The Australian government has announced intentions to continue enhancing paid parental leave (PPL), beginning on July 1, 2025, with the payment of superannuation (super).
It will coincide with the introduction of Working for Women, Australia’s first national policy to achieve gender equality.
Paying superannuation on PPL has long been a goal of the women’s movement and unions. It was also one of the Women’s Economic Equality Taskforce’s main recommendations.
In a joint ministerial release on March 7, 2024 (a Thursday), the government said that this reform is an investment in women’s economic security as well as the larger economy. It builds on the government’s efforts to modernize PPL and extend the payout to a full six months by 2026.
They also noted that including super payments in Government PPL would reduce the effect of parental leave on retirement savings and make it a standard company benefit, similar to annual and sick leave.
Families will have access to an extra two weeks of leave, for a total of 22 weeks, beginning on July 1, 2024, if granted. This leave will rise to 24 weeks from July 2025 and 26 weeks from July 2026.
This expands on earlier adjustments implemented in July of last year to facilitate parent-to-parent sharing of parental leave and increase access to the payout.
This has greatly facilitated the sharing of care between the two parents and includes a more generous $350,000 family income criteria.
The Australian Taxation Office confirms that the Senate is still considering the idea, and it has not become a law yet. The upcoming Budget will include further details, including expenses, about funding retirement savings on PPL.
The Minister for Women, Senator Katy Gallagher, stated: “The data is clear – women’s retirement incomes are impacted when they take time out of the workforce to raise children; on average, women retire with approximately 25% less than men.”
According to her, paying for government parental leave with superannuation is a crucial investment towards reducing the super gap and facilitating women’s decision-making when it comes to juggling employment and caregiving.
Additionally, Amanda Rishworth, the Minister for Social Services, stated that increasing women’s participation in the workforce, valuing caregiving, and giving gender equality top priority are all important steps.
“It helps normalise taking time off work for caring responsibilities and reinforces Paid Parental Leave is not a welfare payment – it is a workplace entitlement just like annual and sick leave.”
