JAYES:
Let's go live to Melbourne now. The Assistant Minister for Superannuation, Jane Hume, joins us. Jane Hume, thank you for your time. It was yesterday that was the starting date for people to be able to access their super early. Did the Government expect the numbers of interest that we've seen?
HUME:
Laura, last night was the end of the first day that people could apply for early release of their superannuation. But over 975,000 people had, in fact, preregistered an interest in applying for early release of their super by Sunday night. The ATO is now progressively contacting those people throughout this week and telling them the applications are now open and the can log
into their my government site, MyGov site, and make that application throughout this week. The estimation is that once you've applied for early release of super via MyGov, it should take the ATO about four days or so to verify and assess each application, and then they will send that file off to the super funds, the relevant super funds, with an instruction and the super funds should release that for those funds within about five days.
JAYES:
Does it concern you that almost a million Australians need to access their super early?
HUME:
Well, of course that's a concern. You know, that's nearly a million Australians that are concerned about their financial viability, their financial future, that are concerned about their jobs and paying the mortgage or paying off a credit card. So, of course, that's a concern. The Government's estimate is that around 1.6 to 1.7 million Australians will apply for early release of their superannuation throughout either this tranche, which ends on June 30, or the next tranche, which is 1 July to 24 September, and in each tranche you can take up to $10,000 from your superannuation.
JAYES:
Should it be a last resort for people because does it risk here undermining the whole apparatus of the super system?
HUME:
Well, I wouldn't go as far to say it's a risk of undermining the apparatus of the super system. Accessing superannuation for issues of financial concern or financial stress has always been available. The Government has simply changed the definition of what that financial stress looks like. So we're not necessarily concerned about the infrastructure behind it.
That said, people should take the decision as to whether they should access their superannuation very seriously indeed. Of course, there's going to be a trade-off between taking money out of superannuation now and keeping it in and locking it up for their retirement savings in the future. I should say, though, Laura, that there are some pretty wild numbers floating around about what taking $10,000 today means for you. We would suggest that people either talk to a trusted financial adviser if they're confused or a registered tax agent or there's also a very handy calculator on the Money Smart - ASIC's Money Smart website that will tell you exactly what taking out money from superannuation means for you.
JAYES:
Is there a chance here that if we do see a lot of young people take up this offer of essentially $20,000 of early money from their superannuation, does it weaken the system years down the track and is that just putting off a problem for another day?
HUME:
Well, we think people are best placed to make those decisions themselves and you've got to think about the counterfactual. What would be the effect of leaving that money in superannuation but not being able to pay your mortgage, not being able to pay off a credit card, having to sell something like your car just to get by? So it really is a decision for individuals. We're certainly not encouraging people to take up the offer but we're giving them the option to make an assessment about their own financial situation, their own family budgets.
JAYES:
It was interesting to hear the Prime Minister last week suggest that superannuation who, you know, these firms that hold essentially a trillion dollars worth of capital should look at taking equity in companies, ailing companies like Virgin. I guess people are sitting there looking at that comment thinking, well, the Government doesn't want to take an equity stake in Virgin so why should retirees?
HUME:
Well, the Government would never direct super funds as to how they should invest their funds.
JAYES:
That was the suggestion.
HUME:
No, well, that said, a $3 trillion investment pool is a very significant one and super funds have often invested in, you know, assets that provide, you know, an investment opportunity that might be a bargain opportunity that's available right now. There's already been $10 billion of capital raisings on the ASX this year alone and the super funds have, you know, have already partaken in those capital raisings quite significantly. So there may be opportunities for good investments by super funds during this period where there's some bargains to be had.
JAYES:
Just finally, Malcolm Turnbull has released a book, it wouldn't have escaped your attention. He's also, in an interview last night, talked about the bullying tactics that some on the right of your party did use during that very crazy week of leadership and the change of prime ministers. Do you have any reflections from that time?
HUME:
Look, I'll be honest with you, Laura, this is such a busy time in my portfolio I think that I should probably leave the commentary on all of that to the commentators. That said, you know, it's a time gone past, I can't remember a time when I felt like I was personally bullied so I think we'll just leave the commentary up to Malcolm, up to the former prime minister, and up to the commentators.
JAYES:
Okay. Just finally, Malcolm Turnbull did have a warning for Scott Morrison saying what happened to me might also happen to you so keep an eye out. Do you think that's a possibility?
HUME:
No, I don't.
JAYES:
Jane Hume, thanks for your time.
HUME:
Thanks, Laura.