Australians could be left poorer in retirement under Pauline Hanson’s proposed superannuation plan, financial commentator Scott Pape has warned.
One Nation wants renters and mortgage holders to be allowed to draw 3 per cent of their future superannuation as wages for up to three years.
Under the proposal, a couple earning a combined 168,000 Australian dollars a year would receive an extra 4,300 dollars after tax annually, or about 82 dollars a week. An individual earning 90,500 dollars would gain around 2,300 dollars a year, equivalent to 44 dollars a week.
But Pape, known as the Barefoot Investor, said the plan was fundamentally different from existing rules, under which early access to super is permitted only in limited circumstances.
He said it risked encouraging workers to exchange long-term financial security for immediate spending, with money taken from retirement savings losing the opportunity to grow through compound returns.
To illustrate his concern, Pape recounted speaking to a woman who had withdrawn superannuation during the Covid pandemic to pay for cosmetic surgery.
“During Covid I stupidly used my super to get a boob job. I got double F implants, the largest size I could,” she told him.
She later asked about accessing more of her savings on compassionate grounds after learning that corrective surgery would cost 18,000 dollars and was not covered by Medicare or private health insurance.
Pape said he did not judge her decision, but argued that the episode demonstrated how easily retirement savings could be sacrificed for an immediate need.
“Her retirement money was gone, and it was never going to compound again,” he wrote.
Concerns over superannuation fees and control
Pape said he agreed with Hanson on some aspects of superannuation, including concerns about management fees and government interference.
“I actually agree with One Nation on a couple of things when it comes to super. The fees we pay are way too high,” he wrote.
He also said Australians should retain control of their retirement savings and urged Prime Minister Anthony Albanese not to interfere with them, declaring: “It is not the government’s money. It’s ours.”
However, he argued that the proposed withdrawal scheme was not a last-resort measure for people in severe financial difficulty.
“This new policy is a different beast. It is not a last-resort rule for people on their knees,” he wrote. “It can feel like a lift at the time. Yet time still marches on, and every dollar you take out now is a dollar that can’t compound.”
Pape also warned that putting more cash into the hands of millions of workers could have broader economic consequences, arguing that higher spending could push up prices and lead the Reserve Bank to raise interest rates, making mortgages more expensive.
He criticised One Nation MP Barnaby Joyce after he was questioned about the plan’s impact on retirement savings on ABC’s 7.30.
When asked about the long-term consequences, Mr Joyce replied: “I’m the Treasury spokesman, not Jesus Christ.” Pape said the remark suggested the policy’s supporters had not fully considered its possible effects.
The Albanese Government has also attacked the proposal. Treasurer Jim Chalmers described it as “crazy” during a speech to the Super Members Council.
Mr Chalmers cited modelling from the council which suggested that every dollar withdrawn by a 25-year-old could mean losing about three dollars by retirement.
“They will end super as we know it and millions of workers will be poorer as a consequence,” he said.
