Speaking up for Superannuation

22 September 2020


Second Reading Debate

Ms JODIE HARRISON(Charlestown) (12:32:24):I contribute to debate on the Superannuation Legislation Amendment Bill 2020. I echo the points made by member for Keira, and shadow health Minister, who led for the Opposition in debate in this Chamber earlier today. I acknowledge that the object of the bill is to amend certain superannuation legislation to prevent superannuation pensions and allowances being reduced because of a fall in consumer prices. That is certainly a worthy objective of the bill. The State Superannuation Scheme was established by the New South Wales Government in 1919 under a Labor Government, through the introduction of the Superannuation Act 1916. Even back in 1919, some 101years ago, Labor cared about working people and what became of them when their working lives were over. This scheme closed to new members in 1985.

Today there are still 67,000 people in New South Wales living in retirement under the pensions paid out by this scheme. These individuals made contributions to the scheme throughout their working lives as they undertook employment within the public service sector. The State Superannuation Scheme was set up to ensure that transport and railway workers, police officers, council workers, workers on the Snowy Mountains Scheme and other public servants could retire from their service to the community with the financial security that the State's defined superannuation benefits scheme offered. Unlike modern superannuation schemes, which are based on investment returns, the New South Wales State Superannuation Scheme was pegged to the consumer price index for Sydney.

Under the rules of some schemes, if the Sydney consumer price index falls by more than 1percent, as it is expected to do in the coming months, pension payments will drop by the same amount. Under the rules of other schemes covered under the legislation, any drop in the Sydney consumer price indexno matter its sizeis passed on through a reduction in pension payments, which is equivalent to any drop in the index. The Treasurer has said that the impact of the COVID-19 pandemic on the index is expected to result in a fall of slightly more than 1.04percent, bringing it to 0.04percent above the threshold that would trigger a matched drop in some pension payments. TheTreasurer has attributed the expected fall of the Sydney consumer price index in part to the Government's adoption of free child care.

I acknowledge that the Government adopted Labor's feefree preschool policy, which, as shadow Minister for Early Childhood Learning, I commend the Government for adopting. Just as fee-free preschool and early childhood education and care protected the very youngest in our community by allowing continued access to quality early learning experiences in the years before school, Labor recognises that the superannuation legislation amendments currently before the House will protect the pensions of 67,000 elders in our community. Theeconomic impact of COVID19 on many people across the State has been devastating, with job losses and business closures, uncertainty and fear. Yet for people of working age there is always the prospect of financial recovery in the coming years as they return to employment or rebuild their businesses.

For the working people who have retired and who rely on pensions from the scheme, there is no prospect of financial recovery down the track. There is no working life ahead of them and, therefore, there is no chance to regain any financial losses that are incurred during the current economic recession. The amendments before the House deal with the design of the superannuation scheme in light of the economic impact of the COVID19 pandemic, with particular regard to the Sydney consumer price index. The amendments will ensure that the working people who contributed their earnings to the scheme are protected. Seven superannuation Acts and three regulations require amendment to protect these retired workers and their pensions. Labor has always stood up for working people, Labor has always stood up for fairness for working people and that is why Labor does not oppose the passage of the bill.