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Wednesday, 17 August 2011
Page: 4662

Superannuation


Senator SINGH (Tasmania) (14:04): My question is to the Minister representing the Minister for Financial Services and Superannuation, Senator Sherry. Can the minister inform the Senate how the Gillard government is ensuring Australia's long-term economic future through its superannuation strategy? How are these reforms and those of previous Labor governments maintaining a stable and certain environment for savings, investment and retirement income planning?


Senator SHERRY (TasmaniaMinister Assisting on Deregulation and Public Sector Superannuation, Minister for Small Business and Minister Assisting the Minister for Tourism) (14:05): I thank Senator Singh for her first question—on superannuation, of all issues. This week is the 20th anniversary of the announcement of the introduction of compulsory nine per cent super¬≠annuation. We on the Labor side are very proud of the implementation of this policy. It has led to the creation of a savings pool of some $1.3 trillion, which is particularly important in these uncertain economic times. It is also particularly important for the stability in investment and savings that it provides to our economy. Of course, there were many critics 20 years ago. In fact we hear the same sorts of criticisms today of the mining tax and the carbon tax that we heard of the superannuation guarantee all those years ago. In 1985 Mr Downer said about compulsory superannuation:

It casts aside the Government's concern that it once said it had for the business community and the capacity of the business community to create wealth in the economy … this whole superannuation deal is one of the most underrated threats to the future stability of Australia's economy, and indeed to the capitalist system … This is a dramatic leap towards the objective of socialism…

That is what we heard from those opposite and they have not changed their view. They have the same dire warnings on the impact of the mining tax and the same dire warnings on the impact of the carbon tax. Of course, in time they will also be proven to be untrue. Indeed, those measures will strengthen the Australian economy, just like compulsory superannuation has done for this country. We propose to go further with superannuation. We propose to cut the contributions tax— (Time expired)


Senator SINGH (Tasmania) (14:07): Mr President, I ask a supplementary question. Does the government believe that fundamental superannuation reform challenges remain, and what reformist policies will the Gillard government pursue to address these issues?


Senator SHERRY (TasmaniaMinister Assisting on Deregulation and Public Sector Superannuation, Minister for Small Business and Minister Assisting the Minister for Tourism) (14:07): As I was saying, we propose to use some of the money from the mining tax to reduce the contributions tax for millions of low- and middle-income Australians. We intend to reduce, and abolish in most cases, the contributions tax paid by low-income earners. We propose to increase the superannuation guarantee from nine to 12 per cent. What do we hear from those opposite? The same negativity, the same criticism which has proven to be untrue. We still hear the same lines, the same mantra—we still hear the same lines on the carbon tax and we still hear the same lines on the resources tax. Of course they say they are going to scrap the resources tax. How are they going to find the $70 billion in savings? One of the things they will have to do is increase the contributions tax for low- and middle-income earners after they scrap, if they ever get into government, the mining tax. The mining tax helps pay for tax cuts in superannuation. (Time expired)


Senator SINGH (Tasmania) (14:08): Mr President, I ask a further supplementary question. Is the minister aware of any alternative policies to the historic achievements of the Gillard government and of previous Labor governments, and do these alternative policies—

Honourable senators interjecting

The PRESIDENT: Order! When there is silence, we will proceed.

Honourable senators interjecting

The PRESIDENT: The time for debate is after 3 pm. If you want to keep this up, we will just chew up question time. Senator Singh, continue.

Senator SINGH: Do these alternative policies pose threats to our economy?





Senator SHERRY (TasmaniaMinister Assisting on Deregulation and Public Sector Superannuation, Minister for Small Business and Minister Assisting the Minister for Tourism) (14:10): We have had conflict¬≠ing statements from those opposite on the issue of superannuation and the increase in the nine per cent superannuation guarantee. It is hard to work out what their policy is. Back in May Mr Abbott said he had no plans to increase the super guarantee—and little wonder, because it is funded at least in part by the revenue from the resources rent tax. Apparently this was not communicated to Mr Hockey last night, who had yet another fairly embarrassing interview on 7.30. He wriggled around, refusing to identify where he was going to make savings, including any savings he might make on the superannuation guarantee. He is having great difficulty because he has to find $70 billion in savings, after they have scrapped the mining tax—if they ever get into government. After they scrap the resources tax the Liberal-National Party have to find tens of millions of dollars to fund all the promises they have made. The Liberal-National Party are wreckers. They have no policies and, if they do, those policies just contradict each other. They are just wreckers who have no regard for the future of the Australian economy. (Time expired)