Assistant Minister to the Prime Minister
TOM CONNELL, HOST: Welcome back. Well, there has been furious debate over superannuation. This was after a speech by the Treasurer last week. Labor Ministers lined up to talk about whether or not this would be a broken election promise and how major these changes might be. Joining me live, Assistant Minister to the Prime Minister Patrick Gorman and former Liberal MP Jason Falinski. Thanks very much, both for your time. Patrick, we better start with you, given that position you have as Anthony Albanese's right-hand man, we might call it. He said before the election, we've got various grabs, we've been playing on Sky News, "No intention, no plans to change superannuation", and that was specifically to do with tax. So, if that happens before the next election, would that be a broken promise?
PATRICK GORMAN, ASSISTANT MINISTER TO THE PRIME MINISTER: As we said, and as the Prime Minister reiterated yesterday, there will be no big changes to superannuation. But we did also say that we wanted to make sure that we had a defined purpose for superannuation. That's the conversation that the Treasurer has opened. We also said that we take responsibility for the challenges that are in front of us as a Government. We wouldn't say, not my job, we wouldn't shut down debates the minute and ideas put on the table. So, we are very comfortable having a mature conversation with the Australian people. Now, not every Australian is as passionate about superannuation policy as Jason Falinski. He is an outlier in that. But we know that people want to make sure that we have a good, strong retirement income system for all Australians. And that's exactly the conversation that we are having.
CONNELL: Before he said no changes. That was clear. That was categorical before the election in two different circumstances. Again, if changes are made that take effect before the election, that's a broken promise, isn't it?
GORMAN: Well, I think firstly, for some historical context for your viewers, I think it's worth noting that the last time tax changes were made to superannuation, it was the Liberal Party in power. Peter Dutton was sitting around the Cabinet table in 2016 when they made those changes.
CONNELL: Which was in 2016, just before an election that came into place after the election. That's the difference.
GORMAN: Well, there's always another election, Tom, but.
CONNELL: My point is, I don't know there were changes proposed. Voters had an opportunity to say if they like them or not, then they came into place. Are you going to follow the same principle, wait until voters have a chance to see these and then make them law afterwards.
GORMAN: Well, there's not a proposal from Government on the table. I think that's worth noting. What we've said is we want to have a definition of superannuation, a clear purpose and object of superannuation. We did outline that in the lead up to the election, so that is not news to anyone. And where people put forward ideas that do highlight some of the challenges in our superannuation system, including the very large superannuation balances for a very small number of people. We do need to look at that.
CONNELL: This was the Treasurer. Do you want to just calm this down …
GORMAN: I'm very calm.
CONNELL: And just let everyone know, let us Fourth Estate that get very excited, no changes on tax would come into place before the next election.
GORMAN: Tom, that's not my style. My style is to say that actually the Australian people deserve mature, considered policy debate. So what we saw from the last government, time and time again, was that they would rule out things before they'd actually said what they wanted to do. I don't believe in sort of going through some sort of a rule out, rule out, rule out game when there are challenges that we, as a responsible government, needs to consider, including the cost to the Australian people at-large for providing large concessional tax treatment to people with very large supervisors.
CONNELL: All of that timing not on ruling out what you'll do. I can hear a sigh from Jason Falinski. That means it has been way too long until I've given him a question. Jason, are there distortions in the superannuation tax system remaining, do you believe?
JASON FALINSKI, FORMER LIBERAL MP: Tom, my sigh was because you were taking all my best arguments. That's what I was upset about. But look, I'm not really that concerned about superannuation. What I'm mostly concerned about is the fact that young Australians don't have the same capacity to afford a home that those generations who came before us did. And when you look at superannuation balances, there is almost, no in fact, there is a direct correlation between expanding superannuation balances and the level of home ownership amongst Australians. They are moving in the opposite direction. The problem for the Labor Party here is that this has got nothing to do about helping Australians save for their retirement. We already have that in law. We have the best financial test for superannuation trustees. And the problem for the Labor Party is that their donors, that the people who are associated with them don't like that test. That's why Stephen Jones unwound or tried to unwind Your Super, Your Future. And only when Lidia Thorpe decided to vote against it did that regulation get disallowed. That's why we've seen that as three major reviews, including Ken Henry's review into super said we should not be putting up the superannuation guarantee any further. And that was back when it was 9%. It's now 10% and Labor wants to take it to 15%. It is doing harm to ordinary Australians in their capacity to live the best lives that they possibly can.
