Foreign Minister Julie Bishop

So the Foreign Minister doesn’t know the full intricacies of the government’s superannuation policies.

So what?

It was indeed, as Julie Bishop said, a “gotcha” moment yesterday when Melbourne radio entertainer Neil Mitchell demanded she explain the government’s transition to retirement policy — under which people nearing retirement can move money from their super account into a pension account without the earnings being taxed — and how it would be affected by the budget superannuation tax concession changes.

The observation from critics is that, knowing Mitchell has been obsessed with the super issue, and especially as she’s a senior minister, Bishop should have been fully briefed. No one cut Labor’s David Feeney any slack for not knowing about Labor’s position on the schoolkids’ bonus, even though it’s entirely outside his portfolio.

But the difference is, it was genuinely unclear what Labor’s schoolkids’ bonus position was and they backflipped on it immediately after the Feeney debacle. The government’s superannuation changes were announced in the budget. They relate to an extraordinarily complex area. Superannuation is so complex most Australians simply don’t bother thinking about it until they reach their 50s. The entire retail super industry is based on disengagement and the assumption clients won’t notice that on average their funds are underperforming the industry super sector. Bishop was perfectly within her rights to say that this was another minister’s area and that she’d been briefed on the changes but the detail was a matter for the relevant minister.

This sort of stuff is one of the reasons politicians stick to carefully scripted talking points rather than answer actual questions from journalists.

The other, more important point is that the government’s policy is a sound one. As Bishop repeatedly pointed out, the 15% tax rate which will apply to earnings on amounts above $1.6 million is still extraordinarily generous, especially compared to the top marginal tax rate that many people subject to it would otherwise face (she might also have pointed out that a couple can have up to $3.2 million in their pension accounts before the cap kicks in, but that’s the sort of detail that only a portfolio minister could be expected to be across). Individual retirees could earn around $80,000 a year before facing up to the dreadful prospect of additional earnings incurring 15% tax. Or they can move the additional cash out of the pension fund and into their super fund, or into another investment, until they reach retirement age. Oh, and the $1.6 million threshold is indexed, as well.

Australia’s retirement incomes policy is supposed to be about, oddly, retirement incomes — not maximising wealth for households that can afford to sock over $3 million away into tax minimisation vehicles — the people Neil Mitchell is apparently so concerned about. That’s why Labor adopted a policy with a similar goal — subjecting pension earnings over $75,000 a year to 15% tax. It’s still extraordinarily generous and beyond what’s needed to encourage Australians to save for a decent retirement income. And when one of the central charges against this government is that it is not doing enough to address the budget deficit and when it does do something, it’s targeting low and middle-income earners, the confected outrage by the wealthy about having one of the most absurdly generous tax lurks minimised (not taken away) is remarkable.

The policy detail will, of course, be lost while we concentrate on that footage of Bishop looking uncomfortable under Neil Mitchell’s questioning. But she’s only guilty of the sin of not being across the intricacies of every other minister’s portfolio in the government — and in an area where the rest of us tune out until we get old enough to panic and wonder what we’ll do when we retire.