Every now and again, an advertising slogan becomes part of the popular lexicon. “Not happy, Jan!” “You’re soaking in it.” “Always a bridesmaid, never a bride” (believe it or not, this was never a saying until a 1950s ad campaign).
From a 1980s bank ad, Australians adopted the phrase, “It’s your money, Ralph”
History not being without a certain sense of irony, a great many State Bank customers learned that it wasn’t really their money after all, when the bank collapsed in 1990.
They’re about to learn the same lesson when it comes to their retirement savings, as the Albanese government quietly breaks yet another election promise.
The Albanese government will target Australians’ $42bn in annual super tax breaks to ensure the retirement system delivers on the proposed legislative objective of being “sustainable” and “equitable”, in a backflip in the policy Labor took to voters at last May’s election.
Jim Chalmers made it clear in leading into the poll that the then opposition had abandoned plans to fiddle with the tax treatment of workers’ retirement savings.
A large part of Labor’s shock loss in 2019 was its stated plan of targeting retirement savings for double-taxation. At least then they were honest about what they were up to. Not so, in 2022. But Australians are about to learn at their leisure a costly lesson about trusting Labor governments.
But in a speech on Monday, the Treasurer made it clear he intended to start a “conversation” on how to rein in tax breaks that cost the budget $42bn a year and which experts say favour wealthier Australians […]
“Right now, we’re on track to spend more on super tax concessions than the age pension by around 2050. I’m not convinced that’s a sustainable way to get to our destination: good retirement incomes for more Australians, now and into the future.
In other words, if you’ve diligently saved for your retirement — sucks to be you. You’re about to learn the hard way how a left-wing cradle-to-grave welfare system works.
Peter Dutton warned the objective was “code for more taxation”.
“When you hear Jim Chalmers talk about wanting to redesign the market and when you hear about him talking about superannuation, it’s all code for more tax,” the Opposition Leader said.
The Australian
In fact, there’s an awful lot of coded messages in Labor’s planned “legislated purpose” for superannuation.
To preserve savings to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way.
Note, especially, the reference to “equity”, not “equality”. For all that they may sound “samey”, they’re very, very different. “Equality” means to provide equal opportunity; “equity” means to force equal results. In other words, Labor believes that all retirees should have equal retirement incomes (“a dignified retirement”), no matter how much they’ve contributed or saved during their working lives.
“Sustainable” almost certainly means two things: firstly, cutting or abolishing tax concessions designed (by Paul Keating) to encourage saving for retirement, rather than relying on the working-age taxpayer to fund generous pension benefits.
Secondly, it also means that superannuation funds will be required to direct their investment portfolio towards environmental, social welfare and climate change initiatives.
But as James Kirby of this newspaper has demonstrated, superannuation funds with a concentration of environment, social and governance assets have significantly underperformed other funds during the past several years. Moreover, funds that purport to have an ethical bent have performed even worse, in part because of their concentrated holdings of technology stocks.
The Australian
The Treasurer essentially sees superannuation funds akin to an arm of government. He cites the examples of affordable housing, climate, the care economy and digital economy. He praises the involvement of industry super funds in social housing even though only one fund has announced a modest investment, with the other funds waiting for more information.
The socialist Albanese government has apparently at least dimly cottoned on to the truism about socialism and other people’s money. Rather than abandon their socialist ideology, though, they’re going to scramble even harder for other people’s money to spend.
Industry super funds, dominated by Labor’s union backers, have long been weaponising worker’s retirement funds towards “progressive” social engineering (which, often as not, bludgeons those very workers, such as in spiralling energy costs driven at least partly by industry super funds investing heavily in “renewables”).
Zippy Chalmers is apparently determined to raid workers’ retirement savings, even as workers will be locked out of accessing their own money (“preserve savings”), to fund the left’s social, economic and environmental agendas.
Get the picture? It’s not your money, Ralph. It’s theirs’ — and they’re going to spend it as they see fit.