Slade Brockman (WA, Liberal Party) Share this | Link to this | Hansard source

The committee is considering amendment (1) on sheet 3457, moved by Senator McKim, to the Treasury Laws Amendment (Payday Superannuation) Bill 2025. The question is that the amendment be agreed to.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

Australia's superannuation system was designed to be universal, but the vast majority of our young workers under the age of 18 are not entitled to superannuation on their hard-earned income. That's because they don't work 30 hours or more a week. Under the current law, workers under 18 years old are only entitled to super if they work more than 30 hours a week for the same employer. This means that 92 per cent—almost all of our young workers—miss out on super, mostly due to school and study commitments. It's incredibly unfair. They're leading busy lives and putting together school and lots of work opportunities, often very variable and unpredictable, and we don't give them the super they deserve. Young people shouldn't be penalised for their studying and school hours. For too long workers under 18 have been missing out on super, setting them back financially and costing them thousands of dollars very early in their careers. We know how important those dollars are later in life. It should not be controversial to say that young workers should receive the same financial rights as everyone else. Super should be paid to every worker on every dollar earned. This exclusion has a real impact. According to the Super Members Council, about 500,000 under-18 workers will be excluded from paid super in 2024-25—half a million of them. This is a combined total of $368 million in super contributions. There's no excuse for excluding young workers from accessing the super system and having the same rights and access as all other workers.

The change we propose is small, it is sensible and it will make a really big difference for thousands of young Australians starting out their working lives. I've heard directly from young South Australians about how important getting super would be for them. Kisa, a 16-year-old, said this: 'I can't always work 30 hours a week as I have school. I don't think this should mean I don't get to start preparing for my future with my superannuation fund.' Alyssa, also 16, said, 'I work just as hard as everyone else and I'm not getting the same benefits to put towards my retirement.' Jackson, an 18-year-old, said, 'I'm going to struggle a lot more in the future as I've had three years of part-time work that hasn't contributed to my super.' And Charlie, who's 15, said: 'Being young and starting to earn money towards my super will be a good start and will put me better off in my future. I also don't understand why it's different for kids under 18 as we are doing the same job.'

Thank you, Kisa, Alyssa, Jackson and Charlie for your stories. You are spot on and you're young people with a lot of foresight. I certainly wasn't thinking about my retirement at 16, 17 and 18. But you're spot on. You're missing out on a lot and you're working in the same way as others, alongside them, and you deserve the same rights. These are real workers who are feeling the impacts of our current unfair super system. That's why we have moved our amendment to the Treasury Laws Amendment (Payday Superannuation) Bill 2025 to make sure that young part-time workers aren't left behind. Labor has a chance to back young workers so that all of them are paid super contributions from their employers regardless of their hours. This amendment ensures that any regulations made under the act cannot exclude workers who are under 18 and are doing fewer than 30 hours from getting superannuation.

In conclusion, I call on Labor to support our amendment to give those young people access to super while they're young and under 18. Labor, what would hold you back from doing such an obvious change that's so fair? You've got the numbers to do this, and this has been a long-running campaign of the SDA and the Super Members Council, who are two strong stakeholders advocating this change. Your own 2023 national platform supports this. Allow me to quote from it:

Labor will support young people through … the accumulation of superannuation on every dollar earned.

Your own platform also says:

Labor will … examine gaps in the superannuation system and where possible close these gaps for … young workers …

Finally, your platform also says:

Labor will ensure that all workers, regardless of how they are engaged, can accumulate superannuation on every dollar earned.

Here's your opportunity. Labor, it is time for you to walk the talk as a party that speaks for the workers. It's time for you to take action for these young people who are waiting, watching and wondering what you're going to do.

Minister, I've got a few questions. As I understand it, this bill includes changes that will repeal section 28, which is the outdated and unfair part of the law that says part-time workers under 18 are not required to be paid super.

