Industry, economist blasts One Nation's super agenda

Industry bodies and an economist have criticised One Nation's plan to let Australians redirect part of their superannuation into take-home pay, warning the policy would fuel inflation and leave workers significantly poorer in retirement.

One Nation is proposing to give Australians paying rent or a mortgage the choice to take one quarter of their future compulsory super contributions as a tax-advantaged 3% pay boost for up to three years.

If Australians opt-in to the boost, 9% of their super will still go into their funds, and they can receive 3% of it directly for up to three years.

"People are working hard and still struggling to get ahead. Interest rates keep rising. Rents keep climbing. Groceries, power bills, petrol and insurance are taking more and more out of the family budget," One Nation senator for Queensland Pauline Hanson said.

"One Nation wants to give people some breathing room."

The Association of Superannuation Funds of Australia (ASFA) chief executive Mary Delahunty noted allowing people to access super early would be "economically disastrous".

"This policy would push up inflation and make people poorer in retirement.  It's as simple as that," Delahunty said.

"Most Australians understand the basic economics. When you pour more money into a high-inflation economy, it makes everything more expensive. This proposal would not alleviate the cost of living; it would drive the cost of living higher."

ASFA polling showed that cutting the super guarantee is extremely unpopular with Australians, with only 18% of people approving of cutting super to 9%, even if the remaining 3% is taken as wages.

Modelling by the Super Members Council (SMC) showed a median full-time worker withdrawing 3% of contributions for three years would be $25,000 poorer by retirement. For a couple it would be more than $50,000 worse off.

"It is unfair to ask everyday working Australians to sacrifice their retirement savings to fix policy problems they didn't cause, like inflation and the housing crisis," Delahunty said.

"These problems need real policy solutions that build more houses and lower the cost of living, not unimaginative ones that make everything more expensive and force Australians to be more dependent on Centrelink in retirement."

AMP chief economist Shane Oliver said the policy would mean significant long-term cost for little short-term gain. For a 30-year-old, he said early access to super would only cover around 1.8 months of mortgage payments, and if used for deposits it would just drive higher home prices.

"Unfortunately giving people more money to spend won't solve cost of living problems (as lots of cost-of-living relief measures have shown over the last few years)," Oliver said.

"The only solution is to slow spending or demand in the economy in the short term and boost supply (productivity) in the long term (and eating away at super won't help that)."

Treasurer Jim Chalmers said the policy means less money and less economic security for millions of Australian workers.

"This will end superannuation as we know it and make millions of Australians poorer as a consequence. One Nation is anti-super because One Nation is anti-worker. You can't be pro-worker and anti-superannuation," Chalmers said.

"By ending super as we know it, by making Australian workers poorer as a consequence, One Nation is showing once again: this is exactly why One Nation poses an unacceptable and dangerous risk to Australian workers."

Chalmers highlighted Australians already have a provision to access their super in cases of economic hardship.

"One Nation is talking about something very, very different. One Nation is proposing a full-frontal attack on superannuation as a full-frontal attack on Australian workers and their economic security," Chalmers said.

"So, let's be really clear about this. This is not about the usual early access provisions. This is about One Nation not supporting super because they don't support Australian workers."

SMC added "busting open" people's super would also force their super funds to invest differently as their money would need to be invested in short-term liquid options.

"That would damage the long-term returns for all Australians with super, which would mean even those Australians who keep their super intact could have up to $246,200 less super at retirement," SMC said.