National Press Club address and Q&A, Canberra

Daniel Mulino: Thanks very much, Tom. Can I firstly thank the National Press Club for the chance to be here today. Can I acknowledge my parliamentary colleagues Senator Deb O’Neill and Senator Lisa Darmanin, and also to say that I work with them so closely on many of the matters that we’re going to be listening to and discussing today.

Can I also say that the Treasurer and I discussed these matters in a division earlier this morning, and he has a great interest in these matters and has been a leader on many of these matters for many years. He would have liked to have been here. But he’s involved in votes in the House right now on the News Bargaining Incentive, but he sends his thoughts.

And I acknowledge also former Treasurer Wayne Swan, who’s here. I begin by acknowledging the Ngunnawal people as the traditional custodians of the land on which we meet today and pay my respects to elders past, present and emerging. It is a privilege to be here today for my first address to the National Press Club, and to do so as Assistant Treasurer and Minister for Financial Services in the Albanese Labor government.

With this role comes the responsibility of safeguarding what superannuation means for millions of Australians – the promise of a dignified and secure retirement. It is that promise and the task of protecting it for future generations that lies at the heart of my speech today. I want to acknowledge the regulators, superannuation funds, industry associations, financial advisers, consumer advocates and policy experts who I’ve engaged with over the past year and who have helped deepen our collective understanding of the issues I’ll be discussing today.

I also want to acknowledge the consumers affected by Shield and First Guardian collapses. Their persistence, advocacy and courage in speaking out have helped shine a light on serious failures within our financial system. In particular, I want to recognise the advocacy of Melinda Kee, who is my guest today at the National Press Club, and who has advocated tirelessly for Shield and First Guardian consumers over the past years and even before that.

Thank you so much for your incredible, tireless efforts. And I want to thank the Treasurer, Jim Chalmers, for his leadership in this portfolio. Jim has proved throughout his time as Treasurer that he’s willing to take on the big reforms our nation needs – modernising our tax system and helping more Australians achieve the dream of home ownership, because some of the most important economic decisions we make are not about the next year but the next generation.

I also want to acknowledge Mum, John and Nadia, who are here today. In government we often talk about intergenerational equity. Well, Nadia and I owe Mum and John an intergenerational debt that we will never be able to repay.

Few reforms demonstrate the power of long‑term thinking better than superannuation. Superannuation is one of Australia’s great nation‑building achievements. Created by the Labor movement, compulsory superannuation was founded on the simple but powerful belief that a dignified retirement should not depend on wealth, privilege or luck but should be within reach of every Australian.

Over more than 3 decades that vision has transformed our country. Today superannuation underpins the retirement security of millions of Australians and stands as the foundation of our retirement income system. Many in this room have contributed to the development of the super system in different ways over decades.

As our superannuation system matures and more people approach retirement, as balances grow and products become more sophisticated, it must continue to evolve alongside the Australians that it serves. Our super system is amongst the largest in the world, but for many advocacy remains a work in progress as life expectancy rises and as health care and aged care become more complex and costly.

In response, the government has lifted the superannuation guarantee to 12 per cent. It has introduced payday super, boosted the low‑income superannuation tax offset and expanded the coverage of super to pay parental leave. Our super system is already supporting millions in retirement, but preservation is constantly under threat from short‑sighted policies to allow people to access their super savings early.

In response, our government has focused on better economic policy, most recently tilting the playing field in favour of first‑home buyers so they don’t need to access their super in order to buy a home. But our system continues to face challenges. Access to financial advice has shrunk and bad actors have become more sophisticated, attracted by Australia’s huge pool of retirement savings.

That’s why today I’m announcing a comprehensive package of reforms that will strengthen Australia’s superannuation system through better consumer protection, increased stability and improved access to financial advice. These reforms will help protect the promise of a dignified and secure retirement for generations to come. The collapses of Shield and First Guardian affected almost 12,000 Australians who invested more than $1 billion of their retirement savings into those schemes.

For many people, the losses they have incurred represent most or even all of their retirement savings they spent decades building. These events exposed vulnerabilities across multiple parts of the financial ecosystem. They involved sophisticated and often predatory lead‑generation practices, advice arrangements that may have failed the best interest duty, and managed investment schemes alleged to have involved mismanagement, conflicted conduct and potentially fraud.

The Albanese government will respond to these losses in 3 crucial ways. First, we will make the financial system safer by strengthening protections across the superannuation advice and investment ecosystem. Second, we will improve access to safe, secure financial advice and guidance so that Australians can navigate an increasingly complex retirement system with greater confidence.

And, third, we will place the Compensation Scheme of Last Resort on a firmer and fairer footing so that it can continue to provide meaningful protection when all other measures have failed. Together, these reforms will help to build a financial system that is safer, more resilient and more worthy of the trust that Australians place in it. The first pillar of the government’s reforms is to make the financial system safer by strengthening protections across the superannuation, advice and investment system.

The people who experience loss in our superannuation system are usually not reckless investors chasing speculative returns; they’re ordinary Australians attempting to make sensible decisions about their retirement. Too often the story begins the same way – a lead generator makes contact through social media, an online advertisement or an unexpected phone call.

A persuasive sales process follows. Consumers are told their superannuation is underperforming, that they are missing opportunities, or even that their retirement may be at risk. I have read the transcripts of these interactions.

The perpetrators are sophisticated and effective. They are then referred to a financial adviser. Recommendations are made, and all too often savings are moved.

In many cases large portions or even all of a person’s retirement savings are directed into a small number of products, and sometimes these products are highly risky, not transparent and not diversified. Sometimes they are not what the person asked for. Those savings can ultimately end up in managed investment schemes that collapse, causing devastating losses.

