The final report of the Cooper Review into Superannuation, delivered to Government yesterday has now called for legislation to ban self-managed super funds from investing in art and requested a shorter time period for super fund art collections to be divested than it previously recommended in April, writes Michael Fox in The Australian Art Sales Digest. For more, click HERE
The arts industry is mobilising in response to proposed changes to self-managed super funds. Michael Fox reports on the launch of the Save Super Art Campaign in the latest edition of Australian Art Collector. For more, click HERE
24 Comments
1 Sherry Thompson wrote:
I support the SAVE SUPER ART campaign against the Cooper Review recommendations banning art investments in Self Managed Super Funds. The recommendations are fundamentally flawed, serve no good purpose, are already creating damaging uncertainty in the Australian art market, and, if implemented, would create disastrous “unintended consequences” for the Australian art industry.
2 Isobel Johnston wrote:
I support the SAVE SUPER ART campaign against the Cooper Review recommendations banning art investments in Self Managed Super Funds. The recommendations are fundamentally flawed, serve no good purpose, are already creating damaging uncertainty in the Australian art market, and, if implemented, would create disastrous “unintended consequences” for the Australian art industry.
3 Grazyna Janczewski wrote:
and i thought that Australia has built up respect for art and artists, instead we are going backwards!!! shame on you politicians!!!!!
4 Andrzej Janczewski wrote:
I fully support this campaign
5 John Franceschini wrote:
I completely disagree with this decision. Investing in art is no different to investing in shares- as long as there is an arms length agreement between the owner and the user of the artwork. I have recently invested in some indigenous art using my super fund that I would not have otherwise invested in- these artists rely on such purchases for their livelihood. This is a ridiculous decision- are they going to ban shares next? If not why not- the investment strategy is the same for both mediums.
6 Euan Hills wrote:
I own and operate Art Mob – an indigenous fine art gallery in Hobart. A good percentage of my sales are of high quality investment worthy artworks to SMSFs. To infer that art is a poor investment makes me consider the obvious option – invest in shares in Australian companies. Then let us compare the current values of the 2 portfolios over the past 3 years. Stockmarket diminished dramatically – art work at least still there and possibly a 20% growth. By killing off this investment option will only lessen the value of already invested art work in SMSFs as the market floods in a very short 5 year timeframe…Wrong again Federal Government. You have already disenfranchised our Aboriginal artists through the resale royalty program by poor definition of the first resale and hence an effective 5% price hike in an already price sensitive market. It’s time to support the finer things in life – rather than destroy them.
7 Elizabeth Hastings wrote:
A work of art won’t decrease in size or value in the same way that a share portfolio can shrink to nothing. I wish my superannuation fund manager had advised I buy art instead of shares in Allco.
8 Cath Brown wrote:
If your aim was to destroy the art market you’re well on the way to succeeding – first with the resale royalty, not because of what it is but how it has been introduced – and now banning smsf’s from investing in art? I agree there has been flaws in this, but surely it’s best practice to introduce new laws to manage the smsf’s than ban them investing in art altogether?
9 Michael Merlin wrote:
Most artists have a hard enough time supporting themselves already, why make it harder for creative Australians who are contributing to the heritage of this country?
Also please consider the damage to aboriginal indigenous communities who rely on art sales as their primary source of income.
10 Rodney Scherer wrote:
This is a completely wrong headed proposal and the consequences will be felt for a very long time. It needs to go no further than the round filing cabinet. PLEASE do not do this.
11 Peter Anderson wrote:
The reduction of the time frame within which art works will need sold by SMSF shows that the Cooper review have no idea about the way the art market works. Oddly, the spike in the volume of work going to market by such a wide spread forced sell off, will not even produce a short term boost to artists through Resale Royalties, as one can assume that these forced sales will be the first sales under the legislation. If both the flooding of the market with SMSF holdings, and the loss of that market segment, serves to depress the market, artists will loose both in terms of primary sales and the new resale royalties. In short, the Goverment’s stated objective in introducing Resale Royalties, to boost artists’ incomes, will be undermined.
