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Wednesday, 17 February 1999
Page: 2982


Mr REITH (Workplace Relations and Small Business) (12:24 PM) —in reply—The Workplace Relations and Other Legislation Amendment (Superannuation) Bill 1998 reflects a policy position that the government has pursued now for some time, going back to the legislation that we introduced as part of our big reform package in 1996. I thank honourable members who have spoken in the debate. I thank the member for Mitchell for his kind words. He not only has a strong reputation for his long and expert interest in workplace relations, but he has also made a particular point of supporting the interests of small business. That is very important because, if we can encourage our small businesses then our small businesses will give people jobs—and that is what we all want. It should be a matter of common interest on both sides of the House.

This bill, combined with our choice of funds legislation, will deliver a package of genuine superannuation reforms. The new arrangements will make superannuation easier for employers to administer because they will only have one set of federal obligations to meet. The removal of superannuation provisions from all awards will remove a layer of complex detail and relieve employers of the burden of complying with an extra set of obligations which have done nothing more than add to the complexity of superannuation administration. I think most people would agree that superannuation is not a simple area to start with. Anything we can do to reduce the complexity of superannuation is furthering the interests of having a system that encourages people to save for their retirement and to be independent in their retirement.

In the government's view, superannuation is most appropriately dealt with through the superannuation guarantee legislation and through agreements at the workplace or enterprise level. I remind honourable members that when we introduced legislation originally we did not have superannuation as an allowable matter. It was added to the allowable matters list by way of a Senate amendment moved by the government and the Australian Democrats as the result of an agreement between us. It was basically a compromise to try to find a reasonable way of dealing with the issue at the time. The Democrats, in particular, wanted the choice of funds legislation to be dealt with contemporaneously with this. That was not an unreasonable proposal on their part, and so we agreed to it. However, it was always intended by both us and the Democrats that this would only be a temporary measure and that superannuation would be removed from the allowable matters as part of the choice of funds legislative package.


Mr Bevis —Provided you didn't reduce benefits. Don't misquote the Democrats.


Mr REITH —I note that the shadow minister had much to say about how workers would be worse off and how, given the choice of believing Peter Reith or Arch Bevis, they would be mad to believe Peter Reith and should therefore believe Arch Bevis. I actually have another person supporting me on this debate—none other than Cheryl Kernot, the member for Dickson.


Mr Bevis —Read the agreement.


Mr REITH —I have it here. Don't worry, I am going to read it out. Why wouldn't I read it out? It is an embarrassment for you because you have on your front bench a Labor frontbencher who said that what the government was doing was fair enough in principle. She did not say that lightly. We spent hours discussing all the issues you raised in your scare campaign mini-speech a minute ago. We discussed all those issues with the member for Dickson. We gave her a full and comprehensive response to each and every issue. In the end, she wrote to us and said that the Democrats would be prepared to support consequential amendments to the Workplace Relations Act to repeal award coverage of superannuation.


Mr Bevis —What were the conditions?


Mr REITH —Sure, she had some conditions, and I am happy to answer all those issues, but do not run around saying that workers are going to be worse off. Cheryl Kernot agreed with me that this was a reasonable proposal and something that should be continued and implemented.


Mr Bevis —Subject to conditions.


Mr REITH —Her principal concern was—and as I was involved in the discussions I claim to be able to—


Mr Bevis —I have read it as well.


Mr REITH —But you were not in the discussions.


Mr Bevis —No, but I have read the outcome.


Mr REITH —You have read the outcome, but she said that they could see merit in having one piece of legislation governing superannuation rather than having entitlements in two separate systems as at present. This is not a big deal. I will tell you why it is a big deal for you guys: because the trade union movement leadership—not the rank-and-file, not the workers, because they never get a look-in on these issues—the trade union officials, the trade union bosses like a system like this. They see this as their system. It has nothing to do with the interests of workers. It is very interesting when you look at who has turned up for this debate. The first time this issue was before the parliament we had McMullan, Thompson, Ferguson and Macklin—who are respectively members of the LHMU, AWU, the MWU and the Labour Resource Centre, and a member of the CPSU. Here they are—the living puppets.

The second time around we have the same old faces again. This time we have the member for Brisbane, the shadow minister, who is an ex-Queensland Teachers Union member. Then we have Kelvin Thomson, a member of the AWU; Jenny Macklin, the member for Jagajaga, and we have the new member—

Ms Gillard interjecting


Mr REITH —That is right. She has more initials than most academics. They are in here. And why are they here? Are they representing small business in their electorates? Are they representing the 72 per cent of people who are not in a union? No way known! This is just a sectional interest group in here who have no interest in the broader public interest. The only one on their side who has actually recognised that what we are doing is a fair thing is none other than Cheryl Kernot, the member for Dickson. The opposition's criticisms of the bill are, therefore, unsurprisingly, without foundation. Once again they have embarked on their attack on award simplification.

It needs to be seen that this is part of broader policy development which the government has been pursuing. I should say that award simplification was supported by none other than the former Prime Minister, Mr Keating. He was all in favour of it. It was just that when he came to implementing the idea he was unable to do so because the unions got hold of the process. They have made the same baseless claims about this issue as they have made about award simplification generally: they have branded it as award stripping.

Award simplification is not about stripping. It is about making awards less prescriptive and detailed, removing obsolete clauses, providing for more flexible working arrangements and making awards more user friendly and easy to understand. For all their claims about the importance of award superannuation, the reality is that the unions simply have not bothered to keep their awards up to date. If they are so important—


Mr Wakelin —They are hopeless.

