Julia Irwin (Fowler, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister for Human Services and Minister for Financial Services, Superannuation and Corporate Law. How will the government’s stronger and fairer superannuation reforms benefit young people? What threats are there to Australia building a world-class retirement income system?

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

I thank the member for Fowler for her question. The reforms announced by the government do act on our commitment to improve our superannuation system and ensure that some of the social dividend from the mining boom is directly channelled into national savings. This is a long-term economic reform which will have long-term benefits.

I am asked by the member for Fowler about those benefits for young people. I can inform the House that an 18-year-old entering the workforce today will be $200,000 better off at retirement because of these reforms. This is important when you consider the amount of time that 18-year-old will need to spend in retirement. The expected time spent in retirement, because we are all living longer, will almost double from 1960 when it was 12.5 years to 22.4 years when we get to the year 2050. When it comes time for today’s 18-year-olds to retire from the workforce they will need enough retirement income to last at least 22 years. It stands to reason that those who will be in the workforce longest under this reform system will be those who benefit very substantially.

The member for Fowler asked me what threats there are to Australia building a world-class retirement income, and the threat sits opposite. Last week the opposition got around to announcing their response to the budget. In their own special way they responded to the government’s budget. The member for Goldstein released a list of things that would be cut. This list confirmed that the opposition opposes the increase in the superannuation guarantee from nine per cent to 12 per cent. They oppose the re-funding of the contributions tax to low income earners, and they oppose allowing people over 50 to make concessional top-up payments to their superannuation funds. They also oppose paying workers aged between 70 and 75 superannuation.

It was this last one that really got my attention. I get a lot of letters about this from older workers in the workforce saying, ‘Why should we be discriminated against just because we turn 70? Why shouldn’t we receive superannuation payments?’ The government considered this and, in order to encourage workforce participation and in order to deal with this discrimination, we announced that we will change the law and will have superannuation guarantee payments for people aged 70 to 75. The opposition oppose this as part of their savings measures. I thought this was a bit curious because this measure does not cost the government any money. They included as a savings measure the abolition of a measure which does not cost money because people who receive superannuation payments for the first time pay tax and this will increase government revenue by $15 million. So the opposition hate superannuation so much that they use as a savings measure the abolition of a measure which will actually make the government money. That is how much they are opposed to the retirement incomes of Australians. This takes their sloppiness to new heights.

Their inconsistencies do not end there. One month ago the shadow minister for superannuation—and, yes, there is one; it is the member for Cowper—gave a speech to the Australian Institute of Superannuation Trustees. It was a scripted, written speech. As far as we know the member for Cowper might have even rehearsed in front of the mirror, so we should have been able to take what he said as the gospel truth. He said that the opposition in government would allow people over 50 to make concessional top-ups to their superannuation payments. That was a commitment from the shadow minister for superannuation. It lasted one month.

On 19 April this was announced as policy by the shadow minister for superannuation. On 19 May, the shadow minister for finance announced this was no longer opposition policy; it had been discontinued. It lasted a month. Their commitment to people aged over 50 lasted a month. How inconsistent can you be? But the Leader of the Opposition is probably very pleased with this. He is probably pleased with the inconsistency. I noticed in the Financial Review today the former Leader of the Opposition and former Leader of the Liberal Party, John Hewson—somebody who knows the current leader very well—said that the Leader of the Opposition thinks:

… consistency is the hobgoblin of little minds.

That is the view of the Leader of the Opposition, and that was just before John Hewson said:

Tony is genuinely innumerate—

that he finds economics ‘boring’—

He has no interest in economics and he has no feeling for it.

That is what Professor John Hewson thinks of the current Leader of the Opposition. That is what he thinks of his economic skills. So we should not be surprised about this inconsistency and this complete lack of economic policy skills from the Leader of the Opposition and the shadow treasurer, who together are the weakest frontbench economics team from opposition in living memory. But we will not be distracted by the inconsistency and the myopia of those opposite. We will continue with our policy of improving the retirement incomes—

Mrs Bronwyn Bishop (Mackellar, Liberal Party, Shadow Minister for Seniors) Share this | Link to this | Hansard source

Mr Speaker, I rise on a point of order. It is on relevance and indeed the common-sense rule applying to whether the answer is relevant. I draw your attention to page 555 where it simply says that lack of provision in the standing orders relating to answers does not preclude you making a decision and a determination that it is clearly relevant. The minister should sit down.

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! Whilst I cannot read my own handwriting for the last part of this question, I was acting in the belief that the minister was being relevant to that aspect. But having said that, I am sure that he is bringing his answer to a very quick conclusion.

Chris Bowen (Prospect, Australian Labor Party, Minister for Financial Services, Superannuation and Corporate Law) Share this | Link to this | Hansard source

It fell to the Labor Party in the 1990s to introduce a national superannuation scheme, against the opposition of the Liberal Party. It now falls to the Labor Party to strengthen the national superannuation scheme in a reform that will have lasting benefits for decades.