Bert Van Manen (Forde, Liberal Party) Share this | Hansard source

I have got to hand it to the member for Reid for the 10 minutes of non-contribution to a debate when we have seen over the past two weeks that the government's magnanimous support of the mining industry with its ill fated and ill constructed mining tax has left far more in the hands of the mining companies than we could have ever hoped to achieve on this side of the House. Whilst they want to give us a lecture about superannuation and revisit history, I think they need to take a bit of a reality check on their economic credentials and success over the past five years.

It is with great pleasure that I stand here today to speak on this MPI and to speak about the negative impact of the government's superannuation measures and tax rises. Since coming to power this Labor government has relentlessly attacked Australians planning for the future by hitting them square on the nose with over $8 billion in extra taxes and revenue from superannuation.

The only reason this has been necessary is because we stand here and look at a government that has spent too much and wants to spend even more, and super is where the money is. It is not just me or my colleagues on this side of the House who have grave concerns about the future of superannuation under this government. I would like to quote the chief executive of Australia's largest bank, Mr Ian Narev, who warned in the Australian Financial Review today:

It is absolutely critical that we have a long-term position and certainty in superannuation.

He went on to say that super should not be used as a political football.

I say to the government opposite and to the Treasurer: it is time to put the ball down. Does the Treasurer not realise that in 2010 he said, and I quote:

… we think certainty is absolutely paramount when it comes to the retirement income system, and we want people to have confidence that they can save in the way in which they have in the past.

As I said earlier, we all know that this government needs all the tax revenue that it can get its hands on. That is not because the people of Australia have done the wrong thing over the past five years; it is because we have a government whose profligate spending has created a situation where they need to find money from every piggy bank they can get their hands on.

Let's look at some of their past efforts in the superannuation space, namely—and I think this is one of the most regressive steps they took—to reduce the concessional contribution caps from $50 in $100,000 to $25,000 across the board. They also reduced the government's super co-contribution for low-income earners and doubled the super contribution tax for high-income earners. In addition, they changed the definition of income in their favour to draft more superannuation earnings into the tax net. To follow on from this, the government's sequel now threatens self-funded retirees through even more taxes.

Yet on this side of the House we have an alternative plan, and that is to encourage voluntary savings—the very thing that Labor plans to discourage. I would like to touch on a couple of facts around self-managed superannuation because I think they are worth bringing to the attention of the House, and maybe it is worth the edification of my colleagues opposite. This is straight from the ATO figures that they collect from the annual returns from self-managed super funds. Eighty-four per cent of the members in self-managed super funds are between the ages of 35 and 64. They are the very people that we want to accumulate as much as they can into superannuation over the remainder of their working life so that they, are self-funded in retirement as much as possible. Bearing in mind that the cut-off limit for the asset test is nearly a million dollars before they no longer have a call on a part age pension, at $25,000 a year as a contribution, less contributions tax, it is going to take 50 years to get to that asset test limit, so we have some work to do.

In addition, 73 per cent of the members in self-managed super funds earn less than $100,000 per annum—hardly the rich and powerful, I might suggest. Self-managed super fund balances that have more than $500,000 over the period from 2003-04 to now have decreased from about 71 per cent to about 47½ per cent. It has shown the value long term of self-managed superannuation funds and people deciding to take responsibility for the management of their own funds. Ultimately, it means the more we have in super the less call we are going to have on government resources.

Australians are doing the right thing by saving for retirement, but they deserve stability in the rules and tax arrangements around superannuation. In the long term, how is this government going to pay for the additional age pension impost that will arise as a result of their short-sighted and short-term desire to fix the budgetary problems that they have created through no fault of the people who have taken the time to save money into superannuation? What would happen to the government's finances if there were no self-managed retirees? Self-funded retirement is the ideal outcome for any retirement-income strategy. The more people who are fully or partially self-funded, the more funds there are available to assist those who do not have the capacity to fund their own retirement. This is the risk with the short-term nature of some of the decisions being made by this government to prop up its budget revenue, resulting from its profligate spending.

In 2007 the Treasurer promised no changes to superannuation, but what have we not seen promised from this government? Labor cannot be trusted when it comes to superannuation or people's retirement plans, no matter how much they love to recount the history of superannuation. Everyone in this House now accepts that superannuation is a vital part of the future of this country, providing for retirement and a financial foundation for our future prosperity.

The Prime Minister promised there would be no taxes on super payments for those over 60 under the government she leads. This does not include ruling out increasing taxes on super savings or super earnings. Australians who are doing the responsible thing and planning for their retirement, and who want to contribute more than $25,000 per year in pre-tax contributions, are being taxed on the excess of that at 46½ per cent. I hardly think they are getting an enormous tax benefit at the expense of lower-paid Australians.

On this side of the House, as a contrast, we take a longer-term view. We consider that having an ageing population and an ever-increasing call on government resources in a wide variety of areas is effaced by a government whose only inclination is to continue to tax people with the very capacity to provide wholly, or at least significantly, for themselves.

The cruel irony of this is that the very people we should assist and provide a hand up to lose out because the government does not have the financial resources to adequately do so.

This all came about because we have a government that creates hurdles and disincentives to saving via super for those who want to plan for a self-sufficient retirement. The government applies ridiculously low concessional limits to superannuation while at the same time increasing taxes on those who have already done the right thing by seeking to become self-funded in their retirement. I am pleased to say that there is another way: you do not have to destroy Australians' retirement plans if you stop the waste.

People across Australia saving for their retirement have a clear choice at the next election: on one hand the coalition, which offers stability and certainty in superannuation arrangements; on the other, a repeat of the high-taxing, chopping-and-changing nature of the government's current superannuation strategy, which does little to give anyone confidence in the superannuation system. (Time expired)

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