Labor hits back at Coalition over super stoush

Labor ministers insist they won’t be breaking any promises on superannuation, claiming the Coalition is “hyperventilating” over the issue.

Labor frontbencher Jason Clare says the Liberal Party is “hyperventilating” over the possibility of paring back superannuation tax concessions for wealthy Australians.

The Coalition is embroiled in a row with the federal government over potential reforms to the nation’s $3.3 trillion retirement system, including scaling back tax breaks to save money for the federal budget.

Mr Clare told Sky News on Thursday it was time for Australians to have a conversation about reforming superannuation.

But he also insisted the government wasn’t going to break a pre-election promise not to change super.

“There’s been no decision made; I know the Liberal Party are hyperventilating about this,” the Education Minister said.

“When they were in power they increased the taxes on super by $5bn … they are dripping with hypocrisy here.

“There’s always going to be a fight on superannuation in this building because we created it and they hate it. They hate the idea of it.”

Education Minister Jason Clare has hit back at the Coalition’s accusation that Labor is breaking an election promise. Picture: NCA NewsWire / Brendan Read

Super tax concessions – first introduced as a way of encouraging workers to save super rather than rely on the pension – are now costing the budget more each year than the aged pension.

With about two-thirds of the $50bn in annual concessions going to the top 20 per cent of income earners, the government has this week reignited debate over whether they should be amended.

One idea being floated is removing tax concessions for super balances over $3m. Labor says only 1 per cent of Australians have this much super and that the average balance is $150,000.

Senior Liberals have accused the Albanese government of going back on its pre-election commitment not to tamper with superannuation and have defended Coalition-era policies which allowed Australians to withdraw $36bn worth of superannuation early during the pandemic.

Mr Albanese said in May last year Labor had “no intention of making any super changes” when he was asked if he would rule out increases to super taxes and changes to caps.

Prime Minister Anthony Albanese says there will be no major changes to superannuation. Picture: NCA NewsWire / David Mariuz

With the Coalition now vowing to block any attempts to change super tax concessions, Deputy Liberal leader Sussan Ley said on Thursday Labor had broken a promise to Australians.

“Make no mistake, if the parliament lets Anthony Albanese get away with this broken promise on superannuation, the Labor Party will be coming after stage three tax cuts next,” she said.

Earlier on Thursday, Anthony Albanese said the government hadn’t made any final decisions, but insisted there would no “major changes” to super.

“We’re not considering that,” the Prime Minister told reporters in Adelaide.

“What we’re doing is defining properly the objective of superannuation, which is something that is needed.”

Mr Albanese made similar comments at the National Press Club in Canberra a day earlier.

The political fight over super was sparked after Treasurer Jim Chalmers unveiled Labor’s proposed wording for a definition of superannuation earlier this week.

Treasurer Jim Chalmers is considering making changes to superannuation tax concessions to improve the budget bottom line. Picture: NCA NewsWire / Gary Ramage

The government wants to enshrine in law the objective of preserving super for retirement, making it more difficult for governments to introduce policies to allow Australians to withdraw their super early.

Dr Chalmers outlined the proposal in a speech to the financial services industry on Monday, in which he also revealed he was eyeing a shake-up of super tax concessions before the May budget.

Dr Chalmers has stared down criticism from the Coalition and said he isn’t going to break any election promises.

“Superannuation is there to provide for a quality of life in people’s retirement, it’s not there for other purposes,” he said on Thursday.

“The Coalition have undermined superannuation at every single opportunity; they went to election after election saying they wouldn’t interfere with the superannuation guarantee and then breached it every single time.”