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Thursday, 26 September 2002
Page: 5002

Senator LIGHTFOOT (2:39 PM) —My question is addressed to the Minister for Revenue and Assistant Treasurer, Senator the Hon. Helen Coonan. What steps are the Howard government taking to assist employees to consolidate their superannuation accounts and give them the freedom to decide where their superannuation is invested? Further, is the minister aware of any alternative policies?

Senator COONAN (Minister for Revenue and Assistant Treasurer) —I thank Senator Lightfoot for the question and for his longstanding interest in these very important issues of choice and portability of superannuation. These are issues that affect all Australians—at least those who are able to save for their retirement. As senators on this side of the chamber would be well aware, Australia does have a world-class superannuation system and the government is currently working to implement a significant package of superannuation reforms to make further enhancements.

The package is designed to encourage a culture of savings among all Australians. It includes measures which will assist those with the greatest capacity to save for their own future and those who are able to do so. It proposes that employees should be able to determine where their superannuation contributions are paid. Letting individuals choose where their retirement savings are invested is a fundamental plank in the government's plan for the future of superannuation. The Howard government's policy of choice and portability, if the Senate passes it, will deliver control into the hands of those with the greatest stake in superannuation— that is, employees.

Senator Sherry —You haven't got a policy on portability. You have a discussion paper that says nothing.

Senator COONAN —Recently, I released for public comment a consultation paper on the implementation of the government's portability of superannuation policy. Portability will give members of accumulation funds the right to transfer benefits from their current superannuation funds to a fund of their choice.

Senator Abetz —That is a very important measure.

Senator COONAN —It is important, because APRA figures from March this year indicated that there are just over 24 million superannuation accounts in Australia, which means that there are approximately two to three accounts for every person who can have an account. This means that many Australians could be paying fees and charges on three or more superannuation accounts which will eat away at their savings and reduce their standard of living in retirement.

Senator Sherry —And they can't get out because you won't ban the exit fees.

Senator COONAN —To complement choice of funds, portability will allow members to consolidate their superannuation benefits in one account reducing the impact of fees and charges.

Senator Sherry —How can they do that if there are exit fees, Helen?

The PRESIDENT —Order! Senator Nick Sherry, come to order. Stop shouting across the chamber.

Senator COONAN —I am asked if I am aware of any alternative policies. Choice has been introduced into the parliament and it has been opposed both times by the Labor Party and the minor parties in the Senate. It is a patronising action. We do not choose which shares or securities employees invest in. It is a matter of choice. So why would you restrict superannuation?

Those on the other side, in particular Senator Sherry, try to argue that Australian adults who buy homes, who invest in shares, who raise their families and who run businesses somehow lack the wit or the wherewithal to choose where their superannuation should be invested. The government has allocated $28.7 million to the Australian Taxation Office over four years to conduct an education campaign and to administer choice. The Labor Party seems to think that $28.7 million is small beer and that it is not enough. The Labor Party spends like there is no tomorrow—what comes to mind is the $8 billion that Labor wasted in interest payments on Labor's debt, and the enormous deficits that Labor favours. I think $28.7 million is quite a lot of money. It is, of course, possible to take an intelligent and targeted approach to education, to work with industry and to be efficient. We know employees deserve freedom to choose. Their superannuation is not their employers' money. It is not the government's money. It is the employees' money and they should be able to choose. (Time expired)