New Parents to Receive 12 Percent Superannuation as Senate Approves

The Labor government has passed legislation in the Senate that provides a 12 percent superannuation payment for new parents without accepting amendments proposed by the Opposition.

Under the new Bill, eligible parents with babies born or adopted on or after July 1, 2025, will receive an additional payment equal to 12 percent of their Paid Parental Leave payment, which will be contributed to their chosen superannuation fund.

“Once the scheme reaches 26 weeks, families will receive a maximum superannuation contribution per birth or adoption exceeding $3,000. This amount will then grow with interest over the working life of the individual’s superannuation account,” according to a government statement.

This payment will be made as a lump sum, including interest, at the end of each financial year in which Paid Parental Leave is received. The contribution will be automatically deposited into the superannuation accounts of eligible parents.

Starting in 2026, Australian parents will have access to a full six months of government-funded Paid Parental Leave, often supplemented by employer-funded programs.

Minister for Social Services Amanda Rishworth stated that including superannuation with Paid Parental Leave will improve retirement security for around 180,000 Australian families annually.

“We know women retire with 25 percent less superannuation than men—an estimated $51,700 less on average. By implementing these reforms, we are ensuring families can optimize their Paid Parental Leave benefits, have more choices and flexibility, and secure a more stable retirement,” said Rishworth.

“This reform highlights the importance of caring for babies and establishes parental leave as a standard workplace benefit.”

Minister for Women Katy Gallagher added that the reform will improve equity and financial security for Australian women.

“We recognize that women who take time off work to have children experience a decrease in their super balances, retiring with 25 percent less super than men,” commented Gallagher.

During a debate on Sept. 18, Liberal Senator Anne Ruston, Manager of Opposition Business in the Senate, proposed amendments to provide families with more flexibility in using their superannuation, offering two options.

The first option suggested an additional two weeks of government-funded leave, increasing the total from 26 to 28 weeks when the scheme is fully operational. The second option allowed families to receive the superannuation payment as a one-time lump sum.

“This flexibility recognizes the financial pressures of having a child,” Ruston said.

Labor Senator Tim Ayres, Assistant Minister for Trade, strongly opposed the amendments, calling them an “attack on the superannuation system by the opposition” and stating that they undermine the intended impact of the proposed changes.

The Bill, initially introduced in August, aimed to supplement paid parental leave with superannuation to address the retirement savings gap between genders.