test which will stop the waste and the rot; and, thirdly, it will put in place what should have been there 30 years ago, performance testing. For 30 years, these people have been able to take our money and do whatever they want with it—all the funds—and they have spent our money very poorly.

Senator McKim interjecting—

No, I don't. Thanks for that interjection. No, I just don't support it.

Senator McKim interjecting—

No, I don't.

Senator McKim interjecting—

No, I don't.


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