Superannuation industry groups are warning the federal government to keep Australia’s $2 trillion retirement savings system away from addressing the nation’s housing affordability problems.
Earlier this week Federal Treasurer Scott Morrison said the government is likely to address housing affordability in its May Budget, and there have been several suggestions about how to deliver the best outcome.
New South Wales Minister for Planning and Housing, Anthony Roberts, recently mentioned the idea of unlocking superannuation for first home deposits.
Industry Super Australia believes the idea is bad policy as it could reduce retirement savings and drive up housing prices while doing nothing to address supply.
ISA chief economist Stephen Anthony said: “In the housing affordability debate, the focus should be on land release, regulation and tax subsidies that fuel investment in existing property rather than new buildings. Allowing first home buyers early access to their super will set back a retirement income system that is still struggling to fully deliver.”
Anthony also said the proposal is inconsistent with the federal government’s objective of super, being “to provide income in retirement to substitute or supplement the age pension.”
The Australian Institute of Superannuation Trustees (AIST) also warned against using superannuation to tackle the nation’s housing affordability challenge.
“The superannuation industry shares concerns about housing affordability for the young but superannuation is not the silver bullet,” AIST chief executive Tom Garcia said.
“Superannuation is about saving for retirement. It’s not a savings pool to be used for any other purpose as the government has made clear in its own proposed objective for super.”
Morrison said in a radio interview with Ray Hadley that he’s had good discussions with senior NSW government ministers about housing affordability issues for a long time.
“It is a big challenge particularly for people here in Sydney and particularly people down in Melbourne. Whether it is in Queensland or other places, particularly South East Queensland there are real challenges there. We want to look at ways that we can improve that situation. It is not just for people who are looking to buy their first home,” Morrison said.