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Wednesday, 15 June 2011
Page: 6084

Mr CRAIG THOMSON (Dobell) (11:41): The government is doing the right thing by its current serving Defence Force men and women by improving superannuation benefits for the majority of those in uniform. The contributions from those opposite on the superannuation bills have been absolutely amazing. They do not dispute that they are going to be better off financially because of the changes. The big thing they are opposed to is employees' representatives—unions—being given a voice on these superannuation funds. Guys, you picked the wrong area in which to be disputing unions' contributions to a policy issue if you are picking on the unions' contribution on superannuation.

The union movement has an impeccable record on superannuation, and it is worth going back and recapping where we would be in Australia without the unions and their push to make sure we have superannuation for all Australians. In Australia we have had superannuation in some form for a little over a century, but for most of that period it has not been universal. Labor has a proud record of reforming and developing superannuation to make it universally available. In 1974 the Australian Bureau of Statistics conducted the first survey of superannuation, and it came up with a pretty sorry sight. Only 32 per cent of the workforce was covered by superannuation, and only 15 per cent of females who worked were covered by superannuation. In the private sector it was even lower: only 24 per cent of people in the private sector had super cover under the conservative government that was in at the time.

The first major breakthrough was not until 1985. That breakthrough came because the union movement made an important contribution to superannuation in this country by working hand in hand with the Hawke Labor government. In 1985 the ACTU sought a three per cent employer superannuation contribution, to be paid into an industry fund as part of the national wage case with the Australian Conciliation and Arbitration Commission. And guess what? Those opposite opposed it then, and they have opposed it ever since. They resent the fact that working people should be provided for in their retirement through universal superannuation. So today's opposition to these bills comes as no surprise.

Before the union movement mounted its campaign and reached an agreement with a Labor government, access to superannuation was deeply inequitable. Before the unions' national wage claim in 1985, only a minority of workers had superannuation, and these were mainly higher earning white-collar workers, public servants and those in the Defence Forces. In recognition of the need to develop strategies to manage an ageing population, the Labor government supported the ACTU's claim, and in February 1986 the commission confirmed that awards would include contributions of up to three per cent to approve superannuation funds. Between 1986 and 1990—a period of Labor government—the number of employees covered by superannuation funds rapidly increased from around 40 per cent of employees to 79 per cent of employees as a result of the commission's ruling. On this side of the parliament we have taken the view that superannuation is needed. Those on the other side have continually attacked and tried to draw it back. On coming to government their contribution was to try and break the industry schemes through choice in superannuation. Of course, what actually happened was that the industry super funds increased the percentage of people participating because they are well-run funds with union representation on their boards and they deliver better returns than most of the retail funds. That is why they have been so successful and that is why the opposition from those opposite is purely ideological. It is in the DNA of those opposite to hate unions. It does not matter what the issue is, they try and bring it up.

Mr Robert interjecting

Mr CRAIG THOMSON: The member opposite says, 'Despise unions.' That is a great contribution that he has made, and it is entirely consistent from the party of Work Choices, who tried to rip away working peoples' conditions, in that they would oppose working people—be they in the military, the public service or generally—from having access to adequate retirement funds through access to superannuation. This party opposite want to take away rights from working people in all aspects. That is why they supported Work Choices. It is no surprise that we see, less than two months after coming into office in New South Wales, attacks on public sector workers by the O'Farrell government. The attacks are almost worse than Work Choices in that they are taking away the rights to have representation before an industrial relations commission, which has existed in the state of New South Wales for over 100 years and which was supported previously in a bipartisan manner.

From those opposite we have an instinctive hatred of working people who want to have their conditions preserved by an independent umpire, but most of all what they dislike is unions. It does not matter what the issue is, if there is an opportunity for them to come along and say that the big bad unions are going to be the downfall of something, they will try and do it. Of course, it does not stack up in reality and it certainly does not stack up with superannuation. In terms of superannuation, as I have already outlined, without the wage claim in 1985 we would not have universal superannuation in this country. It was because of the union movement and then because of the Hawke Labor government that we saw a universal superannuation being extended to most workers in this country. We should remind ourselves what the figures were when the coalition was in government. There was only 32 per cent of the workforce with superannuation and only 15 per cent of females.

Those on this side have a proud history in relation to superannuation, a proud history in making sure that superannuation is accessible for ordinary people, and a proud history of making sure that superannuation is run in a professional manner—a manner that gets the best returns for those people who are part of superannuation funds. That is why people on this side of the House have no problem in saying that industry super funds have been an overwhelming success. If those opposite actually went out and spoke to the financial markets or went overseas they would understand that our industry super funds are the envy of the world. The OECD recommends that governments, when they have the resources available, should look at Australia's universal superannuation system. It is something that is admired around the world.

