Australian super funds troubled by rush for second withdrawal under coronavirus rules – The Guardian

Super funds received more than 340,000 applications in three days from people who wanted to make a second withdrawal from their superannuation accounts under rules allowing early access to retirement savings due to the coronavirus crisis.
The double drawdowns have increased concerns that people who are desperate for cash due to the recession provoked by Covid-19 lockdowns are draining their entire retirement savings.
Statistics released by the prudential regulator on Tuesday show that applications to crack open super accounts surged as the new financial year ticked over at the start of the month.
Under the emergency drawdown rules, introduced by the treasurer, Josh Frydenberg, in March, people suffering hardship due to the coronavirus crisis were allowed to draw down up to $10,000 before the end of the financial year and another $10,000 after 30 June.
The Australian Prudential Regulation Authority said that in the week of 29 June to 3 July, which includes three days of the new financial year, there were 511,000 applications for early release, up from 127,000 the previous week.
Of these, 346,000 were applications to draw down on the same account for a second time. The average amount sought in repeat applications was $8,904, indicating many people have withdrawn as much as possible.
Apra said super funds have paid out $19.1bn.
Industry Super Australia, which represents the employer-and-controlled industry super fund sector, said Apras data showed total drawdowns were likely to eclipse the total of $29bn estimated by the government by the time the scheme closes on 24 September.
The higher amount of average withdrawals on repeat applications may indicate people are taking the maximum available to them, be that what they have in their balance or the full $10,000 available under the scheme, Industry Super Australias chief executive, Bernie Dean, said.
ISA analysis has shown that almost 500,000 people have already wiped out their super savings, for those people it may be very difficult to make up those contributions

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