The other not-for-profit elephant in the room on Friday was the Future Fund, which has $240 billion in assets and will be a critical part of any solution developed on social housing.
Second, the big industry super funds have guaranteed money inflows through default super arrangements that are enforced by law.
In fact, the prospect of further turmoil in financial markets could well be a reason for super fund members to consider shifting funds into cash flow positive super funds.
High cash flows caused by default super arrangements could protect funds from the need to sell assets during times of market upheaval.
Self-managed super funds with limited asset allocation mixes and low levels of unlisted assets could suffer lower returns relative to cash flow positive big super funds.
The apparent virtuous circle of higher cash flows leading to higher returns and therefore leading to growth in members in big super has a negative flip side that ought to concern the Australian Prudential Regulation Authority.
The latest available APRA data on cash flows into super funds shows that about 47 per cent of the 137 funds which lodged their data with APRA in 2021 had negative cash flows.
A fund may have negative cash flows because the bulk of its membership is in the retirement phase, which means the fund is paying out more than it brings in.
Following Friday’s roundtable discussion on social housing, Aware Super’s Deanne Stewart, said her fund gets strong returns from its build-to-rent and affordable housing portfolios.
“Extending the GST allowance that community housing providers can currently access to a broader range of affordable housing projects would have a material positive impact on cost and feasibility,” she said.
NAB’s McEwan identified three barriers to leveraging greater private investment in social and affordable housing.
USA
UK
France
Germany
Russia
India
Canada