The Crest of the Commonwealth of Australia Treasury Portfolio Ministers
Picture of Wayne Swan

Wayne Swan

Deputy Prime Minister and Treasurer

3 December 2007 - 27 June 2013

18 May 2013

Doorstop Interview

Brisbane

SUBJECTS: Tony Abbott's cuts to superannuation; Liberals wanting to increase the GST

TREASURER:

Good morning, there's a lot of people here.  It's good to be here earlier to open the fete.  It's also good to catch up with locals and talk to them about issues that are on their mind and of course, economic security goes to the peace of mind of Australians wherever they live. There's nothing more fundamental to that than superannuation.  So Mr Abbott's proposals to cut superannuation are an act of economic vandalism.  What he will do is hit our national savings pool which is so important to fund investment and create jobs in Australia.  He will also hit the living standards and retirement incomes of millions of Australians.

Around eight million Australians have superannuation, about 1.4 million workers in this state, and under Mr Abbott's proposals if the increases in the Superannuation Guarantee did not go ahead, he would hit the average 30 year old today; he would hit their retirement savings by $127,000.  So that's a big hit to the economic security and peace of mind of many Australians who are looking forward to having dignity and adequate income in their retirement. 

Labor put in place national superannuation for a very good reasons, we have an ageing population, it's important as a capital hungry country that we have a big savings pool, and one of our unique advantages of our national economy is our pool of superannuation savings.  Now Mr Abbott wants to go out cut that savings pool. So that will hit our economy and it in the long-run our capacity to create jobs as well as hitting the retirement incomes of millions of Australian workers. 

Of course, we had some statements today from Mr Keenan, a Liberal Party frontbencher, who's out there saying that the GST should be looked at by the Liberal Party.  Well, we know what the Liberal Party wants; they've always wanted to increase the rate of the GST and to broaden its base.  It appears that's very squarely on the agenda of Mr Abbott and the Liberal Party, because Mr Abbott has a proposal if he's elected to have an audit commission, we know what that audit commission is all about, it's about savage cuts particularly to health and education. Of course, we now know from his preview this week, savage cuts to superannuation.

JOURNALIST:

Wouldn't expanding the GST say to food, as John Howard was advocating in Brisbane this week, help our bottom line?

TREASURER:

I think it'd be terribly unfair, I think it would hit the living standards of millions and millions of low and middle income earners in Australia. It would be a boon if you like for people on very high incomes; they could cope with that easily, but it would really savage the living standards of low and middle income earners in this country.

The Labor Party doesn't favour, hasn't favoured and would never favour an increase in the rate or the base of the GST as many Liberals are now talking about and Mr Abbott has left the door open for that. Last Thursday night, what was most noticeable about his speech, is what he didn't say, but he pointed to.  We had a sneak peek of some of his priorities: the cuts to superannuation. Mr Abbott, in all of his commentary, is really saying he's going to take the axe to spending, particularly in areas such as health and education. Savage cuts to the bone – that's what Mr Abbott's all about.

JOURNALIST:

I thought he said that he would delay the next increase in superannuation.  I didn't think that he said that he'd withdraw it?

TREASURER:

He has said that he will delay the next two increases in superannuation.  This is what the Liberals said when they came to power last time under Mr Howard.  Of course, they delayed the increases forever.  The superannuation guarantee did not go up, and if they were to do this again and it didn't go up it would hit the retirement incomes of a 30 year old today on average incomes by $127,000.  Mr Abbott has described superannuation as a con job.  He doesn't support it and he would attack it.  He has indicated to the extent to which he's made commentary so far, an attack on superannuation to delay the increase on the superannuation guarantee.

JOURNALIST:

Do you think the commission of audit that Queensland has been through is a taste of what we could be in for?

TREASURER:

Too right.  The model of Campbell Newman is the model that Tony Abbott wants to follow. Don't tell the people what you're going to do before the election, after the election, hold a commission of audit and then announce savage cuts to the bone.  And of course, we've seen a very strange performance from the Newman Government this week, where they are now saying they are going to have a flood levy. Let me make this very clear, this would be double-dipping. Queenslanders already paid a flood levy and the Commonwealth has provided significant support to the state of Queensland, as we should have, to deal with flood recovery. Now Campbell Newman thinks he can get away with a tax increase under the guise of a flood levy, because he simply thinks he can.

JOURNALIST:

And schools are being sold off too?

TREASURER:

And schools are being sold off. Savage cuts to the bone are happening across health, we've seen 14,000 workers lose their jobs, 3,000 - 4,000 workers lose their jobs in health, many of them in this local area. Savage cuts to the bone, that's the Campbell Newman approach and that will be the Tony Abbott approach.

JOURNALIST:

Treasurer, just back to the GST.  What's the economic argument for not even looking at changing the GST?

TREASURER:

This Government made it very clear when we established the Henry Review that we would not be looking at the rate or the base of the GST.  We're not doing that, I explained the reasons at length at the Press Club on Wednesday, because it is unfair.  It's an unfair tax which hits hardest lowest and middle income earners in our community.

JOURNALIST:

Are you saying the GST should never be reviewed?

TREASURER:

I'm saying that we in the Labor Party, don't favour putting up the rate or the base like the Liberal Party appears to favour.  That's what Mr Keenan said they were considering today.

Thanks.