These events are not the result of a single failure; they reflect a chain of conduct spanning lead generation, financial advice, managed investment schemes involving conflicts of interest, poor governance and, in some cases, allegations of serious misconduct and fraud. The lesson from Shield and First Guardian is that modern consumer harm can be sophisticated, interconnected, scaleable and readily replicated.

Reports of similar lead‑generation activity targeting Australians continue to emerge. Our task is, therefore, not only to respond to past failures but to reduce the risk of future ones. That requires a comprehensive response that recognises how these business models operate across the financial system, and that will remain effective even as bad actors adapt.

It also requires striking the right balance between consumer choice and protection; between access to advice and appropriate safeguards; and between innovation and the security of Australia’s retirement savings. That is the approach reflected in today’s package. The first objective is prevention for all investors regardless of the type of superannuation fund they choose or the financial products they invest in.

These reforms will reduce the likelihood of major consumer loss events occurring in the future. Today I am announcing a comprehensive crackdown on harmful lead generation practices. We will ban unlicensed, real‑time communication about superannuation.

We will limit the anti‑hawking exemption for financial advice to existing client relationships. We will strengthen penalties for breaches of anti‑hawking laws, and the government will also take further steps to target the data collection and broking activities in the financial sector that often represent consumers’ first point of contact with these bourgeoning ecosystems of harm.

These reforms are designed to disrupt some of the most damaging business models operating in the system today. They intervene at the earliest point of consumer harm, reducing opportunities for bad actors to access potential victims. We are also announcing significant reforms to strengthen the oversight and governance of managed investment schemes.

Audit and assurance requirements will be strengthened and managed investment schemes will be required to notify ASIC when they freeze, suspend or otherwise restrict investors’ ability to redeem their investments. Alongside the additional funding already provided to ASIC in the 2026–27 Budget, these reforms will improve transparency, strengthen accountability and give regulators better visibility of emerging risks.

Importantly, they will help regulators identify concerning flows of consumers and capital into high‑risk products at a much earlier stage and intervene before problems become widespread consumer harm. Australians should expect strong protections when they choose to invest through prudentially regulated parts of the superannuation system. That is why I am also announcing a new framework to enable ASIC to direct superannuation trustees to commence a remediation process where an investment option fails and there is reasonable suspicion trustees have failed to meet their obligations.

Trustees would be required to compensate their members’ full capital losses where the trustee has breached its obligations. We will also give APRA the power to set capital requirements to ensure superannuation trustees that offer higher‑risk options have the financial capacity to meet these obligations. This is significant structural reform.

If a prudentially regulated superannuation platform places a product before consumers and the trustee of that platform fails to discharge its responsibilities, consumers should not be left facing years of uncertainty while they pursue redress through multiple avenues. They should have a clear and practical pathway to meaningful compensation. These reforms will encourage stronger investment governance and reinforce APRA’s ongoing work to address weaknesses in investment governance practices.

We will also strengthen penalties under the Superannuation Industry Supervisory Act, sending a clear natural that members deserve security, transparency and accountability from those entrusted with their retirement savings. These reforms also build on work already being undertaken and led by industry to strengthen oversight and accountability in the superannuation sector, particularly the Financial Service Council’s efforts to lift industry standards.

But a safer system must protect consumers across the entire superannuation system. Over $100 million was invested into Shield and First Guardian through self‑managed super funds, and SMSF losses have already placed immense strain on the CSLR, accounting for more than 90 per cent of costs to date. That is why we will give the ATO a new power to prevent rollovers into SMSFs where there is a well‑founded suspicion of consumer harm, and we will strengthen data sharing between ASIC and the ATO so concerning patterns of rollover activity can be identified earlier.

We will also require SMSFs to maintain uniquely identifiable bank accounts to help idea fraud risks. And we will introduce basic trustee knowledge requirements to ensure Australians understand the obligations they are assuming before taking direct responsibility for their retirement savings. These reforms will build on and reinforce work already underway with the sector, including the SMSF Association’s efforts to uplift trustee education and support better informed decision‑making.

We will also align the first SMSF ATO supervisory levy with fund establishment and increase the levy for the first time since 2013 to help ensure the ATO is appropriately resourced to engage with new trustees, identify emerging risks and intervene where members may be at risk of financial harm. And we are going to improve transparency around SMSF outcomes by requiring newly‑established SMSFs to disclose any financial adviser involved in their establishment and by adding a dedicated line item to SMSF annual statements identifying advice fees deducted during the year.

Importantly, these reforms are targeted at preventing harm, not creating red tape for Australians who choose to manage their retirement through an SMSF. For the vast majority of trustees, they reflect practices already in place, allowing us to better identify at‑risk consumers and interrupt harmful practices. The second pillar of our package is ensuring Australians have access to safe and reliable financial advice.

Financial advice sits at the centre of almost every issue I have discussed today. Good advice helps Australians navigate an increasingly complex retirement system and achieve better outcomes. Poor advice can cause immense harm.

The government has already announced reforms to adviser education standards to support new entrants to the profession and to strengthen the long‑term sustainability of financial advice. And I will continue to act on this as a real priority. Today I am also announcing significant progress on the Delivering Better Financial Outcomes package, enabling us to move forward with measures such as targeted superannuation prompts, intrafund charging and streamlined statements of advice.

These reforms will allow superannuation funds to engage with members when they need support most, helping Australians receive guidance at the important points in their financial lives, rather than after opportunities have already been missed. We will prioritise these measures and progress them alongside consumer protection reforms that I have outlined in this package.

We will also streamline delivery of the remaining components of this package, alongside the consumer safety measures I have announced today. We will proceed with the new class of adviser initially limited to APRA‑regulated superannuation funds and life insurers and supported by strong safeguards against vertical integration through prohibitions on commissions, bonuses and volume‑based payments.

We will review the scope of the new class of adviser in 3 years to determine how it is performing and whether we should expand it further. In the wider advice sector, we will deliver targeted reforms to the best interest duty to enable the provision of scaled advice. And we will also progress a review of the adviser code of ethics to ensure it is fit for purpose.

