The Australian Government provided financial assistance to millions of people to limit the adverse effects of the COVID-19 recession. This paper examines how two distinct large-scale policies delivered during this time, one that increased liquidity by releasing personal savings – the Early Release of Superannuation (ERS) – and one that increased wealth through a government transfer – the JobSeeker Supplement (JSP) – affected the wellbeing of eligible recipients using longitudinal household survey data. 

The ERS and JSP policies acted together in addressing financial hardship, but were different in design and targeted at different cohorts of people. The findings suggest that the JSP supplement, which was targeted at those most in need, provided fast and effective financial relief and raised life satisfaction. ERS allowed people access to precautionary savings but did not obviously raise subjective wellbeing.

Findings

• The life satisfaction of JobSeeker recipients temporarily rose by 4% when the JSP supplement was introduced. The effect was much larger for people receiving the JSP supplement for at least six months.
• The share of Jobseeker recipients having difficulty paying their bills fell from 25% in 2019 to 20% in 2020. This corresponded to 37,000 more Australians being able to pay their bills.
• The ERS program had a limited impact on the reported wellbeing and financial resilience of most withdrawers.