Welcome boost to women’s retirement balances after passage of new laws

Aware Super welcomes the passage of new laws which will see superannuation guarantee contributions paid under the Commonwealth Government’s Paid Parental Leave (PPL) scheme.

The reform means those on parental leave will receive an additional 12 per cent in superannuation on top of their leave payments from 1 July 2025.

Aware Super Chief Executive Officer and Workplace Gender Equality Agency pay equity ambassador Deanne Stewart said it was a momentous step in improving retirement outcomes for women.

“It is great news that superannuation on the government’s paid parental leave has now been approved by the Commonwealth Parliament,” Ms Stewart said.

“It will also make a material contribution to closing the gender retirement gap, which today sees women retiring with around 25 per cent less super than men.”

“Women still shoulder a disproportionate share of caring responsibilities in families and often take time out of the workforce to do so. This is one of the key reasons the gender retirement gap is so much bigger than the gender pay gap.”

Modelling by Aware Super suggests that a woman on a low income with two children, accessing 26 weeks of Commonwealth Paid Parental Leave, would be $10,700 better off at retirement as a result of the additional payments. Due to the compounding of investment returns, the benefit to each individual would be more than twice the cost of making the payment.

Aware Super has been a leader on equity in superannuation, paying our staff super on both paid and unpaid parental leave. Only 13 per cent of employers currently pay superannuation on unpaid parental leave, while 86 per cent with a PPL scheme pay super on leave payments.

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