Australian demand for early super access has outstripped the government’s original estimates, with 5 months still left to run

Australian demand for early super access is outstripping the government’s own estimates. (Elsa A Bravo, via Getty Images)
  • The latest APRA figures show Australians have applied for $29.7 billion in super withdrawals.
  • With the government originally forecasting $29.5 billion, the scheme has already eclipsed expectations, with five months left to run.
  • There are a whole range of reasons why Australians have taken to the scheme, including financial anxiety and a lack of oversight in approvals.
  • Visit Business Insider Australia’s homepage for more stories.

Australians have taken to the superannuation early access scheme like fish to water – and now they’ve eclipsed the government’s projections.

Expecting a grand total $29.5 billion to flood out of super accounts when it announced the policy – which allowed individuals to withdraw up to $10,000 per financial year – the government’s figures have been eclipsed with months still left to run.

The latest APRA figures, which track the scheme’s status to July 19, show $29.7 billion has been requested through 3.9 million applications.

The extraordinary amount, of which $28 billion is already paid, has surged since 1 July, when a second tranche of $10,000 withdrawals was made possible.

The exact number of Australians who have used the scheme is still unclear and may never be made official, an APRA spokesperson told Business insider Australia. The regulator calculates the each individual super account accessed, rather than every individual.

The figures show 2.9 million accounts have been raided, with 1 million second withdrawals made so far.

Looking at the scheme’s construction, it’s not a surprise Australians have rushed to cash out. Prime ministers and central bankers alike have compared the pandemic and imminent unemployment to the Great Depression since March, compounding financial anxiety.

Throw in a level of scepticism about the superannuation industry as a whole, and a desire of the nation’s workers to get a hold of their hard-earned savings, and the demand is understandable.

Entrust applicants with self-assessment, and allow government and regulators alike to abdicate responsibility for approvals, and the scheme becomes like an Oprah episode.

“You get $10,000. And you get $10,000. And you…”

Not wanting to one unnecessary cent more to the burgeoning budget deficit, the super scheme allowed workers to use their own retirement savings to keep their heads above water today, even if it undermines their ability to do so tomorrow.

Treasurer Josh Frydenberg last weekextended the scheme to December, with no guarantee it won’t push it back again come Christmas.

Much of that $28 billion has already been pumped into the economy, providing a stimulus boost Treasury could claim without having to cost it into its record debt.

Given all that, the Morrison government is more likely to view blitzed forecasts as a sign of success rather than failure.