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MoneyQuest CEO Michael Russell has backed the federal government’s decision to not include the family home in the aged pension assets test.
Mr Russell said any recommendation to include the family home “is tantamount to bullying” and an “appalling way to deal with seniors”.
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“The Superannuation Guarantee Levy was only introduced into Australia 23 years ago and as such the majority of seniors worked for most of their working lives without the benefit of what we now know,” Mr Russell said.
“Yes, seniors are placing a heavy strain on our aged pensions system and yes we know it’s going to get worse before it gets better, but those who are asset-rich, income-poor have fundamentally done nothing wrong but raise families, educate their children, pay taxes and contribute significantly to our nation’s economic strength and cultural diversity.”
Mr Russell also warned of the unintended consequences of pursuing seniors to prematurely downsize.
This comes after the Real Estate Institute of New South Wales (REINSW) announced it has been lobbying government to introduce a stamp duty concession for downsizers with president Malcolm Gunning saying it will help fix the housing supply shortage.
“The notion that housing supply will be enhanced to improve affordability with seniors downsizing is fundamentally flawed,” Mr Russell said.
“To be encouraging seniors to prematurely downsize in a hot housing market and then compete head on with first home buyers and investors for much sought-after property can only lead to a further imbalance in the market.
“First home buyers would most likely be further shut out with the price of smaller footprint properties escalating at a time when regulators such as APRA are desperate to cool.”
Mr Russell added that there is little evidence to support that seniors downsizing will result in the strengthening of Australia’s GDP.
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