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Monday, 30 May 2005
Page: 75

Mr TUCKEY (5:44 PM) —The shadow parliamentary secretary to the Leader of the Opposition, the member for Lowe, quite clearly did not write his own speech. It would not have been a bad idea if the shadow minister for finance and superannuation had given him some advice as to what he would be reading. I think he experienced great difficulty in understanding the fundamentals involved, but I wish him well anyway because he made a decent try.

The Superannuation Bill 2005 and the Superannuation (Consequential Amendments) Bill 2005, which are being debated cognately, are an extension of a major policy decision of the Howard government taken originally some years ago and defeated time and again in the Senate. In fact, sometimes it was not even introduced because the Senate made it patently clear that it would not support a fundamental concept of Australia—that is, the opportunity to make decisions in one’s own or one’s family’s interests. The House today has had some debate, which I might refer to more specifically later, about the idea that a modern day employee or employer might like a choice in the arrangements they make as to the remuneration of the employee.

This legislation states that new Public Service employees will have the choice that legislation already debated in the House gives to private sector employees of the superannuation company, fund manager or private fund that, in their opinion, best handles the employer contribution towards their superannuation. Not only is this a good and fair idea but also it addresses a problem that has been around since the commencement of compulsory superannuation. You will remember, Mr Deputy Speaker, this first materialised in state government awards, which made it compulsory that certain employers paid into certain union funds a percentage above the salary of their workers’ salaries.

I might have been the first person to stand in this place in opposition at the time to draw to the attention of the parliament how unfair this arrangement was. I quoted from letters from workers in the shearing industry who pointed out that, even in that trade, they had a multitude of funds to which, from time to time, contributions were being made on their behalf. As a consequence of the nature of their industry, which is seasonal and cyclical, they took other employment at different times. They might have gone to drive a truck, for example, at harvest time when people were not shearing. That money had to go into a different super fund to the one they had for their shearing jobs. They had a multitude of funds, every one of which was having $30 or $50 a year extracted from it, notwithstanding that from time to time there would have been no money going into it.

That situation existed until the Howard government decided to take on the Senate again on the issue of superannuation choice. I would imagine that the first thing that many workers would want to do—if they even know where their money is—is to have it aggregated into a single fund with a single management fee and, of course, a better return on the moneys that a variety of employers have paid on their behalf to assist them in their retirement. For those reasons alone, having choice is eminently sensible. But this legislation will establish the Public Sector Superannuation Accumulation Plan, or PSSAP. I like the SAP bit—‘soon as possible’, which of course is not what it stands for. The point is to give new employees entering the public sector the opportunity to have the funds that the taxpayers of Australia will provide paid into the super fund of their choice.

It is a matter of record that back in 1990 the then government, the Hawke government, introduced measures to create a funded superannuation process for employees who entered the public sector around 1 July 1990. So we have had progress away from a totally unfunded scheme over time. Nevertheless, the superannuation of people who are affected by that scheme and those arrangements remains where it is. This choice process is for new employees. The two bills being debated cognately are the Superannuation Bill 2005 and the Superannuation (Consequential Amendments) Bill 2005. Both set out to put these arrangements into legislation. The employer concerned, under modern arrangements in the public sector, is typically a secretary of a department who has quite a lot of freedom in making arrangements with their work force within their budgetary entitlements and who will understand what offers they can make to employees in the future. I support these arrangements and congratulate the Minister for Finance and Administration, who has brought this additional legislation to the parliament. Clearly public sector employees should be in the same category as others.

I am a little interested in the amendment that was proposed at the last minute by the shadow parliamentary secretary. It talked about scaremongering, suggesting in some way that we should not really worry about the unfunded component of superannuation and the burden it might put on young people who are virtually babies as we stand in this place and whose taxes will have to support that particular situation. That is like running deficit budgets: you are asking the kids of tomorrow to pay for the extravagance or the vote-chasing of the people of today. We saw a five-year period in Australia where a government—principally the Keating-Beazley government—borrowed $80 billion, taking the debt of this parliament from $16 billion to $96 billion, which, of course, has had to be repaid. We as a government could have left it there for my grandkids or somebody else’s children, but we thought it was our responsibility to correct that arrangement and get the matter back into some semblance of order.

It is interesting because while that debt was being contracted there was a huge amount of revenue obtained by selling the Commonwealth Bank, Qantas, Australian Airlines, Commonwealth Serum Laboratories et cetera—not because of any philosophical bent of the government of the day and not because they thought it was a good idea, but simply because they needed the money. As a consequence, the proceeds of those sales were spent at that time, while the additional debt was contracted. It is a matter of record that in attempting to fix this problem, the Howard government, in disposing of a portion of Telstra, immediately applied the proceeds to the reduction of that debt so that it is not a burden for the future. With the changes to representation in the Senate, the government proposes a future fund, which will be primarily directed to the unfunded component of public sector superannuation, except since 1990. With these new measures, future superannuation for new employees in those two categories will be funded. The government will make a contribution on a regular basis and it will form part of the budget announcement, as will any deficiencies that occur as a consequence—and that is fair enough.

