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A Labor win could return super to the fold


Labor can do little to change the past. But a win in May could usher in a new era of co-operation between big super and the government.

There were no surprises in shadow finance minister Stephen Jones’ speech to the 2022 ASFA conference. There is little that Labor can outright promise the industry aside from stability and an ironclad guarantee that the SG will increase to 12 per cent. Jones has said before that Labor mostly supports the idea of YFYS – though not the bloody-mindedness with which it was implemented – and that stapling and the performance test are here to stay. The performance test will likely be tweaked under a Labor government; stapling will not.  

What doesn’t need to be promised – indeed, what will come naturally to two groups that have been branded as fellow travellers since the creation of compulsory superannuation – is closer co-operation than that seen over the last nine years of LNP government.

“(Labor’s economic statement) recognised the enormous possibilities of working in partnership with superannuation and investors to rebuild our economy,” Jones said on Thursday (April 28). “This is the difference between Labor and the government; over the last three years, we’ve seen a government that view superannuation as a problem. Labor – the creators of superannuation – see superannuation as the answer to problems.”

And they’re big problems. Australia’s shuffling advance to net zero by 2050 is beset by international perceptions that we’re a climate laggard and a budget deficit that isn’t conducive to the massive fiscal spending required. Big super’s demand for green infrastructure assets far outstrips the available supply – especially the Australian supply – and it might have a role to play in the transition by funding the construction, either alone or with co-investment from the government, of new greenfields assets in Australia. In his own speech, former federal treasurer and new chair of Cbus Wayne Swan called for just such action. This all represents a marked change from the current government, which has warned funds to stay out of the climate debate.

The recent problems created by Australia’s diminished investment and interest in the Pacific could also be helped by more attention from that $3.4 trillion pool of superannuation capital. There is precedent here; Telstra’s acquisition of Digicel Pacific was partly financed by the Morrison Government in an attempt to keep it out of China’s hands and allow Australia to maintain control over telecommunications in the area.

Of course, one should be wary of believing that super is the solution to all the world’s problems. It’s not even a whole solution to the retirement problem. Both super and Labor have been critical of using superannuation as a “piggy bank”, whether it be for fiscal stimulus or a home loan. These criticisms don’t disappear when the piggy bank is broken open to address existential issues. The sole purpose test has served funds and members well, and should continue to guide the industry regardless of who’s in power.

But should Labor win power in May, it’s hard to believe that greater co-operation wouldn’t result.
And while super has diverged slightly from its place in Labor’s policy heartlands, the fact that Jones was happy to stick around and answer questions without running it past the slightly Orwellian “campaign headquarters” – in an election cycle that’s already become infamous for its “gaffes” and damaging off the cuff comments – indicates that Labor still holds the sector close to its heart.

Photo: Jeremy Veitch

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