AustralianSuper has so far had over 300,000 requests for early release of super and has paid out $2 billion to its members who have fallen under financial hardships due to the COVID-19 pandemic.
But while other super funds have warned on the need for policy stability in the wake of the scheme, AustralianSuper is unlikely to be the voice of change, despite having the most members.
“Do we think that the super system will be a vehicle for early access in the next downturn or the one after, and does that change the way we manage portfolios?” CIO and deputy CEO Mark Delaney told media during a Bloomberg address.
“Part of the reason you can have a long-term investment horizon is because you consider the money is going to be there for a long time.
“But early access on the size and scale we’ve seen this time has been no problem,” Mr Delaney noted.
He warned, however, that while the early release super had been helpful to Australians experiencing financial hardship through the COVID-19 crisis, it would still have consequences for their retirement.
“Early release has worked for people; it’s given them a chance to get some money,” Mr Delaney said. “It has come at the cost of the long-term retirement savings, and that’s something they’ve got to be conscious about and try to rebuild them as quickly as possible, but it has gone well.”
Critics of the policy have noted that Australia’s superannuation system should not be used to support the economy.
“Superannuation funds should not be used as an ATM when times get tough. I understand that these are unprecedented times and many Australians are facing real financial difficulties. But it is a shortsighted policy that will result in a short-term sugar hit to those affected at the expense of their super balances in 20 or 30 years’ time,” Betashares CEO Alex Vynokur said.
Did you enjoy this article? You may also be interested in:
- Superannuation is down but not out
- Can accessing superannuation early close the retirement gap?
- Industry expert slams super release
About the author