12 Michael Floyd wrote:
I established my SMSF about 5 years ago following a substantial loss at the hands of my professional super fund manager. I thought I can do better myself. I then started my own SMSF and today my investment in rare coins and notes (something I know something about) and a few of art works by a well known Sydney artist is worth conservatively about $400,000 My SMSF has showed a conservative increase in those assets each year. I have not lost money in any year which is more than I can say lately for super funds involved in what can only be described as speculative share ‘investments’.
I certainly don’t want to invest in shares and frankly don’t trust other fund managers with my money.
I have acted above board at all times and had my fund audited and tax paid every year with never a problem and I have complied with the law at all times. This forecast change by Mr Cooper will result in my losing a substantial part of my assets if adopted by government for the obvious reason that if effectively outlawed there will be a flood of coins etc onto the market. Even the period to 2015 will not lessen the impact and I strongly urge government to consign the ‘artworks’ section of the changes to the dustbin where it belongs.
Michael Floyd
Ettrema Super Fund.
13 Carlos da Silva wrote:
I support the SAVE SUPER ART campaign against the Cooper Review recommendations banning art investments in Self Managed Super Funds. The recommendations are fundamentally flawed, serve no good purpose, are already creating damaging uncertainty in the Australian art market, and, if implemented, would create disastrous “unintended consequences” for the Australian art industry.
14 Quentin wrote:
The Government should think long and hard before agreeing to the proposed superannuation changes to SMSFs. A lot of retirees will unnecessarily be financially disadvantaged if they are forced to divest their art assets over a set period of time. Art like any other asset, is priced according to the forces of supply and demand. Furthermore, if this Government is concerned with enabling artists to financially benefit from the trading of their artwork via a resale royalty scheme then hopefully they would have the prudence to realise the counter balance of the Cooper Review.
15 Ruth da Silva wrote:
I support the SAVE SUPER ART campaign against the Cooper Review recommendations banning art investments in Self Managed Super Funds. The recommendations are fundamentally flawed, serve no good purpose, are already creating damaging uncertainty in the Australian art market, and, if implemented, would create disastrous “unintended consequences” for the Australian art industry.
16 Michael Zavros wrote:
Dear Mr Cooper, Government Ministers and Opposition Spokespeople
I support the SAVE SUPER ART campaign against the Cooper Review recommendations banning art investments in Self Managed Super Funds. The recommendations are fundamentally flawed, serve no good purpose, are already creating damaging uncertainty in the Australian art market, and, if implemented, would create disastrous “unintended consequences” for the Australian art industry.
17 Michael Levitt wrote:
I am a committed investor in fine Australian art and have been doing so within my self-managed super fund for almost a decade.
I have a clear investment policy, observe a number of important and basic rules, always take expert advice and read widely around the subject before deciding to make a new purchase.
I totally reject the implication of the Cooper Panel’s recommendations that fine art cannot represent a valuable investment and that fine art cannot form the basis of a considered super fund.
Perhaps more importantly, this decision of the Panel assumes that I am insufficiently expert to determine the manner in which I choose to invest my own money and denies me the right to invest within my super fund as I wish. Surely this denies me a basic entitlement as a citizen of this country?
No less, this decision – once implemented by Government – immediately devalues the investment I have carefully accumulated, at a time when art was allowed to be included in super funds. Since other super fund managers can no longer purchase art for their funds, the pool of art investors will be substantially diminished and the price of all art will drop. This will apply in all sectors of the art market and current artists, dependent upon regular and occasional art investors for their income, will be hardest hit. As will their agents and gallerists. Art sales will decline – the Cooper Panel has ensured that their “prophecy” will be realized.
Can anyone imagine the outcry if stocks and shares were arbitrarily banned from self-managed super funds? Yet we all know how easy it is to gamble and speculate in stocks and shares. The Cooper Panel has simply declared that certain investments are no longer “kosher” while others have been granted “most favoured status”. I wonder why? Far better for the Panel to have instigated the sort of advisory services (as proposed in their recommendations for those interested in the stock market) for those interested in investing in art than to ban them from doing so altogether.
This is an oppressive and loathsome series of recommendations masquerading as a consensus document prepared by people purporting to act in the broader interest of Australians. Who actually benefits from withdrawing art from super funds? Retaining art in super funds harms absolutely no-one other than the foolish art investor; why not similarly protect the foolish stock market investor?
