Labor to Add Super Payments to Paid Parental Leave

Labor to Include Superannuation Payments in Paid Parental Leave

March 6, 2024 TruthUSA

Beginning July 1, 2025, eligible parents may receive an additional 12 percent, equivalent to $106, added to their super accounts weekly.

The federal Labor government has committed to providing superannuation to individuals receiving Paid Parental Leave (PPL) support to bridge the super gap between genders.

On March 7, the government announced the inclusion of superannuation in parental support payments starting next year.

Currently, eligible parents receive a weekly payment of $882.75 (US$580) for up to 20 weeks.

With the new change, they can now receive an additional 12 percent, or $106, deposited into their super accounts weekly from July 1, 2025.

The government has expressed that this initiative will help normalize parental leave as a workplace benefit, similar to annual and sick leave.

Furthermore, Minister for Women Katy Gallagher emphasized that the scheme aims to reduce the retirement savings gap between genders, which is currently approximately 25 percent.

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she stated.

An estimated 180,000 Australian families are expected to benefit from this program.

Although the government did not disclose the exact cost to taxpayers, initial estimates suggest an annual expenditure exceeding $200 million.

Treasurer Jim Chalmers emphasized that enhancing the economic status of women is a key focus of the Albanese government.

“A robust paid parental leave system benefits families and the economy as a whole,” he remarked.

“Ultimately, this significant change will lead to a more secure and dignified retirement for numerous Australian women.”

To pass this new policy through parliament, Labor must secure support from either the Opposition or the Greens.

However, a collaboration with the Greens and crossbenchers is likely necessary for success.

In addition to the super scheme, Labor has introduced legislation to extend the PPL program by an additional six weeks starting in July 2026.

Opposition’s Response

Shadow Home Affairs Minister James Paterson questioned the concept of superannuation inclusion in parental leave, noting that it was not intended as a wage replacement originally.

“We will scrutinize the details and particularly the costs to ensure the government has conducted thorough analysis and is transparent about the full expenses,” he noted.

Meanwhile, Greens Leader Adam Bandt raised concerns about the delayed introduction of the super scheme by the Labor government.

“There is no justification for these delays,” he expressed.

“By ensuring big corporations pay their fair share of taxes, we can guarantee every individual can retire with dignity.

“This reform is not just overdue but should not face any further delays.”

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