Retirement
Hume praises ‘overwhelming success’ of early access to super scheme
The Minister for Superannuation has praised the success of the early access to superannuation scheme after it was revealed the majority of Australians used the money to pay their bills.
Hume praises ‘overwhelming success’ of early access to super scheme
The Minister for Superannuation has praised the success of the early access to superannuation scheme after it was revealed the majority of Australians used the money to pay their bills.
A survey released by the Australian Bureau of Statistics showed that the majority of money withdrawn from super was used to pay bills.
The Morrison government allowed people who were suffering hardship to access $10,000 during both 2020 and 2021, under a scheme facilitating early access to super savings.
The ABS survey found that 29 per cent of people who jumped on the scheme by September 2020 used the funds to pay their mortgages or rent, while 27 per cent used it for household bills.
Another 15 per cent directed the extra funds towards servicing their credit cards or personal debts, while only 13 per cent added it to their savings.
“We found that for people who accessed the scheme twice, the average total amount withdrawn was $17,441,” ABS director of household economic resource surveys Dean Adams said.
“The average single withdrawal was $7,728 for the first opportunity, and $7,536 for the second.”
With the ABS data showing that a significant portion (55 per cent) of early super payments were used to pay mortgage, rent or other household bills, Superannuation Minister Jane Hume called it “an overwhelming success”.
“The Morrison government acted decisively in the national interest to support households and businesses and address the significant economic consequences of the COVID-19 – the success of this program proves that it was an effective measure,” Ms Hume said.
“The scheme was a flexible option, and more than 3 million Australians weighed up the decision, and decided that withdrawing their super was the best financial decision for them.”
Ms Hume praised the Australians who used their super to pay down debt, citing the Retirement Income Review’s finding that “offering prudent and limited access to superannuation prior to retirement is consistent with the objective of balancing living standards pre- and post-retirement”.
Early super payments quickly surpassed Treasury’s initial estimates of $27 billion, with around $36 billion withdrawn.
The program faced significant criticism from superannuation funds and economists, but Ms Hume said that early super was a “flexible option” that many Australians decided “was the best financial decision for them”.
“The best way for the government to help workers rebuild their retirement savings is to do everything we can to help them get back into a job soon. And that’s exactly what we’re focused on,” Ms Hume said.
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