Treasury Laws Amendment (More Flexible Superannuation)

25 August 2020

An address to the Australian Parliament on superannuation.

I rise to speak on the Treasury Laws Amendment (More Flexible Superannuation) Bill 2020. Today, for the very first time since compulsory superannuation was introduced three decades ago, something really quite remarkable happened. What we saw today for the first time ever in our compulsory super system is that, in net terms, the superannuation balance of this country actually declined, by which I mean people took more money out of super than was put in. That hasn't happened before. On this side of the House—I know the member for Perth would agree with me, along with the previous speakers from this side who have contributed to the debate—we think that is a tragedy. We think that invites all kinds of intergenerational carnage, all kinds of disadvantage, all kind of consequences that we'd hope not to see in this country, in its remarkable superannuation system. The problem is that those opposite see those kinds of outcomes as 'mission accomplished', and that is really troubling.

That's why my colleague the member for Whitlam has moved this really important second reading amendment. It makes the point that, although within the narrow confines of what is being proposed in this bill specifically we will support it through the House, we will not support, we do not endorse and we do not welcome some of the really damaging, destructive attempts by those opposite to diminish and undermine the superannuation system, which is not just a proud creation of Labor governments of years past but a proud creation of the Australian people. It is something that we can be genuinely proud of—something which has its imperfections but something which the rest of the world looks at and thinks, 'It would be good to have a system like that.' So we support the bill, but we do not support and will not support the attack on super, or the attack on pensions which we 've seen in recent months and which we all know is coming in the budget or at some point really quite soon.

More than a month ago, those opposite received the report of the Retirement Income Review. They received it last month, on 24 July, the day after the budget update, and they've sat on that report now for more than a month. Our fears about that Retirement Income Review all along—and, if anything, our fears are more pronounced, now that the government has been sitting on it for so long—are that they would use the review as a stalking horse for more cuts to superannuation and more cuts to the pension. We've spoken publicly about those fears for some time now. A number of us—the members for Whitlam, Kingsford Smith, Barton and others, and the Leader of the Opposition—have said that this should not be a stalking horse for more cuts to superannuation and the pension. But we all know what's going on here. You can see them coming from a mile away. The party of wage stagnation and rampant wage theft is now gearing up to rob workers of their superannuation savings as well. When that 2½ percentage point increase in compulsory super from 9½ per cent now to 12 per cent could go to wages or to super, those opposite actually want it to go to neither. They want to make super voluntary. They want to take the 'compulsory' out of compulsory super.

The thing that is especially galling about this is that, when the Prime Minister and the Treasurer needed to get themselves through an election and its aftermath, they promised repeatedly—over and over again, I asked them about it in question time, and they said, from that dispatch box—that they had no intention of changing the legislated superannuation guarantee increase. But we have known all along that this was rubbish. We have always known that, if you want to work out what the Treasurer of this country is going to do, you just need to hear what some of the weirdos up the back on that side of the parliament are saying. So we've known for some time. We saw this sort of bizarre auditioning for the member for Deakin's ministerial slot or Senator Colbeck's ministerial slot. We saw them time and time again, one after the other, step up to try and diminish superannuation. And we know that, in this Liberal Party, the tail wags the Treasurer. We saw it on energy policy and we're seeing it now on superannuation. Remarkably, we have a minister for superannuation who, when asked by Fran Kelly whether the minister for superannuation had a view on the legislated super guarantee increase, literally said, 'I'm ambivalent about it.' It would be like the health minister being ambivalent about hospitals, and the education minister being ambivalent about universities. It really is quite an absurd state of affairs—this minister for superannuation, ambivalent on the big issue, but spending a lot of time on Twitter, probably all of their time on Twitter, instead of protecting and advancing superannuation in this country.

It comes as no surprise, really, to any of us that now, of course, the Treasurer and the Prime Minister are inching over and inching over and inching over—and we all know what's coming. Once again, they will attack and cut superannuation for working people in this country. And their rationale is based on a really big con. They want to pretend now, all of a sudden, after seven years of wage stagnation, wage theft and superannuation theft, that the big justification for cutting workers' super is that they want to see wages growth. They're worried about the trade-off between wages growth and superannuation. Give me a break!

When Tony Abbott froze the superannuation guarantee in 2014, all we got after that was wage stagnation—actually, historically stagnant wages. The idea that the old link between wages and super is somehow still there in perfect nick doesn't bear scrutiny. In recent years, not only have wages stayed where they were after those opposite froze the superannuation guarantee in the past; they have actually gone backwards. The member for Kingsford Smith made that point with characteristic eloquence a moment ago. Wages have gone backwards. Wages have actually never been weaker in growth terms than they are under those opposite. So spare us this rubbish that you're concerned about superannuation because of the trade-off with wages. We know that that is an absolute crock that those opposite keep referring to.

