Early super worry

Young people ‘forced’ to withdraw funds

LABOR has blamed the Coalition government’s bungled JobKeeper scheme on young people being forced to withdraw billions in retirement savings.

As of May 11, a third of the almost 1.4 million people who accessed up to $10,000 of their superannuation early were under 30, totalling $3 billion.

About 268,000 people aged between 26 and 30 applied for early access, the biggest single group.

A further 247,700 were between 31 and 35, while 21 to 25year-olds accounted for 172,000 people who have applied for the cash.

The Federal Opposition believes the decision to exclude many arts and entertainment workers, university staff and a large chunk of casual employees from coronavirus wage subsidies is to blame.

JobKeeper was estimated to spend $130 billion on keeping 6.3 million workers employed, but a massive forecasting error means just 3.5 people are covered at a lower cost of $70 billion.

Shadow treasurer Jim Chalmers said people unnecessarily excluded from the program had been forced to withdraw super.

“That will have devastating consequences for the type of income that they can rely on in retirement,” he told reporters in Brisbane yesterday. He said the crisis was disproportionately hurting younger workers who were being forced to withdraw superannuation.

“The government is in many ways robbing them of a decent retirement,” Mr Chalmers said.

The number of young people withdrawing super will rise, with the total take up of the program passing 1.62 million last week. Eligible individuals are able to access $10,000 of their super in the 2019/20 financial year and a further 10,000 in 2020/21.