Industry funds representative group, the Australian Institute of Superannuation Trustees (AIST) has given a cautious welcome to the Budget superannuation measures intended to help first home buyers and down-sizers.
AIST chief executive, Eva Scheerlinck said the Budget proposal to allow super fund members to build a housing deposit inside their superannuation represented a massive shift in thinking around the objective of super and would require careful analysis as well as legislative change.
“Super is designed as a long-term investment for retirement income purposes, so using it as a vehicle to save for a home deposit is sending a mixed message about the objective of super,” she said.
However, on the plus side, Scheerlinck said the measure could assist first home buyers to save for their home through a well-managed concessionally-taxed investment vehicle and potentially help them further engage with their superannuation.
“Importantly, this measure is limited to voluntary super contributions of up to $30,000 and does not allow people to access their existing compulsory super contributions for a housing deposit – something AIST has long-opposed,” she said.
Commenting on other Budget measures to tackle housing affordability, Scheerlinck welcomed the proposal to encourage older Australians to downsize and contribute up to $300,000 from the sale proceeds of their home into superannuation as a non-concessional contribution.
“These downsizing measures – while unlikely to have a significant impact on housing affordability – will at least give greater flexibility to those older Australians wanting to move into a smaller home and also free up housing stock that may be better suited to larger families,” Scheerlinck said.
“AIST is particularly pleased that this measure is subject to the transfer balance cap of $1.6 million, which is an important equity and sustainability measure in our super system.”
