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senate vote 2020-08-25#4
Edited by
mackay staff
on
2020-10-02 13:19:42
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Title
Bills — Treasury Laws Amendment (Your Superannuation, Your Choice) Bill 2019; in Committee- Treasury Laws Amendment (Your Superannuation, Your Choice) Bill 2019 - in Committee - Superannuation contributions in National Employment Standards
Description
<p class="speaker">David Fawcett</p><p>Senator Waters, were you seeking the call? I believe you were interrupted by technology in making a contribution previously?</p> <p class="speaker">Larissa Waters</p>- The majority voted against an [amendment](https://www.openaustralia.org.au/senate/?gid=2020-08-25.41.1) introduced by NSW Senator [Jenny McAllister](https://theyvoteforyou.org.au/people/senate/nsw/jenny_mcallister) (Labor), which means it failed.
- ### What is the main idea of the bill?
- According to the [bills digest](https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/bd/bd1920a/20bd104):
- > *The purpose of the Treasury Laws Amendment (Your Superannuation, Your Choice) Bill 2019 (the Bill) is to amend the Superannuation Guarantee (Administration) Act 1992 (SGAA) to ensure employees under new workplace determinations or enterprise agreements have an opportunity to choose the superannuation fund for their compulsory employer contributions.*
- ### Amendment text
- > *(1) Page 4 (after line 16) , at the end of the Bill, add:*
- >
- > *Schedule 2 — Superannuation contributions in National Employment Standards*
- >
- > *Fair Work Act 2009*
- >
- >> *1 After paragraph 61(2)(h)*
- >>
- >> *Insert:*
- >>
- >>> *(ha) superannuation contributions (Division 10A);*
- >>
- >> *2 After Division 10 of Part 2-2 of Chapter 2*
- >>
- >> *Insert:*
- >>
- >> *Division 10A — Superannuation contributions*
- >>
- >> *116A Superannuation contributions*
- >>
- >> *Obligation in relation to contributions*
- >>
- >>> *(1) An employer must make contributions to a superannuation fund for the benefit of an employee so as to avoid liability to pay superannuation guarantee charge under the Superannuation Guarantee Charge Act 1992 in relation to the employee.*
- >>
- >> *Amount of contributions*
- >>
- >>> *(2) The amount of the contributions relating to the employee is to be worked out:*
- >>>
- >>>> *(a) in accordance with the Superannuation Guarantee (Administration) Act 1992 ; or*
- >>>>
- >>>> *(b) if a modern award or enterprise agreement applies to the employee and provides for an amount higher than the amount applicable under paragraph (a)—in accordance with the modern award or enterprise agreement (as the case requires).*
- >>>
- >>> *Superannuation fund*
- >>>
- >>> *(3) The superannuation fund to which the contributions relating to the employee are made must be:
- >>>
- >>>> *(a) if a superannuation fund is a chosen fund (within the meaning of the Superannuation Guarantee (Administration) Act 1992 ) for the employee—that superannuation fund; or*
- >>>>
- >>>> *(b) if there is no chosen fund (within the meaning of that Act) for the employee and a modern award or enterprise agreement applies to the employee—the superannuation fund specified in the modern award or enterprise agreement (as the case requires); or*
- >>>>
- >>>> *(c) otherwise—a superannuation fund for which the choice of fund requirements in section 32C of that Act are satisfied in relation to the contributions to the fund.*
- >>>
- >>> *Salary sacrifice arrangements*
- >>>
- >>> *(4) A contribution made by an employer to a superannuation fund for the benefit of an employee under a salary sacrifice arrangement (within the meaning of the Superannuation Guarantee (Administration) Act 1992 ) with the employee does not satisfy the employer’s obligation to make contributions under subsection (1).*
- >>
- >> *Superannuation Guarantee (Administration) Act 1992*
- >>
- >> *3 After subsection 37(1)*
- >>
- >> *Insert:*
- >>
- >>> *(1A) Without limiting subsection (1), the Commissioner may amend an assessment if a court or tribunal has ordered the payment of superannuation contributions in relation to an employee and the order has been complied with.*
<p>Yes. With your indulgence, Chair, I seek leave of the chamber to speak for a few moments on the substance of the amendment. I acknowledge that it has already been voted on, but unfortunately the link crashed so I didn't get to give the justification for the amendment nor was I aware that it was being voted on until after the link was restored.</p><p>Leave granted.</p><p>I thank folk there in the chamber for their indulgence. As I was saying earlier, the amendment I moved would abolish the $450 superannuation threshold at which nobody gets paid super if they get paid less than $450 a month. This disproportionately affects women, who are 60 per cent of the people who earn less than $450 a month; it disproportionately affects young people, who often hold multiple jobs; and it disproportionately affects people in casual work. For all of these reasons, we think it's a very outdated and discriminatory threshold. Sadly, we know that women retire with, on average, half the superannuation of men, and this is one of the reasons for that. There are so many, but this is one of them.</p><p>This is an easily fixable situation. I acknowledge that the vote on this amendment has, sadly, already gone down, but I am informed that the government indicated that they are considering this issue as part of the Treasurer's response to the retirement income review. Certainly we would love to see some movement on this, and I'm informed that the Labor Party indicated that they would also consider this issue in the lead-up to the next election. So there's perhaps some cause for hope that the two big parties are taking this issue on. There's no longer a justification for making that superannuation retirement gap worse for low-income earners, who are disproportionately women.