This reform recognises a simple reality: millions of Australians need help navigating an increasingly complex retirement system, and there should be accessible and affordable ways for them to receive that help. At the same time, regulators have rightly highlighted the risks associated with poor conduct, lead generation and large‑scale consumer harm if these settings are not carefully designed.

ASIC’s work on advice fee deductions exposed serious failures in platform governance and inappropriate switching charges levied on consumers. It is difficult to argue that very large advice fees charged to members with low balances for switching‑related advice can satisfy an adviser’s obligation to act in their clients’ best interests. The government will respond by legislating an obligation on superannuation trustees to have and ensure compliance with advice fee deduction caps for their members.

Given the significant advice needs of Australians approaching retirement, there is no legitimate place for these practices in our system. ASIC’s work in this area has been longstanding and outstanding, and the government will respond by legislating an obligation on superannuation trustees to have and ensure compliance with advice fee deduction caps for their members.

ASIC’s ongoing work and our reforms to SMSF reporting will dovetail to provide better visibility of advice fee deductions across the entire ecosystem and greater assurance that members’ balances are not being eroded by unreasonable and inappropriate deductions. Most financial advisers are doing the right thing. They help Australians plan for the future, navigate retirement with confidence and achieve better outcomes.

They support Australians with some of the most important decisions they make in their life. But when the advice falls short, the consequences are profound. Consumers do not just lose money; they lose security, opportunity and confidence in retirement.

They lose faith in a system that was meant to protect them. The third pillar of this package is ensuring the compensation scheme of last resort is on a firmer and fairer footing for the future. When everything else fails, consumers need somewhere to turn.

The CSLR was created to ensure Australians have access to compensation when they have suffered serious losses and all other avenues have been exhausted. It is an important safeguard within our financial system and an important protection for consumers. But the CSLR was not designed to absorb the costs associated with large‑scale investment losses linked to personal‑advice failures.

The quantum of these losses is simply too large. As thousands of claims flow through the system AFCA is required to process large volumes of complex cases. Consumers face lengthy delays while their claims are determined and compensation pathways are worked through.

At the same time, the costs of these failures are ultimately distributed through increasingly large special levies imposed on parts of the financial services industry. That process is placing pressure on the scheme, pressure on industry and, most importantly, pressure on consumers seeking timely outcomes. That is not a sustainable position.

But we must remember that the most important reforms required to strengthen the CSLR are not found within the CSLR itself; they are the preventative consumer protection reforms that I have already outlined today. We are ensuring that compensation is delivered earlier and by parties more directly connected to the conduct that caused the harm, and that is the purpose of the trustee remediation reforms I outlined earlier.

But even with stronger consumer protections and stronger remediation arrangements, there will still be circumstances where consumers need a genuine safety net. AFCA is undertaking ongoing efforts to improve efficiency, reduce costs and deliver better outcomes for consumers navigating the dispute resolution process, and the CSLR remains an essential backstop. It must remain there for consumers when all other protections have failed.

That is why I am announcing a series of reforms to strengthen its long‑term sustainability. I am also announcing that in 2026–27 the government will apply the waterfall model outlined in consultation to the $170.3 million special levy attributed to the financial advice subsector. But applying the waterfall model doesn’t mean that subsectors are automatically going to pay their maximum cap.

The legislation requires me to consider the viability of affected sectors and the broader interests of the financial system. And that is exactly what Treasury is analysing now, in consultation with stakeholders before I make any final decision. In particular, I recognise that financial advice is a sector made up largely of small businesses.

I want advisers to know that I recognise the immense value they provide to Australians. I have heard the concerns that they have raised throughout this process and I am committed to working with the sector to ensure that we arrive at an outcome that is sustainable, proportionate and fit for purpose. We recognise the significant impact that these levies have across the financial system.

We recognise that consumers need to access – need access to a compensation framework that is fair, effective and reliable. We will also ensure that SMSFs contribute to special levies in future years where a special levy is required. SMSFs are a legitimate and important part of Australia’s retirement income system.

They are also part of the financial services system that benefits from the existence of a compensation framework. This is a balanced approach under which it is estimated that individual SMSFs are likely to contribute no more than $20 per leviable period which an overall sector levy scaled according to the relative size of the SMSF population assets compared to APRA‑regulated sector assets.

Alternative models, including excluding SMSFs from the scheme altogether, would have created significant gaps in consumer protection while adding complexity and administrative costs. Today I am also announcing that compensation under the scheme will be limited to actual investment losses rather than hypothetical loses for applications made to AFCA after 30 June next year.

This is a necessary decision to safeguard the sustainability of the scheme. And I want to recognise the important work being undertaken through Super Consumer Australia’s Take Back your Super campaign, and the role it will play as we navigate this transitional period. I also want to acknowledge again the Shield and First Guardian consumers who continue to navigate the path to compensation.

These reforms are about delivering a safer and more accountable system for the future, but they do not diminish the importance of the challenges consumers face today. We have not forgotten about you. And we remain committed to working with you and supporting you as you navigate these processes and pursue fair outcomes.

In developing this package the government has been guided by a simple principle: the best reforms are developed through genuine consultation. Over the past 6 months we have undertaken one of the most extensive consultation processes in recent memory on these issues. We have released 6 discussion papers, tested a wide range of ideas and invited feedback from across the financial services ecosystem.

That process has involved many written submissions, roundtables, stakeholder workshops and direct engagement with consumer groups, industry participants, regulators, policy experts and, of course, the individual Australians who have been affected by the issues we are seeking to address. I want to thank everyone who contributed to that process. Your expertise, your advocacy and your willingness to engage constructively have improved the final package.

