When I came into the chamber to make my contribution on the Treasury Laws Amendment (Your Superannuation, Your Choice) Bill 2019, I did a bit of a double take, because I thought I heard Senator Watt say that he is supportive, or that the Labor Party are supportive, of this bill. I thought, ‘Well, that’s news,’ because we have been trying to provide more choice for Australians to determine how their own money is invested for basically five years now, and the Labor Party have fought tooth and nail for those five years against those workers’ rights to choose where their money is invested.
It’s a pretty simple choice for people to have. It’s their money. They’ve worked hard for it and accumulated it. They should have some choice, you would think, over where that money is invested. I thought, hearing Senator Watt, ‘Well, maybe the Labor Party have seen the light and have realised five years later, after losing two elections since, that maybe, if they want to represent workers’ rights, they might actually make some decisions in favour of workers and in favour of an individual worker’s right to decide where their money is invested and goes; maybe they’ve had that epiphany.’ But I find, after checking with the minister’s office here, that apparently I’m completely wrong, Senator Watt was trying to pull the wool over all of our eyes. The Labor Party are not supportive of this bill, of workers’ choice or of individuals being able to invest their money as they would like to do it. What they’re really going to try do is amend the bill in the committee stage so it doesn’t actually provide that choice. They can have a fig leaf of saying they support choice, but they’re really going to try once again to deny workers their right to invest their own money and try to stymie this bill once again.
As I said, this has been a long road, trying for five years to provide something as simple as workers’ choices. This bill came from recommendations that were made by the Financial System Inquiry way back in 2014. This was an inquiry that was established by the incoming coalition government when it was elected in 2013, a root-and-branch inquiry into the financial sector. I think it was the largest inquiry into the financial sector since the Campbell inquiry in the early 1980s, which presaged the financial sector reforms of that era. The Financial System Inquiry final report came back in late 2014, and it recommended that there be greater choice given to workers in where their super is invested, particularly where, currently, that choice might be taken away from them through an enterprise agreement. That recommendation by the Financial System Inquiry was supported by the government, hence this legislation.
Subsequent to the 2014 Financial System Inquiry final report, it was also supported by the Productivity Commission in their 2018 report. They also highlighted issues with an existing lack of choice among members in enterprise agreements and some practical things too; practical things that Senator Watt wouldn’t realise because he never goes to a factory or a mine, or talks to real workers—and I’ll come back to the Labor Party, what they really think and why they’re really passionately against this bill. The practical thing of this is that a lot of people end up locked into multiple superannuation accounts because they don’t have choice, because they’re told through their employment contract where they will invest. An account is established for them without their choice and, if they happen to change jobs, if they happen to have a few jobs over their working life, they can end up with a variety of different superannuation accounts that they’ve had no choice over but are left with and anchored with through to their retirement.
The issue with that is that it’s not just a complexity for them. The issue is that it often leads them to paying much, much more in fees to the financial industry than they would have otherwise if they’d just had a consolidated one or two, or only a few, accounts. By making workers accumulate multiple accounts, the winners here are the financial industry. They’re the bankers. They’re the people in the big buildings in Sydney that go up 40 or 50 flights of stairs—now they don’t use lifts so much—to nice views of the city. They’re the people who benefit from that complexity, not your average worker; not your average person just trying to earn a wage every week and put a little bit away each side for their retirement. They don’t benefit from that complexity, the banking industry does. And by opposing these changes here today, the Labor Party show their true colours: that they’re really on the side of the bankers, not the workers. That is the position of the Labor Party on this bill, because the people that benefit from a lack of choice for the workers are the financial industry who, through complexity, can charge more fees on more accounts and more bonuses for themselves every year when those fees accrue.
Surely we could agree on something as practical as that—as simple as that—that we should reduce complexity, help workers out and ensure that they don’t get saddled with excessive and unnecessary fees through their working life. Surely we could all agree with that? But we can’t, because the Labor Party cannot bring themselves to provide that choice, in part because they’re supporting this big financial industry. But that wouldn’t really give you the reason why they’d so passionately—and it was a passionate speech from Senator Watt before—fight against such complexity. Why would a once-proud workers party, the Labor Party, be passionately in favour of bankers and the banking industry? The reason is that they’re part of that industry now; that’s the reason. They’re part of it. They used to fight against banks. They used to want to nationalise the banks. They used to hate the banks. They used to hate the financial industry. But now, the modern Labor Party is a sold-up subsidiary of the Australian financial industry. That’s why they’re passionately against it, because they’re part of it.
They get board positions on superannuation funds; they get a little bit of a clip of the fees. We all know how the financial industry works: you just want a little bit of the crumbs. You just want to have lots of transactions. If you get a few of the crumbs that come off the table, you make a lot of money. The Labor Party are all part of that, sitting at the bottom of the table and eating those crumbs that come off the contributions that the average Australian worker makes. That’s why Senator Watt and the Labor Party so passionately defend this industry, because they benefit from the industry. It is like mother’s milk for the Labor Party. Superannuation fees, banking fees—the whole banking industry is mother’s milk for the Labor Party, because they suck on that teat time and time again and it helps all their mates out. And we’ve seen how they look after their mates in the Labor Party.
