Hostplus releases $1.05 billion to its members as part of the COVID-19 Special Early Release Scheme
As of 15 May 2020, Hostplus has received 173,226 ATO-approved requests for early release of super (ERS), totalling $1.18 billion.
To date, the fund has paid 158,080 members a total of $1.05 billion, with more than 97% of payments being processed within five business days.
“Ensuring our members have access to their superannuation at this difficult time is our priority and the fact that we have been able to process more than 91% of payments to date is a significant achievement.
“Our members in the hospitality, sport and tourism industries have been some of the hardest hit by the pandemic, and we’ve brought on additional staff who are working around the clock to manage members’ enquiries but there is clearly more work to do”, said Hostplus CEO, David Elia.
“While the vast majority of Hostplus members have been paid within five business days, a small number have experienced delays in receiving their payments. This is due to a need for additional checks and processes to ensure the accurate and secure processing of these payments.
“We understand that many people are facing real financial strain and are anxious to receive their early release payments. However, we must also remain vigilant to a small minority who are attempting to take advantage of the situation. At a time when fraudulent activity around super is rising, it is important for all our members that our processes and risk controls are as robust as ever”. said Mr Elia.
In addition to the need to protect against potential fraud, there are several other reasons some members’ payments may be delayed. These include circumstances where there is a need for a member to take an action on their account, including where they might hold direct assets such as shares or a term deposit.
“For the minority of members experiencing a delay in their payment, we appreciate their patience while we work to assist all our members, some of whom are under a great deal of pressure right now, and we sincerely thank them for their understanding” Mr. Elia added.
Hostplus’ cash reserves and its liquidity position remain strong, ensuring it can continue to comfortably accommodate ERS payments, as well as investment switches and routine benefit payments. The total amount of cash available as at 18 May is $6 billion.
“The total sum of ERS payments requested by Hostplus members to date represents less than 2.6% of the Fund’s total funds under management. The overall number of people requesting early release is also getting lower each week. With parts of the economy beginning to reopen, Hostplus expects this trend to continue”, Mr Elia said.
The COVID-19 pandemic, and the ERS scheme, has led to significant changes for the superannuation industry and for Hostplus.
“This is especially so when you consider that, prior to the current COVID-19 crisis, Hostplus would typically receive around 100 financial hardship applications in an average week. The number of special early release applications we’ve received to date is around 360 times higher than our normal volume, and our call centre has experienced a 290% increase in calls in addition to the more than 8,000 emails also being received per week.
“We are working around the clock to meet this challenge and continue to encourage members awaiting payment to visit the Hostplus website for more information on this, as well as steps they can actively take to help us process payments quicker” advised Mr. Elia.