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Thursday, 5 December 2002
Page: 7276


Senator WATSON (2:06 PM) —My question is directed to the Minister for Revenue and Assistant Treasurer, Senator Coonan. Will the minister update the Senate on what control Australian workers have over their superannuation? What steps is the government taking to address the issue? Is the minister aware of any alternative policies?


Senator COONAN (Minister for Revenue and Assistant Treasurer) —I thank Senator Watson for the question and acknowledge his continuing interest in this very important issue. Australia's superannuation system is growing at a phenomenal rate. The maturing of the system and the increases in the superannuation guarantee rate mean that for most Australians superannuation savings are their second largest asset after the family home; yet today most Australian workers are in the preposterous situation of having absolutely no say in where their superannuation savings are invested. Regardless of the fees they are charged, the returns their funds achieve or the services their funds deliver, these employees cannot change their super fund. Even though it is the workers' money and the workers paying the fees, the decision of which fund to invest in is made for them by their employer or through their award by their union.

The person paying the piper here does not call the tune, and this government believes that it is time that changed. The government has been trying for six years to implement choice and portability in superannuation to let employees choose their fund now and to allow them to roll money from different funds into one more efficient chosen fund. With a more flexible and dynamic labour market, portability and choice are absolutely vital to the efficient and effective growth of retirement incomes. We believe that people should be able to take an active interest in their superannuation, to choose a fund that suits them, to direct their money to ethical investments if they wish and to consolidate their superannuation into one account to save money on fees and charges.

Repeatedly, the ALP have opposed and blocked these reforms and are giving every indication of getting ready to do it once again. There are clearly some vested interests that would like to protect the current system from competition, and the ALP are completely in their pockets on this issue. The ACTU do not want employees to have a choice; they want to be free to direct workers' money into union funds, and they have sent the message loud and clear to their minions here in the Senate. Recent Financial Planning Association research shows that 71 per cent of employees believe they should have the right to choose their own super fund. This is another example of Labor and their union masters acting against the interests of workers.

The government's superannuation choice legislation was backed by the electorate at the last election and has strong support in the community. Asked whether they were happy to let their employer choose where their money was invested, as occurs under the present system, the answer from employees was a resounding no. How does Labor's spokesperson on this, Senator Sherry, justify his steadfast refusal to allow some competition into the system to bring down fees and improve services? `Simple,' he argues, `the public aren't capable of making a choice, so it needs to be made for them.'


Senator Abetz —How patronising!


Senator COONAN —Yes, how patronising, Senator Abetz. According to Investor Weekly, Senator Sherry told an industry lunch last week:

The problem with choice of funds is that it is based on the presumption that we can educate members, but I am sceptical that we can educate nine million people.

According to the Labor Party, Australian workers are not up to choosing their own super fund and never will be. Senator Sherry should seriously think about whether he should be following union orders on this one. It is not employers' money, it is not the super funds' money and it is not the government's money; it is employees' money, and they should have a say on where it is invested. This is just a commonsense freedom, and it is about time it was granted to all Australians.