No more digging into super

There will be no more digging into super savings early, says Senator Jane Hume, who confirmed yesterday that there will be no third wave of the early release scheme.

“We said early on that this was a temporary package in response to the pandemic. Not something we wanted to set up as a permanent proposition,” said the assistant minister for superannuation, financial services and financial technology.

“The vast majority of calls to my office [in Richmond, Victoria] was about extending the early release of super scheme and it breaks my heart to say no we’re not doing that.”

Senator Hume told the Financial Services Council (FSC) that the first extension of the scheme was “proportionate” and was “limited but powerful”, reported Super Review.

According to the Australian Prudential Regulation Authority (APRA), fund members who accessed the super scheme twice took out, on average, $15,854.

And more often than not, members took out more the second time around.

APRA said the fund members took out, on average, $7402 the first time around and an average of $8452 on the repeat application.

Depending on whose modelling you believe, between 83,000 and 480,000 accounts were drained before the second tranche.

Enabling access a third time round may have depleted even more super funds.

While the senator has confirmed there will be no more early release tranches, there was also no mention in the Budget of the superannuation guarantee increase or super for housing.

When asked if this would end any criticism that the government was ideological on super, Senator Hume said the “accusation that the government is ideological on super always blows me away”.

“[The] productivity commission said super had served Australians well but it’s not efficient, not compulsory and, because government compels people to quarantine nearly $1.10 on nearly everything they earn, we have a responsibility to make it an efficient system,” she said.

“This ideological accusation I find frustrating.

“… we’re not about dismantling the system here; every time I open my mouth everyone in the industry loses their minds.

“We’re here to improve the system so that it better serves all Australians, because there are 16 million out there that rely on it being a good quality, high performing system.”

Which super measures would you have liked to see in Tuesday’s Budget?

If you enjoy our content, don’t keep it to yourself. Share our free eNews with your friends and encourage them to sign up.

Related articles:

Written by Leon Della Bosca

Publisher of YourLifeChoices – Australia's most-trusted and longest-running retirement website. A trusted voice on Australia's retirement landscape, including retirement income and planning, government entitlements, lifestyle and news and information relevant to Australians over 50. Leon has worked in publishing for more than 25 years and is also a travel writer and editor, graphic designer and photographer.

Leave a Reply

GIPHY App Key not set. Please check settings

Cafe ‘trick’ can change eating choices

Wills made simple