In my years in this House I have never seen a more duplicitous document than the explanatory memorandum for this bill, the Treasury Legislation Amendment (Unclaimed Money and Other Measures) Bill 2012.
In fact, it is an underhanded bill.
It is a bill that will enable this government to get its hands on Australians’ money.
It is that simple. The money that the government is going to get its hands on is long-term unclaimed money found in bank accounts, perhaps including first home owner accounts and retirement savings accounts, insurance policies and superannuation accounts—your money.
For some time the government has been able to claim money to the credit of an account that has not been operated on by either deposit or withdrawal for a period of not less than seven years.
But the bill before the House reduces the period for such money to be claimed by this government to just three years.
Obviously this is a windfall for a very desperate government, a government that we know cannot balance its budget or rein in its spending. It is one more way that the Labor government has its hands in Australians’ pockets.
In addition, superannuation accounts holding less than $200 are currently able to be raided by the government. The bill will raise this to $2,000—another government windfall.
In addition, it will shorten the time frame for activity that labels a superannuation account inactive from five years to just one year. Do we really need any further proof that the government has both of its hands deep into the pockets of the Australian people?
There could be many, many reasons why an account is inactive for those periods. During that time the government is going to take that money.
The audacity of the wording in the explanatory memorandum, however, really should outrage all Australians.
In an attempt to sugar-coat a very bitter pill, the bill purports and pretends to save account holders by claiming that they are more likely to get their money back under the new regime. Specifically, the memorandum states:
The Bill will bring forward the time at which money is recognised under the relevant law as lost or unclaimed, helping to reunite people with their money earlier, and will protect superannuation account balances transferred to the Australian Taxation Office (ATO) from erosion by fees and charges.
From this statement, perhaps the reader could reasonably infer that more money will be returned to account holders, reuniting people with their money earlier.
The reality in fact is absolutely the reverse, and this is amply demonstrated if you just go a bit further down in the memorandum. Under the heading ‘Financial impact’, we read:
Measures in Schedules 1, 2 and 3 are estimated to provide savings to the Budget—
and a saving to the budget is a cost to an Australian—
of $92.3 million over the forward estimates period …
So there we see that money will be taken from Australians. The government will reap an additional $92.3 million by taking it from Australian citizens whose accounts have been inactive.
It may be a small bank account they have. It might be a holiday savings account. We are heading into Christmas.
Maybe it was set up originally as a Christmas treat, to save for that overseas trip. You may not have contributed to or moved funds in and out of that account. Or perhaps it could be a forgotten life insurance policy that has matured but not been converted. This happens in the community.
It may be a savings account started by grandparents or parents for their children. These can sit inactive for some time. It might well be the account of someone on an overseas posting who may well take more than three years to return.
Or it might be that people are not using their accounts because they are suffering from an extended period of illness.
The figure of $92 million also includes first home owner accounts and retirement savings accounts.
Many of these can be left untouched for years, especially when a family or an individual is facing hardship. They may not be able to contribute further for a time, but they are often resistant to taking money out until it is really needed. It is an absolute last resort, or it is their nest egg for when things get better and they can make good decisions in their lives.
People need to be careful that the Treasurer’s own last resort is going to come before their own—that $1.1 billion surplus that he is chasing, based on the fact that he has wasted so much of taxpayers’ funds.
The money will be taken by the government before the owner of that money finally hits that last desperate state and goes looking for it to find it is not there. Perhaps at a time when you need it most and count on it most, thinking that it is in that account, no, it will not be.
This Treasurer will have it.
However, the first three schedules represent a relatively small saving. It is sort of stealthy and sleight of hand, if you will. By comparison, the memorandum states:
… measures in Schedule 4 are estimated to provide savings to the Budget of $675.2 million over the forward estimates period …
Therefore, claiming superannuation at one year instead of five and for amounts of up to $2,000 instead of $200 will rake in two-thirds of a billion dollars of your money for this government.
So, while there has been some support for an increase in the threshold, the impacts really do need to be assessed.
Schedule 5 sees an additional impost on business which is estimated to provide savings to the budget of $118.5 million over the forward estimates period.
That is a total impost, an extra tax grab—call it what it is—on Australian citizens of nearly $900 million.
Basically, it is the government with its hands in the pockets of Australians. This is Robin Hood in reverse.
While it may be understandable to some that a government and a Treasurer that have totally lost control of their fiscal policy would be desperate to rip every dollar that they can out of the pockets of Australians, the fact that they attempt to hide it through this bill is what frustrates and angers the community and certainly leads them to not trust the duplicitous actions of this government.
More than half the Gillard government’s promised surplus 2012-13—and I said ‘promised’—is to be achieved through the increased revenue from this bill. This is the sole purpose of the government removing this money from your accounts. This is what the government is doing.
Its addiction to spending has left it unable to balance its budget. The government will, as it has so often previously, resort to negative comparisons to somehow justify this incompetence and its wasteful spending.
How often have we had to listen to the Treasurer basically gloating that Australia’s debt position is not nearly as bad as that of other nations?
It is an absolute nonsense argument: ‘We might be in a bad way, but others are worse, so that makes it fine.’ This government is saying that, although they have propelled Australia down a hole, we are not as deeply down that hole as perhaps somewhere like Greece or other at risk nations, so that should give us some comfort.
That is a farce perpetrated on us all by a Labor government in a desperate state. And they are looking at walking away from that budget surplus promise—just watch this space.
Australia was in a good financial position. The previous Liberal government left the current one with a budget surplus, no net debt and billions of dollars invested in savings. The Labor government did what Labor governments do: they spent all the money and wasted so much of it.
They are now gorging on debt. Through our amendments, the coalition is seeking to fix what is just the latest legislative debacle from this government.
Our amendments seek to redefine the appropriate timeframes needed for fairness in this process. For example, the three-year inactivity threshold for bank accounts is far too short. I have articulated any number of reasons why your account may not have been active over that period.
That definitely should be reviewed. The most appropriate period needs to be reassessed. There also needs to be a better explanation as to why the first homeowner account is included.
It is just an extraordinary inclusion. Many aspiring homeowners struggle to attain that much-needed deposit. They are working so hard and we should be encouraging such people, not making it harder for them, not having them live in fear: ‘If you don’t make a contribution to that account, then the government will take it.’
There are also questions about the range of accounts captured by this legislation. It remains the position of the opposition that the new rules should apply only to accounts that earn very low or zero interest, typically at-call accounts.
The coalition also believe that accounts should be grouped under account holders so that if someone has one or more active accounts which are currently in use, then any inactive accounts should not be claimed by the government.
They are working their accounts; it is how they are working their financial affairs. In such circumstances, the account holder is obviously known to the banking institution and their account is not lost; it is simply inactive.
And that is okay and should be okay with this government. It is not okay for the government to take your funds in that instance.
The government has already acknowledged that this latest piece of legislation is flawed.
I wonder why the government cannot get its work done right the first time. Why can’t it do the work that is necessary to get this type of legislation right?
The Parliamentary Secretary to the Treasurer has put out a media statement outlining a months delay in implementing the bill, which will now come into effect on 31 May next year.
This is just another example of the government’s incompetence. We also know that further delays will almost be inevitable, as the government struggles to get its act together.
The government also needs to tell the House and the banking sector how these amendments will change the financial impact of the bill over the forward estimates. We need to know more about this and so do the people of Australia.
Let us hope that the government actually tries to improve this legislation and bring it into this House in the form it should have brought it in in the first place.
The amendments that the coalition are proposing certainly deserve support.