The other obvious attack—and we're seeing this already—on the SG legislated increases is the coming carnage. When it comes to what's happening right now, we've seen it with the early super access regime. As I said at the outset today, APRA has told us that, for the first time in three decades, more money has come out of super than went in. For the first time since the great man Paul Keating, a friend of the member for Chifley's and of mine, legislated compulsory superannuation, more has come out than went in. That's a tragedy. As I said, that's intergenerational carnage. That's a very concerning development. Those opposite think it's a good development.

Early access to super is a diabolical problem. Others have described it as intergenerational theft, and I think that's an appropriate description. It is a diabolical policy that those opposite have inflicted on the Australian people. And we warned them about it. One of the things that I think really shines a light on their motivations here is that, if they genuinely wanted to give people in hardship access to superannuation, they would probably check that the person was in hardship. But, instead of doing that, you can get two lots of $10,000 out of your super without anybody ever checking that you're in hardship. That's why we've seen all of this discretionary spending happen—all the stats out of AlphaBeta and elsewhere about people and what they're spending their money on. In some cases it is gambling and alcohol. In other cases they are just transferring it from their super account to their bank account. There is a lot of discretionary spending going on. Those opposite didn't want anybody to ever check. They never asked the ATO to do even random audits. And that, I think, exposes their motivations here.

That's why more than twice the number of Australians than they thought would access super early are actually accessing super early. That's why something like 600,000 people cleaned out their accounts entirely. If you're a 25-year-old in this country and you take $20,000 out of your super, you could on average be $100,000 worse off in retirement. We knew that there would be a risk that this scheme would be rorted, that there'd be fraud. It gives us no joy to say that we've been right about that. In this scheme there has been widespread rorting, widespread fraud—all kinds of problems that we warned those opposite about. But they proceeded anyway. And that is going to invite all kinds of consequences into the future as well.

At a time like this, when things are as difficult as they are in the economy, when the economy is crying out for investment, when we need to get the show going and get the wheels of industry moving again, we've got this remarkable asset, this incredible advantage, which is that three decades ago we had the foresight, imagination and courage to put in place this system—and again I pay tribute to former Treasurer and Prime Minister Paul Keating—and now $3 trillion of funds are available to invest in Australian jobs and Australian businesses. We have that advantage. We should be working out ways not to diminish super, not to undermine super, but to unleash it for purposes which are good for people and good for their retirement, but also good for investment and getting the place going again.

I mentioned earlier the Retirement Income Review, and I think it's absolutely critical that the report is released sooner rather than later. Sitting on it for more than a month is obviously not acceptable. There is already enough uncertainty in our community, particularly, I think, among older Australians. We want to see that Retirement Income Review report released. And the context for that—it's something that's not that well known in the community yet, but it will be in time—is that there is another first that is approaching: for the first time since the 1990s, as it stands, the government will actually freeze the indexation of the pension next month. Think about that for a moment. Think about all the difficulties, all the uncertainty and all the anxiety that Australians who have contributed so much to this country are going through—and those opposite are content to see the pension frozen in September. Under Labor we saw the biggest-ever increase to the age pension in history. We talk about our proud record on social security. We ask the government why they have, time and time again, tried to cut the pension and various supplements. They say, 'No, it goes up twice a year.' But it's not going up in September, as it stands.

This government is going to freeze the pension when people are doing it really tough. They have tried, time and again, to attack pensions, to increase the pension age to 70 and to do all kinds of things to the supplements. This is in their DNA. The reason it is, and the reason why we've got this ridiculous agenda, this attack on superannuation, is that those opposite can't see past their ideological obsessions to the national economic interest. When they rank their priorities, it's never Australian workers, Australian retirees or pensioners at the top; it's always about their ideological obsessions. We have heard that from one speaker after another on the opposite side of the House. We have heard it on industrial relations. We have heard it on pensions. We have heard it on superannuation. All across the board, they are always trying to tear down Labor legacies rather than build up the country and its people.

The best evidence of these ideological blinkers is that the Prime Minister, when asked about superannuation today, referred to a part of the superannuation system which is actually equally represented by employers and employees; it's a triumph of cooperation in the workforce. He refers to them as 'union funds', and that, I think, is a tell. It gives us a sense of this ideological obsession he has. The idea that some of these funds have Master Builders or the AiG on them, or all these employer groups, equally represented alongside representatives of the workers—that is a good thing. We should be looking for more ways to harness that kind of cooperation. But those opposite refer to them as 'union funds', because they can't see past that ideological obsession.

Those opposite have never believed in super. They have never believed in its vast possibilities to build a decent retirement for ordinary working people and to build a better future for this country. They opposed it, they froze it, they tried to abolish the low-income super contribution and they tried to weaken penalties for employers not paying. Not even a crisis of this magnitude can make a leopard change its spots; they want to use this crisis as an excuse to come after super. If they want a fight on superannuation, they will get one. The narrow proposal in this bill is fine, but what is not fine is to come after super, to destroy the system, to freeze pensions. If they want to do that, they'll have to come through us.