SKY NEWS AM AGENDA
WEDNESDAY, 10 JUNE 2020
ANNELISE NIELSEN, HOST: Joining us live is Shadow Assistant Treasurer Stephen Jones to talk about financial topics kicking around Parliament this week with sitting resuming. Stephen Jones, thanks for your time.
STEPHEN JONES MP, SHADOW ASSISTANT TREASURER: Good to be with you.
NIELSEN: Now, the Treasurer has made a call for super funds to be investing in more local infrastructure to get more Australian jobs going, do you think that's a good call?
JONES: I do, but there's two things that we need to see, if we're going to encourage superannuation to be doing more. Let's not forget, they are already significant investors in infrastructure as well as Australian companies and business, but there's two things that need to happen for us to see that taken to the next level. The first is we need a long-term stable superannuation policy and unfortunately, we've had anything but that. We've got government members agitating for a change in position, being seriously contemplated by the Government. You've got drains on funds through the poorly administered and managed early access scheme. All of these things mitigate against funds being able to say; right we've got this block of funds, we're able to invest them in the public interest for the long-term, delivering great returns for superannuation members, but also delivering economic infrastructure, long-term benefits for the country as a whole. So stable policy, so funds are able to invest. But secondly we need a government partner and this requires both state and federal governments working together to ensure that we have got a pipeline of investable projects for superannuation funds to partner with government to deliver. None of those things are working properly at the moment. The Government is the key obstacle to those things happening.
NIELSEN: So if we go to those two points you mentioned firstly, you said that there's no long-term stability, agitation for change doesn't mean it has happened in the past. The superannuation policy has been quite stable, unless you have any examples to tell me otherwise, and the early access scheme so far APRA has reported 13.5 billion being withdrawn through that program. We're talking about a pool of 300 trillion dollars in liquidity across the sector. How is that going to be impacting anything to do with the bottom line?
JONES: Yeah, good questions. Firstly, the early access scheme. I expressed some concerns about it. I don't think it's been very well administered at all, but it's not going to be a massive threat to the funds in and of itself if it's just a once-off, but if this is to be an ongoing exercise where funds are drained on an annual basis, that totally prevents funds being able to use that pool of cash to invest in the long-term. Superannuation becomes more like a bank account and it delivers more like the results of a bank account. So instead of getting 8 to 10 percent returns per year for members, you're going to get more like 1 to 2 percent return on funds within that account. So that ability to make long-term stable investments with long-term stable policy settings is in flux at the moment, add to that the uncertainty that the Government is generating itself around the delivery of the existing legislated superannuation increases and we've got significant uncertainty in policy across the sector.
NIELSEN: And when it comes to that point about you saying government agitation against superannuation, we have seen discussion around changing the legislated increase from 9 percent to 12.5 percent, keeping it at that 9 percent but we haven't actually seen any agitation among government ranks to not have superannuation be compulsory in Australia.
JONES: Quite the opposite. We've seen somebody, who's appeared on this program last week, write a book about it. A bloke who once made his living from superannuation, now joins Parliament and has decided to lead the campaign against it. He is absolutely campaigning to have our universal superannuation system scrapped, particularly for low and middle income earners. We've got other senior members of the government, chairs of the economics committee for example, who are using their positions to maintain a sustained and dishonest war against superannuation in this country. So to say that there isn't anybody who's seriously proposing the end of our universal system is not quite true. That's exactly what they're doing. And we know that they are getting willing ears inside government. It's very easy for the Prime Minister to stand up any day this week and say; the SGL would continue, superannuation policy will be stable and remain on track and this early access scheme was a once-off, a once-off only in an exceptional circumstance. He can put those agitators today back in their box and explain to them and to the rest of the country why superannuation, for the long-term, is in the interest of jobs, retirement savings and a strong rebound from this COVID crisis. He hasn't done that yet.
NIELSEN: I'm going to assume you're talking about Senator Andrew Bragg there. I think we might have to get a panel with you too because each week you come on and have a go at the other, we might need to get you guys to sort it out on air.
JONES: If he just said something sensible I'd come out and praise him, but the guy uses his platform here in Parliament to pedal ridiculous conspiracy theories and frankly untruths about what's going on inside super. Our superannuation system is the envy of the world, I just find it disappointing that some people in this place use their platform and their title to criticise something that is doing such a great job for the country.
NIELSEN: Well, it's certainly a hot topic at the moment, so we'll keep on it. Stephen Jones Shadow Assistant Treasurer, thank you for your time.
JONES: Great to be with you.