And I hope those who participated in these consultations and those with an interest in these issues more broadly can see that their views have been heard and genuinely considered. Throughout this process a number of ideas were put forward for consideration. Many were thoughtful proposals that at first glance appeared worthy of serious examination.

Some of these ideas have informed the package I am announcing today. Others have not. That is not a sign that consultation has failed.

In my view, it is a sign that consultation has worked. Good policy is not about defending every idea that enters a discussion paper. It is about identifying the reforms that will deliver the best outcomes for consumers and the strongest outcomes for the system as a whole.

The result is a package that improves consumer outcomes without imposing new burdens on businesses already doing the right thing. We will strengthen accountability, remove practices that serve no useful purpose, formalise standards that responsible actors already have in place, and support more efficient allocation of capital across the economy through improving market integrity and consumer confidence.

That is not more regulation; It is better regulation. It is working with industry to deliver consumer protection alongside our government’s broader productivity agenda. And we know the work does not end with this announcement.

We will continue to engage closely and constructively with stakeholders as we work through the legislative design process, bringing the same willingness to listen, test ideas and get the detail right. Finally, I want to acknowledge the extraordinary work of Treasury officials who have supported this reform effort, including Jenny Wilkinson, Secretary of the department, who is joining us at the Press Club today, but also her whole team.

I think there are maybe some other members here. It has been a massive effort over a long period of time. And can I also acknowledge the efforts of other regulators who have contributed to that effort.

Their professionalism, expertise and dedication has been instrumental in bringing this package together. I thank all of them for their work. Similarly, I recognise the work of Sarah Court and ASIC for their tireless efforts to achieve positive outcomes for consumers.

In conclusion, today’s announcement is another step forward for the legacy of a government and a Labor Party committed to improving outcomes for Australians through every stage of life, including in retirement. In too many cases bad actors within the superannuation system have exploited Australians’ aspirations for a secure future and called into question the retirement security they spent their working lives building.

These reforms will make superannuation safer from every angle. They will crack down on bad actors wherever they operate, and strengthen confidence in the system. Just as importantly, they will preserve the ability of members to choose the products that best meet their needs.

We do not accept that Australians must sacrifice choice to get stronger protections. Our reforms will deliver both. This package recognises the growth of the superannuation system, the reality that millions more Australians are moving into retirement and the central role that financial advice plays in both consumer protections and wealth creation.

It is comprehensive. It addresses the causes of the Shield and First Guardian collapses. It responds to the harms they exposed.

It anticipates how bad actors may adapt. And it makes the system fairer, safer and more trusted. Most importantly, it places superannuation members at its centre, recognising that superannuation is not merely a financial product but an industrial entitlement enshrined by the Australian Labor Party in 1992.

The package I have announced today delivers on the promise of all Labor governments – to strengthen the system, to leave it better than we found it and to safeguard it for future generations of Australians. Thank you. Tom Connell: Thank you, minister.

You mentioned the crucial element that without social media and all of the leads generated, First Guardian wouldn’t have happened, and this change of only allowing licensed funds to be able to advertise. Why not go further? Because, you know, Australians, wouldn’t they rightfully be saying, well, is social media really going to enact that change given it took years before we finally stopped seeing Kochie flogging crypto coin or Richard Wilkins with a great investment opportunity?

Yes, so, look, this is an approach to lead generation that is really comprehensive. It is a very clear ban on real‑time reaching out to consumers that will be highly effective. That is the most harmful side of the behaviour that we have seen.

It’s the real‑time interactions where there is manipulation of people through telephone calls and discussions through chats. And so unlicensed involvement in real‑time engagement is particularly harmful. We’re also going to be looking at through targeted consultation banning engagement whereby data is collected, which is the way through which there can be referrals to other parts of the financial services sector.

But these reforms dovetail with the limitation of the anti‑hawking exemptions to existing client lists. So it’s really all of these measures working together. And then finally with stronger consent provisions.

And we’re confident that all of these measures working together will see a system whereby people will not have unsolicited reaching out to them, where they will be protected from that kind of manipulative behaviour, where their data will not be misused in the system. Okay. For anyone watching at home, don’t click on the Kochie link on crypto coin.

Now, complicated matter and a lot of people to get through, so, please, I don’t actually say this a lot, but please stick to one question, colleagues. James Mayger from James Mayger: Thank you for your time, minister. A few days ago, the PM talked with President Trump and he talked about the super system and characterised it as an investment vehicle for Australia, including into the US.

Do you see the pull of superannuation funds that you’re talking about as a tool of diplomacy to be directed or encouraged to invest in Australian allies? And more broadly, do you see government having a role in directing where super or encouraging where superannuation funds are invested, including at home into projects of nation building which, you know, the government is looking towards with, you know, Future Made in Australia and that kind of thing?

Thank you. Thanks. So, look, first and foremost – and I just want to put this out there very clearly – the superannuation system is there for the benefit of its members.

It’s there for their dignity in retirement. It’s there to achieve the best long‑term risk‑adjusted rate of return. So the sole purpose test is absolutely critical, and that remains the lodestar for the system.

Having said that, the superannuation system is now large, and so in achieving those risk‑adjusted rates of return for members the superannuation system will end up investing in Australian companies through listed equities. It will engage in where it sees fit. It will engage in unlisted assets, which might include infrastructure.

And it will, where appropriate, seek to diversify by investing internationally. So we have seen and we will continue to see because of the size of the super system that it will invest in assets that benefit our macro economy, but that is in the context of where superannuation trustees are first and foremost being guided by the best interests of their members.

On the international dimension, it is also true to say that a number of observers – I believe rightly – have pointed to the fact that Australia benefits from soft diplomacy in the investments that many super funds make in countries in our region and beyond. Nicholas Moore, I think, has made points on this front, but many others. And that is a benefit.

