Open the borders and boost superannuation guarantee, says former PM Paul Keating

The ‘best solution’ to funding a post-recession recovery would be direct buying of government bonds by the RBA, says former PM Paul Keating.

Former Prime Minister Paul Keating: “I’m not one for border closures, not anywhere, it’s the national economy.” Picture: Nikki Short

Former Prime Minister Paul Keating has blasted suggestions that the rise in the superannuation guarantee be delayed, saying the Liberal party was “putting a cleaver” through the savings program.

The architect of the superannuation program, introduced to Australia in the immediate wake of the 1991 recession, said now was not the time to be delaying an increase to superannuation.

“In an economy like this you want everyone pulling along. You want everyone trying and having a go, the last thing you want is some bitchy performance from the Liberal party,” he said on Radio National’s Breakfast program on Thursday.

“Superannuation is a structural change not a cyclic policy, you don’t take it down when things are bad and lift it up when things are good. You want superannuation tugging away at this economy now.”

Mr Keating said it was all the more important to ensure a growth in the rate of superannuation given how 600,000 Australians had drained their long-term savings in recent months.

“What the Libs are up to is to pull the plug out of the bath and turn the tap off at the top of it. We’ve got the fourth biggest group savings in the world the best personal savings scheme and these monkeys want to destroy it,” he said.

“These people have been forced to raid their savings. These young people are mostly low paid, mostly renters, forced to carry their HECS debt and carrying 10 per cent GST around their necks.”

He said the Liberal party was using the pandemic as cover “to put a knife through people’s savings”.

“Because of their ideological obsession with super, they said it’s your money, take it out,” he said.

“They’d like to crack it open for housing deposits, for savings, they want to crack it open to get rid of it.”

Recovery will come

Mr Keating said the government had used people’s personal savings to shift the cost of supporting the economy away from government coffers.

“The recovery will come what we’ve got to do is support people on the way through,” he said.

“We’ve got to see the wave into the beach. What the government shouldn’t do is do the dumper, which is what I think they’re getting ready to do, which is to pull JobKeeper back.”

Mr Keating said the best solution to funding a post-recession recovery would be direct buying of government bonds by the RBA.

“If the RBA got off its tail and actually bought the bonds … we can afford the JobKeeper and JobSeeker right to the beach rather than the dumper 100m out,” he said.

However, he warned reopening state borders was essential to speed the economic recovery, although noting that the closure by NSW and Victoria had been spurred by “an emergency” which had now passed.

“I’m not one for border closures, not anywhere, it’s the national economy,” he said.