CONNELL: Well, indeed, I think both sides have supported legislation that gets to 12%. On the housing aspect, Jason, it looks as though the Coalition might sort of expand what it wants to do in that area. How do you make sure we don't get what we get a lot of the times in housing policy and heating up prices? Could it be a holistic look at the whole way housing works, including even the CGT discount, for example, that obviously benefits investors in housing? Is that the sort of thing the Liberal Party should be willing to look at?
FALINSKI: Look, Tom, there was in the last Parliament this comprehensive review of housing policy in Australia. It was very well written, if I say so myself. And one of the things it did say was that you would want to look at capital gains tax for investors. But the biggest issue, without a doubt like it's the 98% issue, is the amount of supply of housing in Australia. Put simply, councils and states have been going slow on that. There is now an undersupply of 400,000 houses across Australia. That report identified some of the things that the Federal Government could be doing to tie reforms at state and local government levels to increasing supply. This shouldn't be a partisan issue. I do hope that this Government takes those suggestions up and if there are improvements on them, implements them as well.
CONNELL: Indeed, the Liberal Party might take up the report that was humbly written by the former member for Mackellar. Patrick. I am intrigued at this aspect, though, in terms of housing, because the direction from the Treasurer is values capitalism could include superannuation funds investing in social housing, which would have to be, you'd assume, not the best returns, so people would be invested in that, but they couldn't use it for their own house. Do you understand voters might be frustrated at that prospect?
GORMAN: Well, I think it's first on this question of returns, Tom, what we know is that when you look at returns for any investment fund, you are balancing risk and the returns that are generated. So, I don't think it's as simple.
CONNELL: Lower returns, lower risk.
GORMAN: It's not as simple as talking about good or bad or high or low returns. There's a whole range of factors that superannuation funds, under the legislation that governs them, needs to consider in making their investments on behalf of them.
CONNELL: So does that mean just that? Whatever it's not just about this being good for the country, that any investment like that would have to stack up an investment choice.
GORMAN: It already in many occasions does. The government runs investment funds? I actually visited one of the National Housing Finance and Investment Corporation projects with Julie Collins last week in my electorate of Perth, where, again, the government provides loans at low rates to ensure that we build the stock of housing supply. One of the people we met in that housing was actually working for the WA Police Force. So that has returns on a social level, on a community safety level. It has a return for the government in terms of the money that we lend out, and it means that we have more housing stock available for essential workers. So, these things do have many different benefits. Now, when it comes to the questions that Jason has just raised, obviously there is a group who pushed for superannuation to be raided for the purposes of people purchasing homes. That was also taken to the last election. That was not a proposal endorsed by the Australian people. But, I think what we've got to be honest about, in terms when it comes to the Coalition, is they've always got an idea on what super should be spent for. That isn't retirement. They want to spend it on aged care, they want to spend on housing, they want to spend it on people who aren't able to access unemployment benefits. We want to keep super for retirement.
CONNELL: Very quickly, Jason, but one of the whole ideas behind this is raising money, the budget's in a bit of strife. Is there a single measure you think your party should look at, whether it comes to raising tax or cutting spending, that isn't spoken about enough right there?
FALINSKI: Absolutely, Tom. The waste of mismanagement in Canberra is out of control. After our last interview, I went and did an average run rate of new spending that Labor's announced since the election. It adds up to $133,000,000 per week. But, you know, we don't, the truth is, we want super to be used by the people who put the money in it. Labor wants super to be used by their mates who are the trust funds. And that's why Australians are now spending twice as much on superannuation fees as they spend on household electricity bills. And that's just wrong, Tom. It's really, really wrong.
CONNELL: Our super fees are high compared to the rest of the world. We'll let Jason end on that one. Patrick, perhaps you can get right of reply next week, but I'm getting the wrap. I've gone along already. Patrick. Jason will talk again in a fortnight.