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

Thank you to the advisers in the box; I understand that's correct, and it will be replaced with regulations.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

Has the government advised businesses that they're obliged to now pay super to under-18s, regardless of the hours they work, until such a regulation is in place?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

The regulation will be in place. That is not the intent of this bill, so there has been no requirement to advise employers of that.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

When do you expect that regulation to come into place?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

It'll be in place well in advance of 1 July, when this bill will commence, if it's passed.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

If this bill is passed, Minister, will there not be a gap of at least six months until that regulation comes into operation?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

No, if the bill is passed the act will commence on 1 July.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

So the act will commence on 1 July; thank you. Let me clarify. You intend to pass this bill, which makes everyone eligible for superannuation, regardless of their age and their hours of work. I just want to make sure I understand what's being proposed here. Do you intend to remove any prohibition on paying super or to enable people who are under 18 and working any number of hours to become eligible for superannuation pending a regulation?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I've just been helpfully shown paragraph 1.25 in the explanatory memorandum, which deals with this exact matter:

The exclusions for certain payments from the SG framework were previously set out in both the SGA Act and the regulations. No change is being made to the exclusions, but they will all be consolidated in the regulations to improve readability of the legislation. It is appropriate that the exclusions are set out in regulations as they are technical and specific exclusions to the general law.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

Can I, then, check that you see no difference in the timing or the application of the treatment of superannuation for people under 18, whether it's within the law or within the regulation, and no gap in time between the operation of those two parts?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

There's certainly no gap. The current arrangements would continue until the new act commences on 1 July.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

What's your view about the fairness of excluding people who are less than 18 years old and working less than 30 hours a week from access to super on every dollar they earn, as is clear in your own policy platform?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

This deals with the broader question of your amendment which I'm happy to speak to now. I was going to put these comments on the record. We are the party that established superannuation, and we are the party that continues to strengthen it. As you've seen since we came to government, we have done a number of things, including paying super on PPL and making sure the SG, the superannuation guarantee, increases to 12 per cent, as that makes a big difference to people's retirement earnings, including young people if they are paid superannuation. Indeed, in the last month or so, there was the announcement about our commitment to the low income superannuation tax offset, also known as the LISTO.

We work through these things in a methodical way. That's the way we approach these arrangements. It wasn't part of our commitment to payday super to make a change like the one that your amendment seeks. But we continue to engage with the superannuation industry, with the superannuation council, as you identified, and others, as we did on LISTO to put in place appropriate strengthening of the superannuation system, and we'll continue to do that. We don't change the superannuation system based on an amendment from the Greens in the Senate.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

It is a fair question though for you to change the superannuation system in line with your own published policy platform—is it not?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I'm not responsible for the party platform, but decisions the government makes about the timing are a matter for the government. As I've said, since coming to government, we've done a number of things. Lifting the superannuation guarantee to 12 per cent will have the biggest impact on people's retirement earnings, as are increases to the minimum wage which covers a lot of young people and increases in the wage earnings of early educators and people in the care economy, whether it be in disability or the aged-care sector. They are big commitments worth billions and billions of dollars that we have done to make sure that workers not only get good wages now but also accumulate superannuation earnings for a dignified retirement.

We have a very proud record of strengthening superannuation and improving it for all working people, including young people. Our commitment recently around LISTO is in the order of hundreds of millions of dollars to make that change. We're doing it because it's the right thing to do and so that people—including women and young people, who have the opportunity to accumulate superannuation entitlements through their working career—do retire with enough money in their superannuation. We will continue to do that. That's the approach the Treasurer has taken. It's the approach the Assistant Treasurer has taken.

Paying super on PPL—a lot of people have talked about that for a long time, but it took this government actually coming in here to get that change done. We've got a proud record of strengthening superannuation. We'll continue to work through commitments that have formed part of Labor policy for a long time, in a careful and methodical way, and we will bring the industry and all stakeholders—as there are many in this industry—together as we do that.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

Minister, I applaud the superannuation that's now payable on paid parental leave. I was one amongst many, many Australians who saw that as a gross inequity at the moment of a family change, where extra dollars make such a difference, especially for women in their longer term earnings. I have no argument about that. But on what basis would you withhold superannuation from a 17-year-old—working alongside an 18-year-old—who is not paid super on every dollar they earn? What is the basis for that age discrimination?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

That currently forms part of the superannuation system—the arrangements around people under the age of 18. I'll just see if there's something more. The point I would like to make here—and the one which the advice to government is based on—is the one I've made earlier, which is that we don't make changes to the superannuation system based on an amendment from the Greens. The superannuation system is complicated. There are a lot of stakeholders involved, and the government, as we pursue changes that continue to strengthen super, do it in a careful and thoughtful and methodical way. That is, we want to understand, if a proposed change was made, how that might impact in a practical sense and in any responsibilities we have. It's been a feature of the system, I think, since the commencement of the superannuation system.