</p><p>On that point, in the context of the COVID crisis that has beset us all this year and the somewhat unfortunate decision by government to allow people to access their super, I've got some statistics here that I would like to put on the record, and this has a gendered element as well. I understand that, whilst more men than women have accessed their super through the early-release scheme, women are taking out a higher proportion of their savings from super, and that's probably also a result of the fact that their account balances are lower and therefore the amount they can withdraw is a larger proportion. Long story short: the existing super inequities have been exacerbated by the early-release scheme, and they have been exacerbated for the past few decades by this threshold of a $450 contribution. Women in Super estimates that 220,000 women and 145,000 men are missing out on about $125 million in superannuation each year because they're not meeting that $450 threshold.</p><p>I thank the members of the crossbench who supported us on this amendment to remove that threshold. I'm disappointed that the big parties didn't vote for it but acknowledge that they've made some statements that indicate that perhaps this issue is under review, and we really hope to see some progress on it in the coming months. Thank you very much for your indulgence, Chair.</p> <p class="speaker">Jenny McAllister</p><p>I move opposition amendment (1) on sheet 1001:</p><p class="italic">(1) Page 4 (after line 16), at the end of the Bill, add:</p><p class="italic">Schedule 2 — Superannuation contributions in National Employment Standards</p><p class="italic"> <i>Fair Work Act 2009 </i></p><p class="italic">1 After paragraph 61(2 )( h)</p><p class="italic">Insert:</p><p class="italic">(ha) superannuation contributions (Division 10A);</p><p class="italic">2 After Division 10 of Part 2-2 of Chapter 2</p><p class="italic">Insert:</p><p class="italic">Division 10A — Superannuation contributions</p><p class="italic">116A Superannuation contributions</p><p class="italic"> <i>Obligation in relation to contributions</i></p><p class="italic">(1) An employer must make contributions to a superannuation fund for the benefit of an employee so as to avoid liability to pay superannuation guarantee charge under the <i>Superannuation Guarantee Charge Act 1992</i> in relation to the employee.</p><p class="italic"> <i>Amount of contributions</i></p><p class="italic">(2) The amount of the contributions relating to the employee is to be worked out:</p><p class="italic">(a) in accordance with the <i>Superannuation Guarantee (Administration) Act 1992</i>; or</p><p class="italic">(b) if a modern award or enterprise agreement applies to the employee and provides for an amount higher than the amount applicable under paragraph (a)—in accordance with the modern award or enterprise agreement (as the case requires).</p><p class="italic"> <i>Superannuation fund</i></p><p class="italic">(3) The superannuation fund to which the contributions relating to the employee are made must be:</p><p class="italic">(a) if a superannuation fund is a chosen fund (within the meaning of the <i>Superannuation Guarantee (Administration) Act 1992</i>) for the employee—that superannuation fund; or</p><p class="italic">(b) if there is no chosen fund (within the meaning of that Act) for the employee and a modern award or enterprise agreement applies to the employee—the superannuation fund specified in the modern award or enterprise agreement (as the case requires); or</p><p class="italic">(c) otherwise—a superannuation fund for which the choice of fund requirements in section 32C of that Act are satisfied in relation to the contributions to the fund.</p><p class="italic"> <i>Salary sacrifice arrangements</i></p><p class="italic">(4) A contribution made by an employer to a superannuation fund for the benefit of an employee under a salary sacrifice arrangement (within the meaning of the <i>Superannuation Guarantee (Administration) Act 1992</i>) with the employee does not satisfy the employer's obligation to make contributions under subsection (1).</p><p class="italic"> <i>Superannuation Guarantee (Administration) Act 1992</i></p><p class="italic">3 After subsection 37(1)</p><p class="italic">Insert:</p><p class="italic">(1A) Without limiting subsection (1), the Commissioner may amend an assessment if a court or tribunal has ordered the payment of superannuation contributions in relation to an employee and the order has been complied with.</p><p>Underpayment of superannuation is an enormous problem. And the problem that is not being dealt with by the government is that there are basically very limited mechanisms for individuals who find themselves being underpaid. The amendment that we propose would change the law to include a right to superannuation within the National Employment Standards, and that would give every employee the right to pursue their unpaid superannuation in their own right.</p><p>The problem is this: currently unpaid or underpaid employer superannuation contributions are a debt that is owed to the Australian Taxation Office rather than to the individual worker. Unless there is a specific clause in their award or their agreement—and I observe that the government does everything in its power to make it difficult for such agreements to be formed—workers can't chase this money, because the money's not technically owed to them; it's technically owed to the ATO.</p><p>By placing superannuation within the National Employment Standards in the Fair Work Act, all employees would be empowered to recoup unpaid super from employers through the Fair Work Commission or through the Federal Court. Individuals would be empowered to chase their own unpaid super, instead of waiting for the ATO to do it for them. Again, the Senate Economics Legislation Committee has previously heard evidence about the administrative problems—the delays and difficulties encountered by people who try to get the ATO to act on their behalf in relation to these matters.