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Spend your money how you please: PM

The Prime Minister has said it is not the government's place to tell Australians how to spend the money they have removed from super due to the Early Release of Super (ERS) scheme.

Speaking at a press conference Prime Minister Scott Morrison said the only person who can decide how to spend the money is the individual who removed it.

This comes after Treasury provided an updated forecast of the amount it estimates would be removed from people's retirement savings after its initial estimate of $29 billion was already passed.

Treasury said it now expects $42 billion to be removed from retirement savings, reflecting the government's decision to extended access to the scheme until December.

"Well, it's not my money. It's not the government's money. It is their money. The intent for which it is used is decided by the person whose money it is," the Prime Minister said.

"The government doesn't give people lectures about how they should spend their money that is not the sort of government we are."

Morrison stressed people should not be taking the money out unless they are facing financial hardship, and therefore have the right to use the funds however they please if it helps them.

"It is their money and if they believe they need it because they are facing hardship, because the rules are there to only be making this available in cases of that hardship, just as there has always been rules to support people to access their superannuation because of a particular hardship," Morrison said.

Additionally, Morrison hit back at the notion individuals were misusing the funds, saying he believes the majority of people are using the money to pay off debts.

"The overwhelming majority of cases that my advice is that people are using it actually to restructure their own personal balance sheets," he said.

"They are putting it against their debts and they are putting it against to support their mortgages and that strikes me as a very good opportunity for them to reduce their risk, to increase their financial resilience with their own resources and in many respects, you will find that by taking those decisions, they may be, I would argue, potentially much more financially advantageous decisions they are making by redeploying their own resources to those uses right now and put them even in a stronger position in the future."

Morrison said, based on the advice he has received, he is not concerned about people abusing the scheme and believes it is no one's place to lecture Australians on the matter.

"Superannuation doesn't belong to the superannuation fund managers. It belongs to the superannuation fund members," he said.

"It is their money and there are legitimate and I think very appropriate rules to enable people in this time of hardship to access their own money, to do with it what they believe is best for them. I will back them as to how they spend their money every day of the week."

Read our full COVID-19 news coverage and analysis here.

Read more: ERSEarly Release of SuperTreasuryScott MorrisonCOVID-19
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