Prime Minister Malcolm Turnbull has moved to shut down the unruly public debate over letting first-home buyers raid their superannuation, saying the issue had gone "round and round" and referring to his earlier criticism of the plan as a "thoroughly bad idea".
The cabinet's budget razor gang will examine a range of housing affordability measures, including the contentious super for housing proposal and paring back capital gains tax concessions, in an all-day meeting in Sydney on Thursday.
Ahead of that meeting, Coalition MPs have split over the super for housing proposal, underscoring divisions inside the Turnbull government about the best way to tackle housing affordability.
Treasurer Scott Morrison and Assistant Treasurer Michael Sukkar are understood to support both proposals, but Mr Turnbull, Finance Minister Mathias Cormann and Revenue and Financial Services Minister Kelly O'Dwyer have argued against them.
A final decision on super for housing or capital gains tax concessions is not expected on Thursday, but the expenditure review committee could tick off on other parts of the budget's housing affordability package, including a mooted affordable housing finance corporation and supply measures.
Mr Turnbull said on Wednesday the proposal to allow first-home buyers to use part of their superannuation for a deposit was a "debate that's gone round and round, for a long time".
"I've read all of the speculation. Standing here in Mumbai I won't contribute to it, although I've expressed fairly strong views about it in the past," he said.
Mr Turnbull said the proposal was "all part of the pre-budget debate" but reiterated that the purpose of super was to provide for retirement.
"That is the legislated purpose of superannuation, to provide for retirement. That is why the whole system was set up in the first place," he told Sky News.
As communications minister in 2015, Mr Turnbull labelled the proposal a "thoroughly bad idea".
Deputy Prime Minister Barnaby Joyce declined to comment on the super option, but argued there was not a housing affordability crisis in Australia.
"There is a housing affordability crisis in Sydney and Melbourne. That is where there is a housing affordability crisis."
But his Nationals colleague Resources Minister Matthew Canavan, said the scheme should be examined.
"All I ask colleagues is to give it due consideration," he said. "I don't ask them to agree with me. They disagree plenty of times. I am fine with that. It should be a battle of ideas and a contest."
Former prime minister Tony Abbott backed the super for housing proposal, praised Mr Sukkar and said the Coalition should not have a "Stalinist approach" to debate.
"If people want to float ideas, if people want to respond to those ideas, why not?"
WA Liberal backbencher Ian Goodenough and Queensland MP George Christensen also publicly backed the proposal.
But assistant minister Anne Ruston likened it to pouring "a bucket of kerosene on a fire", former health minister Sussan Ley criticised it and Nationals MP Andrew Broad called it a "lazy response to the problem".
Australia's leading economists have unanimously criticised the super for housing proposal, with Saul Eslake labelling it a "thoroughly stupid idea" and Deloitte Access Economics' Chris Richardson warning it would just "be adding extra money into a market that's already pretty heated".
Mr Richardson told the National Press Club families would be disappointed if they thought the federal government could solve the housing affordability crisis, and said the "one bit of advice I give to young Australians right now is don't buy".
He also backed cuts to CGT and criticised Labor's policy to limit negative gearing.
House prices surged 1.4 per cent across Australia in March, pushing annual price growth to 19 per cent in Sydney and 16 per cent in Melbourne.
Shadow treasurer Chris Bowen said the super debate had turned into a proxy battle between Mr Turnbull and Mr Abbott.
"We seem to be getting hourly updates on who is in favour and who is against ahead of tomorrow's expenditure review committee," he said.
Mr Bowen said new tax office data for 2014-15 showed the number of property investors who owned at least five properties had grown at triple the rate of those who owned just one investment property.
"This new data again draws out the problems with the current tax concessions on housing – an investor buying their fifth, sixth or seventh property gets more assistance than a first-home buyer trying to get into the market," he said.
James Massola is south-east Asia correspondent, based in Jakarta. He was previously chief political correspondent for The Sydney Morning Herald and The Age, based in Canberra. He has been a Walkley and Quills finalist on three occasions.
Mark Kenny is the national affairs editor for the Sydney Morning Herald and The Age, based at Parliament House