This payday super bill, which I should have included in the list of things that we are doing to strengthen superannuation, is making sure that workers do get their entitlements as they are due and in a timely way, as is not the case right now. We know a lot of workers miss out on super because it's not paid at the point of their pay cycle. That is another practical strengthening of the superannuation system. If you add that to PPL, if you add that to the increase in the SG, if you add LISTO to that and if you add the wage increases that we have funded and supported, I think that tells a story of a government that wants to make sure that working people in Australia get appropriate superannuation and are able to accumulate savings for a dignified retirement.

This bill does not propose to change the current arrangements, and, if there were any future changes—not necessarily of the point you raise, Senator Pocock, but indeed any other changes—we would do so in the way that we have approached all the other ones, which is to work over a period of time with the industry to understand the impact of changes before the government considers and agrees to any.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

Your arguments essentially go to the statements of: 'It's an existing arrangement. It's a convention. It's complicated,' because the Greens suggested it. I don't think the young people in South Australia who I cited in my speech, those 16- and 17-year olds and the 18-year-old who's missed out on three years super, really care whose idea this is. I don't think they care that you've already done things. I think they don't care about convention. If we cared about convention, we wouldn't even have a super system. We do things because they're the right thing to do. Clearly, your party has considered this over years—that it's important to remove age discrimination in our super system. I just want you to consider that these are not sound arguments, and they will not be convincing to the young people you are today refusing to give justice to in their pay in order to have a decent retirement down the track.

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I disagree with that, Senator Pocock. You can make that argument, but I think young people today are earning more through the minimum wage, and, if they work in particular industries where we have advocated for higher wages, that is not their experience. Young people, when I speak to them—I'm not discounting this as an issue. As I said in my earlier comments, the government will consider this.

The point of this bill is to deal with the issue about people getting their super paid on time in accordance with their wages, rather than missing out or having it paid down the track. That is the purpose of this bill, just as the one that we bring forward on the low-income super tax offset will be about LISTO, just as the one we did on super on PPL was about super on PPL. It's less about who's moving it; it's that we do not do superannuation policy based on an amendment in this place that hasn't gone through all of the consideration and policy development that all of our other changes have gone through.

For example, young people at that entry level where they're starting, between 15 and 18, often move around jobs. Does that mean multiple accounts? Does it mean multiple low-balance accounts that have fees that eat up a lot of that super? These are the types of things that a proper policy process would work through and understand. That is the point I make. We don't do policy on the fly on an amendment in the Senate. On this and on any other area, before a government takes a decision on it, we have to understand how it would be implemented and who has responsibility to implement it. With all the employers that are currently making changes to accommodate payday super with their IT systems, I don't think any sane government would then just dump this on because an amendment was moved in the Senate. There is practical engagement and consultation that needs to happen.

In terms of what we have done for young people—supporting minimum wage increases, supporting better wages in a whole range of sectors, things like fee-free TAFE, HECS debt relief and looking at our housing policy—all of those policies have young people at heart as we consider some of the challenges they are facing. We will continue to take that approach, whether it be in super or any other area.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

The pattern of employment for lots of young people who are 17 and 16 is not significantly different from the patterns of employment that characterise so many Australian workers. A third of our workforce are now precarious. Many of them have multiple jobs. Their lives are complex and their employment arrangements are complex. Their pay packets are complex, and yet we navigate superannuation for them. Why would we not do exactly the same for those young people? It is simply their age that holds them back from something that is no more complex for them than it is for millions of other workers.

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

Again, Senator Pocock, I acknowledge your career and your work as an academic in understanding patterns of work and things like that, but I'll make the same points in this answer that I made in the last. The broader point I am making is that we don't do superannuation reform on the fly in the Senate. We don't. If you look at the approach we have taken since we came to government, we have brought forward reforms to superannuation in a staged and careful way, and that is the way we will continue. This bill is about making sure everyone gets the superannuation they are entitled to and it is paid into their accounts in a timely way. All of the other changes that I've already outlined are also targeted at making sure the superannuation system continues to work in the interests of working people.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

Thank you for that answer. As I understand what you propose to do, you are going to bring back, through regulation, the exclusion of young people under 18 receiving super on any income they earn if they work less than 30 hours a week. You intend to reregulate, essentially, the prevention of those young people from having access to superannuation. Have I understood that correctly?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

The explanatory memorandum makes this clear, and I've already answered—three times now—that the regulations will be brought to align with the commencement of this act, and it will reflect current practice.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

Will that be a disallowable regulation?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

Yes.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

In event that it wasn't passed as a regulation, you would therefore have opened the gateway to those young people to proceed to have access to superannuation regardless of their age or their hours of work; is that correct?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I can't foresee what the Senate will do with that. It's a disallowable instrument. It's then over to the Senate to determine that.