But, again, I would say similarly to my first point, that is within the context of super trustees being guided by the best interests of members. As they diversify internationally, there is no doubt that Australia will benefit from the positive impacts of a lot of those investments. Ron Mizen from the AFR.

Thank you, minister. You’ve included super funds and life insurance in your new class of advisers. A question from one of my colleagues is: why not include banks in that?

Do you think they’re a higher risk in terms of the advice? And how do you expect super funds to raise the capital buffers? Presumably that’s not going to come from member funds.

Where will that funding come from? Member fees? So just on the first question, so the policy rationale for DBFO has been very focused on the fact that in super in particular there have been a number of situations evolve in the system where a number of understandable protections in the system have now meant that super funds can’t answer basic questions when members call up.

And that is not to the advantage of members. I believe it’s actually contributed to members seeking guidance from other sources. So, the DBFO new class of adviser was primarily focused, from a policy rationale point of view, on the super system and on life insurance in situations where basic guidance, basic answers to questions, would have provided people with assistance in getting much better outcomes.

Now, we’ve limited it to the APRA‑regulated parts of those 2 sectors because we believe if it’s tightly defined that will provide people with answers to really important questions but in a targeted way that will not encroach on the kinds of advice that advisers do. So that is one of the pieces of work that we will undertake to ensure that it’s well targeted. But the new class of adviser will see super funds and life insurance with appropriate safeguards be able to give people really meaningful advice to make sure they get better outcomes.

And I think limiting it to APRA for the first 3 years is a way of just making sure that we have a really clear understanding of how that new class of adviser is rolling out. It is going to be less regulated than the full‑blown financial advice, which is a really critical part of our system, and I’ve said in a number of forums I see demand for that increasing as balances grow, as more people approach retirement.

But I think we need to really understand how it’s operating in that APRA‑regulated part of the sector. And so that’s a big step forward. That’s one of the big, important reforms in this system.

And, sorry, the second question? That’s all right, I’ll leave it there seeing as Tom’s very direct – I don’t want to get into trouble with the president. Well, that’s an easy way for me to avoid the difficult questions – by referring to the second question.

Now I look at that, so he was talking about the levy. So it has to sharpen fees, right? There’s no magic pot of money.

So, sorry, the capital requirements. Yes. Look, there’s – on APRA‑regulated super funds there are already a range of requirements for them to hold reserves and for them to provide stability.

What we’re really looking at here is an additional set of requirements that where we’re talking about super trustees offering services through platforms in particular. And motivated by the fact that if we look at what happened after Shield and First Guardian, when Macquarie and Netwealth stepped up, and at different times, but then both stepped up, people got their capital back and they got it back pretty quickly.

And that was with some distress, obviously and obviously people went through very traumatic times, but compared to the delays that people would have faced if they’d had to navigate the whole rest of the system, that was a good outcome. And it also meant that parties with direct involvement were the ones who were stumping up and it wasn’t then having to go to the CSLR and be spread across the whole sector.

So what we’re saying is that where you’re operating a platform, you’ve got to demonstrate that you have the wherewithal to back up your obligations. So, firstly, we’re going to continue to work with APRA to strengthen clarity around what those obligations are. But, secondly, if you’ve got those obligations and you don’t meet them, you fail to live up to those obligations, you have to have the ability to compensate, to give people the capital back.

Now, that can either be through showing you’ve got direct access to capital or it might be a related party guarantee. We will work through the details on this. There are ways that we’re going to be able to do this that are risk rated, that are not overly burdensome.

And as I mentioned in the speech, it will dovetail with the MIS reforms where we’re collecting more data on MISs so that we can identify the high‑risk MISs. Nassim Khadem from ABC. Nassim Khadem: Nassim Khadem from ABC News.

There’s well above $4 trillion in super assets, more than a trillion held in self‑managed super funds. As more people want to self‑manage their super, is there any further changes that you can make to make it easier for them and to better protect them? Yeah, so I think the reforms that we’ve announced today are really important reforms.

I acknowledge the importance of the SMSF sector in our broader superannuation sector. Today there are a number of reforms that improve transparency in that sector. So the unique bank accounts, the fact that SMSFs will be required to provide important but basic information to the ATO, such as a financial adviser involved in their establishment, or on an annual basis advice fees that they’re paying.

That transparency will be really important for the sector. I think the requirement for an SMSF trustee to demonstrate they have a basic level of understanding of their obligations is going to be important for our system. I think it’s going to be beneficial for those managing SMSFs.

It will reinforce to them the importance of the role that they’re taking on. So I think that what we’re looking at today are reforms that will through very low‑cost data reporting improve transparency and through very sensible capacity‑building build better trustee capacity. Jack Quail from The Australian Jack Quail: Thank you very much, Dr Mulino, for your address.

I just want to ask you about your – given your changes to grant super funds greater avenues to offer financial advice, I’m wondering if you think there’s merit in and are you open to offering greater information‑sharing between Centrelink and superannuation funds such that that advice can be as comprehensive as possible? Yes, so, look, I’ve been told not to say that’s a great question to every single question as a way of delaying my answer.

But, look, that is really important question. And I think it is something that the government is looking at. It was actually an issue raised at the national conference and something that is now in Labor’s platform.

I think this is something which we need to step through carefully. There are issues around privacy. There are issues around the IT build which, as many people in this room would know, is nothing to underestimate.

In fact, it may send shivers up the spine of many around this room. But there is a real opportunity here for funds to give better guidance if they have a basic understanding of somebody’s overarching financial situation. So this is something that the government will look at.

But I don’t want to underestimate the challenges that might arise along the way. These are complex systems to dovetail. I mean, in my portfolio more specifically, you know, we are looking, for example, at the consumer data right and ways in which it might access certain government information.

There are lots of ways in which information flows can benefit consumers. I think we just need to make sure that we step through those movements carefully. Next question, Andrew Greene from The Nightly Andrew Greene: Minister Mulino, I’ll ask a question in your role as the minister for sin taxes, specifically alcohol and tobacco.

