A staggering 4,350 people in the electorate of Blair have wiped out their entire retirement savings through the Morrison Government’s early release of superannuation scheme.
Federal Member for Blair Shayne Neumann has slammed the scheme and said the alarming figures highlighted the Government’s failure to manage the economic recovery coming out of the coronavirus crisis.
“It’s been estimated that a 30-year-old who withdraws $10,000 in super now could have up to $41,000 less at retirement. Of course, that is going to affect their standard of living later in life,” he said.
“The Government’s decision to extend their fraudulent robo-release early access super scheme was a vote of no confidence in their own ability to deal with soaring unemployment and the economic challenges ahead.
“Scott Morrison’s lack of a plan for jobs and the recovery has forced thousands of anxious people in Ipswich, the Somerset Region and Karana Downs region to raid their hard-earned retirement savings.”
Industry Super Australia (ISA) analysis shows that the average early withdrawal payment in Blair was $7,892 with 4,350 individuals emptying their super balance. Around 170,000 men, women and children live in the electorate of Blair.
The analysis, based on Treasury, ABS, ATO and Australian Prudential Regulatory Authority data, show that 29,397 Blair residents had applied to dip into their super, with $218.5 million paid out since April.
The Government implemented early release in April to support people who had lost their jobs or had work hours reduced because of the pandemic, and it allows account holders to withdraw up to $20,000 in super.
Mr Neumann said the figures showed the Government needs to stick to its legislated promise to lift the Superannuation Guarantee rate to 12 per cent by 2025 so people can save enough to fund a dignified retirement.
“Now more than ever, people in my electorate need the legislated rise in the Super Guarantee to help rebuild their retirement balances.
“If the Government backflips on its promise and caves in to a vocal minority of Liberal and National backbench MPs who want to take workers’ increases away, billions will be drained from people’s retirement income – this is a bill we can’t afford.
“When people withdraw super early, it means they have to work longer to fund their retirement and we all pay more in higher taxes to prop up more people drawing a full pension down the track,” he said.
ISA analysis shows that if the super rate increase were cut, an average 30-year-old man who took $20,000 from their super would either lose $180,000 from their retirement or be forced to work until 74, while an average 30 year-old female would need to work an extra eight years or have $150,000 less at retirement.
Mr Neumann also called on the Government to immediately release the Retirement Income Review that they received on Friday.
“We know the Scott Morrison and Josh Frydenberg set up this review as a stalking horse for more cuts to the pension and further delays to the legislated increase in the Super Guarantee to 12 per cent.
“Australian workers and retirees should not be kept in the dark on the Government’s secret plans to cut their retirement income,” Mr Neumann said.