At the end of the day, the Cooper Panel doesn’t understand or appreciate art investment and has decided to reject it rather than try to extend their appreciation beyond the stock market and the big banks; Big Brother conducting the Cultural Revolution.
Can we not do anything at all to reverse this odious, anti-libertarian and damaging decision?
18 Phillip McNamara wrote:
It would take a thesis to explain why the Cooper Review is muddled in their views on art, however the wisdom of Charles Nodrum should be heeded. Furthermore as an artist and writer on the arts I know first hand how difficult it is to initially interest some people in buying art work and also how long it takes to build up any sort of sustained market. To create an “industry” there needs to be many levels of entry and layers of interest. From what I have observed some of the people who have come to art through their super have also taken up some of the more altruistic and less “investment” driven aspects. Once they become knowledgeable about the history of art they also gain the eye that sees the cultural importance of art; and it is these artists/works that then tend to be the ones sort after for super funds. There will be many unintended consequences of the changes. Apart from any potential impact on prices my sadness would be the loss of the super avenue for getting the next generation involved in exploring the many layers of an art scene. Patronage is important and providing a range of reasons to buy is essential.
19 Mark&Karen Kestigian wrote:
Dear Mr Cooper, Government Ministers and Opposition Spokespeople
We support the SAVE SUPER ART campaign against the Cooper Review recommendations banning art investments in Self Managed Super Funds. We have a small business and started our super fund in the 80s. We chose to invest part of our super contributions in art as we had knowledge of that market opposed to the stock market. Through well planned selection our art collection has seen a healthy valuation on our investment even during the global financial crisis whilst prices in the art market have remained consistent.We also feel this investment aids our legacy to coming generations to enjoy the “masters” of Australian art and helps support up and coming artists. Further we feel in banning art you are taking away our democratic rights in choosing how and in what to invest. Particularly when we come from an “educated” level of art investor. When you consider an investor in the stock market who perhaps has no background and can encounter huge losses in the hundreds of thousands of dollars – which has been witnessed in recent years. Having said that when a time limit is set – to 2015 – to sell our collection, what do you think will happen to art market sales? Being pushed into selling collections investors will be in a “fire sale” market place.Whilst this might be a small sector in comparison to the overall population – it is still worth millions and this tax review will without a doubt “kill” the art market and effectively the super fund investor will be the loser. Our art investment which we stridently researched and collected and followed the tax guidelines – not to hang or derive any pleasure from the paintings – will be devalued and we are the losers. We have always intended to fund our retirement without any burden on the government. Now because of this tax review that intention is jeopardized. We are in our late fifties and early sixties and our super fund is being very much compromised. Please taken a deeper look at what is being intended. If art investment is such a small sector – why is it necessary to change the regulations??
20 Andrew Millist wrote:
There’s no reason for this whatsoever, this will only cripple the art industry and then we all lose.
21 Critton Astras wrote:
My Family has been in the Arts Industry for over 45 years, my father an Artist my mother a gallery owner/valuer for Tax Incentive Scheme for over 30 years. I have been the director of 3 galleries over the last 10 years and 12 months ago opened Astras Galleries at Marina Mirage (Formerly Schubert Gallery). My family and I fully supports this Campaign.
22 Tony Corrie wrote:
If these recommendations go ahead artists throughout Australia will effectively lose their jobs
23 Robyn Bauer wrote:
Galleries here in Brisbane’s Paddington are already suffering enough in the GFC. Several have already closed. Artists are suffering blow after blow. What is the gallery of the future going to look like? The only ones that survive around here are artist’s studio galleries, where we live as well as work.
24 Melody Smith wrote:
I am an emerging artist who has recently graduated from university and opened an artist run space promoting students and emerging artists.
I support the SAVE SUPER ART campaign against the Cooper Review recommendations banning art investments in Self Managed Super Funds. The recommendations are fundamentally flawed, serve no good purpose, are already creating damaging uncertainty in the Australian art market, and, if implemented, would create disastrous “unintended consequences” for the Australian art industry.