If we put aside all the ideology about super—and we had this large speech from Senator Watt about the super system: how retirement savings are ‘at risk’, apparently, if we pass this legislation—all this legislation does is allow a worker, an individual worker, to say: ‘Look, whatever my EBA says, whatever has been agreed between the trade union and the business, I’d like my funds to go somewhere else. I’d like to have a self-managed superannuation fund,’ perhaps, or, ‘I’d like to have a different wealth accumulation strategy.’ That’s all it does. But, apparently, according to the contribution from the other side, that puts at risk billions of dollars of retirement savings and the very future of Australians’ retirement in old age. What a load of absolute tosh! How could you draw those conclusions from this bill? You just can’t. They don’t stand up to scrutiny. It is an excuse being put here for the Labor Party to provide that protection to this broader industry.
At the heart of that protection that the Labor Party is engaged in here is a complete lack of respect for an individual and his or her own choices. It’s a lack of respect for an individual and the fruits of his or her own labour. That is the difference between the approach the coalition government is taking here, through this bill and to issues of superannuation more generally, and the stance of the modern Labor Party on these issues.
It does go to the heart of a philosophical difference, almost, between the two sides here. Generally speaking, when we talk about taxes and spending, and now people’s savings, quite often we hear inherently in the contributions made by members of the Labor Party that they don’t really believe that that money is other people’s. They don’t really believe that the taxes people pay come from their work. They don’t really believe that the money we spend here, whether it’s on JobKeeper or whether it’s on the variety of other assistance packages we have provided through this crisis, is other people’s money. They get confused and they start to believe that it’s actually their money: ‘Almost all money should stay with the government, and we will just give some of it back to you every now and again.’ That’s the fundamental difference between the Labor Party and us here in the Liberal and National parties; we believe that people have an inherent right to the money from the work that they do. We believe there should be an appropriate tax system to fund public services but that that should always be done with care and with the knowledge that we are managing other people’s money, not ours.
When this crisis hit, when it became clear a few months ago that our economy would almost certainly enter recession—although that hasn’t officially happened yet, it almost certainly will—and that people were going to come under great hardship, especially those sectors directly affected by this crisis, naturally we felt that people should have access to their own resources to help them respond to such a crisis. If you have accumulated and saved an amount of money through your super, and, rightly, you’re trying to do your best to save for your retirement, and you’re hit by an unexpected out-of-the-blue shock as we have been with coronavirus, you should have some ability to draw down those resources you have accumulated for that risk. That’s exactly what you’re doing for your retirement anyway; it’s just more predictable than these other risks and eventualities that have occurred through the coronavirus crisis. What you’re doing for your retirement is putting money aside for that time, because, as you know, at some stage you’re not going to earn as much you do today. Putting that money aside for times when you don’t have as many resources is not particularly different to what we’ve experienced here today; as I said, it’s just more unexpected. What we’ve experienced in the last few months has been an unexpected income and wealth shock for many people. It makes absolute, abundant sense to allow people to draw down their own resources to help them in that situation. It’s also fair.
I picked up from Senator Watt’s contribution before that what he thinks should have happened is: ‘Don’t allow people to draw down their own resources; the government can just pay people. The government can just hand out money to people in those circumstances.’ How fair would that be, though? If someone is sitting on hundreds of thousands, possibly millions, of dollars of superannuation in their account, why should the government—remember, it’s other people’s money; it’s not the government’s money—help bail that person out? Why shouldn’t someone in that situation be allowed to first look at their own resources and how they can respond to such a situation before seeking assistance from others to do so? Keep in mind: we have provided that assistance. We do help and support those who can’t and don’t have their own resources to do so in the circumstances. But if you do have those resources it is actually fair to require that to occur first, and that’s what has happened in this instance.
We’ve seen the popularity of this. We’ve seen that people do actually want to have control of their own money—surprise, surprise! A shocking finding, that people do have some inherent want and desire, when they’re in bad circumstances, to say, ‘I can draw down a bit of super right now and I might be able to catch it up later.’ We trust people to be able to manage their affairs over time. They don’t need to be led, and at times like this it’s right and proper that we help them.
It’s right and proper that we have a superannuation system that’s actually designed for workers and their needs at an individual level, not the needs of the bankers in the modern-day Labor Party. They are full of bankers. There are not many workers in their ranks, but lots of people from the banking industry. They are tied to that industry now and that’s why they’re passionately opposing these changes, which would invest workers with choice, which would allow an individual to decide how their own money is invested and which would provide a little bit of scope for people to manage and control their own futures and affairs. That’s why we passionately support these changes. They’re simple commonsense changes that we’ll keep trying to chip away at and, hopefully, eventually, this place—this Senate—will seek to invest individuals with their own choices and their own rights, not big corporations and banks.
