In remarks made to InvestorDaily’s sister brand ifa, shadow assistant treasurer and shadow minister for financial services Luke Howarth said senior members of the Coalition, including himself, support super.
“Angus, Jane and myself have been clear that we support super,” Howarth said, alluding to shadow treasurer Angus Taylor and Senator Jane Hume.
“I started salary sacrificing at a young age on the advice of my dad.
“I know the importance of compounding and super’s role in our retirement system,” Howarth said, adding the Coalition is committed to maintaining the superannuation guarantee at 12 per cent.
On Tuesday, in his valedictory speech, Financial Services Minister Stephen Jones remarked that he had always found it perplexing that Coalition members accept receiving a 15 per cent super guarantee, while insisting that “the mob” get just 9.5 per cent.
Alluding to having prevented the now opposition from freezing the SG at 9.5 per cent, Jones said: “I was very proud to be a part of an opposition where I worked with my friend, former prime minister Keating and former prime minister Rudd, and the Treasurer and the Prime Minister to stop this idea that we were going to freeze the superannuation entitlements of Australians at 9.5 per cent.”
“At the end of June this year, all Australians will be receiving 12 per cent superannuation guarantee, and that’s a damn good thing,” Jones, who retired from politics last month, said.
The Coalition came under fire last month following reports it would reduce the superannuation guarantee if it wins the next election.
Namely, in January, The Australian reported that a number of backbenchers were lobbying Peter Dutton to reduce the superannuation guarantee to 9 per cent from the current 11.5 per cent.
In response to reports about the Coalition’s plan at the time, Treasurer Jim Chalmers accused them of “hacking into” and “undermining super”.
“They don’t believe in superannuation, and people would be worse off as a consequence. They want people retiring with less when they retire and they want them earning less when they’re working,” he said.
Also at the time, the Australian Council of Trade Unions (ACTU) slammed the Coalition, suggesting that super is not safe under a Dutton government.
“The last time the Coalition were in power, they froze super and forced people to raid their super to get by in a pandemic. Now, they’re talking about cutting super and getting workers to raid what’s left for more expensive houses,” ACTU assistant secretary Joseph Mitchell said.
“It’s clear that working people’s wages and retirement savings are at risk under Peter Dutton.”
The commotion around the SG is just one of a few criticisms levelled at the Coalition in recent months.
In October last year, a speech given by Taylor saw the shadow treasurer accused of plotting to dismantle compulsory super to align it with global retirement schemes, particularly the US 401(k) model – a voluntary framework.
In a speech at Sydney University at the time, Taylor said: “The Coalition has started by aligning superannuation with other global retirement schemes – like 401k – that allow withdrawals for the purpose of purchasing a first home.”
While the ACTU decried Taylor’s remarks, the CEO of the Association of Superannuation Funds of Australia Mary Delahunty stepped in to defend him, arguing that Taylor’s sentence was taken out of context.
“The full sentence makes it clear that that reference to the substandard American system is drawing a comparison to the Coalition’s policy on early access,” Delahunty said. “Broadly, it’s not Coalition policy.”
However, Coalition members have previously argued for a more flexible superannuation system that enables Australians to make voluntary contributions based on their individual financial circumstances.
Senator Andrew Bragg has been the most vocal proponent of this idea, advocating for a voluntary superannuation system in public and in his book, titled Bad Egg: How to Fix Super.
Interestingly, Howarth did not mention Bragg in his remarks to ifa this week, but did assure that the Coalition not only backs super but also supports allowing funds to provide simple or scaled financial advice, particularly to members entering the retirement phase.
