The Association of Superannuation Funds of Australia (ASFA) estimates that Australian super funds had by 30 April made around 855,000 individual payments, totaling around $7.1 billion in financial support, as part of the temporary early release of superannuation scheme.
ASFA CEO Dr Martin Fahy said: “These are anxious times, particularly for people who have lost their job or have had to close their businesses due to the COVID-19 crisis”.
“Despite having only 18 working days to prepare for one of the biggest system changes in 30 years, superannuation funds and administrators have been working hard to support members at this difficult time, through the early release of superannuation scheme”.
“Funds have worked cooperatively with government and regulators to change systems to process this unprecedented volume of transactions and ensure early release financial hardship payments have been made quickly and safely”.
Reflecting on the first two weeks of the scheme, ASFA analysis suggests:
- the number of early release financial hardship payments processed by funds is running at 200 times the typical weekly average
- up to 95 per cent of applications have benefited from straight through processing and triggered only minimal amounts of exception handling. Some funds have experienced slightly higher levels of exception handling
- as a result, preliminary estimates indicate that close to 98 per cent of applications have been paid within five working days
- a relatively small number of claims have been rejected by funds due to anomalies or concerns regarding evidence of fraud or potential fraud or because an account had been closed or an invalid bank account number was supplied
- ASFA estimates that the average withdrawal is around $8,200. This is less than the maximum amount of $10,000 as a substantial number of applicants have less than $10,000 in their superannuation account (or are withdrawing from more than one superannuation account). Some applicants also are withdrawing only what they need rather than the maximum amount.
“The strength of Australia’s world-class compulsory super system has enabled super funds to play this important role in supporting Australians in these unique circumstances and superannuation is committed to playing a key role in rebuilding the economy, by providing much needed capital for the recovery,” Dr Fahy concluded.
For further information, please contact:
Jacqui Maddock, 0451 949 300.
ASFA is the peak policy, research and advocacy body for Australia’s superannuation industry. It is a not-for-profit, sector-neutral, and non-party political, national organisation. ASFA’s mission is to continuously improve the superannuation system, so all Australians can enjoy a comfortable and dignified retirement.