Just yesterday we saw the ATO do a crackdown on alcohol excise avoidance. That was for a scheme that was only launched 6 weeks ago. Do you think crackdowns like this are enough to stop the alcohol sector following the path of tobacco where we’re seeing illegal, you know, crime gangs running a lot of the market?

And on a related point, is there any merit, as many fellow economists have said, to Pauline Hanson’s proposal to reduce tobacco excise to crack down on the black market? I like the way you’re using ‘related point’ to avoid the criticism of 2 questions. But, look, both of these issues are in the news a lot.

And can I just say on the tobacco excise firstly, we are working closely with jurisdictions right around Australia on this. We’re working with all states and territories. I think it’s worth noting some of the comments from the Commissioner for Illegal Tobacco and E‑cigarettes, who has said that if you look at that market in other countries, there have been a number of jurisdictions where excises have not increased and where enforcement issues have risen, where organised crime has tried to get a foothold.

She made the observation that she feels that even if the excise dropped substantially and potentially even if the excise was to be taken away there would still be opportunities potentially for organised crime to make a profit. So when it comes to the tobacco excise, our priority is very much on continuing to work with other jurisdictions. We have undertaken positive work with all jurisdictions, I think with Queensland and South Australia in particular.

There’s been real progress in shutting down some illegal shops. So that’s the priority at the minute. With alcohol, it’s in a different place.

But there are issues being raised in the public sphere as well. And I’ve met with the commissioner on a number of occasions. We are looking at this issue.

The ATO is examining it from a range of perspectives, both compliance with the remission scheme in relation to spirits, for example, but also potentially any linkages with organised crime. At this point, again, we feel that the best approach in relation to that remission scheme – which I would just say is a really important program for boosting the spirits industry in Australia, which is a really high‑value add and a huge exporter – but we need to make sure that we continue to be on top of the enforcement task in relation to that tax.

Can you point to a single time in Australia when policing alone has fixed the black market issue? Look, I think what I’d say is that what I think is clear in this case is that the price incentive in tobacco excise I think will not make a material difference at this point. And I think that I wouldn’t necessarily expect that better policing is going to totally eradicate.

So for me, better enforcement necessarily isn’t about achieving a perfect solution. Better policing, better enforcement is about achieving the best overall regulatory outcome. And so for me it may be that there remains some illegal tobacco in the system.

But for me the best approach at the moment in terms of regulatory effort is on putting more effort into enforcement. Julie Hare. Julie Hare: Dr Mulino, thank you for your speech.

You completed a PhD at Yale in the early 90s. For the benefit of people who don’t know what it’s called, I’ll read it out for them – The Macro Economics of Ageing: the impact of an ageing society on capital deepening and the international factor flows. It would seem to me that that PhD would set you up very well for your current job, but the world has changed a lot since the early 1990s and today.

I just came from an AI and skills conference just down the road, and one of the issues that was broached was the value of in‑depth, long‑term qualifications like PhDs in the modern AI‑driven economy. I was just wondering if you could briefly reflect on your PhD and how it has contributed to your ability and capacity to deal with complex policy solutions. Well, it’s a – thank you for that question.

Now, it’s interesting if you go to Amazon, there’s a little industry in North America and Europe where there’s a publisher who takes PhDs and then publishes them as books and charges $150 bucks a pop. I think with libraries being the only purchaser of that. So I think my PhD is available on Amazon.

There is one review of that book, which says that it’s a real page‑turner. And that is the Member for Bean, and he has not opened a page of it, I can assure you. But, look, I think the issues canvassed in that dissertation are obviously very relevant today.

And, in a sense, the ageing of societies was happening back then and it continues. If anything, I feel that Australia is in a relatively good position compared to just about any other advanced economy. And, indeed, there are a lot of emerging economies, a lot of economies at much lower GDP per capita with much more challenging ageing demographics than we have.

Now, that’s no reason to rest on laurels, no reason to not take it as a serious issue. But I think we have relatively speaking a very healthy demographic outlook going forward. And that’s something, I think, which intergenerational reports have pointed to in recent years.

What I would say is, though, that because we know that the ageing of our society will continue – and, again, I’d just say parenthetically, it is a nice problem to have; it is far better than the alternative of not living longer and healthier lives – but my sense is that it offers us opportunities to think through over those longer lives. We will possibly want to engage in connection with the workforce for longer and how do we think through that.

That’s something which I think successive governments are having to navigate. I think as we engage with the workforce longer and as workforce participation increases at older ages I think we need to think through people having multiple careers, and I think that some of the points you touched on – technological change and AI – will point to that. I think there are a number of efforts around the world at that.

We’re pretty good at it. I think fee‑free TAFE and our very amazing skills ecosystem is part of that, but you look at lifetime accounts in some other countries, this is huge area for policy thinking going forward. But the other thing I would say is that quite apart from all of those working life challenges, it’s quite likely, I think, that we will be living longer and healthier retirements.

And that’s where super and other parts of our safety net come into play. And so I think we need to start thinking about that post‑retirement part of the super challenge. And the Treasurer, for example, has put out 2 discussion papers this term around collecting better data on retirement products, around best practice principles for retirement products.

I think there’s an acknowledgement in the super sector that the sector has done a really good job of accumulation, of lifting risk‑rated returns, of building accounts. Government has done a lot of heavy lifting when it comes to things like the SG and payday super. I think speaking of us living longer and having long retirements, I think we’re going to need to think through what kinds of products, what kind of range of products but also relevantly to the things we’re talking about today how do we make sure people get the advice and guidance as they approach retirement so that they can make the right choices.

Andrew Probyn from the Nine Network. Andrew Probyn: Dr Mulino, I also want to refer back to your studies in economics. But I also want to ask about tobacco.

