The proposal to allow first home-buyers access to their superannuation to afford a deposit has prompted strong reactions across the political spectrum.
The plan would allow first home buyers to divert compulsory super contributions to a savings account, provided they are matched dollar for dollar with personal contributions.
First, the idea needs the tick-off from the expenditure review committee before the budget, then it would have to survive any attempted modification by the Coalition party room, and finally pass the Senate crossbench.
We won’t know if it’s government policy until budget night on 9 May. But here are the views so far on the plan.
Team yes please, super is our money, let’s have at it:
“It seems strange that you can invest in other people’s assets, in equity, in bonds, but not the most important asset in your life, which is your own home … This is a legitimate idea. It had support from people like Paul Keating in the past and it is used in other countries. We should consider all the elements and keep our eyes on the focus of helping young Australians.” – Minister for resources and northern Australia, Matt Canavan, ABC AM, Tuesday.
“I have quite a bit of sympathy with this idea because in the end you want your money to be as useful as it can be and superannuation is not the government’s money it’s the people’s money.” – Tony Abbott, Monday.
Camp don’t do it, wrong way, go back:
“Increasing the amount of money going into real estate by facilitating access to super savings pre-retirement will not improve housing affordability. It would increase demand for housing and … would actually drive up house prices by more.” – Finance minister, Mathias Cormann in 2014.
Crossbench senator, Derryn Hinch, has called the idea “crazy” and said it has “no merit”. “Superannuation is there for when you retire ... if you do this it will push more people onto the pension and how the hell are you going to fund it? Owning your own home is not an Australian right, it’s a dream,” Hinch told ABC radio on Tuesday.
“This would actually overheat the housing market even more, the only winners would be vendors who would have two first home buyers with access to super outbidding each other” - Shadow treasurer, Chris Bowen.
Liberal MP Sussan Ley on Twitter, Tuesday:
Young people need their super for retirement, not to try to take pressure off an urban housing bubble, better solved by decentralisation.— Sussan Ley (@sussanley) April 12, 2017
The prime minister, Malcolm Turnbull, reportedly called access to super for housing a “thoroughly bad” idea in Fairfax Media in 2016.
On Wednesday at a press conference in Mumbai, Turnbull said “I have expressed fairly strong views about it in the past,” a statement interpreted as all but ruling out the option.
He later told Sky News the “legislated objective” of Australia’s super system was to provide for retirement. “That’s the whole purpose of it,” he said.
“I think we need to ensure that superannuation is maintained to provision for people’s retirement. The beauty of super is compound investment – so a person puts a little bit of money in super, and the sooner they do the better off they are in retirement. You strip that away from superannuation to put that towards a house, you run into a whole lot of extra complications.” – Nationals MP Andrew Broad.
“I’ll agree with [Labor’s Nick] Champion … We need to be careful that you don’t pour a bucket of kerosene on a fire. We need to look at all of the measures in total.” – Liberal senator Anne Ruston on ABC Radio Adelaide, Wednesday.
Not wedded to the idea, but certainly dating it
“If it’s taking you eight years to save that deposit, by the time you get to that eighth year it’s not $50,000 it’s actually the deposit required is more than that ... We are going to be pretty keen to examine measures that can bridge that gap and allow first home buyers to get into the market as soon as possible otherwise the goal posts keep shifting.” – minister assisting the treasurer, Michael Sukkar, Sky News, Tuesday.
“I think all ideas need to be on the table, including this one. But I suggest that it needs to be done in a cautious, considered way, keeping an eye on the ramifications in the housing market.” - Nick Xenophon, on ABC Radio, Tuesday.
“The government won’t be drawn on speculation. Various ideas are always flagged on big issues.” – spokesperson for Treasurer Scott Morrison to Guardian Australia.
And Morrison told ABC Radio in Melbourne on Monday that “one of the predominant reasons for people using their [superannuation] lump sums when they go into retirement” is to pay down their remaining mortgage and “that has an impact on their retirement income”.
Better value in Tamworth
“The reason houses are dear here is because so many people want to buy them … I think you can do whatever you can to help but there is a big opportunity. If you want to buy a house that you can pay off in your lifetime, please consider regional cities such as Tamworth.” – Nationals leader Barnaby Joyce.