Mr Bevis interjecting


Mr REITH —Just hear the facts. The fact of the matter is that, for the most part, unions have not been relying on awards at all. They have relied on the superannuation guarantee legislation and not on awards. The 1994 superannuation test case decision of the commission provided that awards could include the super guarantee levy on contributions. But, five years on, the vast majority of awards provide for three per cent contributions whereas the superannuation guarantee stands at seven per cent.

It is clear that unions have not supported these award superannuation provisions and that they rely on the superannuation guarantee, the legislation—namely, the federal law—to establish minimum contributions. It is the superannuation guarantee legislation and not awards that establishes the minimum superannuation entitlement for the vast majority of workers in the federal jurisdiction. These workers no longer need award superannuation as the guarantee does the work previously done by awards. This will be all the more so with the introduction of choice of fund.

I take the opportunity of reminding honourable members of the origins of the superannuation guarantee legislation. The previous government introduced the guarantee legislation following the rejection of the unions' application to the commission for an increase in award superannuation. The previous government was more than happy to override or sidestep awards at that time. The very people who are here defending this system either forget the history of this matter or have never understood it. It is incredible.

The previous government—your government—was more than happy to override awards at that time, but you never had the courage to deal with the mess that had been created by letting award superannuation continue alongside the guarantee legislation, despite all the inherent problems of having two systems. What a nightmarish, red-tape, duplicated system we inherited from you people because, in the end, you just could not get on and do the basic work that was required to reduce red tape, reduce the cost to employers, reduce the complexity and reduce the confusion, which is what this measure will obviously do.

When it is all boiled down, as with so many issues, the mess in this whole area of superannuation is something that you created. Yet, when we came along with a solution to fix it, you opposed it. It is the same with unfair dismissals. You lumbered this country with an unfair system. We came along to fix it; we got public support for what we were doing—it was voted on at the last election—and when we came up with a solution, what did you do? You opposed it. You created this genuine problem for young people with the junior rates system—a problem that you put in place, although you never implemented it because you yourselves, in government, must have known that it would be a problem—and then we came along with a sensible solution, but what did you do? You opposed it—right across the policy front.

You left us with high unemployment. We put up a whole series of proposals to reduce unemployment, but what did you do? You used your numbers in the Senate because a few trade union bosses told you to do so to try and obstruct the government's program to create jobs.

This bill will fix the problems created by the opposition. It will simplify superannuation regulations for employers in the federal workplace system by removing an unnecessary layer of regulation and provide for efficient and effective regulation through a single set of legislative requirements. Despite my strong objections to the scare campaign run by the opposition in their contributions, I thank even them for coming into the House—

Mr Bevis interjecting


Mr REITH —It is a public document and you can box it. I thank all members for their contributions to the debate. I must say that we have also seen, through this debate in the last couple of days, how sensitive they are to the revelation that 52 per cent of Labor's frontbench are former trade union officials.

When we started running through who the hereditary peers were the other day in question time, it sparked off quite a reaction. We had the member for Charlton, otherwise known as `The Lady Charlton', taking an objection.


Mr Bevis —I take a point of order, Mr Deputy Speaker. What the minister is now going into is not relevant. What is relevant is the agreement with the Democrats. He said he would put the detail of the conditions in Hansard . He should do it, instead of now introducing an irrelevant matter.


Mr DEPUTY SPEAKER (Mr Hawker) —Order! That is not a point of order. I call the minister.


Mr REITH —The former ACTU President, the member for Batman, had to get up and register his objections. Then we had the member for Scullin. He was very unhappy with what had been said.

Mr Danby interjecting


Mr REITH —Well, your attitude to this bill is determined by the fact that your party structure means that the people who have a disproportionate influence over your policy development happen to be the trade union movement bosses who dictate a lot of your policy. It is not just me saying that. The member for Melbourne makes a very good point. He says look at what happened when Gough was leader. In 1966, in the piece on the Whitlam years, Freudenberg said first of all you have to fix up the party. Then you have to fix up—


Mr Tanner —On a point of order, Mr Deputy Speaker.


Mr REITH —Here he is, the author himself. Do you want an application for a literary grant for your next book?


Mr Tanner —No, an application for a literacy grant to teach you how to read.


Mr DEPUTY SPEAKER —What is your point of order?


Mr Tanner —Yes, Mr Deputy Speaker. Clearly, what the minister is talking about has absolutely no relevance whatsoever to the matter before the House and you should call him to order.


Mr DEPUTY SPEAKER —I am sure the minister is summing up his point.


Mr REITH —I certainly am. The point of order that the member for Melbourne takes just demonstrates the sensitivity of the Labor Party to this whole issue. The fact is—as it was back in the second half of the 1960s and as it is again now in the second half of the 1990s—your whole position on some of these critical issues is determined by the policy dictates of the trade union movement. You know that is right. I give you marks: it was a bold measure for a frontbencher to get up and tell the Leader of the Opposition, Mr Beazley, that he had to get his act together when it comes to the structure of the party.

We went through this ourselves in the mid-1980s. This is not new for a political party. It is not easy to attack your leader and keep your place on the front bench at the same time. I understand all that. In the end, you are going to have to address these issues. I think the next book ought to be on the drawing board.

I commend the bill to the House. This is a sensible measure. It should have been done years ago and it took the election of the Howard government to get on and fix many of the problems that Labor left us.

Question put:

That the bill be now read a second time.

The House divided. [12.44 p.m.]

(Mr Deputy Speaker—Mr D.P.M. Hawker)

Ayes . . . . . . . . . . . . . . . . 70

Noes . . . . . . . . . . . . . . . . 63

——

Majority . . . . . . . . . . . . 7

——

Question so resolved in the affirmative.

Voting lists are recorded in the Votes and Proceedings.

Bill read a second time.