When you were an economics student, you would have no doubt studied the Laffer Curve whereby if you tax so much you end up collecting nothing because it changes behaviour. Tobacco excise in Australia is a classic case in point – 80 per cent is bought on the black market, smoking rates might be increasing because consumption is certainly increasing. You’re no longer raising the billions that you once were, and all most smokers – 80 per cent of smokers – are now complicit in organised crime buying cheap ciggies.

Now, how is it that tax policy isn’t relevant here? And if you say it isn’t, then surely you’re fibbing? And, look, the Laffer Curve is an interesting economic theory.

And it was, of course, really famous in the 80s. It inspired a lot of Ronald Reagan’s thinking around income taxes. And, look, in theory it is true to say if you tax zero you get zero; if you tax a hundred, unless you’ve got really strong powers of compulsion, you get zero.

And Laffer, of course, I think famously on a napkin drew a bell curve or something like that. What I would say about the Laffer Curve is I think that, firstly, the relationship between any tax and total receipts I suspect is not some simple straight line like that, acknowledging that there are trade‑offs. But the reality is there are so many other aspects of raising tax.

There’s compliance issues. There’s motivation issues and so forth. So just to say in theory it’s true that at high rates there are trade‑offs, at low rates and so forth.

But what I would say is that when you start to think about collecting tax in a more complex environment where it’s not simply a matter of trying to find the optimal point in a Laffer Curve. And I think Ronald Reagan, for example, got that wrong when it came to corporate and income tax. I would go to some of the evidence that we heard from some of the experts in this field, like the Commissioner for Illegal Tobacco and E‑Cigarettes, where she basically said she thinks that we’re at the point now – and maybe we wish we weren’t – but she thinks we’re at the point now where even if we were to drop excise significantly it wouldn’t really have much of an impact on that model.

Shrinking the differential would surely help. That’s what Chris Richardson says. It’s what Richard Holden says.

Yeah, and this is where I’d go to the fact that there’s – when you look at economic modelling, you’re always trying to model complex social phenomena through a range of perspectives. Things like price incentives or differentials it is one aspect of it. There are institutional arrangements.

And so I think some people would say, look, we would wish we hadn’t got to the point where organised crime was entrenched. It is entrenched, so how do we deal with that now. Is organised crime going to feel like a little bit of a – Hang on, you just said organised crime is entrenched.

If it is entrenched, don’t you do everything to stop it? But that’s why I’m saying that the focus I think needs to be on enforcement. And I think that’s where we’ve said for some time now we’re working with state governments, we’re working with territory governments.

We have made real progress across the board, and I think Queensland and South Australia stand out, but we will work with all state and territory governments. That’s our priority at the minute. The government modelling never said this would happen in the first place.

So why trust it to say lowering tax wouldn’t help unwind it? Well, look, I mean, I wasn’t involved when, you know, a whole series of changes were made to the – But we were never [indistinct], were we? Look, this is a long‑term set of changes that have been made.

And I would just simply say that I understand in principle some of the incentive arguments that are being raised. But I do think taxation in a real‑world environment involves complex decisions about the demand side, and we’re often talking about people who are making decisions to buy a product that is addictive. That side of things is complicated.

We’re talking about institutional arrangements on the supply side. So I’m not saying that in theory prices don’t matter and that, you know, regulatory gaps don’t matter at all in theory. I’m simply saying that at the moment I think – and this is backed up, I think, but the evidence from the commissioner and other experts; not a universally held view by the way, I acknowledge that some economists have been out on this review – I think that the right focus at the minute is on enforcement.

Okay. Aleks Vickovich from Connexus Financial Aleks Vickovich: Thank you. It’s serendipitous, minister, that you’re speaking at the retirement leaders summit at Old Parliament House later today because many of the tensions that you speak to are around the time that consumers are retiring.

You’ve rightly identified harmful lead‑generation activity, unlicensed super spruiking and other harmful activity. But your way of going about that seems to be mostly reinforcing or adding additional obligations on regulated entities – financial services providers – or bringing some of that unlicensed activity into the purview of the regulators, when presumably a lot of this activity is also happening on social media, in AI chatbots and by way of large language models.

So in going down the path, did you consider a role for bringing big tech to account on their ability to monitor and potentially stamp out some of this activity, particularly given that your government has been willing to do that in the case of the social media ban for children? Yeah, well, and we’re also leaning in right now up in parliament on, you know, the News Bargaining Incentive.

So there’s a range of ways in which this government is interacting in world‑leading ways with big tech. Look, what I’d say with the lead generation is that I’ve set out today some of the parameters that we are going to ban unlicensed real‑time, that we’re going to look at aspects. We’ve targeted consultation on lead generation that involves data harvesting and that we’re dealing with the anti‑hawking exemption.

But we will need to look at a lot of the detail as we roll out the legislation that sets that up. I expect that we, you know, may need to look at ways in which we enforce those bans in different settings. Obviously, when people think about real time in a telephone call you think about interrupting that through stopping the call centre or, you know, interrupting it that way.

Look, if there’s activities through bots that are occurring through social media, then, yeah, we will need to think through those details. One of the other areas in my portfolio where I’m dealing with what we intentionally label an ecosystem approach is scams, which sometimes have many characteristics of some of the ways in which people are reached out to in this space.

There are investment scams that sometimes look quite similar to the kinds of things we’re talking about today. And we’ve intentionally with scams included telecommunications companies and digital platforms as designated sectors. We are at the moment developing codes of practice which will be enforceable on those sectors.

So you’re totally right to raise enforcement as an additional challenge on top of setting clear obligations. I’m confident that we can step through those challenges. Jacob Shteyman from AAP.

Jacob Shteyman: Dr Mulino, including SMSFs in contributing to the CSLR in a way acknowledges that those that benefit from the scheme should contribute to it. Why do institutional super‑fund members still have to contribute to CSLR levies when they can’t claim from it? So, look, this has always been a really complicated part of the CSLR.

