The Albanese government has recently proposed a bill that aims to introduce superannuation entitlements for new parents on paid parental leave starting from July 2025. The main goal of this bill is to reduce the gender pay gap by allowing new mothers and fathers to receive 12 percent superannuation while on leave. Previously, parents did not receive superannuation during their leave, which contributed to the gender disparity in retirement savings.
However, the Coalition has presented an alternative approach to this issue. They suggest giving eligible parents a choice between three options. The first option is to receive super contributions during paid parental leave. The second option is to take an additional two weeks of leave without super, extending the total leave period to 26 weeks after July 1, 2025, and 28 weeks after July 1, 2026. The third option is to select a one-time payment equivalent to their super entitlement, estimated at $2,900 in 2025 and $3,140 in 2026.
Prime Minister Anthony Albanese expressed his disappointment in Parliament at the Coalition’s opposition to his proposed bill. He believed that the bill should have been easily supported by the opposition, considering the importance of superannuation in ensuring economic security. He argued that the Coalition’s options did not address the issue of superannuation and did not contribute to higher retirement incomes for working women.
In response, the Coalition defended their position, stating that superannuation is the individual’s money and they should have the freedom to use it as they see fit. They emphasized that Australians should have the choice to utilize their superannuation entitlements to support their lifestyles.
On the other hand, Minister for Social Services Amanda Rishworth supported the government’s bill, stating that it is a significant step toward reducing the gender gap in retirement savings and ensuring a dignified retirement for more Australians. She acknowledged that women make up the majority of primary caregivers in the country and highlighted the fact that women with children experience a significant drop in earnings within the first five years of parenthood. This drop in income over time leads to a substantial superannuation gap between men and women at retirement.
Rishworth emphasized that the data clearly shows that women retire with around 25 percent less super than men. Therefore, the proposed bill is seen as an investment in the future of working women, aiming to address the superannuation gap and provide better financial security for women who have children.
In conclusion, the proposed bill by the Albanese government to introduce superannuation entitlements for new parents on paid parental leave has sparked a debate between the government and the Coalition. While the government believes that providing superannuation during parental leave is crucial for reducing the gender pay gap and ensuring higher retirement incomes for working women, the Coalition argues that individuals should have the freedom to choose how to use their superannuation entitlements. The bill is seen as an important step toward addressing the gender disparity in retirement savings and supporting a dignified retirement for more Australians.