</p><p>What's before the chamber now is a significantly more practical proposal than the government's pathetic response to this issue. What did the government decide to do? Their only response to this issue has been to allow an amnesty in place for employers, who can actually claim amnesty as far back as 1992. You can have been not paying super since 1992 and get a tick from the government. The amnesty is coming to an end, but it is indicative of the pathetic and inadequate attempts by the government to grapple with these problems. They come into this chamber and cry crocodile tears about various aspects of superannuation and various problems for individuals. If they had the courage of their convictions, they would support this simple amendment, because it is an amendment that would give individuals the power to chase the money that is owed to them.</p> <p class="speaker">Jane Hume</p><p>The government opposes this amendment. The amendment as outlined by Senator McAllister proposes to insert the superannuation guarantee into the National Employment Standards, which would mean, yes, workers would be able to pursue their employers through the Fair Work Commission on super issues in addition to the existing regulatory oversight by the ATO. The amendment that's proposed is identical to an amendment related to the Treasury Laws Amendment (Recovering Unpaid Superannuation) Bill 2019 that was defeated in this chamber on 24 February this year. As I advised the chamber at that time, on 24 February, I have committed to the crossbenchers that Treasury will examine this proposal in good faith and will brief the crossbench on the outcomes of that examination. That work is currently underway, and I am more than happy to offer any crossbench senators a briefing if they wish. As agreed to in my discussions with Senator Patrick, and also as followed up with the shadow Assistant Treasurer, the time frame for that work has been extended by six months to February next year, 2020-21. The reason for that is that the relevant Treasury resources were redeployed to work on the coronavirus response.</p><p>The amendment, though, contains a number of very complex issues that require some quite careful examination and aren't appropriate to be debated on the floor of the chamber today. They include things like the potential duplication by the Fair Work Commission of the regulatory work that is already undertaken by the ATO. This would create considerable uncertainty both for small businesses and for individuals, with small-business owners potentially facing duplicate penalties and with the presence of multiple regulators potentially causing confusion for workers and employees. That is why a proper examination of this policy and its consequences is required, and that examination is what I have instructed Treasury to undertake.</p> <p class="speaker">Rex Patrick</p><p>I just rise to make a short contribution here. I actually do accept the proposals put forward by Senator McAllister, but I also accept that there are some issues that need to be resolved in relation to this, that it could create issues. So I am taking on good faith the commitment that has been made by the minister to have a review completed by February. Very shortly after, I'm anticipating that we'll have legislation before the parliament that will remedy the very things that Senator McAllister is talking about. So I won't be supporting the amendment today. But certainly if we get to a point some reasonable time after February and the government hasn't acted I will change that position.</p> <p class="speaker">Jenny McAllister</p><p>Thanks for the update, Minister. I note the blow-out, again, of another six months in acting on this issue that is so important for so many people who are being underpaid by their employers. I asked on the last occasion whether a briefing could be provided to the opposition. It strikes me as odd that some parts of the chamber could be briefed on this question and issue but the opposition could not be. Have you given any further consideration to that request?</p> <p class="speaker">Jane Hume</p><p>I think the last time this issue came up I said that, if you agreed, as Senator Patrick had, to not support your own amendment, we would be quite happy to provide you the same briefings that we would provide the crossbenchers who were supporting us in not supporting your amendment.</p> <p class="speaker">Jenny McAllister</p><p>I will make the observation that on occasion, just every now and then, we expect the government to rise to the task of actually trying to deliver for the Australian people, instead of playing political games and trying to get petty wins in this place. Now, that may prove to be optimistic—some would say the triumph of hope over experience—but I had thought, on this occasion, the minister might be willing to engage with the chamber on a matter that appears to be of interest to the whole chamber. I have, in fact, brought this amendment forward in this debate in good faith. And I bring it forward because I know that there are many, many people out there who are looking for an answer, who are looking for a solution and who don't want to be exploited any further; they want a remedy. That's actually what acting in good faith on behalf of your community looks like. I don't understand why the people who look to be represented by the opposition can't expect some kind of dialogue with the minister responsible for this issue.</p> <p class="speaker">David Fawcett</p><p>The question is that opposition amendment (1) on sheet 1001 be agreed to.</p><p>The TEMPORARY CHAIR (13:32): The question now is that the bill as amended be agreed to.</p><p>Bill, as amended, agreed to.</p>
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