Scott Morrison urged to let workers use superannuation to buy property

Workers have drained $14 billion from super already – now the PM is being urged to allow them to use retirement savings to buy property

Scott Morrison is being urged to allow Australians to drain their retirement savings to buy property with a Liberal MP declaring it’s “more important” than superannuation.

After allowing workers to empty up to $20,000 from their super accounts during the coronavirus crisis, there are fresh calls to allow workers to access more cash to buy a house.

The COVID-19 measures have seen workers rip $14 billion from super accounts with some workers completely emptying their accounts before using the cash for online gambling.

But former Liberal Party director and Senator Andrew Bragg writes in his new book Bad Egg: How to Fix Super, that the PM should go even further, arguing superannuation requires radical surgery and is gouging workers with high fees.

“The system costs more than it saves. There should be more flexibility. Australians should be allowed to access super for a first home, a home is more important than super,” he said.

“At the very least, we should put the interests of working Australians first.”

Australians have invested $2.8 trillion in superannuation since it was made compulsory by the Hawke-Keating Government.

Prime Minister Scott Morrison has previously rejected calls to allow workers to raid their super accounts to buy houses.

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Aussies have already withdrawn $14 billion from their super accounts thanks to coronavirus. Picture: Supplied

However, he did introduce a first home saver’s account in 2017 that allows workers to make extra voluntary contributions to super accounts which are taxed at a concessional rate and can be then withdrawn to pay for a house deposit, up to a maximum of $30,000.

Senator Bragg wants that scheme to be expanded to allow workers to also withdraw mandatory super payments paid by employers.

During the 2019 election, Mr Morrison also announced the introduction of the First Home Deposit scheme to assist first home buyers enter the market. 

The scheme saves eligible first home buyers up to $10,000 in Lenders Mortgage Insurance that would typically be required without a 20 per cent deposit.

Senator Bragg said there were real questions about whether mandatory superannuation was fulfilling its original goals or acting as a cash cow for the super industry that gouges $32 billion a year in fees.

“The industry’s response to questioning is to accuse critics of being ‘anti-vaxxers’ – this only highlights the immaturity of an industry established by a government mandate,” Senator Bragg said. 

Prime Minister Scott Morrison is being urged to allow workers to crack open their super piggy bank early to buy a house. Picture: AAP Image/Joel Carrett

But Labor MP Stephen Jones said the Liberals were hellbent on the destruction of super which would destroy workers’ hopes of a comfortable retirement.

“It’s a bloody stupid idea that gets recycled every four years,’’ he said.

“Andrew Bragg’s agenda is simply to destroy super. He does not care about getting access to home loans, it’s just about destroying super.

“It’s just a sneaky way to attempt to destroy the industry. If super is treated like a bank account you will get the returns you get from a bank account.”