More than 19,000 Australians tried to dip in to their super last year to service mortgage repayments and the cost of treating medical conditions.

In another sign of increasing financial stress among Australian households, the 2013/14 annual report of the Department of Human Services reveals that applications for early release of superannuation funds on compassionate grounds rose by seven per cent to 19,286 in the year to June.

The department is responsible for handling early-release applications and makes recommendations to super funds as to whether people should be given special access to cash before retirement.

Strict criteria are used to assess claims, with applicants having to demonstrate that an early-release payment is necessary, on compassionate grounds, to help them deal with a medical condition or a protracted bout of unemployment.

• Nine ways to simplify your finances
• How to buy your first home – expert tips
• The top five people to avoid in the office

The higher number of applications in 2013/14 continues a rising trend apparent since 2011 when 17,391 people sought early access to their super.

However, the increase in applications last year was not matched by an equivalent rise in approvals by the department.

Less than two-thirds of all applications were approved in full or part, with the total value of early payouts rising only four per cent, or $5.4 million, to $151 million.

This equates to a fraction of the $1.85 trillion worth of assets that were held in Australian superannuation accounts at the end of June.

The average payment approved by the department rose only two per cent to $12,874 from $12,643 in 2012/13.

The latest statistics appear to allay fears that Australians are exploiting superannuation “loopholes” to enhance their lifestyles before retirement.

Concerns have been raised in the past that unscrupulous cosmetic surgeons have targeted the superannuation industry as a way to fund elective surgeries for low-income clients.

Although the department makes recommendations on compassionate grounds, the final decision to release retirement money rests solely with the trustees of super funds.

Trustees are also responsible for deciding whether fund members can get early access to funds to cover general living expenses in exceptional cases of extreme financial hardship.

“Anyone considering applying for early access to their super needs to be aware that strict criteria applies and that there may be significant tax implications,” Tom Garcia, CEO of the Australian Institute of Superannuation Trustees.

“Accessing super early will impact on your ability to save for retirement, including the potential to miss out on the magic of compounding interest. “