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senate vote 2019-02-14#12
Edited by
mackay staff
on
2019-03-14 14:25:24
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Title
Bills — Treasury Laws Amendment (Protecting Your Superannuation Package) Bill 2018; in Committee- Treasury Laws Amendment (Protecting Your Superannuation Package) Bill 2018 - in Committee - Labor amendments
Description
<p class="speaker">Mathias Cormann</p><p>I advise that the government withdraws its amendments to this bill. I withdraw, on behalf of the government, all of the amendments on sheet QM101.</p> <p class="speaker">Deborah O'Neill</p>- The majority voted against [amendments (1) to (34) on sheet 8501](https://www.openaustralia.org.au/senate/?gid=2019-02-14.244.1), which means they failed. They were introduced by NSW Senator Deborah O'Neill (ALP).
- ### What does the bill do?
- According to the [bills digest](https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/bd/bd1819a/19bd032):
- > *The Treasury Laws Amendment (Protecting Your Superannuation Package) Bill 2018 contains three Schedules, the purpose of which is to make amendments to the* [Superannuation Industry (Supervision) Act 1993] *and the* [Superannuation (Unclaimed Money and Lost Members) Act 1999] *to:*
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- >> * *limit the amount of fees that can be charged by a trustee of a superannuation fund for MySuper or choice products to three per cent of the balance of the account if the balance is less than $6,000*
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- >> * *prohibit superannuation funds and approved deposit funds from imposing exit fees when a member disposes of all or part of their interest in a fund*
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- >> * *prevent superannuation funds from providing insurance such as death, total and permanent disability or income protection insurance on an opt-out basis where:*
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- >>> * *the member is under the age of 25 years and begins to hold a new superannuation account on or after 1 July 2019*
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- >>> * *the member’s account balance falls below $6,000 or*
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- >>> * *the member’s account has not received a contribution for 13 months and is inactive*
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- >> * *require retirement savings account providers and superannuation providers to pay the balance of MySuper or choice accounts to the Commissioner of Taxation, where the account is inactive and the balance is less than $6,000 and*
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- >> * *require the Commissioner to consolidate any amounts received into a person’s superannuation account that will have a balance of $6,000 or more once consolidated.*
<p>by leave—I move the opposition's amendments (1) to (34) on sheet 8501 together:</p><p class="italic">(1) Schedule 2, page 10 (before line 5), before item 1, insert:</p><p class="italic">1A Subsection 10(1) (after paragraph (h) of the definition of <i>reviewable decision</i> )</p><p class="italic">Insert:</p><p class="italic">(haa) a decision of the Regulator refusing to make a declaration under section 68AADC; or</p><p class="italic">(2) Schedule 2, item 1, page 10 (line 14), omit "13", substitute "16".</p><p class="italic">(3) Schedule 2, item 1, page 10 (line 19), omit "13", substitute "16".</p><p class="italic">(4) Schedule 2, item 1, page 10 (line 28), omit "13", substitute "16".</p><p class="italic">(5) Schedule 2, item 1, page 11 (line 8), omit "13", substitute "16".</p><p class="italic">(6) Schedule 2, item 1, page 11 (line 11), omit "13", substitute "16".</p><p class="italic">(7) Schedule 2, item 1, page 12 (line 14), omit "1 April", substitute "1 October".</p><p class="italic">(8) Schedule 2, item 1, page 14 (after line 28), after section 68AAD, insert:</p><p class="italic">68AADA Sections 68AAB and 68AAC do not apply if section 68AADC declaration in force</p><p class="italic">Sections 68AAB and 68AAC do not apply in relation to a kind of member of a regulated superannuation fund if a section 68AADC declaration specifying that kind of member of the fund is in force.</p><p class="italic">68AADB Application for section 68AADC declaration</p><p class="italic">(1) A trustee of a regulated superannuation fund may apply to the Regulator for a written declaration that sections 68AAB and 68AAC do not apply in relation to a specified kind of member of the fund.</p><p class="italic">(2) The application must:</p><p class="italic">(a) be in writing; and</p><p class="italic">(b) be in a form approved, in writing, by the Regulator.</p><p class="italic">68AADC Declaration that sections 68AAB and 68AAC do not apply</p><p class="italic">(1) On receiving an application under section 68AADB for a written declaration that sections 68AAB and 68AAC do not apply in relation to a specified kind of member of a regulated superannuation fund, the Regulator must decide:</p><p class="italic">(a) to make the declaration; or</p><p class="italic">(b) to refuse to make the declaration.</p><p class="italic">(2) The Regulator must not make the declaration unless the Regulator is satisfied that if the fund were to provide a benefit to, or in respect of, a member of the specified kind under a choice product or MySuper product held by the member by taking out or maintaining insurance, doing so would:</p><p class="italic">(a) be consistent with the fund's insurance management framework (however described); and</p><p class="italic">(b) not unreasonably erode the retirement savings of a member of that kind; and</p><p class="italic">(c) either:</p><p class="italic">(i) represent exceptionally good value for money for a member of that kind; or</p><p class="italic">(ii) meet a need for insurance of a member of that kind, having regard to the matters specified in subsection (3).