Nick McKim (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Firstly, on the line of questioning that Senator Pocock was advancing then—Minister, this bill will take effect from 1 July next year; is that right?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I have said that three times too.

Nick McKim (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Minister, you say you don't want to make law on the run, but you could accept the Greens amendment today. You would have eight months to set up the systems that are needed in order to make sure that young folks—people under the age of 18—receive the superannuation money that they are due, no matter how many hours a week they work, wouldn't you?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

I've made it clear in my answers to Senator Pocock that the government does not make superannuation policy or superannuation law like that. We take a measured approach. We consult with industry stakeholders, and, before we take a decision, we actually like to understand all of the implications of taking that decision.

Nick McKim (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Are you currently studying the implications of taking a decision to require superannuation to be paid to people who are under 18, no matter how many hours they work?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

The focus for the Treasurer and the Assistant Treasurer has been on this legislation, and, in looking forward, it will be also on the low-income superannuation tax offset. They are the priorities, as is the balance cap work that will also come in a bill to the Senate at an appropriate time. That's been the focus of our economic team.

Nick McKim (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Minister, as you'd be aware, the SDA, the Shop, Distributive and Allied Employees Association, is campaigning strongly for superannuation to be paid to people who are under 18, no matter how many hours they work in a week. I want to make some observations about that. Firstly, the Labor Party has—tragically for the country and tragically for many, many millions of Australians—listened very closely to the shoppies for many decades now. Because the Labor Party has listened so closely to the shoppies for so long, this country has been held back.

We could have had marriage equality many, many years before we eventually got it, and we didn't get it because of the stranglehold that the shoppies have got on the Labor Party. We could have had real, true, needs based funding through the Gonski reforms, if it hadn't been for the stranglehold that the shoppies have over the Australian Labor Party. We could have had an effects test in our competition law many, many years before we finally got it, if it weren't for the stranglehold that the shoppies have over the Australian Labor Party. Every time the Labor Party has looked in the last 30 years to do progressive, social and economic reform, there have been the shoppies, holding the Labor Party back and holding this country back. It's been a disgrace, and it's led to this country being a less progressive, less fair place than it should have been. My question to you, Minister, is: having been under a stranglehold from the shoppies for so long, to the detriment of this country and to the detriment of millions of Australians, why aren't you listening to the shoppies now that they're actually advocating for something that is positive for this country?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

Thank you, Senator McKim. I was wondering how you were going to bring those two narratives together towards the end—on the one hand trying to support the SDA but, on the other hand, having difficulty in doing that. I congratulate the SDA. We worked closely with them on paying super on PPL. Their union did a lot of work on that and provided advice to government about the benefits that would come for their largely female membership, should we make that change. I commend the SDA for the work that they've done in strengthening superannuation. We continue to work with all stakeholders, including unions, who are actually responsible for the formation of superannuation in the first place and have been active participants in all debates about it since. We will continue to engage with the SDA. They have been very supportive, as have all unions, on payday super, so I look forward to actually passing the legislation and what it's actually about, which is making sure people get their super when it's due and that they benefit from that over the longer term.

Barbara Pocock (SA, Australian Greens) Share this | Link to this | Hansard source

Minister, 92 per cent of people under 18 are missing out on super here—$368 million a year. We heard their voices. Half a million workers under 18 are missing out. It's a straightforward discriminatory matter, and it's a big loophole in our super system. In the interests of fairness, will you commit to fixing this discriminatory loophole in the super system?

Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Link to this | Hansard source

The Labor Party is the party of superannuation, and we will continue to work with all stakeholders about ways to continue to strengthen it in the interests of working people.

Dorinda Cox (WA, Australian Labor Party) Share this | Link to this | Hansard source

The question is that the amendment on sheet 3457 be agreed to.