Hunter residents have withdrawn more than $830 million from their super accounts since the federal government relaxed restrictions on accessing retirement savings due to the COVID pandemic, new figures reveal.
December figures show 80,981 people have now accessed $831.7 million. The average payment was $7492 compared to the state average of $7512.
Of those, 15,172 people, up from 13,377, have effectively wiped out their accounts.
The withdrawals have occurred since April when the government changed the superannuation access rules to allow people who had lost their jobs or had hours reduced to access $10,000 in super before July 1 and a further $10,000 until December.
The Herald previously reported research by analytics firm illion that showed much of the withdrawn super was not being used as intended and 38 per cent of applicants had not suffered a drop in income. On average, Australians spent an extra $3618, or about half the average withdrawal, in the first fortnight compared with what they spent in a normal fortnight before receiving early super. The research showed 64 per cent of this additional spending in the first two weeks was on discretionary items, including gambling ($284 extra), clothing and department stores ($317) and eating out ($287). The automotive and fuel spending category was up $388 on average per person in the first fortnight.
Analysis by Industry Super Australia shows accessing super early in one's career can have major flow-on effects.
It estimates that a 30-year-old who withdraws $20,000 could have up to $80,000 less at retirement. There is also a cost to the public purse, as for every $1 taken out by someone in their 30s the taxpayer contributes up to $2.50 in increased pension costs.
Industry Super Australia chief executive Bernie Dean said it was essential that the government made good on its promise to lift the super rate from 9.5 per cent to 10 per cent next year.
"The young NSW workers who had to sacrifice their retirement savings to support themselves during the pandemic had been promised a super boost to make it up," he said.
"Ripping it away from them would be a cruel double blow, it would leave them with far less at retirement and saddle these young workers with a whopping pension bill they pay for through higher taxes.
"Super is not a cookie jar for government to raid to solve short-term budget problems, nor is it for housing. Busting into super early comes at a steep cost for the individual and future taxpayers, as a society we shouldn't be demanding our young people pay the price yet again."
For faster access to the latest Newcastle news download our NEWCASTLE HERALD APP and sign up for breaking news, sport and what's on sent directly to your email.