</p><p class="italic">(3) The following matters are specified for the purposes of subparagraph (2)(c)(ii):</p><p class="italic">(a) the level of workplace, occupational or other risk faced by a member of that kind;</p><p class="italic">(b) the extent and nature of the financial commitments, including commitments to dependents, of a member of that kind;</p><p class="italic">(c) any other matter advanced by the applicant consistently with the fund's obligations to its members.</p><p class="italic">(4) If the Regulator decides to refuse to make the declaration, the Regulator must give the applicant a written notice setting out the decision and the reasons for it.</p><p class="italic">(5) A declaration made under subsection (1) is not a legislative instrument.</p><p class="italic">(9) Schedule 2, item 3, page 16 (line 4), omit "1 July 2019", substitute "1 January 2020".</p><p class="italic">(10) Schedule 2, item 3, page 16 (line 14), omit "1 April", substitute "1 October".</p><p class="italic">(11) Schedule 2, item 3, page 16 (line 18), omit "1 May", substitute "1 November".</p><p class="italic">(12) Schedule 2, item 3, page 16 (line 22), omit "1 July 2019", substitute "1 January 2020".</p><p class="italic">(13) Schedule 2, item 3, page 16 (line 25), omit "13", substitute "16".</p><p class="italic">(14) Schedule 2, item 3, page 16 (line 33), omit "13", substitute "16".</p><p class="italic">(15) Schedule 2, item 3, page 17 (line 11), omit "1 April", substitute "1 October".</p><p class="italic">(16) Schedule 2, item 4, page 17 (line 26), omit "1 July 2019", substitute "1 January 2020".</p><p class="italic">(17) Schedule 2, item 4, page 17 (line 28), omit "<i>1</i><i>April</i>", substitute "<i>1</i><i>October</i>".</p><p class="italic">(18) Schedule 2, item 4, page 17 (line 32), omit "1 April", substitute "1 October".</p><p class="italic">(19) Schedule 2, item 4, page 18 (line 1), omit "1 May", substitute "1 November".</p><p class="italic">(20) Schedule 2, item 4, page 18 (line 5), omit "1 July 2019", substitute "1 January 2020".</p><p class="italic">(21) Schedule 2, item 4, page 18 (line 10), omit "1 April", substitute "1 October".</p><p class="italic">(22) Schedule 2, item 4, page 18 (line 28), omit "1 April", substitute "1 October".</p><p class="italic">(23) Schedule 2, item 4, page 19 (line 5), omit "<i>1</i><i>April</i>", substitute "<i>1</i><i>October</i>".</p><p class="italic">(24) Schedule 2, item 4, page 19 (line 9), omit "1 April", substitute "1 October".</p><p class="italic">(25) Schedule 2, item 4, page 19 (line 12), omit "1 July 2019", substitute "1 January 2020".</p><p class="italic">(26) Schedule 2, item 4, page 19 (line 15), omit "1 April", substitute "1 October".</p><p class="italic">(27) Schedule 2, item 5, page 19 (lines 34 and 35), omit "1 July 2019", substitute "1 January 2020".</p><p class="italic">(28) Schedule 3, item 21, page 25 (lines 12 and 13), omit the definition of <i>inactive low</i><i>-</i><i>balance account</i> in section 8, substitute:</p><p class="italic"><i>inactive low</i> <i>-</i> <i>balance account</i>: see subsections 20QA(1) and (1A).</p><p class="italic">(29) Schedule 3, item 30, page 27 (line 13), omit "13", substitute "16".</p><p class="italic">(30) Schedule 3, item 30, page 28 (line 2), omit "13", substitute "16".</p><p class="italic">(31) Schedule 3, item 30, page 28 (after line 15), after subsection 20QA(1), insert:</p><p class="italic">(1A) However, an account in a fund that is a regulated superannuation fund is taken not to be an <i>inactive low</i><i>-</i><i>balance account</i> if:</p><p class="italic">(a) the account is held on behalf of a member of the fund; and</p><p class="italic">(b) any of the following occurred in relation to the member in the last 16 months:</p><p class="italic">(i) the member changed the member's investment options under the fund;</p><p class="italic">(ii) the member made changes in relation to the member's insurance coverage under the fund;</p><p class="italic">(iii) the member made or amended a binding beneficiary nomination;</p><p class="italic">(iv) the member, by written notice given to the Regulator, declared that the member was not a member of an inactive low-balance account;</p><p class="italic">(v) the superannuation provider was owed an amount in respect of the member.</p><p class="italic">(32) Schedule 3, item 32, page 42 (line 19), after "must", insert ", within 28 days of becoming satisfied as mentioned in paragraph (1)(b),".</p><p class="italic">(33) Schedule 3, item 32, page 42 (lines 27 to 29), omit paragraph 24NA(2)(d).</p><p class="italic">(34) Schedule 3, item 32, page 42 (line 34), omit "(c), (d) and (e)", substitute "(c) and (e)".</p><p>I'm a little at a loss for words, given the amazing change that we've seen from this government in the last few hours. We had a contribution from Senator Hume, who described herself just before lunchtime as a person worthy of making a considerable contribution to what's going on in this debate because of her experience as part of the superannuation sector. It's a big sector. It's grown to be a big sector because the Australian Labor Party envisioned a retirement savings structure for Australians. We instituted it. We've made sure that it's been protected. We've looked after it and protected it from the actions of this government opposite.