I do not know where the scaremongering is. I guess it is the suggestion that maybe this is not a very large cost. To tell you the truth, whether it is large or small, it is our responsibility to address the issues of people who have been employed in the public sector, not people who are going to be employed in the future. The government should make provisions now. In terms of that future fund and the responses to address the unfunded side of the government’s superannuation responsibilities, I must express in this place—as I have to the Minister for Finance and Administration—some concern as to how that money will be managed. There is a suggestion, and I think it is quite proper, that it be at arm’s length from politicians so that it is not—as happened with the sale of the Commonwealth Bank, Qantas and those other government business enterprises I mentioned—consumed in recurrent funding or through wacky deals. I do not believe—as a consequence of superannuation, which will be enhanced by choice—the share market or stock exchange activities necessarily are the proper repositories for this money.

We see massive changes as we speak, with the proposed takeover of Western Mining—another major independent resource company disappearing from the stock exchange with huge payouts to the shareholders. We see in many ways that, as a result of compulsory superannuation, there is a huge investment pool within Australia. I am not convinced that gambling it on the stock exchange and reducing the return per dollar of share value is a good idea. It extends to high farce, in my mind—as the National Bank discovered some time ago—that derivative trading, which I refer to as one person betting today that they can find someone more stupid than themselves tomorrow, is an appropriate means of building wealth. The original idea of futures or derivatives was to bring together somebody who needed to secure a price—whatever it was—for their product, with someone who needed to buy it at that price because they had ongoing commitments to manufacturing using that product. That was appropriate. People started going in and making judgments—having a bet. They would have got better odds at the races in many cases.

I want to put that on the record. I have given the message to senior people in our party that as they progress with the future fund, which I endorse, they should look at the investment. I do not think there is anything wrong with good investments in business enterprises that need government to subscribe in the early stages. The government did it with the Darwin-Alice Springs railway—and let us hope that over time that investment, which is a gift, will ensure that operation is maintained and adds value to the economy. Telstra and the Commonwealth Bank were investments by a government at a time when nobody else wanted to invest. I argue that another investment of that nature should be made in tidal power in the Kimberleys, which nobody wants to do at this time. In the cases of Telstra and the Commonwealth Bank, there comes a point in time when it is no longer appropriate for the government to run a business of that nature, it would be better operated by the private sector, and the government could take a good profit on behalf of the taxpayer. I put those matters forward for when one looks at superannuation and where it is going.

Let me take this opportunity to endorse the Prime Minister’s remarks today after an attack from the member for Perth and the Leader of the Opposition, who wanted to make all these comparisons between members of parliament—the job they do and the remuneration they receive—and other people in the community. It is a silly exercise. But it also greatly denigrates the efforts of people in this place. I have been here longer than most and I am well aware of the financial opportunities I would have had if I had remained in the private sector. I do not regret my decision and I hope over time that there are things I have done in this place that have contributed to the welfare of the people I represent directly, and the rest of Australia.

I have not seen a truly lazy member of parliament in 24 years—I do not care who they represent. I find it passing strange that it was raised by two people who have been totally dependent on politics for their personal remuneration throughout their lives as compared with many others who have come here from aspects of the private sector—less so on the Labor Party side, I must say—to give service at what are relatively average levels of remuneration in this day and age. Why should these two people, who as I said in an interjection during question time today, have never had a real job in their lives be the ones chucking bricks in a house of glass? It is silly, and I am glad the Prime Minister took them on today. What did we have? We had their previous leader attacking the superannuation system that for the 50 per cent of MPs never—

Ms King —On a point of order, Mr Deputy Speaker. I ask you to draw the member back to the content of the bill.

The DEPUTY SPEAKER (Mr Lindsay)—The member for O’Connor will come back to the content of the bill.

Mr TUCKEY —I am a bit confused as to how I would follow that instruction, having heard the previous speaker, who was all over the place in his contribution.

I am talking about superannuation for new employees, which includes members of parliament and the public sector. The old system so criticised by Mr Latham was not very generous to people who failed to serve in this place for more than eight years: they just got their money back. Many other issues, such as the idea that a younger person retiring after 10 years service could get a pension for life, were fixed. Again we had this tall poppy syndrome argument being presented in this place, and a lot of the public did not understand what it was all about. If those opposite want to have a political debate, they should get some decent facts and figures, speak to them and make a point. But I thought that that exercise today was hopeless.

With my time almost concluded, I would like to say that this is a good bill which is built on good legislation for the private sector. The bill gives the same rights to a public servant notwithstanding that, if it is their choice, they can accept the PSSAP as the fund to look after them. Otherwise they can go out, and some of the better remunerated might want to run their own scheme. There are provisions in the tax law to do that. They should have that entitlement as much as it is available to private sector employees.

In regard to that choice, a lot of remarks were made about where small business might be inconvenienced by the new arrangements, as typically we governments ask them to do a lot of work that maybe we should not be asking them to do. However, I was encouraged the other day when the Minister for Revenue and Assistant Treasurer, Mr Brough, was questioned in our party room about some of this complexity, and he pointed out, for instance, how an employer with a number of people that have the same choice of super can send one cheque to a single fund with advice as to where that money should be distributed, and the funds will do that work. That is going to be a great help. And presumably arrangements in the public sector might be the same, but they will not need to be because they have very large numbers. (Time expired)