Super reforms: Cormann blasts Shorten, Shorten blasts Hockey, Hockey blasts Swan
By WP | 23/10/2012 8:30:00 AM | 14 comments
The fallout from yesterday’s treasury announcement has hit fever pitch, with Shorten being accused of making cynical “cash grabs” to hit Labor’s surplus target. But he isn’t taking the criticism lying down…
Comment has come in thick and fast on Labor’s proposed changes to the treatment of lost super, with Shadow Superannuation Minister Mathias Cormann accusing government counterpart Bill Shorten of overseeing a government raid on super.
“More than half of Labor's wafer thin $1.1bn surplus for this financial year will come from a six month federal government raid on supposedly lost superannuation savings,” he said.
Cormann has criticised Labor for proposing that the ATO “go after” accounts with up to $2,000 in savings – ten times as much as before.
“Most significantly, Labor wants to give the ATO the power to go after people's super savings after 12 months of inactivity in their account instead of the current five years,” he added.
“There is no doubt that this will increase the risk that some people will lose their money to the ATO before they have had the chance to make their own arrangements to consolidate their super accounts.”
He went on to criticise proposed increases to government SMSF charges by a further $319 million over the current forward estimates.
“These are short term cash grabs to deal with the fiscal mess Labor has created over five years in government, they have nothing to do with a 'boost to super savings' as asserted by the Minister,” said Cormann.
Shorten fights back
Shorten, however, has been quick to defend the government’s proposals, jumping on comments made yesterday by Shadow Treasurer Joe Hockey in the wake of the treasury’s announcements.
“Let’s be clear, these lost accounts can be claimed at any time through the ATO’s SuperSeeker website,” said a Shorten spokesperson.
“Australians with lost superannuation will be better off in many instances, because they won’t have their savings eroded by fees and deductions without their knowledge.
“Mr Hockey himself is on the record as saying ‘Going to one place to claim unclaimed super is a good idea’ (House of Representatives, 19 October 2010).
“Mr Hockey’s irresponsible claims that this initiative is about acquiring people’s super are misleading and nothing more than a poor attempt to cast doubt on a perfectly sensible initiative which will protect people’s savings.”
More pain to come?
Hockey, however, has continued to twist the dagger, claiming that Labor “continues to raid superannuation to bolster their budget bottom line”.
“Over half of the Government’s promised surplus in 2012-13 will be achieved through ripping even more money out of the superannuation system – a system already undermined by Labor’s consistent tax grabs since coming to power,” he said in a statement, pouncing on a comment made by Treasurer Wayne Swan yesterday which Hockey claims confirms that more tax rise pain is in order.
Claiming that Swan said at a media conference yesterday that “I'm also saying there will be other structural saves we will have to take as well”, Hockey noted that “Wayne Swan has to tell Australians which part of their lives he will choose to tax next”.
What do you make of the latest superannuation proposals? Join the debate by commenting below.
Shorten announces super changes
mark longhurst on 23 Oct 2012 09:46 AM
pure unadulterated theft-where is the AG on this?
mark longhurst on 23 Oct 2012 09:47 AM
pure unadulterated theft-surely the AG should be stopping this?
Lee on 23 Oct 2012 09:57 AM
I can think of at least 2 widows who would be very glad this rule wasn't in when their husbands died.
Mel on 23 Oct 2012 10:26 AM
Bill Shorten is going to make people very "Shorten" on Insurance benefits which will cost the government a lot of money in Government support. But hey, thats a long term Strategy, what kind of strategy is that?
Two years at an absolute MINIMUM, $1,000 MAXIMUM.
What about all the people on maternity leave, students working part time who have no other insurance, people on extended leave, self-employed keeping an account open for the insurance, the list goes on.
Gav on 23 Oct 2012 10:39 AM
Bill, this is what an exit door looks like...please use it!
John on 23 Oct 2012 11:40 AM
Dear Bill, will you be taking on all the insurance covers that will be included in the superannuation accounts that you are going to forcibly acquire?
Rodney on 23 Oct 2012 12:07 PM
Ask those you know could be affected to write to the Labour Party that is their understanding that the Labour Party has now taken on the legal responsibility of insuring their lives. Retain the letter. Now they are on notice of legal liability!!
Henry on 23 Oct 2012 02:49 PM
Some how the punters apathetic behaviour needs changing...Good idea B
Carol on 23 Oct 2012 03:32 PM
Does the transfer of accounts to the ATO include accounts which are not receiving contributions. While they are technically not lost accounts they can often be inactive as not receiving contributions. This move would be very detrimental as account holders would lose any insurance cover they hold.
Mathias Cormann on 23 Oct 2012 04:22 PM
If Swan and Shorten really expected all that 'lost' super to be re-united with their rightful owners as they appear to be trying to dishonestly suggest, how then is the government raising $555 million from super savings in just 6 months? Indeed more than half the promised surplus for 2012/13.
Matt on 24 Oct 2012 09:33 AM
I agree with MEl, I have clients who have a small super fund open for insurance purposes only due to pre-existing health issues...are the government going to replace this cover for those clients just as easily and cost effectively? Very short sighted money grab Bill.
Karen Murray on 24 Oct 2012 10:08 AM
Is it just me being cynical, but I think the Government is making money by investing the lost super and only paying out a return at CPI when returned to members?
James S on 25 Oct 2012 11:40 AM
Prey tell how will "Australians with lost superannuation will be better off..."?
According to APRA, average super return in the last 10 years was 3.8% after fees, CPI in the last 10 years was 2.9%, would that not indicate that keeping money in super would on average mean 0.9% better off?