Too many women are caught in a low-income trap. They can’t simply ‘put back’ their super

Data released by the Australian Prudential Regulation Authority on Monday showed that the fears of critics of the government’s superannuation early release scheme were well placed: more than $17bn has been ripped out of Australia’s retirement savings in just two months.

Funds have paid out an average of $7,492 to at least 2.3 million Australian workers who have applied to withdraw their super as they face the loss of jobs and income due to Covid-19.

Related: Younger Australians face working till they drop after draining super accounts, industry group warns

Under the scheme, people in receipt of income support, or who have lost their jobs or at least 20% of their income, are able to access up to $10,000 of their superannuation savings in each of the 2019-20 and 2020-21 financial years.

It’s difficult to predict whether withdrawals in the financial year that started on Wednesday will match those of the last two months. People may seek to access the scheme for the first time in the 2020-21 financial year as their jobs disappear with the withdrawal of jobkeeper in September, or their incomes decline further as employers reassess their forecasts for the first accounting year to have kicked off in a recession in almost three decades.

It’s likely, though, that a significant number of those who have accessed the scheme already won’t be coming back for more – because they don’t have anything left to withdraw. More than half of the applicants were aged under 35, and so were likely to be wiping out their meagre super balances entirely.

Of equal concern is the apparently disproportionate impact on women. Data from the Australian Taxation Office revealed that, while fewer women than men had accessed the scheme in its first month, those who did withdrew more than a third less than did men. This again indicates that women were more likely to be wiping out their savings entirely, probably because they have suffered a greater loss of jobs and hours of employment since March, and more of them are ineligible for the jobkeeper payment due to the often short-term, casual nature of their jobs.

Moreover, almost 400,000 Australian women gave up looking for work entirely between March and May, meaning they are not even receiving the jobseeker unemployment benefit.

Yet, remarkably, when asked by the chair of the select committee on Covid-19, the Labor senator Katy Gallagher, how it was measuring the impact of the scheme on women, the Treasury responded simply that it had “not undertaken distributional analysis of early release of superannuation in response to Covid-19 by gender”.

Such a cavalier attitude to the gender impact of this wrong-headed policy reflects a dangerous lack of understanding among Treasury officials of the realities of women’s financial insecurity in Australia, both during and after their working lives.

Since Per Capita and the Australian Services Union published a report on women’s superannuation in 2017, the fact that women retire with about 47% less super than men has become widely known.

The “super gap” is due to the higher levels of part-time and casual work, and frequent career interruptions, that characterise women’s work in Australia, which is primarily the result of their disproportionate burden of unpaid work and care. It’s also because jobs in female-dominated industries including healthcare, social services, retail and hospitality are among the lowest paid in our economy.

Yet on ABC Radio’s AM program on Tuesday, while calling for yet another delay in the legislated increase of the compulsory rate of employer-paid superannuation, the small business ombudsman, Kate Carnell, blithely suggested that the solution to the obliteration of women’s retirement savings over the last two months was simply for women to “put it back in” when they were working again.

It seems ignorance of the low-income trap in which too many Australian women are caught isn’t confined to Treasury officials.

In Australia today, more than half a million single older women rely on the full age pension as their sole source of income, and more than half of them live in permanent income poverty.

Many of them spent their lives in the care of others, working for the minimum wage in aged care homes, providing in-home care for people with disabilities or elderly people, or in educating and caring for our preschool children.

Related: 'Pink-collar recession': how the Covid-19 crisis could set back a generation of women

Women like these have been essential workers during the pandemic, putting themselves in the line of the virus so the rest of us could stay safely at home. Others have been thrown out of the insecure, low-paid jobs they managed to fit around their unpaid parenting and other caring commitments as their employers closed shop.

The government’s lack of targeted support for women in its response to this pandemic has, predictably, resulted in them withdrawing what meagre savings they had for their retirement. And an analysis released in June showed that they were doing so primarily to meet the essential needs of their families, while men were more likely to be dipping in to their super to spend on recreation, including gambling.

So, yet again, women are expected to sacrifice themselves – to trade off their financial security in retirement against the wellbeing of their families today – and all because the government and its advisers don’t, or won’t, understand the imperative to apply a gender lens to their economic decisions.

If they don’t learn this lesson now, they will condemn another generation of working women to a lifetime of financial insecurity, and a retirement spent living barely above the breadline.

• Emma Dawson is executive director of the public policy thinktank Per Capita, and co-author of Measure for Measure: Gender Inequality in Australia