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Tuesday, 7 December 2004
Page: 96

Senator CHERRY (6:23 PM) —I move Democrat amendment (1) on sheet 4473:

(1) Schedule 1, item 1, page 3 (lines 6 and 7), omit the item, substitute:

1 After subsection 23A(2)


(2A) A report prepared in accordance with subsection (2) can be in the form of:

(a) pay advice; or

(b) letter; or

(c) any form in which the information can be communicated effectively to the employee.

This particular clause seeks to broaden the flexibility of the reporting requirement on quarterly superannuation. In particular, it seeks to ensure that reporting to an employee through a pay slip is deemed to be compliance with this legislation. What that means is that an employee will actually be told either through a letter from their employer or through some other form, as the act currently requires, or by their pay slip, into what fund their superannuation is going.

This puts into place very formally the provisions which the minister was speaking about in her comments earlier and which are also included in the explanatory memorandum, where it says that there are requirements that allow for superannuation to be reported in pay slips. The minister said in her closing comments that this is a requirement of award legislation and of state payroll legislation. As I pointed out in my speech in the second reading debate, there are holes in that reporting system. In respect of the award system, because of the award simplification process many awards no longer include clauses requiring the actual notification of payment of superannuation. In particular, the award only requires the pay slip to include the information where the award clause actually says that. I would have thought that the vast majority of employees who are covered by the workplace relations system are not covered by a requirement in the award clause that superannuation contributions and the award fund be included.

The minister also pointed to state legislation about payroll payments. It is worth noting again that New South Wales, South Australia and Queensland are required to contain certain information about contributions but they do not include information about the fund to which the contributions are to be paid. So we have a significant hole in the award system in that it only requires the information be included in the pay system if the award clause actually says that that is the case. We have a significant problem with state legislation in that three states that have reporting of superannuation do not require the fund to go on the pay slip.

What we are simply saying in relation to the minister's comments about ensuring that the reporting be done through pay slips is: `Okay, fine—if they do report through pay slips then they are deemed to meet this reporting requirement,' so that there are no holes in the system. Pick it up through pay slips and it is done. If the award clause says you must report it through pay slips then, fine, you comply with the legislation. If state legislation requires you to do it, fine, you comply with legislation. If they do not, then either you do it through a pay slip or you give the employee a letter or some other form of communication. I commend this amendment in particular to the Labor Party, because it is your policy. I will read out the policy released by Nick Sherry and Simon Crean in November last year:

All contributions, made by either the employer or the employee, are included on an employee's pay slip at the time of payment.

Employers are already required to report SG contributions made on behalf of an employer to accumulation funds within 30 days of the contributions being made. Labor will extend this to require reporting of all contributions made to an accumulation fund through an employer.

The Labor Party said that this was important to protect superannuation fund members and to ensure that they knew where their superannuation was going. So this amendment we are moving today is the Labor Party's policy at the last federal election. It is also the intent of what is expressed in the explanatory memorandum. From that point of view, I commend it to the Senate. I think it is an important amendment and I hope that the Senate supports it. In moving this amendment I ask the minister whether she will acknowledge that there are holes in the award system where the award does not include a clause requiring information in respect of payment of superannuation and whether she also recognises the hole in respect of state legislation in that it does not require the fund to be noted on pay slips?