“As we see it, the super wars have largely been won, and now we need to win the peace,” said Dr. Chalmers.
Keating took aim at superfunds, warning them not to take their social license for granted. They should be thinking about how to make housing easier rather than just looking for returns by investing in offshore companies, he said.
“This is a society that cannot house its own children,” Keating said. “If superfunds think they can go buy tech stocks in the US and highways in Italy, they’re going to be in trouble. Without being heavy-handed, there is a requirement for funds to seek social opportunities.”
Legislate a purpose for super
Keating and Anthony Pratt, chief executive of Visy, argued that superannuation funds should also invest more in corporate debt, along with major banks, to diversify their portfolios and support Australian credit markets.
Dr Chalmers pointed to the lack of spending in the elderly care sector, saying he would “consider what additional role, if any, there is for the super in that.”
Amid renewed debate about the role of retirement in the economy, Dr. Chalmers said the government is working on a legislated purpose for retirement. He said this would avoid policies like the previous government’s early retirement scheme.
A codified purpose for super will focus on whether providing an income in retirement needs trustees to maximize returns and how much they should diversify into lower-yielding assets.
Returns remain a priority
AustralianSuper’s Russell said Super is benefiting from a “huge wave of money” and is looking to diversify beyond equities. But policyholder expectations, generated by high-growth, dividend-paying stocks during the stock market boom, mean investment returns remain a priority.
“We’re very conscious that we have to deliver returns that our members expect, because we’ve provided returns for members for the last 10 to 15 years of 8 or 9 percent, which is extraordinary, and that’s what it’s built on. in.”
However, Dr. Chalmers said the government wants to support the movement of labor across the country and is concerned that high house prices and rents will restrict it.
He said the government is working on social housing policies and other schemes with state treasurers, but also wants to “put something more substantial on the table on housing” at the next jobs summit.
Mr Keating suggested this could involve the development of ‘built-to-rent’ housing as an asset class.
Dr. Chalmers pointed to figures showing that overinvestment in infrastructure had risen from 3.7% to 6.6% of portfolios since 2014, while investment in residential housing had risen from 7.4% to 8.5%. during the same period. “Infrastructure investment doesn’t align with what we’d love to see in residential housing, and the obvious question for all of us is how do we turn it around,” he said.
The treasurer said that after the labor summit, he would convene a “treasurer investment roundtable” inspired by meetings organized by former Prime Minister Bob Hawke and Mr. Keating in the late 1980s and early 1990s. , to “establish a structure around trying to solve some of the problems”. these difficult challenges of the economy”.
The meeting would include super-investors, banks and venture capital funds to decipher housing, energy and social impact investing policy, while also “seeking the best place for the government’s own investment funds,” including in green energy. , advanced. production and supply chains.
The treasurer’s investment roundtable would be a “genuine attempt to treat supers as a potential space for common ground and not just another political battleground,” said Dr. Chalmers.
“I would look for ideas, not ideologies” to solve the nation’s biggest economic challenges and avoid “unnecessary fights over the supermarket.”
“We have absolutely no interest or inclination to be goaded into unnecessary ideological fights over retirement; there’s been too much of that in the last decade,” he said.
Superfund leaders said one of the main challenges in shifting the sector to financing longer-term debt, and potentially other asset classes, is a lack of liquidity and relatively lower yields compared to what is expected. has offered in listed shares.