Leading article Australia


28 May 2016

9:00 AM

28 May 2016

9:00 AM

For the first time in living memory, many conservative Australians are unenchanted by the choices facing them at the ballot box. Many others, of course, are over the moon.

Without a doubt, a large swathe of hard-working, tax paying individuals and couples nearing the retirement age feel betrayed by this government’s surprise changes to their superannuation plans. The most publicised cap – $1.6 million in the retirement fund – will see self-funded retirees in the foreseeable future of low interest rates lucky to generate an income that is even half what politicians and public servants themselves can happily look forward to for the rest of their lives courtesy of those very same taxpayers. The second and third caps – the retrospective lifetime $500,000 after-tax contributions cap and the $25,000 per annum concessional contributions cap – ensure that very few self-employed business people will have much hope of ever reaching even that first, relatively modest target.

Despite Michael Baume’s words of wisdom in his ‘Business/Robbery etc’ column this week, the rushed and poorly thought-through changes do have ‘unintended consequences’, as Julie Bishop noted, that have infuriated conservatives. Nobody argues against a reasonable upper limit on super – but if it is to be ‘fair’ then it must at least be commensurate with what our politicians and public servants believe necessary to provide for their retirement; in other words the $1.6 million cap should be closer to three or four million.

Why? As Peter Costello has pointed out, the budget assumes interest rates of 5 per cent or thereabouts, when the reality (and the experience overseas) suggests retirees for the next decade at least may well be looking at interest rates even lower than today’s; perhaps – who knows? – going down to zero. And the $500,000 cap should be scrapped altogether. Yet, as the Prime Minister made clear during his long-awaited interview with top broadcaster Alan Jones, he and Mr Morrison have no intention of amending their superannuation changes, no matter how great the anger within the conservative heartland. Mr Turnbull may well view this as an indication of ‘strength’, but a more accurate description would be ‘contempt’ or ‘arrogance’. It is hard to escape the conclusion that Mr Turnbull’s progressive values are bubbling furiously away beneath the surface, eagerly awaiting the validation of an election victory to burst forth on July 3.

An example: in this week’s issue Brigitte Dwyer and Julia Patrick look at, among other things, the insidious, neo-Marxist attacks on mainstream Australian values evident in the Safe Schools ‘gender fluidity’ program. Yet when asked in the same Alan Jones interview about his government’s attitude to such dubious left wing social engineering schemes – which even former Labor leader Mark Latham recognises as abhorrent – the Prime Minister was patronisingly dismissive, brushing any concerns aside with mutterings about ‘engaging the parents’. When Australians’ hard-won and increasingly scarce tax dollars are being used to promote creepy role-playing in young children promoting promiscuity and homosexuality, that response is simply not good enough from a leader who professes to be the heir to John Howard and Robert Menzies.

As the election grinds on, the Coalition attempts to (rightly) make the case that a Shorten government would be a fiscal disaster in the Rudd/Gillard/Swan mould. Without a doubt, a Labor-Greens alliance would see welfare and public service spending rocket out of control on a host of ideological forays, hurtling us further towards euro-style bureaucratic dependency and debt. The political gimmick of the week was Mr Shorten’s ‘spend-o-meter’, which would be a lethal barb were it not for the fact that it was the opposition leader himself who made the joke. So blasé are our leaders and media about soaring debt levels that Mr Shorten felt comfortable cracking such a gag at his own expense. Hardly surprising, given the Coalition’s inaction on debt and deficit, as evidenced by their staggering inability to promote or undertake any form of spending cuts; relying instead on Norman Lindsay-esque ‘growth’ to bring the budget back into surplus at some wondrous point in the future. Should that magical growth fail to materialise, or should we hit another global financial crisis or overdue recession, there is not even a whiff of a back-up plan. Treasury in their PEFO statement approved of this heroic ‘growth’ with little more than tightly crossed fingers and sweaty palms.

Ominous hints have also been dropped by the PM that he expects to be embracing more punitive action on climate change in the future. No wonder conservatives are less than thrilled by their choices at the ballot box. Yet, like many conservative commentators, this magazine recognises the need for a Coalition victory, primarily because of the Coalition’s success with, and steadfast commitment to, stopping the boats and controlling our borders. But on too many other issues, the best that can be said is that Labor and the Greens would be so much worse.

Hardly a ringing endorsement.

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Show comments
  • Sue Smith

    The scandal is that “Defined Benefits” superannuation is NEVER discussed; this is the scheme which most public servants can look forward to, and the one to which you probably refer. Robert Gottleibson is the only person to have raised this in the media. At least apply a ‘deeming rate’ to Defined Benefits pensions, otherwise it’s the High Court for us and ‘discrimination’!!!

    I’m afraid it’s the likes of David Marr and his luvvies’ campaign to overturn “Caman Island Tax Advantages” for self-funded retirees which has worn government down when cash-strapped. That and the Gratten Institute which says, in Saturday’s “Australian”, that $500,000 is all SFR’s need for a retirement and from that they can earn $58,000 pa! Daly also says they ‘should be able to get a part pension’. And that both the CHICKEN and the EGG need to be consumed (as it were) in retirement. This totally flies in the face of my investment strategy as a self-funded retiree; wealth creation for retirement, to ensure I NEVER have to draw on a pension.

    Such whacky comments need to be challenged and it beggars belief that Lucy Turnbull is on the Board of the Gratten Institute!!!!! They have an ideology based on WELFARE DEPENDENCY.