Labor moves to end super speculation, but has broken his promise to Australians

Prime Minister Anthony Albanese and Treasurer Jim Chalmers have moved to crack down on super tax concessions. Picture: Damian Shaw

Anthony Albanese has sought to bring an abrupt end to days of damaging speculation over Labor plans for superannuation.

The problem is the government may have dipped further into its political capital than it needed, to achieve a disputed outcome.

There can be little doubt the policy adventurism on super was quickly getting away from the government. Having floated the idea of reining in tax concessions for the wealthy only a week ago, the government on Tuesday sought to cauterise the potential damage from having uncertainty hover over retirement funds like a missile-armed drone.

The Prime Minister and Jim Chalmers landed on what they believed was the most modest policy prescription they could find: doubling the concessional tax rate for super balances of more than $3m. They are banking on reasonable minded Australians wondering what all the fuss is about.

The price tag? A few hundred million dollars a year. It hardly seems worth the pain.

And Albanese will find it harder to escape the context in which the changes to super tax concessions were made. Half an hour before Albanese and the Treasurer announced it, Chalmers’ office released the annual tax expenditure and insights statement which listed $150bn in tax arrangements – so-called generous measures presented as a recurring structural drain on the budget.

Chalmers rightly pointed out this was not a statement of government policy or intent. But by breaching faith with the electorate on super, this has the potential to become a broader issue of trust.

Chalmers may have under­estimated the level of hostility when unspecified plans to meddle with existing rules around super are floated – regardless of how equitable or not they may be.

One can only assume the feedback coming into central command wasn’t good. There are few policy areas that ignite community hostility more than tinkering with retirement savings. It is hard to form a view other than this was rushed through cabinet on Tuesday to try to draw a line under the ambiguity. The budget is not for another two months.

It may well be a valuable lesson for Albanese on the dangers of letting an issue run loose.

Whether the decision to curb some of the excesses at the top end of super concessions is good policy will continue to be debated. As will the question of whether it was good politics. It is a lesson that could be applied equally to the voice.

Having said before the election it would not impose changes to superannuation, Labor is now asking to be taken on its word that there will be no further changes to super. It starts to look like an unnecessary risk for the government to have taken on a policy of questionable fiscal dividend and even less obvious political benefit.