SUPERANNUATION (SURCHARGE RATE REDUCTION) AMENDMENT BILL 2003: Second Reading
Mr CADMAN (Mitchell) (6.11 p.m.) —That is a strange amendment to the second reading motion for the Superannuation (Surcharge Rate Reduction) Amendment Bill 2003, I have to say.
When I look at the amendment and at the budget proposals put forward by the Leader of the Opposition, I see that the proposal is to reduce all contributions. Are you going to improve the lot of the worker by forcing reduced contributions? That is a strange way of doing things.
You make a claim that you are going to improve the lot of retirees, yet your policy, stated by the Leader of the Opposition in reply to the 2003-04 budget, is to lower the superannuation contributions tax from 15 per cent to 13 per cent. That is the tax factor; you are going to put more back into the super funds. Very impressive! This is inconsistent, illogical and poorly thought through, with no policy base, no understanding of superannuation and no commitment to it or the workers. This is very strange policy making from a very strange party. I can just imagine somebody in that great organisation saying that turkeys had voted for Christmas; somebody probably did say that during the recent decision on the leadership.
I do not know how logical people can bypass the gradual change proposed by the government to relieve the super surcharge for those at the top end contributing towards their own retirement. It seems to me that this nation is in conflict over what is the best thing to do about retirement. The Australian Labor Party say, `We're going to reduce the tax on the super funds,' while the coalition say, `We're going to reduce the amount people at the upper end are going to have to contribute. We're going to allow them to actually contribute a greater amount to the fund, and we're not going to claw back so much through the super surcharge.'
There is no doubt that superannuation is complex. But this is a step towards making it clearer and easier. The claim of the coalition is that this is a worthy recommendation. It is a process that will improve the lot of those who should be encouraged to prepare for their own retirement. The disadvantage and disincentive in the current system is wrong. It was proposed that from 1 July 2002 the superannuation and termination payment surcharge rates would be reduced by one-tenth of their current levels for each of the next three income years. The Australian Labor Party rejected this, and they have proposed instead a reduction of tax for super funds.
The explanatory memorandum for this bill updates the figures in the 2002-03 budget papers, and the financial impact to revenue is now expected to cost $65 million in 2003-04, $170 million in 2004-05 and $290 million in 2005-06. When announcing this process, the Minister for Revenue and Assistant Treasurer, Senator Helen Coonan, said:
The Federal Government will increase the momentum for superannuation reform with renewed efforts to implement its election promises.
It seems strange that the government, having made commitments to the Australian people, is now being told: `You have got it wrong and the Australian people have got it wrong. Only the Australian Labor Party can read what the community wants, and we're going to move our own amendments.' If the Labor Party are so successful in reading the community's mind, they would have won the election—that is the fact of the matter. But they lost. This is their way of saying, `We want to have our way anyway.'
It reminds me of my mother-in-law, who used to watch the television chefs making their favourite recipes. She would follow the recipe and be critical of the amounts of ingredients in the recipe. As she watched the presentation on television, she would change the ingredients. When she went to cook the recipe, she found that she only made the same things as she always had and she was not at all excited with what the recipe of the famous chef was supposed to provide. That is what the Australian Labor Party are doing here. They wish to change something that is sensible and far-sighted which encourages those who ought to be preparing for their own retirement and takes away some of the penalties, and they are wondering why they are going to get the same results as they always have from employers and the community. They are proposing a forced superannuation process, which is something that is not going to produce long-lasting benefits in retirement and that lacks imagination. (Quorum formed)
As I was saying—
A government member—Tell us about the bantams.
Mr CADMAN —The bantams are the ones that say the turkeys voted for Christmas, and there is one sitting at the table. The idea that you are going to help people superannuate by insisting on keeping high taxes is crazy. The Australian Labor Party has no policy, no direction and no understanding when it comes to superannuation. The simple measure that we have here reduces the tax on the super surcharge in a scaled process. Part 2, schedule 1 of the bill indicates that 13.5 per cent of the amount to be accrued for the 2002-03 year will be removed. In 2003-04, 12 per cent of the amount accrued will be removed and in 2004-05 it will be 10.5 per cent. That is a very simple approach; it is a simple bill. Mr Deputy Speaker Price, I am disappointed and I know that the constituents of Western Sydney—who we represent and who the member at the table would not understand—will be absolutely shattered by the unintelligent, inept approach to superannuation being offered by the Australian Labor Party. [start page 15943]
I have spoken on this bill before. I have pleaded with the Australian Labor Party to have some commonsense in what they are doing and to encourage people to superannuate. That is a promise we made at the election. The Australian Labor Party want to ignore or change a commitment that we made. Their solution—and I cannot believe they suggested it—does not help the superannuation payers. They are saying that they are going to cut the tax on super funds. They are going to help the institutions; they are not going to help the people paying super at all. On that note, I have to retire to my office to meet a crowd of people who have got a much more intelligent approach than you have here. I am really disappointed in the way in which this process has been handled. I would have thought that even the member for Grayndler, who claims to have an understanding of superannuation, would stop his party from being so crazy.
Author: Alan Cadman MP
Source: House Hansard - 18th June 2003
Release Date: 3 Jul 2003