Superannuation (Objective) Bill 2023



Ms CLAYDON (Newcastle—Deputy Speaker) (18:52): I certainly won't be supporting the amendment, but I am delighted to rise in this House to support the Albanese Labor government's Superannuation (Objective) Bill 2023. I've listened to some of the contributions here, and it frankly breaks my heart that the coalition seems unable to support a single superannuation bill that is put before this House—for what has been almost decades now.

As I said, I am delighted to rise in this chamber to support this bill on a policy made universal and compulsory by the former Keating Labor government. Superannuation has a long history in Australia. The super guarantee laws passed through this very House in 1992. Mr Keating was able to see that the number of those reaching retirement age in Australia was going to explode in the coming decades—we know he was right—and that that would result in increased pressure on age pension payments and put additional strain on the economy. That was going to present some challenges, and one of the great solutions to those challenges was superannuation.

I note the three pillars of a secure retirement, which were explained, perhaps incorrectly, by members opposite a moment ago. The first was to ensure that we had a social security age pension. That's a great thing. The second component was the compulsory superannuation contributions, and the third part was additional private savings. Working together, they would make sure that Australians had a comfortable income and some dignity in retirement.

There is a fundamental disconnect and misunderstanding about what superannuation is in this House, and that is tragic. One can only assume that there is some deliberate misunderstanding going on here. Despite those opposite purporting to know about the three pillars of a secure retirement, they have taken absolutely every opportunity to undermine superannuation in Australia—to undermine the very intention of superannuation.

Let's go back to the Howard government's freezing of the planned increases in contributions. It exploded over the past decade when the former government allowed—and, indeed, strongly encouraged—Australians to raid their own super funds with reckless abandon and lifelong detrimental impacts. I think that's what people really need to understand here. This is not just an impact for now, particularly for women—I'll come to this point later—who already have more than 25 per cent lower superannuation balances than men. If you raid that super fund now, you never, ever, ever catch up. You're already behind the eight ball, and you will never catch up. What a depressing outcome. But that is exactly the reckless-abandon behaviours of people opposite who like to appeal to populous ideologies about this.

During the COVID pandemic we saw exactly what would happen. The former Morrison government strongly encouraged people to go out there and withdraw money from their own super funds to stump up for their recovery, rather than asking the government to have an economic stimulus package that was a fairer distribution of the common wealth—the common monies that belong to the Australian citizens. Under the former coalition government's scheme Australians could make initial withdrawals of $10,000 in the first half of 2020 and then a further $10,000 from 1 July. Figures from the Australian Prudential Regulation Authority reveal that, during this short window of 12 months, Australian workers withdrew more than $36 billion from their retirement savings. It means that those Australian workers were not only abandoned by the Morrison government but were then asked to pay for the failure of the Morrison government's policies to protect them during a time of crisis by spending all their superannuation. They will be far worse off in the future.

On average those who used that scheme under the former coalition government cut their super balances by 51 per cent. In fact, expert analysis of that scheme suggested that those people have now deprived themselves of $120,000 in retirement savings, missing out on compound interest over their working lives. Those who withdrew super moved quickly to spend it. We know that because they were withdrawing on average $1,064 from ATMs, at a time when the use of cash had dropped significantly. The next identifiable expenditure that we could track was gambling, with an average spend of $293 per person on gambling. That's where that money went. Earners of the lowest incomes were most likely to use their withdrawal on the quick cash spends that I was just talking about. People with low incomes and people in regional and remote parts of the country are the groups of people that the former government failed to assist, letting them raid their super funds to make up for failed policies of the other side. Let's not sugar-coat what happened there.

Those that were on higher incomes—and I heard the member for Menzies speaking earlier, alleging that he funded himself through his super funds during COVID-19—were more likely to save their money than withdraw it. This unprecedented, short-sighted political attack is a catastrophic blow to the retirement prospects of an entire generation of Australian citizens. Yet those on low incomes are the most disadvantaged—again, let down by the former Morrison government.

