The latest property band-aid

Another day, another housing non-solution. Why the proposed first home super scheme is a no-go.

Model house with coins and a piggy bank.

Image source: Getty Images

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Oh boy.

Am I really going to wade into housing policy?

In a week so politically charged as this one, given polling day is this Saturday?

Am I really that nuts?

You betcha.

And there will be a small but committed group who will either agree wholeheartedly or disagree violently, no matter what follows, because they’re ‘rusted-on’ to one party or the other.

If that’s you, feel free to skip this one – I’m here for the policy, not the politics.

Sorry if that sounds a little punchy… I’m just getting ahead of the hate mail!

Now, for those who are still here for the ‘make our country better’ stuff, let’s kick off.

First, I’ve made my views clear on Labor’s ‘Help to Buy’ scheme: It’s a band-aid on a band-aid, using government money because they can’t imagine there’s any other solution to housing affordability that sees deposits take more than a decade to save in some parts of the country.

And then, last night, the Liberal / National Coalition gave the Opposition an almighty “Hold my beer” as they went one step further: not using government money (though Super contributions are tax-advantaged, so the taxpayer is already kicking in), but inviting us to raid our Super for the second time in a couple of years – this time to buy a house.

If it feels like the government has a predisposition to see Super as a Magic Pudding, you’re not alone, but we’ll get to that.

See, both major parties have taken a similar approach: “We know housing is unaffordable for too many people, so here’s our solution.”

They’ve also taken a similar approach to the solution.

Or should I say “solution”.

‘It’s the least we can do’, they should have said.

Because it truly is the very least they could do.

Housing is too unaffordable? We won’t fix it, you can just buy 60% of a house instead!

Housing is too unaffordable? We won’t fix it, a comfortable retirement is overrated anyway!


Yes, a pox on both their houses.

But I have to say, the Liberal / National policy that was announced yesterday – to let people raid their Super for housing – takes the cake.

It comes after they encouraged people to raid Super during the COVID crisis.

And after they wanted to let victims of domestic violence access their Super in 2021.

To be very, very clear: none of these are undeserving causes.

But the proposed solutions – making Super a magic pudding any time the government wants to solve a problem – are undeserving answers.

We should be a country that doesn’t make young people choose between Super and housing.

Or, as I tweeted to an overwhelming response:

“Imagine being as wealthy as Australia, but decreeing that young people can have a house, or Super, but not both, because we have neither the vision nor the will to meaningfully address housing policy.

“What a complete and utter abandonment of principle and duty.”

Those last two concepts seem hard to find sometimes in politics, don’t they?

(And again, for the record, I also bagged Labor’s policy.)

Neither party seems to have a policy response that actually addresses the real problems – just different piggy banks they’re prepared to raid to add another housing band-aid to an ever-growing pile.

But Super?


As I did when the government made it a piggy bank during COVID, I’ll ask you to look around the world, and compare our retirement savings system to literally any other.

We have the fourth largest retirement savings pool on Earth, despite having only 25 million people.

Other countries, with non-compulsory, or lower levels of compulsory savings have – surprise! – lower levels of retirement savings.

Super works.

And for its success, it’s become a honeypot that government can’t help but try to tap, over and over again, for financial and ideological reasons.

But my issue isn’t ideological.

It’s financial.

Making Australians choose between Super and financial hardship is a false binary.

Making Australians choose between Super and housing is a false binary.

Super is for retirement. Full stop.

Anything else is an undermining of a system that has clearly proven its worth.

And anything that undermines Super threatens the retirement incomes of Australians (and increases the burden on the Federal budget, after both major parties recognised the intergenerational challenges of a growing retirement cohort and longer lives).

I’m sorry if this offends your political sensibilities (in either direction).

But I’m not here to tread gingerly on eggshells.

I’m here to call it as I see it – usually about shares and investing, but also about issues that impact the financial lives of all of us.

We need to be good enough, as a country, to solve for housing affordability, without needing governments to tip in millions, or homebuyers to jeopardise their retirements.

We need to treat Super as sacrosanct, protected for retirement.

We need to have some serious, tough conversations, rather than reaching for the band-aid (or, worse, the hollow soundbite).

We need to return to ideals of, as I said in my tweet, duty and principle (and I’ll add ‘service’).

It’s the least we should expect.

Fire at will!

Fool on!

Motley Fool contributor Scott Phillips has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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