Wilson’s loaded home deposit super questions

The chair of the House of Representatives Standing Committee on Economics, Tim Wilson appears to have made political the issue of allowing people to access superannuation for first home deposits onto the committee’s agenda via a series of questions on notice to superannuation funds. 

Wilson’s questioning of superannuation funds has been revealed in questions on notice filed by Wilson as part of his committee’s Review of the Four Major Banks and other Financial Institutions with industry fund, Prime Super being amongst the first to provide answers. 

Wilson’s use of the questions on notice comes amid claims by some member of the Federal Opposition that his actions are inappropriate and represent a politicisation of the committee process. 

Among the questions asked of Prime Super by Wilson were: “What data do you have on the home ownership rates of fund members?” and whether the fund has ever: 

  • Completed internal research that includes retirement outcomes for fund members who own their home in retirement, compared to those who do not? 
  • Commissioned external research that includes retirement outcomes for fund members who own their home in retirement, compared to those who do not?” 

Wilson also asked the superannuation fund to outline its policy on fund members using their superannuation fund for a deposit to buy their first home and retirees using their superannuation to renovate their home or pay rent. 

Prime Super has responded to Wilson stating it does not have a specific policy relating to his questions on the use of superannuation to fund a deposit on a first home or for retirees to use their superannuation to renovate a home. 

“Withdrawals from the fund are governed by the rules of superannuation. Therefore, fund members can only withdraw funds under certain circumstances (retirement and financial hardship for example),” Prime Super said in its response. 

“Where a member meets the requirements for the release of their superannuation Prime Super will pay the member the balance of their account. Given the legislative requirements around release of superannuation monies it is unlikely that any money paid as a benefit from Prime Super would be utilised by a member as a deposit for their first home.” 

“Where members of Prime Super retire and receive a lump sum, or receive an ongoing pension payment, Prime Super does not seek, nor retain, any information in relation to how the member intends to utilise those funds.” 




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Comments

Comments

Wilson is at it again abusing his position on the Committee.

Hedware, these funds are charging members ongoing fees for the provision of personal advise (Intra Fund Advise). The funds it seems do not have a clue about their members on the most basic level such as home ownership.
To recap for your benefit - conflicts of interest have been over the last 20 years removed due to "community expectations". A good test to see how conflicted these Super Funds are - if a member has a loan - would the fund want the money in the fund or used to repay mortgage of the member?
Clearly these fund are conflicted and Tim Wilson is simply using his position to support "community expectations".
Simple as that.

Tim Wilson's use of his position as the chair of this committee to pursue these biased campaigns is a significant distraction and cost versus the other more important work this committee is simply not getting to. My taxpayer dollars should not be wasted on this stuff.

Great questions! The Keating (he who invented everything good for the unions) said that its a good thing that people have super because they can pay their mortgage with the proceeds. Seeing some data on this is helpful and gives me a better understanding on how the average punter views their money in super. It does seem a bit like that Utopia episode though.. The one where an infrastructure future fund was the idea - you know save money now so you can spend it on the same thing later...

Keating was the one who got compulsory superannuation underway and the unions agreed to curtail excessive wage growth and therefore reduce high inflation, etc at the time. There are many commentators here who dont know their history yet owe much of their financial advice business to Keating and the unions.

The present day Keating is completely against using early release superannuation for home deposits. There are many others of the same opinion. Superannuation is about compound growth and ending up with enough to support a person comfortably in their retirement. Also having people self fund their pensions means less take of taxpayer funds to pay government pensions.

Retail and industry superannuation funds have to take the long view and so should wage earners. Investing in superannuation with its tax benefits is more likely to give better capital growth than a residence in the long run.

The industry funds are running a publicity campaign and behind the scenes the retail funds are running a campaign against Wilson.

Let the people decided what to do with their money.

and let the taxpayers pay their pensions.

I believe the tax concessions already outweigh the Age Pension - so good deal.

Hedware, you seem very knowledgeable. What are you sources in regards to the campaign against Wilson?
As for your comments on how wage earners "should" view there own assets, what a load of sanctimonious trollop. Blind Freddie can see that home ownership is a clear way to avoid poverty in retirement. Have you noticed the property market rises? Have you bothered to look at how a small rent increase can impact someone on a fixed income?
The recent price rise has opened the door for many clients to downsize and increase there standard of living at the same time. But hang on - no FUM for your mates in the industry funds if that happens eh?

As for owing the necessity of my job to the Keating, maybe. The complexity of the industry - particularly prior to Choice of fund, RBL removals' ect was extreme. Thankfully Costello came along to tidy up some of the Keating's mess.

Maybe you aren't on the invitation lists or in the right coffee shops.
No FUM for financial advisors either if all in property. Real estate agents and conveyance lawyers do nicely.
Costello - a nice guy but blew all the mining boom profits on top end of town and on overseas owners and did nothing for investing in infrastructure, skills development, communications, information technology, etc. He did improve some of the Keating approach and supported increases in superannuation contributions unlike his self-serving counterparts like Wilson, Bragg, Paterson and others.
Property is great for property investors who can take advantage of high end property, interest only loans and tax benefits, and who are able to sell on supply and demand..

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