Allowing Australians to access their superannuation to fund a house deposit could have a trillion-dollar impact on the economy, according to industry modelling.
The modelling, commissioned by the Super Members Council, found uncapped access to super funds would cost taxpayers a cumulative $1 trillion.
Super Members Council CEO Misha Schubert said the analysis also showed a capped policy, which allowed up to $50,000 to be withdrawn from accounts, could still create a $300 billion cost to federal coffers across coming decades.
Ms Schubert said the modelling showed pension costs climbed exponentially as first home buyers started to retire with far less super and were forced to rely more heavily on the taxpayer-funded age pension.
“To meet the rising Budget costs, future Governments may have to increase taxes or cut services to offset the extra fiscal pressure created by the bigger age pension outlays,” she said.
The modelling showed that, at its peak, the capped super-for-a-house policy could cost taxpayers an extra $8 billion per year, while an uncapped model could cost taxpayers an extra $25 billion a year.
Ms Schubert said previous Council modelling showed a policy to access super for housing would raise capital city house prices by $75,000 – forcing future generations of young Australians to wait even longer to buy.
She said a growing body of expert evidence showed the policy would not lift home ownership rates – it would only make housing affordability worse while eroding retirement savings and leaving all Australians with a tax bill.
“It’s economically reckless. It sets a policy trap for young Australians because it hikes house prices and blows a Budget blackhole in the decades ahead mostly by pushing up age pension costs – which every taxpayer would pay,” she said.
Ms Schubert said the modelling – completed by Deloitte – was based on a rigorous microsimulation model accounting for population change, super contributions and balances, tax and pension expenditures.
