$7.1bn paid in early release scheme: ASFA
Around 855,000 payments totalling around $7.1 billion have been made from super funds to individuals by the end of April as part of the government’s temporary early release scheme, an analysis from the Association of Superannuation Funds of Australia suggests.
ASFA’s analysis suggested that, reflecting on the first two weeks of the scheme:
- 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.
ASFA chief executive 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,” Dr Fahy said.
“Funds have worked co-operatively 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.”
Adrian Flores is the deputy editor of SMSF Adviser. Before that, he was the features editor for ifa (Independent Financial Adviser), InvestorDaily, Risk Adviser, Fintech Business and Adviser Innovation.