What do we have from those opposite? We have pot shots about who sits on the boards. It is demeaning of those opposite, but it is also insulting to those many union officials who have sat and worked for the best interests of their union members on the superannuation boards to make sure that our superannuation funds in Australia, our industry superannuation funds that have union representations, give the best returns of any superannuation funds in this country. I think that the members opposite owe a big apology to those people who have contributed so much over many years now to make sure that our funds are the envy of the world.

There are three bills specifically in relation to the debate here today. One of those three bills is the Governance of Australian Government Superannuation Schemes Bill 2011. This bill gives effect to the government's announcement in October 2008 to merge the Australian Reward Investment Alliance, the Military Superannuation and Benefits Board and the Defence Force Retirement and Death Benefits Authority to a consolidated trustee body. The new consolidated trustee body, to be known as the Commonwealth Super­annuation Corporation, will be responsible for managing the main Commonwealth civilian and military superannuation schemes. It will also assume responsibility for two closed civilian superannuation schemes from the Commissioner for Superannuation and for the Defence Force (Superannuation) (Productivity Benefit) Determination. The merger will bring more than 680,000 members and pensioners and over $21 billion in funds under management of the CSC. Again, what we find from those opposite is that the only objection to this bill is who is going to sit on the board.

The second bill is the ComSuper Bill 2011. This bill gives effect to the government's decision in November 2009 to modernise the governance structure for the administration of the Australian government superannuation and to clarify the functions of ComSuper. The statutory office of the Commissioner for Superannuation will be replaced with a CEO of ComSuper to be appointed by the Minister for Finance and Deregulation. The CEO will be responsible for providing administration services to the CSC. Replacing the role of the Commissioner for Superannuation with a CEO and transferring the commissioner's current trustee responsibilities for some old, closed civilian schemes to CSC will allow the CEO and ComSuper to focus on the delivery of administration services. Under the bill ComSuper will be established as a statutory agency for the purposes of the Public Service Act 1999 comprising the CEO and staff of ComSuper.

The last bill in the package, the Superannuation Legislation (Consequential Amendments and Transitional Provisions) Bill 2011, supports the reforms including the governance and the ComSuper bills. The bill does this by making consequential amendments to a range of Commonwealth legislation to take into account the changes to the governance of Australian government superannuation. It also puts into place transitional arrangements for the reforms. The bill transfers responsibility for the management of the scheme under the Superannuation Act 1922 and the Papua New Guinea Scheme from the Commissioner for Superannuation to the CSC. The bill also facilitates public sector employees being able to consolidate their superannuation savings under the management of the CSC, should the government decide to implement such a reform in the future.

Overall, the package of the three bills implements reforms required to maintain strong, contemporary governance arrangements for Commonwealth superannuation schemes that will allow substantial benefits to flow to members while retaining the individual scheme benefits and entitlements. The package protects those features of military superannuation that recognise that military service is unique and different to civilian employment. So these bills are targeted bills that go to making sure we have better administrative arrangements that have a real effect on the payouts and entitlements of civilian, public service and military personnel.

The package of bills will increase superannuation returns for the majority of our serving members. Specifically, it will increase the take-home superannuation of over 90 per cent of our current serving personnel. It will also benefit all future members of the Defence Force. By way of example, a 0.5 per cent increase in the net investment return for a member of the RAAF, who joins as an officer cadet and rises through the ranks to group captain at retirement, would lead to an increase in superannuation benefit of $95,000 over the full career.

So we have here legislation that is modern and provides up-to-date administrative arrangements and tangible benefits in terms of superannuation outcomes, but all we have from those opposite is their fear and the bogey associated with the scare campaign that they want to run on union interests—legitimate ones—not being excluded from these superannuation boards as trustees. Again we see the complete bias of those opposite who cannot help themselves and attack the unions and also the government in this case for legislation that is about improving outcomes for military people, civilians and public servants and about improving their arrangements. The whole basis of their opposition is about trying to silence the voices of the elected trade union representatives of the workers who work in those industries. If this were the first time that this had ever happened you might say, 'Well, let's have a look and see how it works,' but we have industry superfunds and we have union representatives who are nominated by the ACTU on these funds. We have had industry funds operating since 1986. They have been universally acknowledged as being great vehicles for people's retirements and have been tremendously successfully. To try and run a campaign opposing these bills shows how shallow those opposite are and shows how they really do not have at heart the interests of any workers, whether they be public servants, the military or the general public. These important bills should be passed, and I commend them to the House.