On Friday, Mr Hockey suggested the government may consider allowing young people to use their superannuation savings for a house deposit, according to a report in the Sydney Morning Herald.
“We need to have these conversations,” he said.
ISA chief executive David Whiteley slammed this idea, urging the government to keep super inaccessible until retirement.
“Such proposals are completely at odds with the objective of encouraging Australians to build private savings to take pressure off the aged pension,” he said.
“The government should rule out such proposals immediately.”
He suggested the move could inflate house prices and reduce retirement savings over the long term.
“Super funds could also face increased liquidity demands, undermining optimal asset allocation and potentially reducing investment returns to members,” he said.
Mr Whiteley acknowledged current policy settings were failing to deliver a comfortable retirement for some Australians but said the government had other options available.
“Most obviously the government could more efficiently distribute tax concessions, ensuring that all taxpayers are incentivised to save for their retirement, and protect the super safety net that ensures members who do not choose their own fund are defaulted into a well-performing fund,” he said.
They may also be a bit nervous about having to meet a lot of cash withdrawals given the large level of illiquid investments they hold. Look what happened at MTAA when the GFC hit.
Well said Alan – also more transparency on the ISA fund financials, with full details on what the hundreds of $millions that appear under ‘indirect member costs’ each year…
The orangatang is obviously trying to protect what they consider property of the ISA i.e. the nation’s savings!
If accessibility were to open up, their would be a greater need for advice, and hence our profession comes back into prominence for an even wider group of Australians…
Bring it on, this could greatly assist younger Aussies to get ahead on their home loans etc.
Interesting to see that the ISA are upset with the current Super access talk doing the rounds. The Government should also look at capping trustee fees and requiring full disclosure of how much each individual trustee is earning from the fund. Be good for all members to see what the Union heavyweights are earning for all their hard work on behalf of members