In the following year, in 2021, while women were taking to the streets saying 'Enough is enough', speaking out about sexual harassment, sexual assault, and family and domestic violence and calling on the government to do more and be better, the Morrison government, rather than increasing funding and support to those frontline women's services and organisations, announced a plan—it was gobsmacking, I have to say—to say to those women: 'Do you know what? You go and access your own superannuation funds. Your retirement plans can all go out the window now. You go and fund your own safety escape plan now.'

The member for Dunkley, the late and great Peta Murphy, marched straight into this chamber when that policy was announced. She was astounded and outraged, as we all were, at this—yet again—failed policy approach by those opposite. She said at the time.

It defies belief that women who are protesting should not only be glad they're not getting shot but should also have to go into poverty to escape violence.

She said:

The response of the Morrison government to women needing to flee violent relationships is to say, 'We know you earn 42 per cent less than men in superannuation, we know that the fastest-growing cohort of homeless people is women over the age of 55, and we know that single women in retirement are more likely to live in poverty than men, but don't worry—if you need to escape a domestic violent relationship, you can draw down on your retirement savings in order to do so.'

Well, the coalition government quickly withdrew that idea. They instead turned their attention to raiding super for housing. So, ahead of the 2022 federal election, the coalition released a housing policy built on the premise that the only way to make sure young Australians can afford a home is to allow them to raid their superannuation funds. Luckily, they were not re-elected.

You would hope that that terrible policy idea would have quietly faded away when they lost government. Instead, just last week the shadow housing and homelessness minister, the member for Deakin, reaffirmed the coalition's commitment to it and flagged that it could indeed be expanded, that they might expand the policy to increase the amount that first home buyers can withdraw. The Super Members Council has slammed the proposal, with modelling showing that property prices could rise by nearly $75,000 across Australia's five largest capital cities—not to mention the fact that it goes against the very principles of superannuation: delivering a dignified retirement to more Australians.

Time and time again the coalition government has raided the superannuation system for its own ideological purposes, despite, as I said, those lifelong detrimental impacts on Australian workers. And it will no doubt continue to do so, with this week's confirmation of expanding their ridiculous idea of raiding your super fund now to cover up 10 years of failure to do anything constructive about addressing the housing crisis in Australia. They throw their hands in the air and say: 'Sorry, we've got nothing to say about how to fix the housing crisis. But do you know what? Do you need some cash? Go and ensure that your retirement is absolutely put in jeopardy, that your chances of retiring in dignity is put in jeopardy by the lack of policy capacity of our members'—those opposite.

This is why the bill before the House today is so important. It will go some way to making sure this sort of short-sightedness never happens again. It will enshrine the objective of superannuation in legislation to preserve savings and to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way. This simple and straightforward objective will serve as a guide for future governments, regulators, industry and the wider community, instilling greater confidence in the system. It will make sure that the focus of super is on the best interests of its members and not of those interested in ideological battles, and it will ensure that any future changes to the superannuation system will support its objective, not supplant or undermine it. Put simply, this bill will secure super's future by embedding its purpose into law, and it will do so by requiring ministers to produce a statement to parliament explaining how any proposed changes to super are compatible with its legislated purposes. Policymakers will be held to account, and that's a good thing. They'll be held to account when considering changes that affect Australians' retirement savings.

The objective will not alter superannuation trustees' existing obligations. Super funds will continue to be required to make investment decisions in the best financial interests of their members. This legislation also doesn't change the ability of members to get early access to their super on genuine compassionate grounds or in cases of genuine financial hardship. They are absolutely legitimate reasons for early access to super funds. For trustees, the objective will serve as a reminder of their role to support members during their working life and into retirement, and, with more Australians approaching retirement age than at any other time in our history, delivering better retirement incomes has never been more important. It is astonishingly shortsighted, and not just that but utterly reckless, for those opposite to suggest that we should just be raiding these super funds at this time in history.

This bill's an important step towards making a stronger super system for a stronger economy, and it has been met with strong industry support. I want to thank the industry for their engagement. Built by Labor, the now $3.5 trillion superannuation system is the fourth-largest pool of retirement savings in the world. I'm very proud to be part of the party that built superannuation. We will protect it and make it the best it can be, to ensure that it continues to deliver dignity in retirement for generations of Australians to come.