Bill's Transcripts




28 MAY 2013

SUBJECT/S: Superannuation, Workplace health and safety

MICHAEL BAILEY:       …Rockhampton is just a shining city and at long last the water quality report is being released today about what’s happening with the mine releases into the mighty Fitzroy river and it looks like thumbs are up and the green light could be on for more water release from the mines.

BILL SHORTEN:           That’s good news.

MICHAEL BAILEY:       Yeah it all helps the bottom line, doesn’t it?

BILL SHORTEN:           Yeah and also quality of life.

MICHAEL BAILEY:       Quality of life absolutely. Talking about quality of life, Bill, super. What’s happening with that because it’s going to go from 9 to 12 per cent?

BILL SHORTEN:           We hope.

MICHAEL BAILEY:       We hope, although I do believe the Leader of the Opposition wants to freeze it for two years, is that right?

BILL SHORTEN:           Yes, superannuation is part of people’s wages packet, their remuneration. We passed a law increasing it from 9 to 12 per cent over the next 7 years. So for business people listening, it will increase by a quarter of a per cent this year, a quarter of a per cent next year and five lots of half a per cent over the following five years. So it’s not a fast increase.

                                           It’s always been part of people’s wage rises. We think it’s important because we don’t want people to have to depend on the Age Pension. When people retire and they are living a lot longer than they were 30, 40, 50 years ago, they want to have some control over their own lives.

So increasing compulsory savings in the long term will mean that a 30 year old working today, on average wages – a nurse, or a teacher, or a mechanic – will have about $127,000 extra when they retire, if we increase the super from 9 to 12.

My concern is that superannuation should be above day to day politics, but the Opposition have said they will freeze it for at least two years. What that means is that if you’re a 30 year old, you will probably have $20,000 less when you retire than you otherwise would because you can’t get that money back that you didn’t save.

MICHAEL BAILEY:       Is small business jumping up and down, like every year, there is that yearly pay rise and they’ve got to find that extra quarter of a per cent. Will that break small business do you think or put them to the edge over time?

BILL SHORTEN:           No, because history shows it doesn’t. When superannuation went up from 3 to 9 per cent between 1992 and 2002, so it’s not the first time super has gone up. What happened between 1992 and 2002 is that employment rose at the same time as super going up. There was no spike in real wages. Employment rose, business profit as a share of the economy or GDP, it rose. Unemployment fell.

So increasing superannuation is not a set of circumstances whereby it leads to greater costs. The only way it could be a greater cost is if you never ever give someone a pay rise ever. Now the last time we had seven years of no pay rises was during the convict era.

MICHAEL BAILEY:       Gee, that’s going back a few years Bill.

BILL SHORTEN:           Yeah I admit some of my ancestors did get a free trip from England but that was in the 1830s. In all seriousness when people get worried and the Opposition, I think, mischaracterise it when they say it’s a tax on business. It’s not, because it’s offset against people’s wage increases. We all know that overtime people’s wages do go up.

                                           So I’ve got historical evidence of when it was increasing and it didn’t have any of the bad consequences. The plus is, it’s not just the individual account which starts building up, but it means we’ve now got $1.6 trillion in savings.  That makes us the third largest market in the world in terms of savings. There’s not a lot that Australia comes third in.

The beauty of having that much money in our own economy, going to our share market, going to infrastructure, going to other assets, is that we don’t have to borrow so much money from the rest of the world. When you’re not borrowing money from the rest of the world, to the same extent as you otherwise would, you pay less interest rates on it.

MICHAEL BAILEY:       Bill I know there are over 22500 individuals in Capricornia who will be listening this with great intent with of course the freeze for two years, they are missing out on money. But small business, you say, will cop it sweet. It’s like with the GST, remember Australia was going to fall apart when the GST was introduced, but we survived didn’t we?

BILL SHORTEN:           Well yes, but what I would say is that there are two sets of numbers. In Capricornia, actually, it’s nearly 50,000 people who will have their increases frozen for two years.

