2GB: Morrison’s Retirement Rip-Off

E&OE TRANSCRIPT
RADIO INTERVIEW
BEN FORDHAM LIVE
2GB, SYDNEY

Topics: Superannuation; Cheng Lei consular matter

Ben Fordham
Now, superannuation to increase or not? Right now 9.5% of your wage goes towards super, and it sits there until you retire. From July 1 next year, the compulsory rate is going up. It will climb by half a per cent every year until it hits 12% in 2025. So it’s slowly going from 9.5% to 12%. Now that was legislated long before Coronavirus. Now we are in recession, and the government is hinting strongly that it’s ready to dump or delay the policy to increase super contributions. Now I reckon this is a genuine barbecue stopper. It’s not a question of Labor versus Liberal or left versus right. Some want their money now to help them out of hardship. Others say no, we have super for a reason and that is to save for the future. Former Prime Minister Kevin Rudd has got a strong view on this and he joins us on the line. Kevin Rudd, good morning to you.

Kevin Rudd
Morning, Ben. Thanks for having me on the program.

Ben Fordham
No problem. You want Scott Morrison and Josh Frydenberg to leave super alone.

Kevin Rudd
That’s right. And Mr Morrison did promise to maintain this policy which we brought in when he went to the people at the last election. And remember, Ben, back in 2014, they already deferred this for five years. Otherwise, this thing would be done and dusted and it’d be all the way up to 12 by now. I’m just worried we’re going to find one excuse after another to kick this into the Never Never Land. And the result is that working families, those people listening to your program this morning, are not going to have a decent nest egg for their retirement.

Ben Fordham
All right, most of those hard-working Aussies are telling me that they would like the option of having the money right now.

Kevin Rudd
Well, the problem with super is that if you open the floodgates and allow people what Morrison calls as ‘early access’, then what happens is they hollow out and then if you take out $10,000 now as a 35-year-old, by the time you retire you’re going to be $65,000 to $130,000 worse off. That’s how it builds up. So I’m really worried about that. And also, you know Ben, then we’re living longer. Once upon a time, we used to retire at 65 and we’d all be dead by 70. Guess what, that’s not the case anymore. People are living to 80, 90 and the young people listen to your program, or a large number of them, are going to be around until they’re 100. So what we have for retirement income is really important, otherwise you’re back on the age pension which, despite changes I made in office, is not hugely generous.

Ben Fordham
I’m sure you respect the view of the Reserve Bank governor Philip Lowe. Philip Lowe says lifting the super guarantee would reduce wages, cut consumer spending and cost jobs. So he’s got a very different view to you.

Kevin Rudd
Well, I’ve actually had a look at what Governor Lowe had to say. I’ve been reading his submission in the last 24 hours or so. On the question of the impact on wages, yes, he says it would be a potential deferral of wages, but he doesn’t express a view one way or the other to whether that is good or bad. But on employment and the argument used by the government that this is somehow some negative effect on employment, it just doesn’t stack up. By the way, Ben, remember, if this logic held that somehow if we don’t have the superannuation guarantee levy going up, that wages would increase; well, after the government deferred this for five years, starting from 2014, guess what, working people got no increase in their super, but also their wages have flatlined as well. I’m just worried about how this all lands at the end for working people wanting to have a decent retirement.

Ben Fordham
Okay, but don’t we need to be aware of the times that we’re living in? You said earlier, you’re concerned that the government’s looking for excuses to put this thing off or kill this thing off. Well, we do have a global health pandemic at the moment. Isn’t that the ultimate reason why we should be adjusting our position?

Kevin Rudd
There’s always a crisis. I took the country through the global financial crisis, which threw every economy in the world, every major one, into recession. We managed to avoid it here in Australia through a combination of good policy and some other factors as well. It didn’t cross our mind to kill super during that period of time, or superannuation increases. It was simply not in our view the right approach, because we were concerned about keeping the economy going in here and now, but also making proper preparations for the future. But then here’s the rub. If 9% is good enough for everybody, or 9.5% where it is at the moment, then why the politicians and their staffers currently on 15.4%? Very generous for them. Not so generous for working families. That’s what worries me.

Ben Fordham
We know that you keep a keen eye on China. We wake up this morning to the news that Chinese authorities have detained an Australian journalist, Cheng Lei, without charge. Is the timing of this at all suspicious?

Kevin Rudd
You know, Ben, I don’t know enough of the individual circumstances surrounding this case. I don’t want to say anything which jeopardizes the individual concerned. All I’d say is, the Australian Government has a responsibility to look after any Australian — Chinese Australian, Anglo Saxon Australian, whoever Australian — if they get into strife abroad. And I’m sure, knowing the professionalism of the Australian Foreign Service, that they’re doing everything physically possible at present to try and look after this person.

Ben Fordham
Yeah, we know that Marise Payne’s doing that this morning. We appreciate you jumping on the phone and talking to us.

Kevin Rudd
Thanks, Ben. Appreciate it.

Ben Fordham
Former Prime Minister Kevin Rudd, I reckon this is one of these issues where you can’t just put a line down the middle of the page and say, ‘okay, Labor supporters are going to think this way and Liberal supporters are going to think that way’. I think there are two schools of thought and it depends on your age, it depends on your circumstance, it depends on your attitude. Some say ‘give me the money now, it’s my money, not yours’. Others say ‘no, we have super for a reason, it’s there for our retirement’. Where do you stand? It’s 7.52 am.