AUSTRALIA - The Australian opposition's A$5bn (US$3.6bn) super policy is a "poorly targeted piece of policy on-the-run" that could potentially stifle job creation, minister for superannuation and corporate law Senator Nick Sherry says.
In his address to the Australian Chamber of Commerce and Industry (ACCI) general council dinner yesterday, the opposition leader Malcolm Turnbull outlined the opposition's plan and strategy to support and sustain the small business community.
He said the government should reduce on-costs for firms with 20 or fewer staff - temporarily reducing the cash cost to small employers of the superannuation guarantee contribution.
Turnbull said three percentage points of the employer contribution should be refunded in the first year and 1.5 percentage points of the employer contribution in the second year.
"The cost to the Budget over the two years would be approximately A$5bn - leaving small employers $5bn better off in cash flow terms," said Turnbull.
However Sherry criticised Turnbull's latest plan, claiming it will still create a A$5bn hole in the budget without delivering any of the stated benefits.
"This policy is a poorly targeted, job killing, administrative nightmare," said Sherry.
He said that the policy will be a burden for super funds, which will end up costing the members more money, while the impact of such a measure will take at least six months to take effect, contradicting the need for decisive and immediate action.
He added that the plan is "poorly targeted" - noting it is not clear how it would stimulate the economy, and that it treats high-income earners the same as those on lower income, while the government is currently providing assistance to those most at risk.
"This is a truly dangerous policy that if ever implemented would cost Australia jobs," he said.
Businesses would have to weigh up whether to employ more staff and lose the government payment, which in the current economic environment, means "businesses would decide not to add new workers."
He added that in terms of administration, it is "almost impossible" that any Government payment of superannuation could occur before 2010.
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