Mehreen Faruqi (NSW, Australian Greens) | Link to this | Hansard source

The committee is considering the Treasury Laws Amendment (Putting Members' Interests First) Bill 2019. The question is that the bill, as amended, be agreed to.

Jenny McAllister (NSW, Australian Labor Party, Shadow Cabinet Secretary) | Link to this | Hansard source

by leave—I move amendments (1) to (3) on sheet 8765 together:

(1) Schedule 1, item 1, page 4 (line 13), at the end of subsection 68AAB(4), add:

; or (e) a member to whom the occupation or industry exception applies (see section 68AAF).

(2) Schedule 1, item 1, page 5 (line 29), at the end of subsection 68AAC(4), add:

; or (e) a member to whom the occupation or industry exception applies (see section 68AAF).

(3) Schedule 1, page 5 (after line 35), after item 3, insert:

3A After section 68AAE

Insert:

68AAF Occupation or industry exception

(1) The occupation or industry exception applies to a member of a regulated superannuation fund who holds a choice product or MySuper product in the fund if, at the time the member first holds the product, the member is working in an occupation or industry covered by an election referred to in subsection (2).

(2) For the purposes of subsection (1), the trustees of a regulated superannuation fund may elect an occupation or industry if the trustees are satisfied that the election of the occupation or industry is appropriate having regard to either or both of the following:

(a) evidence of risk and insurance claims in the industry or occupation;

(b) the availability of insurance for people working in that industry or occupation that, if taken out on behalf of members of the fund working in that industry or occupation, would represent exceptionally good value for those members.

(3) However, the trustees of a regulated superannuation fund must not elect an industry or occupation unless the trustees are satisfied that applying the occupation or industry exception to members of the fund working in that industry or occupation would not inappropriately erode those members' superannuation interests in the fund.

(4) The election must be made by giving APRA a written notice that:

(a) is in the approved form; and

(b) is signed by each trustee of the fund; and

(c) includes the outcomes of an actuarial investigation of the matters mentioned in subsections (2) and (3); and

(d) includes data about risks in that occupation or industry and past insurance claims for that occupation or industry.

(5) An election under subsection (2) is not a legislative instrument.

These amendments essentially seek to create an additional pathway by which workers in high-risk industries can continue to receive life insurance through the opt-out mechanism. The mechanism we propose is an additional alternative to the mechanism proposed by the government earlier in the debate and adopted through the committee process in this chamber. It would allow for trustees to elect an industry which it considers to be a high-risk industry by writing to APRA and providing evidence of the basis on which they have made that decision.

As was explored earlier in the debate, whilst it is true that many young workers and workers with low-balance accounts may be able to access life insurance or income protection insurance other than through a group insurance product, this is not the case for many workers in high-risk industries. The Productivity Commission raised concerns about this in their report and they contemplated a broad exemption for workers in these industries. They said:

… exemptions to the under-25 opt-in restriction should only be granted if the trustee can demonstrate to APRA that opt-out disability or income protection insurance would be in the best interests of a specific cohort of younger members.

They're important words from the PC, because they don't go to individual members; they go to a cohort of members, and they're contemplating evidence about some of these industries that was also raised in the Senate inquiry process.

The evidence from the ACTU points out more than a quarter of workers under the age of 25 are in high-risk jobs, with a real risk of fatality. They said that from 2003 to 2016 more than 3,400 workers lost their lives on the job, and, of those, 335 were under the age of 25. More than 27 per cent of workers under the age of 25 are in a high-risk job, and people aged under 25 make up 15.3 per cent of the workforce and suffer injuries at work. They provided case studies to show that young people in these categories have suffered horrific injuries or been killed at work.

Their concern was that if the bill passed unamended it would cancel the insurance of police officers, paramedics, construction workers, truck drivers, agricultural workers, forestry workers, prison officers, nurses and healthcare workers. They were pointing to these industries where there are higher-than-usual risks and where group insurance on an opt-out basis is entirely appropriate and sensible. The amendments that have been proposed by Labor on this occasion seek to create exactly the kind of mechanism envisaged by the Productivity Commission when they provided their report to government.

Mehreen Faruqi (NSW, Australian Greens) | Link to this | Hansard source

The question is that amendments (1) to (3) on sheet 8765 be agreed to.