</p><p>What we're seeing tonight from this government is an absolutely disgraceful response to the reality that faces Australians under the type of government it's offering us—the chaotic, dysfunctional, out-of-touch government that we have come to know and expect here, sadly, every single day. At lunchtime today, we had the Deputy Government Whip in the Senate saying that she worked in superannuation for almost all of her professional career before coming to the Senate. She worked in retail and industry superannuation funds and she thinks that that gave her a unique perspective on superannuation—its intricacies, complexities and vagaries. But what we see here tonight with this government is that it's decided to gut its own bill. Responsible governments who undertake negotiations in good faith with a sector as large as the superannuation sector should do what they say they're going to do.</p><p>The amendments that we have moved here this evening were composed in the context of honest, careful conversations with the sector. Our amendments seek to address the government's proposed very blunt removal of default insurance for large groups of Australians. That was their view. In its current form, the bill risks leaving younger members and lower income earners, predominantly women, without adequate insurance cover. That's why Labor have advanced these amendments. Our amendments were carefully considered. They were advanced in consultation. They haven't been changed at the last minute, which is what we've seen from the government. We know that the government simply don't understand the reality of hardworking Australians. They don't accept and respect the responsibility of government and they've failed the Australian people by what they've done here this evening.</p> <p class="speaker">Peter Whish-Wilson</p><p>The Greens won't be supporting the Labor amendments tonight. I won't go into any detail on that—</p><p class="italic">Senator Watt interjecting—</p><p>except to say that we think our amendments are better than yours, Senator Watt. We will get that on record.</p> <p class="speaker">Mathias Cormann</p><p>The government will not be supporting the Labor amendments either. I have to say that, on this occasion, I agree with Senator Whish-Wilson that the Greens amendments are better than the Labor amendments. The Labor amendments were essentially going to gut the whole bill, whereas with us supporting the Greens amendments today we are able to secure the passage of important reforms like the capping of fees on low-value accounts, the abolition of exit fees and the streamlined consolidation of superannuation accounts. We would have liked to have seen the reforms in relation to insurance pass through the Senate today, but that wasn't possible. There wasn't a majority in this chamber for that.</p><p>So instead of getting nothing, we're securing passage of a substantial part of our package, and we will, of course, introduce legislation at the earliest opportunity to pursue the remaining part of this very important reform package. Of course, the Labor Party would have liked us to just cop a complete dismantling of every aspect of important reform. That is not something we were prepared to entertain, because we are standing up for the best interests of Australians saving for their retirement. That is what Australians saving for their retirement expect us to do—to get as many improvements as we can today by securing a consensus on the Senate floor. That is what we've been able to do. Let's continue the conversation in relation to the remaining reforms.</p><p>As I've indicated to the chamber previously, the government continues to be of the view that there ought to be reforms to the default provision of insurance for under-25s and low-balance accounts. As I indicated earlier, while the government acknowledges that insurance in superannuation provides benefits to many people, there are some cohorts, particularly young people, who do not receive value from default insurance, and for too long these people have been cross-subsidising other members. The independent Productivity Commission, in its superannuation report, found that while insurance in super provides value for money for many members, it doesn't for all, particularly young members or members with low incomes. The PC found that insurance in super is poor value and does not meet their needs.</p><p>Secure passage on the very important reforms that we are able to get majority support for in this chamber is why we've made the decisions we have made. Labor's amendment seeks to delay the implementation date to 2020. We don't support that. It seeks to do a whole range of other things that we don't believe are desirable. For example, it seeks to give APRA the authority to carve out funds of cohorts of members from the under-25s and under-$6,000, where members are at particular risk—</p><p class="italic">Senator O'Neill interjecting—</p><p>Let me tell you, essentially the Labor amendments were causing difficulty all throughout the reform. To be fair to the Greens, the Greens are carving out a very distinct bit, and that is a very distinct bit that we will be able to pursue separately later. But in the meantime we don't want to stand in the way of Australians saving for their retirement and having the benefit of lower fees and the abolition of exit fees altogether.</p> <p class='motion-notice motion-notice-truncated'>Long debate text truncated.</p>
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