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Monday, 21 May 2012
Page: 4908


Mr PERRETT (Moreton) (16:21): I rise to voice my support for the Tax and Superannuation Laws Amendment (2012 Measures No. 1) Bill 2012 and commend those opposite for supporting this wonderful piece of legislation. This bill brings in a raft of amendments to ensure Australia's tax and superannuation systems operate in a fair and just manner in the best interests of the Australian people. This bill seeks to re-establish an intended operation of GST law by making certain the supply by a healthcare provider, paid for by an insurer or a government entity, is treated as a GST-free supply where the related supply from the healthcare provider to an individual is a GST-free health supply. This bill also amends A New Tax System (Goods and Services Tax) Act 1999 to restore the policy intent that noncommercial activities of government related entities are not subject to GST.

It also brings in the government's Mid-Year Economic and Fiscal Outlook measure to halt the indexation of the concessional contributions cap for one year. The bill provides eligible people the opportunity to have certain excess concessional contributions refunded in tax, giving individuals who exceed their concessional contribution caps for the first time a second chance.

It allows the ATO to offer improved online services by allowing taxation officers to on-disclose protected information to superannuation entities and the administrators, and it implements a necessary integrity measure by giving the Commissioner of Taxation discretion to delay refunding an amount to a taxpayer pending checks of their claim. These are all necessary actions I am pleased to see in this bill, and I echo again the support of those opposite.

But I would like to speak in greater detail about the bill's requirement that employers keep their workers in the loop about superannuation contributions, including how much and when payment is expected. It is a sad truth—and I think that some of the members on this side of the chamber would have seen it in their previous jobs—that not all employers do the right thing. Certainly in my time working in the education union I saw education employers that had got into trouble. Thankfully, it is not something that happens a lot in the education sector but it does happen. When employers do not do the right thing—or some rogues or those in economic trouble do not do the right thing—and they do not make their superannuation guarantee contributions in full and on time, the employee misses out.

This troubling situation is only made worse when employees are left in the dark and they cannot ask the ATO to step in on their behalf. Sometimes when a business is going to the wall it is a tough time for the management and they just forget to communicate with their employees. This problem impacts on thousands of workers. You need only look at the ATO 2010-11 annual report to see the extent of the problem: almost 18,000 employee complaints were investigated, superannuation guarantee entitlements for nearly 300,000 employees were raised, and $269 million in superannuation guarantee charge and $139 million in penalties were collected.

This bill will allow employees to check that their contributions have actually been made by their employers, because once it is sitting in the hands of the trustees of the super fund it is ticking over for the benefit of the employee. Obviously when it is sitting in the office tin it is not benefiting the employee at all, even though that was the contractual relationship: that they receive the money. So it is great to see the Gillard Labor government take action to address this significant problem.

Superannuation has a long history in Australia. Way back in 1915, the Income Tax Assessment Act provided for tax deductibility of employer contributions made on behalf of employees and for the exemption of superannuation fund earnings from taxation—obviously a good initiative back in 1915 but not widely accessed by many in the workforce. Fast forward to the early 1970s, and still only 32 per cent of workers were covered by superannuation. Obviously with superannuation you had the benefit of investment and accumulation and also the relative certainty of making those investments by the appropriate mechanisms. In 1973, the Whitlam Labor government established the National Superannuation Committee of Inquiry. However, it was a Liberal-Country Party government that decided against setting up a contributory national superannuation scheme in 1977.

Fast forward to the 1990s, when 64 per cent of employees had superannuation coverage—obviously better but nowhere near good enough. So it was in 1992 that the Keating Labor government, building on the initiatives of the Hawke government, introduced compulsory superannuation. I seem to recall that I was working in 1992—I was in my sixth year of teaching—and there was certainly a wages trade-off as part of the original deal. We saw after the legislation that a year later 80 per cent of employees either made super contributions or had them made on their behalf. Since then many other steps have been taken to improve security for retiring workers by creating a fair, sustainable and efficient superannuation system. There has now been a gradual increase, and we have seen in the enterprise bargaining context that people do make trade-offs in terms of what they will do at their retirement.

The 2012-13 budget is building on this history of superannuation and of reforms by taking another step forward, boosting the superannuation guarantee from nine per cent eventually up to 12 per cent. From 1 July this year, workers earning up to $37,000 will get a boost to their superannuation savings worth up to $500. This ensures they effectively pay no tax on their superannuation guarantee contributions. This follows our decision to bring in the low-income superannuation contribution. It is not right that a small number of high-income earners have been getting a much better tax deal out of super than millions of Australians on average incomes—although I did notice some opposite speaking against this in their speeches. This Labor government is taking action to make the system fairer by bringing down the higher tax concession that very high-income earners receive on their concessional contributions. This will bring them a little bit closer in line with the concession received by average income earners.

No matter what we see, unfortunately some people opposite will continue to whinge and moan, but I note that they do support this legislation. It is always good in government when you can look at the average workers and their needs rather than people like Clive Palmer and Gina Rinehart. It is always good to put the average worker first. What we are doing is appropriately governing for all Australians and supporting families and businesses currently struggling to cope with the cost of living. I commend the legislation to the House.