While the early access to superannuation scheme was designed to give Australians facing financial hardships during COVID-19 access to a maximum $10,000 a year for two years from their super accounts, some members have used the money for discretionary spending.
“The government isn’t in the business of telling people how to spend their own money. We don’t do that,” Ms Hume said.
“In the same way we still pay a JobSeeker to a person who might spend it on cigarettes and beer.”
“If people choose to take their own money and spend it on something that isn’t particularly helpful, that’s their business,” she explained.
Ms Hume also believes that research indicating how much early superannuation was wasted on discretionary spending was overblown.
“(The statistics) came from an organisation that provides a budgeting tool, so you’re dealing with a sample of people who are in poor financial mismanagement anyway,” Ms Hume said.
“I think it was terribly misleading and unnecessarily – dare I say, political – use of information about a really important and effective scheme.”
Ms Hume also hit out at superannuation funds who have claimed that early access to superannuation is creating problems for the industry, or changing investment strategies.
“They’ve made a mountain out of a molehill here,” Ms Hume told the media. “The amount that has been taken out for early release is less than 10 per cent of contributions that were made last year.”
“There is no way that superannuation funds should have to dramatically adjust their investment strategies to account for such a small amount of money.”
Ms Hume said that early super was a “nice excuse”, but it hasn’t “changed the face” of the superannuation system.
“The funds have had no real problems paying out this money,” Ms Hume explained. “APRA identified before we began that it shouldn’t impact the system overall at all.”
Finally, Ms Hume confirmed that legislation which would increase the superannuation guarantee to 12 per cent from 1 July 2021 will still go ahead, despite the government flagging changes to industrial relations under its JobMaker scheme.
“It has always been the government’s intention to increase the superannuation guarantee, and we haven’t deviated from that intention or that message,” Ms Hume said.
“That said, I would not be surprised if we get a lot of pushback when that goes ahead next year – particularly from the business community, who [understands] that there is a limited amount of money out there to pay employees, and when you increase the superannuation guarantee, something has to give,” she concluded.
Did you enjoy this article? You may also be interested in:
- Jones calls to end the war on super
- Can accessing superannuation early close the retirement gap?
- 'Stunning result' for superannuation despite COVID-19 battering
About the author
