July 1 was meant to be a day of celebration for Labor, the party that introduced superannuation to Australia.
The compulsory super rate rose to 12 per cent on Tuesday, further alleviating the burden on government to help fund people’s retirement.
Instead, the focus on Tuesday was on the growing number of Labor-aligned critics of the Anthony Albanese-Jim Chalmers super tax plan.
As Paul Keating and Australian Council of Trade Unions secretary Sally McManus’s critiques of the plan reverberated across Australia, Albanese went in to bat.
But the contrast in stroke play with Chalmers is obvious.
Albanese is taking a cautious, dead-bat approach to questions around Labor’s plan to introduce an unrealised gains tax on super accounts of $3m or more without indexation.
He knows the big voices need to be managed by at least obliging a conversation around the changes.
The Prime Minister said in an interview with Sky News on Tuesday that Labor’s plan was “being discussed”.
Chalmers on the other hand is obstinate, seeking to play a more defiant role and push through the plan without any changes.
“We’re not changing the policies we took to the election; we’ve got a mandate for that change,” he said last month directly in response to changes on the super tax plan.
Chalmers is on leave this week, leaving the “discussions” on Labor’s super tax policy to open up even further.
Keating, in his characteristically shrewd manner, was the big name. He highlighted the $3m superannuation threshold at which Labor’s unrealised tax kicks in. Highlighting the $3m is the significant attempt to soften up Labor into make changes to the tax plan.
Employment and Workplace Relations Minister Amanda Rishworth said Labor should listen to Keating’s views on the super tax.
“In terms of the superannuation proposals … we listen to Paul Keating respectfully, as we do others,” Rishworth said.
McManus, whose ACTU usually leads to others falling in line, said on Tuesday morning she believed the tax threshold of $3m would have to be indexed.
This echoes Australia’s biggest superannuation fund, AustralianSuper, and the Australian Retirement Trust having already demanded the tax threshold of $3m automatically be indexed each year.
McManus wasn’t the first union leader to speak out in favour of changes.
Former ACTU secretary Bill Kelty has already slammed Labor’s proposed super tax plan as “bad policy”.
Michael Easson, a former Labor vice-president and trade union leader, has also cut down the plan for a tax on unrealised gains. Labor-aligned Mike Fitzpatrick, one of the leading candidates during the Rudd-Gillard Labor government to be chairman of the Clean Energy Finance Corporation, also says the tax plan has to be changed.
Garry Weaven, a former trade union official and the so-called “godfather” of the industry super fund movement, has been one of the few voices saying it’s OK, qualifying that with: “As long as it’s done in a way that doesn’t cause unforeseen problems.”
Albanese is clearly on a different pitch to Chalmers.
The Treasurer is using the collateral of Albanese’s historic majority election win to push through a policy that would bring in more than $40bn in revenue over the next decade.
Albanese knows this and is looking uncomfortable at the crease every time the super tax critics come out, especially when they ask how his defined benefit plan calculates it.
Keating’s first delivery this week was a warm-up.
How Albanese and Chalmers play their shots when Keating is at full tilt will test their mettle and the integrity of the super tax plan altogether.
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