Tom Garcia, CEO of the Australian Institute of Superannuation Trustees and AuSAE Member, spoke on the AM program last week about the repercussions of making the superannuation system more flexible. He warned the Government that changing the system could have an impact of the way super funds invest in the broader community.

Please find full interview transcript below. Please find the full interview recording here.

Naomi Woodley reported this story on Monday, March 9, 2015

MICHAEL BRISSENDEN: One month on from the failed motion for a leadership spill, the Prime Minister says the Government is "absolutely and relentlessly" focused on the questions that matter to the community.

The Government is using last week's release of the Intergenerational Report to try to spark debate about future economic settings.

As part of that the Treasurer Joe Hockey says they're prepared to look at ways to make the superannuation system more flexible.

But one major superannuation group says that could impede the Government's plans to encourage more private sector investment in large infrastructure projects.

From Canberra, Naomi Woodley reports.

NAOMI WOODLEY: The Prime Minister Tony Abbott spent the evening at a community forum in Geraldton in Western Australia, promising his Government was focused on the future.

But he still feels the need to refer to one event in the recent past - the failed motion for a leadership spill.

TONY ABBOTT: I want to assure you that that excitement has been absolutely put behind us, and in the few weeks since that excitement we have been absolutely, relentlessly focused on the sorts of things which are front and centre for the people of Australia.

NAOMI WOODLEY: The Treasurer too is promising a major round of consultation or town hall conversations about Australia's future, off the back of last week's Intergenerational Report.

The Government is holding to its promise that it won't make changes to superannuation in this term of Government.

But in recent days Joe Hockey has repeatedly referred to their willingness to have a debate about more flexibility in the super system.

JOE HOCKEY: If a young Australian is going to live to 100, they are going to have many careers. Naturally enough, they are not going to be retiring at 65. So with many careers and a longer time in the workforce, which is their choice, then we may need to look at how we can make superannuation more flexible to cope with the ins and outs from a working life.

NAOMI WOODLEY: And that includes raising the question of whether first homebuyers should be able to use some of their super to buy property.

JOE HOCKEY: We are prepared to look at a diverse range of proposals to help young Australians buy their first home

TOM GARCIA: We certainly need to have a conversation about super, we know we do, but I think talking about opening up for home loans or anything else is not the way to start.

NAOMI WOODLEY: Tom Garcia is the CEO of the Australian Institute of Superannuation Trustees, representing not for profit funds in the public sector, industry and corporate sectors.

TOM GARCIA: It's a matter of principle; the idea of the superannuation system is to provide someone for an income later in life when they finish working. If you start pulling money out at the beginning you lose all the effect of compounding, what else does it get opened up to? I don't think we should be fiddling with it at all. This is beginning to look like tinkering again.

NAOMI WOODLEY: And he warns the Government that it could have an impact on the way super funds invest in the broader economy.

TOM GARCIA: One of the great things that not for profit funds have been able to do is invest in illiquid assets, infrastructure, property, these types of things. They're the types of investments that pay a greater premium, they earn better returns. It's one of the reasons why not for profit funds have delivered such good returns for so long.

And this is part of what the Government's trying to do anyway with their asset recycling. To be able to then put a tap on it would reduce the ability for funds to invest in these types of things and actually invest back into the economy and back into Australia.

MICHAEL BRISSENDEN: The CEO of the Australian Institute of Superannuation Trustees, Tom Garcia, ending Naomi Woodley's report.