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Wednesday, 16 June 2004
Page: 23916

Senator SHERRY (2:49 PM) —My question is to the Minister for Revenue and Assistant Treasurer, Senator Coonan. Can the minister confirm that, in respect of the estimated take-up rate of the existing superannuation co-contribution, she said in the Senate debate on Wednesday, 17 September last year, `There are about half a million people who will receive the co-contribution—540,000 is the estimate'? Can she further confirm that at budget estimates on Friday, 4 June this year, Dr Rothman confirmed that the take-up estimate was 540,000 individuals?

Senator COONAN (Minister for Revenue and Assistant Treasurer) —Thank you to Senator Sherry for the question. No, I am not going to confirm either of those statements unless Senator Sherry wants to refer me to a document that I can have reference to while I am answering the question. What I can say is that the government's co-contribution scheme not only is popular but has been significantly enhanced by the recent budget measures. We have seen over the past number of months a suite of measures that significantly augment a direct injection into the retirement incomes of low-income Australians. I would have thought that was a very worthy objective. It is certainly one that is supported by industry. I would have thought that all Australians would support the very useful way in which the co-contribution can enhance the retirement savings of ordinary Australians. When you look at how much money has been devoted to these measures, you can see that this government is very serious about doing something significant to put some money behind its retirement income strategies. Initially, the co-contribution measure introduced into this place seemed to receive only half-hearted support from the Labor Party. The debate took a very long time, with those on the other side cavilling about how many people might take it up and making all sorts of other criticisms, whereas in fact it has proved popular and the industry has very much welcomed it.

That led to an extension of the co-contribution. People who earned under the superannuation guarantee were also able to access the co-contribution, as a matter of fairness. It is not as if anyone has to have $1,000 to take advantage of the co-contribution. Any amount is acceptable and will qualify for a co-contribution. It can be spare change; it can be any amount that any Australian who qualifies wishes to contribute to enhance their contribution. This was then extended again in the budget. The threshold was increased to $28,000 for the maximum contribution up to an increased range of $58,000.

Senator Sherry —Mr President, I rise on a point of order. The point of order goes to relevance. My question related very specifically to whether or not the minister gave an estimate of 540,000 as the likely take-up. I have just sent the Hansard quote over there, if the minister wants to have a look at it—page 15368, to be precise. That is the question I asked. Relevant!

The PRESIDENT —The minister has over a minute to continue her answer. I am sure she will come to an answer.

Senator COONAN —The point I was making in answer to Senator Sherry's question is that, with the expanded range of people who will be entitled to the co-contribution up to $58,000, many more Australians will now be able to access the co-contribution measure. Not only does the income range extend to assist those people who earn under $58,000—because there was some mention that those people did not get anything out of this budget—but this measure directly responds to lower and middle-income Australians, who are now able to access a retirement income strategy for themselves to enhance their retirement savings. The co-contribution measure will provide to Australians an opportunity, not previously available, that this government has designed and implemented to enhance the retirement savings of low- and middle-income earners. (Time expired)

Senator SHERRY —Mr President, I ask a supplementary question. Given that I have passed the transcript over to the minister, can she confirm that she said there are about half a million people who will benefit from, or receive, the co-contribution? Further, can the minister explain why the Treasurer, Mr Costello, in a statement to the House of Representatives on 13 May this year, claimed in reference to the existing superannuation co-contribution scheme:

The changes will improve retirement income savings for over one million Australians who already receive the co-contribution ...

Minister, which is the correct figure—the 540,000 that you claim is the figure or the `over one million' that the Treasurer claims is the figure?

Senator COONAN (Minister for Revenue and Assistant Treasurer) —Thank you for the supplementary question, Senator Sherry. I can understand that Senator Sherry may not have followed the fact that there have been three announcements in respect of the co-contribution, each of them with their own estimates. My recollection is that the Treasurer was referring to the most recent announcement. I can also understand how Senator Sherry may find it very difficult for the opposition to be dealing with a measure which opens up the superannuation saving system to low- and middle-income earners so they can seriously augment their savings. That might be difficult for the opposition to deal with. We have seen nothing from the opposition that remotely approximates the benefit to low- and middle-income Australians from the co-contribution measure. If Senator Sherry is worried about take-up, he should just wait and see how this new measure will go.