By Kris Sayce – Port Phillip Insider (Australia) –
And so, another political thought bubble is consigned to the waste paper bin of history — for now, anyway.
That was the idea of allowing first home buyers to cash-in some of their superannuation, in order to use it for a deposit on a home.
Former Prime Minister, Paul Keating, said it was a terrible idea — among other things.
And not surprisingly, the funds management industry thought it was a bad idea too.
As ABC News reported last week:
‘Financial Services Council chief executive Sally Loane said tinkering with superannuation would undermine public confidence in the system and be counterproductive.
‘“Withdrawing superannuation savings to buy a house — especially when house prices appear to be at the high end of the cycle in the major states — will not help first home buyers into the market,” she said in a statement.
‘“It will only further fuel the increase in house prices.”’
Of course, there’s a reason the financial services and funds management industry doesn’t like the idea. And it’s got nothing to do with pushing up house prices.
The real reason is that every dollar taken out of superannuation is a dollar less on which the industry can charge a management fee.