Plans to allow domestic violence victims to access their superannuation before retirement will entrench disadvantage and further endanger vulnerable women, according to critics of the proposed scheme.

A day after tens of thousands of Australians took to the streets to rally against the sexual assault and discrimination of women, the Nine Newspapers reported on Tuesday that the federal government was forging ahead with plans to extend early superannuation access to victims of domestic abuse.

The plans were first flagged in 2018 in the federal government’s Women’s Economic Security Statement, and Minister for Superannuation, Financial Services and the Digital Economy Jane Hume confirmed on Tuesday that the scheme would come into effect in a matter of weeks.

Domestic Violence NSW CEO Delia Donovan said the scheme would give abusers another means of extorting money from their victims – something she said took place during the early super access scheme last year.

“In theory, it probably sounds really good, but it’s absolutely not OK in terms of creating further debt and poverty later on for women, who are already affected by the gender pay gap,” she said.

Experts said the scheme would be open to exploitation and put victims at risk. Photo: Getty

Ms Donovan said to make matters worse the news came after the sector had called on the government to increase long-term funding for emergency accommodation and other key services for domestic violence victims.

She told The New Daily the scheme shifted responsibility from the federal government to vulnerable women.

“This is not OK,” Ms Donovan said.

• Related – Early super access failed victims of financial abuse, says Labor

Labor MPs also slammed the policy for playing into the hands of abusers.

Jenny McAllister, shadow assistant minister for communities and the prevention of violence against women, said women and children fleeing domestic violence needed support.

“But the message from the Liberals is that you’re on your own,” she said.

“Drawing on meagre retirement savings to escape domestic violence exposes women to financial hardship and reduces financial independence at a time when it’s most needed.”

“A woman’s super balance should not determine her ability to live without fear of violence,” added shadow superannuation minister Stephen Jones.  

“Action is desperately needed to improve women’s safety, but this plan from the government will do the opposite.”

The government statement in which the scheme was first announced cites data from the Australian Bureau of Statistics showing women retire with 42 per cent less money in their superannuation accounts than men.

The data also shows one in three women have no money in their super.

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Independent economist and former Gillard government adviser Stephen Koukoulas said the proposed scheme, which would allow domestic violence victims to access $10,000 in super, would “erode the very purpose of superannuation”.

“It’s a bit like taking money out for your house … You’re fixing a problem with the wrong instrument,” Mr Koukoulas told The New Daily.

“If people need financial support because they are victims of domestic violence, just bloody give them the money.”

Mr Koukoulas said if the Morrison government wanted to provide more financial assistance for domestic violence victims, it could find money in the federal budget for direct cash handouts.

He said the proposed scheme would not only erode the retirement savings of vulnerable women, but struggle to provide timely support as the ATO would take time to process the claims.

“Victims of domestic violence need immediate help,” he said.

“So how on earth are you going to access it? Presumably the tax office gets involved and it’s not going to happen quickly.”

• Related – Domestic violence groups fear banking reforms will ‘perpetuate’ abuse

Per Capita executive director Emma Dawson said the policy was a “terrible way” to support women escaping abusers and came after the government had cut funding to domestic violence services and privatised the domestic violence help line.

“The government should instead invest in support services for victim-survivors of domestic violence and build dedicated social housing to put a safe and secure roof over their heads,” she told The New Daily.

“Rather than asking women in the most desperate and vulnerable circumstances to further increase their risk of poverty in retirement, the government should ensure that they pay superannuation on parental leave, introduce carer credits, abolish the $450-a-month threshold under which super is not payable, and legislate for paid domestic violence leave.”

Senator Jane Hume was approached for comment.

The New Daily is owned by Industry Super Holdings