Minister for Financial Services & Superannuation
14 September 2010 - 1 July 2013
Liberals Warming up for Back Flip on Superannuation
Reports today of a chaotic split in the upper ranks of the Liberal Party show Tony Abbott's team are warming up for a massive back flip which will leave millions of Australians worse off, Minister for Superannuation Bill Shorten said.
Shadow Finance Minister Andrew Robb slammed the Liberal's own policy on Sydney radio yesterday, calling their commitment to keep the Labor Government's historic boost to superannuation a move which will 'knock the stuffing' out of employers.
"Andrew Robb either supports his party's policy, or he's preparing the ground to scrap it - because he clearly can't have it both ways," Mr Shorten said.
"Mr Robb has obviously come to the conclusion that Joe Hockey and Tony Abbott are writing cheques their egos can't cash. The Liberals have been left in a financial state where they simply do not have the money to support the Gillard Government's boost to Australian's retirement savings."
"Put simply, Andrew Robb has belatedly realised what has been apparent for some time, their $70 billion budget crater means they literally cannot afford to have positive plans for working Australians."
The Gillard Government's boost to compulsory superannuation from 9 to 12 per cent, as well as the effective abolition of tax paid on superannuation by Australians earning under $37,000, is made possible through the revenue of the Minerals Resource Rent Tax.
A core pillar of our retirement savings system is that if we are going to make saving compulsory we should also tax it concessionally. Taxing super concessionally at 15% rather than at higher marginal tax rates comes at a significant cost to the Budget. Revenue from the mining tax ensures the lift is affordable.
We are also abolishing the 15 percent tax paid on superannuation contributions of people who earn less than $37,000. There is also a significant budget impact of handing back that revenue. 3.6 million Australians, including 2.1 million women, will benefit from the Low Income Superannuation Contribution at a cost to the Commonwealth of $1.9 billion over the forward estimates. Revenue from the mining tax makes this very fair measure affordable.
"Because the Liberals would rather give a tax cut to a few vested interests by opposing the mining tax and our superannuation reforms, they've sold the interests of the many up the river and have left working Australians without a paddle."
Research released by the Financial Services Council earlier this week shows why this boost is vital to the Australian economy, stating the increase in the Superannuation Guarantee from 9 per cent to 12 per cent will mean Australians will be $184 billion better off by 2020 as a result.
"Given a choice between a massive tax cut for billionaire vested interests and a boost of $184 billion in savings for working Australians, the Liberals will always side with vested interests."
"This just shows you where the Opposition's priorities lie."
22 March 2012