                                           In terms of small business, again, I’ve got to stress that the record shows that these increases, say if you were going to give someone a 3 per cent pay rise, or 3 and a quarter per cent pay rise, it gets discounted from that quarter of a per cent that you’re passing on in super. It all comes from the bottom line.

So we’ve put a submission in for the national wage case for the minimum wage where we say the superannuation increase should be taken into account.

This is a Labor government who is not naive or silly, we are very clear; we say that superannuation is a part of people’s remuneration increases. What we also say is that jamming it at 9 and a quarter per cent is denying people now a more comfortable retirement. I think that’s dumb.

MICHAEL BAILEY:       Well it seems to be dumb to me. But what about workplace health and safety, is that crippling some of the businesses do you think or is it making just a safer workplace?

BILL SHORTEN:           Well we now have national laws in place for everywhere except Victoria and WA. What it means is if you’ve got a business in Rocky who is doing business in another state in Australia you’ve got the same rules. That means far less red tape.

                                           No I don’t believe it is. You’ve always got to make sure paperwork isn’t greater than the outcomes you’re seeking to prevent. Workplace injury in Australia is far more common than people realise. It does cost the Australian industry billions of dollars every year. Not to mention the individual hardship.

So having safer workplaces ultimately saves businesses money because if you’ve got someone who gets injured at work that costs money in rehabilitation, compensation payments, loss of morale.

I think that good safety does make sense.

MICHAEL BAILEY:       It does make sense. An extra burden, maybe, but in the long term you’re saying it saves money.

BILL SHORTEN:           There’s no short cuts here are there. If someone gets hurt…

MICHAEL BAILEY:       They are hurt.

BILL SHORTEN:           That’s right - if you do your back and can’t lift your kids on their birthday, or if you suffer some sort of permanent impairment - that’s with a person for the rest of their life.

                                           The workers compensation doesn’t ever compensate people for their injury it’s just some form of financial restitution to help them get by with their injury.

I’ve never met someone who’s been injured at work who wouldn’t if they could find that magic wand go back to the day they got hurt and instead undo the hurt. They don’t want the compensation, they don’t want to be hurt.

MICHAEL BAILEY:       I think you’ve said it all. So super, it’s all systems go but you’re very fearful of course of Tony Abbott freezing it for two years.

BILL SHORTEN:           I am, if it’s only two years. A previous Liberal government came in in 1996 and said they were going to increase super to 15 per cent as the Labor government of 1996 said. But they decided it was never a good time to do it.

                                           My problem is that you’ve got people now in their 50s and 60s retiring. I wish they invented compulsory super when Robert Menzies was Prime Minister, then people would have bigger accounts.


BILL SHORTEN:           You know people would argue now is not a good time to save money. But the problem is it’s never a good time to save money. But if you don’t, we are now living longer, the reality is that Australians are redefining what it is to be retired. It’s 20, it’s 30, it’s 40 years of life.

                                           We haven’t got enough saved. Superannuation is anti-inflationary as well because if people aren’t, admittedly it’s only a small proportion, but if they’re not spending it all now it keeps downward pressure on prices and instead savings is something that keeps real value in the community for people.

MICHAEL BAILEY:       It does and time is running out. That’s the Honourable Bill Shorten MP, the Minister for Employment and Workplace Relations and Minister for Financial Services and Superannuation. You’ve got a long title and a half haven’t you Bill?

BILL SHORTEN:           Yeah, when I’ve travelled overseas…no I’ll tell you when the titles have seemed a bit silly is when I put my business cards into brail, because I’m very interested in people with disabilities and having brail on your cards just reminds people that we all come in different shapes and packages and just because someone has an impairment we shouldn’t just stop making the effort to communicate. But I do concede that trying to get the title into brail was a little hard.

MICHAEL BAILEY:       Good to see you’ve got a sense of humour too. Bill Shorten thanks very much for talking to 990 4RO.

BILL SHORTEN:           You have a nice day. Thank you