Which parties offer best policies for investors on pensions, super, housing this election

What’s in the election for investors? Quite a lot actually with stark differences emerging between the major parties on investment choices from pensions to superannuation.

After this week’s budget from the ALP we also know there is an emerging split on public sector waste, immigration and energy security.

What’s in the election for investors? Quite a lot actually.

Since both sides of parliament have matched each other in key spending programs – such as medical welfare payments- it’s in housing and superannuation where the major parties offer distinctly separate policies.

After this week’s Budget from the ALP – and the Coalition’s Budget Reply – we also know there is an emerging split on public sector waste, immigration (the Coalition wants a 25 per cent cut) and energy security.

Behind the headlines, the core approach from both sides remains unchanged. The ALP is broadly a ‘big government’ choice while the Coalition is in favour of ‘small government’ with roughly one in five public servants to disappear if Dutton has his way.

But if you are waiting for the sharemarket to respond to the election, don’t hold your breath. History suggests that election campaigns prompt business leaders to put projects on hold.

As a result, the direct impact of an election announcement is to send both the share market -and the Aussie dollar -tracking sideways.

Here are seven key issues for investors.

Economic Nationalisation - A share market negative

Like it or not, globalisation is on the back foot this year and the market is now keenly anticipating Liberation Day on April 2 when US president Trump will spell out in detail his tariff policy.

The sharemarket has dropped since Trump took office and there is every sign more tariffs will mean more losses for the share market.

Faced with Trump’a agenda, both sides in Canberra have been making moves the market does not like and which will infuriate specific industry sectors.

The ALP’s version of economic nationalism is the ‘Future Made in Australia’ policy where the government is picking winners: This is a notoriously difficult and disaster-prone policy where history is littered with write offs.

The same imperative of economic nationalism explains the Coalition plan for market intervention in gas to ensure supply and lower prices.

The structure of the gas industry has inadvertently led to gas shortages which are inexplicable to the everyday taxpayer who is keenly aware that Australia is one of the richest gas suppliers in the world.

Super - $3m super tax is still on the agenda.

The ALP’s planned new tax on super of 15 per cent on amounts above $3m is one of the most unpopular and poorly designed measures in recent decades.

The Coalition has voted against the new super tax measure at every turn.

Technically, the bill – called Division 296 – will have lapsed with the closure of parliament and that means the Coalition will not have to repeal it. (Because it was never passed in the first place).

However, a wealth tax on super is still on the books and the Treasurer Jim Chalmers recently reiterated his support for the move.

Pensions - No news is good news

Both parties appear to have put a freeze on the deeming rate – the rate which controls pension access by ‘deeming’ how much has been made on investments.

In another example of a de facto truce between the major parties on a key welfare issue is the benchmark deeming rate has been left unchanged at an artificially low level of 2.25 per cent. As The Australian pointed out last week the deeming rate is now a joke – but it appears safe regardless of who wins power.

Housing - Separation Street

This is one area where there is a substantial policy difference between the parties.

The ALP has opted for a new Shared Ownership scheme where the first homebuyer shares equity in a home with the government.

In the budget the scheme was widened. It now includes anyone earning up to $100,000 a year and will include homes worth up to $1.3m.

The government will take a stake of up to 30 per cent of an existing home and 40 per cent of a new home. Once the home is sold the homeowner must return the stake to the government.

This is a fresh initiative – with plenty of risks for the homeowner – but it is set to become popular.

In contrast, the Coalition offers a completely different initiative based on an individual’s own money.

It will allow first home buyers to use up to $50,000 from their super savings to buy a first home.

Anyone who uses the scheme to withdraw super must re-contribute the amount back into their super fund on the sale of the property purchased.

This scheme would also be popular with young home buyers.

Personal Tax - Big deal over a tiny change

The ALP offered a tiny tax cut in this week’s budget. The lowest tax band of 16 per cent rate is to be lowered to 15 per cent in 2026 and 14 per cent in 2027.

This is a small change and as a result issues such as bracket creep considerations are similarly limited in scope.

Nonetheless, it is a tax cut. The Coalition had originally set out a more ambitious train of tax cuts for all tax bands before the Albanese administration came to power.

That series of cuts was implemented in a diluted form by Treasurer Jim Chalmers with a skew towards the lower bands – an extension of that policy is now being brought to the election

Energy policy - Gas and fuel cuts?

The cost of living crisis – typified by rising energy bills – is a key focus for both parties. The ALP extended the energy rebate of $150 for households in this week’s budget.

The Coalition has announced a more ambitious plan to actively intervene in the gas market. In his budget reply, Dutton said the Coalition could bring down wholesale gas prices by 40 per cent by forcing gas companies to set aside for domestic use up to one fifth of supply that would otherwise by exported.

Separately, the Coalition also aims to cut the fuel excise by half – from 50 cents to 25 cents a litre – for a year.

Student loans - Debt forgiven

On debt forgiveness for students, the ALP has offered an undisguised lure for younger voters. The government will offer students with HECS bills a 20 per cent discount. It means $5,520 off an average $27,600 bill.

James Kirby hosts the twice-weekly Money Puzzle podcast.