The special levy – and can I just say this from the outset, the special levy is, in a sense, imposed right across the board on parties that were not associated with the bad activity, because when you get to the CSLR, the bad actors have phoenixed or left somehow. So everybody involved in the CSLR is not involved in perpetrating that behaviour. And in deciding how we allocate across different parts of the financial services sector, we’ve been guided to date by a couple of principles.

One is that even though everybody in the CSLR is not directly involved in the bad actions, we have wanted to bring in a principle of sectoral proximity. We thought that made sense – that you – and that underpins the whole design of the CSLR, of course, because each of the 4 subsectors are the first port of call, that the financial advice sector has to pay the first 20 million before you get to a special levy, and then it goes beyond that.

So proximity is one of the criteria. The other criteria – and this is meant to be a reflection of the need to be pragmatic when special levies are large – is the fact that you can’t just do it based on proximity otherwise it would be overly burdensome. And so what we’ve said is we need to spread it widely, even if that means there are some subsectors that don’t really have much to do.

And you’re right to put out super funds where there’s high levels of regulation, but banks, general insurers, life insurers, a number of other sectors, financial markets, they will make the point that we have nothing to do with this particular bad activity. But if we didn’t spread the burden of the CSLR special levies widely, it would not be feasible to recover those funds.

Now, when I dealt with one of the more challenging things that I had to deal with, which was the $47 million special levy late last year, I received representations from just about every of the 20‑plus retail‑facing parts of the financial‑services sector, almost all of them argued it should be spread very widely, but not us. And that was with sensible arguments, I mean, very coherent arguments.

But everybody’s second‑best position was if us, everybody. And so that’s where we landed, everybody. But what we’re really trying to balance is the fact that if special levies are going to work, it really has to be spread very widely.

And that will include, at a sectoral level, entities which would argue they don’t have a lot to do with what’s gone wrong. And I totally get that. But we are, through the waterfall model, trying to link it more to subsectors with a direct connection.

But I’m always guided by trying to balance those 2 overarching kind of policy considerations. We’ll squeeze one in from Zac de Silva. Zac De Silva: Thanks for your speech, Dr Mulino.

On a different issue related in some way, at your most recent party conference, Labour passed a motion allowing to allow children under 18 to get super no matter how many hours they’d worked. That’s obviously up to the parliamentary party to determine the timing of that. Where are you at on that?

Has any work been done so far and when should we expect movement on that policy? Yeah, so look, I feel like I’ve announced enough things today without adding one late one. But look, clearly, you know, it’s fair to say that, I’ve made reference to a number of measures that this party has enacted over recent years which sees super paid on, you know, more dollars of income and in fact, super on paid parental leave is one example of that.

So, when it comes to the principle underpinning super for under 18s, I mean, that is something which I think there’d be no surprise. It’s a principle that is supported across the party. I supported it going into the platform.

When it comes to the precise timing, that is really something we’re going to have to work through various budget processes. But, you know, I personally stand behind that as an important measure. It’s just a question of when.

Now we’re at the National Press Club, so a bit of self‑interest: the News Bargaining Incentive, tech companies complaining a bit, saying it’s unfair. So, the penalty rate going from 2.25 to 2.75, is it still fair to say that on an individual basis? Because it only applies to advertising.

It’s actually less of an impost. No. So, I’d say that media is doing well out of this and that’s a good thing because journalism is so important.

But we increased that in 2 jumps. So, the 2.25 to 2.5 was when we shifted from total revenue to digital advertising revenue. And that was based upon maintaining the same overall amount.

So, when we went from 2.25 to 2.5, it was based on a different charge base, which was a more sensible charge base. We didn’t want to include all revenue and discourage big tech from broadening their activities. But that was to keep the overall base, the overall revenue the same.

When we went from 2.5 to 2.75, which is what the House is debating right now. So, that will actually take the pull to a higher level – Higher level with more companies in it, though, overall? Well, no, no.

So, in the 2.25 to 2.5 was also, that was at the same time that we announced we were including LinkedIn. And so the inclusion of LinkedIn and the jump of 2.25 saw the pool of revenue remain the same. Now what we’re seeing today is that we are now jumping it again to 2.75.

That will see the pool grow, and that is good for media, I think. You know, media undertakes a critical role in our democracy. So, this is something the government has been championing throughout my time in this role.

Okay, final question on rent increases. Is it really only going to increase by $2 on average from the changes we saw in the Budget? And how can we measure that?

Yeah, I mean, look, what I’d just start by saying is that there is a lot of commentary on rent at the minute. A number of the numbers that people are citing, and this is from the sources of those numbers themselves, is not based upon forecasts. Full forecast, it’s not based on modelling.

And so I just think we have to be very clear about that. Quite often numbers are put out into the public realm, out of context. The second thing I would say is that it’s really important to remember that we have grandfathered negatively‑geared properties, all negatively‑geared properties.

So, that is something that we did, firstly, to respect the fact that people had made investments under a certain understanding. But secondly, because we wanted strong structural, important change, but with stability in the market. Secondly, it’s important to acknowledge that people who want to negatively gear can still negatively gear through new properties.

And finally, I’d just add that we are adding to supply now, the Treasury modelling that we have in the Budget points to the fact that there will be minimal changes in rent. And I think if you think about the changes that we’re trying to achieve here, we’re trying to shift 75,000 people from renting to owning their own home. As those people shift from renting to owning their own home, they’re taking pressure off the rental market and shifting to owning.

And so that’s the fundamental dynamic which I think intuitively indicates that is likely to be the outcome. We thank you for your time. Busy sitting day, I think.

I don’t think many of mine got a ‘that was a good question’, so, I’ll work on some better ones for next time. Ladies and gentlemen, please thank the minister.