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Tuesday, 7 December 2004
Page: 92

Senator COONAN (Minister for Communications, Information Technology and the Arts) (5:59 PM) —I thank honourable senators who participated in the second reading debate on the Tax Laws Amendment (Superannuation Reporting) Bill 2004. The small business sector has for some considerable time been concerned at the administrative burden of the superannuation guarantee employer reporting requirement. The government recognises the high cost faced by employers in complying with this requirement, particularly those employing high levels of casual and itinerant workers. The government has responded to these concerns, which it regards as well founded, with amendments that will remove the requirement for employers to report to employees under the superannuation guarantee arrangements from 1 January 2005. This initiative will significantly reduce paperwork and costs for employers and remove duplication of information for many small businesses.

Some senators have raised concerns that this amendment will have adverse consequences for employees. In fact, I think both of the speakers in this second reading debate have raised this issue. Obviously the government disagrees with this proposition or this bill would not be coming forward in its current form. The basis for the government's disagreement is that, whilst it is important that employees remain informed and engaged in relation to their superannuation entitlements, there is already a combination of practices and safeguards found throughout other Australian legislation that will allow employees to remain informed about their superannuation. Currently, superannuation funds provide members with at least annual reports, showing both employer and member contributions. Only information from funds can provide the certainty to members that contributions have been received by the fund and allocated to the correct account, and members can contact their funds as frequently as they wish.

There are also a number of provisions in Australian workplace legislation and awards that require employers to report superannuation contributions more regularly on pay slips. These amendments will not affect those obligations, nor will they affect an employer's obligation to make superannuation contributions at least quarterly. That brings us to consider the extent to which the notification, in addressing the concerns of small business, can be modified. The Workplace Relations Act 1996, for example, requires employers operating under federal awards, certified agreements and Australian workplace agreements—as well as Victorian and territory employers—to provide information in relation to superannuation contributions on pay slips. That requirement exists already. Queensland and South Australia have similar provisions requiring employers to disclose information about certain superannuation contributions on pay slips. So the government recognises the importance of employees knowing that their superannuation entitlements are being met and having a sense of ownership over their retirement savings. We have talked about that a great deal in debates on superannuation over the past three years. As I have already noted, employees will continue to receive at least annual statements from their superannuation funds and, importantly, even critically, they can contact their funds as frequently as they like to satisfy themselves that their entitlements have been received by their funds and allocated to their accounts. This level of conclusiveness is not provided by current employer reports.

I was disappointed to hear that Senator Cherry is not supporting the bill in its current form. I was hoping that the good sense of the objectives behind this bill would receive support, given the great importance of keeping compliance costs at a level that is not unjustifiably burdensome on our business community and of getting the balance right between keeping employees informed of their contributions and meeting the need for business efficiencies and reducing the compliance burden. We are all aware that small business continually complains about compliance. If I may just foreshadow, it seems that the amendments that are being proposed ignore the fact that the objective of this bill is to significantly reduce the compliance burden on employers, particularly small businesses. We will get to it later but I think I can apprehend Senator Cherry's amendment, and my response to it is that it simply does not achieve this objective and is not aligned with the government's intent in this bill. The amendment would fail to assist small business and would maintain an onerous quarterly reporting requirement that has in effect been made redundant by the existence of other measures and safeguards that I have outlined in my remarks. For all of these reasons the government will be urging the Senate to pass the bill without amendment.

Question agreed to.

Bill read a second time.