Access to super for housing is still bad policy

Superannuation industry associations have once again come out strongly against a policy of allowing first home buyers early access to their superannuation to purchase a home.

Following comments this week from Assistant Treasurer Michael Sukkar, who made the case for early access as part of a broader package to increased housing supply, Industry Super Australia, the SMSF Association, and the Financial Services Council have all remained emphatic in their opposition to the policy.

"This proposal could reduce retirement savings and drive up housing prices while doing nothing to address supply. It's simply bad policy," ISA chief economist Stephen Anthony said.

FSC chief officer Sally Loane was quick to remind members of the objective of superannuation; to ensure Australians can support themselves in retirement and reduce pressure on the public purse.

"The strength of the superannuation system is that relatively modest amounts saved early in your working life compound over time and help support a comfortable retirement," FSC chief executive Sally Loane said.

"Withdrawing superannuation savings to buy a house - especially when house prices appear to be at the high end of the cycle in the major states - will not help first home buyers into the market. It will only further fuel the increase in house prices."

"Using super to solve housing policy problems jeopardises the success of the superannuation system, which is ranked as the third best in the world by the Melbourne Mercer Global Pension Index," SMSF Association managing director and chief executive Andrea Slattery added.

Anthony hopes the housing affordability debate will remain focused on land release, regulation and tax subsidies that fuel investment in existing property rather than new buildings.

In a statement released yesterday, shadow treasurer Chris Bowen echoed the industry's calls adding that the government's plan was to let "a thousand stupid thought bubbles bloom."

"Early access to superannuation for a home deposit would undermine retirement savings, create new financial risks and ultimately serve no credible purpose other than bidding up the price of housing and pushing home ownership further out of reach of young aspiring Australians," Bowen said.

It is reported the government's plan is being considered as part of a wider housing affordability strategy set to be unveiled in the May federal budget.

Read more: AustraliansSally LoaneSMSF AssociationFSCChris BowenStephen AnthonyAndrea SlatteryAssistant Treasurer Michael SukkarFinancial Services CouncilIndustry Super AustraliaISAMelbourne Mercer Global Pension Index
Editor's Choice
New-York based financial firm Goldman Sachs is planning to launch an ETF which will invest in high-yield corporate debt, according to documents filed with the US Securities and Exchange Commission.
ALEX BURKE  |   12:59PM
Two Contango MicroCap (CTN) directors were removed following an extraordinary general meeting and a third resigned prior to resolutions being passed.
BT Financial Group confirmed its chief investment officer left the company "effective immediately."
Franklin Templeton Investments has launched its global online training portal for advisers in the Australian market.
Brought to you by
31 JAN 2017
Investors who try and predict macroeconomics as a source of alpha rather than focusing on long term trends will suffer in the long term. AXA Investment Managers' head of Framlington Equities Asia, Mark ...
Get it Daily
Keep up to date, don't be the last to know! Get the Financial Standard Daily Newsletter.
Pocket investment guides featuring adviser case studies and a glossary.
Investing trends and strategies from the industry’s thought leaders.
Putting the spotlight on investment products that matter.
Expert Feed
Christopher Page
A new era
After years of back and forth, the legislation to increase the professional standards of financial advisers has been passed. The new ...
Stephen Fay
Starting at the insurance base camp with focus on value
Insurance can be a complex beast, but in a period where its reputation may be strained it is all the more important to talk of some ...
Christopher Page
Redefining the family office
While the family office model has traditionally been the preserve of the ultra-rich, this may be changing very soon. Last week, Findex ...
Michelle Baltazar
Like rocket fuel to a Spaceship
When a superannuation fund calls itself a Spaceship and nobody bats an eyelid, you know you're entering a new era in retirement investing. Spaceship's ...
Featured Profile
Professional Subscription for $295
(inc GST) for 1 year.
FS Advice
The Australian Journal of Financial Planning.
Get the free iPad app
Download the Financial Standard iPad app for FREE.
Link to something 5nIb5di5