Kylea Tink (North Sydney, Independent) Share this | Hansard source

When I had my three children between 2003 and 2007, government-provided paid parental leave did not yet exist. I was, however, lucky enough to work for an employer who, of their own volition, provided paid parental leave for a period of 12 weeks, which you could take at half pay if you wished. The kicker in the program, however, was that you only received the six weeks of salary whilst on leave, and you needed to return to work to receive the balance, with an underwriting that if you then left their employment in the next 12 months, you would be required to pay the parental leave back. The program was groundbreaking. As an American firm, they saw their investment in this scheme as something that was not only good for the individual, as it encouraged loyalty, but also ultimately good for their business, as it boosted retention and job satisfaction. It's not an overstatement to say people jostled to be employed by the company I worked for.

In this context, 24 years later, I'm really excited to be able to stand in this House today and welcome this bill, which ensures parents receive a superannuation contribution on top of their parental leave payments. This development comes on top of earlier measures to improve families' access to government paid parental leave, provide parents with more flexibility in how they take their leave and encourage families to share care. The legislation will see superannuation paid on government paid parental leave beginning 1 July next year. I wish it was sooner, but I understand why it is set at that date. Eligible parents with babies born or adopted on or after 1 July 2025 will receive an additional payment of 12 per cent of their parental leave payment as a contribution paid directly to their nominated superannuation fund.

As we know, this legislation is part of a package of reforms to Australia's Paid Parental Leave scheme delivered by this government. It follows legislation passed mid last year that changed the family income tests and made it easier for families to share care. It also follows legislation passed earlier this year that increased the number of weeks a birth parent would be eligible for paid leave under the scheme from 20 weeks to 22 weeks, further extending over time to 26 weeks in 2026 and including 'use it or lose it' provisions for the non-birth parent.

The package of reforms is long overdue, and I thank all of those who have tirelessly advocated for these improvements over many years. The changes that are now being made to our paid parental leave system are a result of significant, consistent advocacy from various individuals and organisations, many of which have been calling for these changes since the introduction of the Paid Parental Leave scheme in 2011. I am so grateful that this government has listened, at least partially, to the voices of women and families, to the women's movement, to the health, aged-care and community services sectors, and to unions, economists, businesses and employers.

Including superannuation on top of maternity leave was a key recommendation of the Women's Economic Equality Taskforce, and it is a necessary step towards closing the gender super gap. Parental leave is the only form of leave that doesn't attract a super guarantee, leaving many rightly questioning why it has taken so long to rectify this perverse situation. In fact, when I surveyed my community of North Sydney for their views on parental leave reform, 100 per cent of the people who responded indicated they would like to see superannuation payments added onto paid parental leave payments. For most people, this reform seemed obvious.

The reality is that parental leave policy settings have a significant and wideranging impact on families, children, women, the economy and, ultimately, our society as a whole. Right now Australian women retire with, on average, 47 per cent less super than men. A major contributing factor to that inequity is the lack of super on parental leave. This is then exacerbated by other factors, including the current Australian gender pay gap of 19 per cent on average, the fact that mothers usually return to work part time after having children, an inequitable labour market and household care dynamics.

For a primary carer, usually a woman, the accumulation of superannuation savings is interrupted while on paid parental leave, and the leave itself is commonly extended by several months of unpaid leave. The effect is compounded over years, resulting in a large gender disparity in retirement balances, and is exacerbated on return to work, with women commonly rejoining the workforce on a part-time basis after their parental leave period has ended. The inequity that occurs during parental leave follows the primary carer throughout their career and into their retirement, creating significant inequalities in retirement incomes.

Beyond boosting super balances, paying super on government funded paid parental leave will help normalise parental leave as a workplace entitlement, reinforcing the understanding that paid parental leave is not a welfare payment but rather a workplace entitlement just like annual leave or sick leave. Additionally, it will address one of the financial barriers that discourages men from taking on their share of parental leave, encouraging families to more evenly distribute caring responsibilities.

The bill before us will ensure the super contribution paid on top of the government parental leave will match the superannuation guarantee rate as of 1 July of the financial year the leave is taken and will rise with any future increases to the legislated superannuation guarantee. The contribution will be made annually by the ATO at the end of each financial year and will include an additional interest component to address any forgone superannuation fund earnings as a result of the payment not being made more regularly. This is a really sensible and welcome approach.

Improving and driving gender equality is vital to both the wellbeing of our society and the success of our economy. As the Grattan Institute has noted, greater sharing of childcare is one of the best ways to improve women's economic security. From being caregivers, nurturers and educators to taking on professional roles in community leadership, women's essential contributions are often undervalued and unpaid, perpetuating economic inequality. Those outdated systems, policies and norms discount women from active participation in our society and our workforce. Indeed, the estimated value to the Australian economy that could be realised by purposefully removing the persistent barriers to women's full and equal participation in the economy is a staggering $128 billion.

The Women's Economic Equality Taskforce reported Australian women still face deep gender inequality and continue to shoulder a disproportionate burden of unpaid labour across all spheres of life. We can and must do better. I'm hugely supportive of an improved Paid Parental Leave scheme in Australia and I welcome these reforms, but I also firmly believe we can aim even higher. With so much evidence accumulating around the world to the benefits of adopting progressive policies to support shared care and gender balance in society, it's truly astounding that we're only just now debating legislative reform to parental leave that has been operating in some countries for multiple decades. Certainly, this bill is a vast improvement to Australia's Paid Parental Leave system, but let us not forget: Australia is actually far behind global best practice.

When Australia's parental leave scheme was first introduced in 2011, it was not—as described then by the minister for families—historic reform or a major win for working families when you compared it to the schemes available in other jurisdictions. On average, families in the OECD are typically entitled to more than 50 weeks of paid leave—that's 2½ times more than what we offer in Australia. In Finland new parents each have access to seven months paid leave, and policies such as these have been directly linked with better development outcomes for children, and support a more balanced division of labour between a two-parent family. Ultimately, I believe our goal as a society should be to provide families with the full support they need to enable them to choose who they want the primary carer to be, and when, without a gender bias lens being brought to the discussion.

While the addition of superannuation to the government's paid parental leave is an improvement, there is still far more that can be done to improve not only our parental leave system but also the other systems that play a pivotal role in shaping gender outcomes in this country and that support working parents, including the superannuation system more broadly and the early childhood education and care sector—specifically, providing universal access to early childhood education and care, and pursuing other measures to ensure a robust super system, including reforming the low-income super tax effect. Australia can and should go further in adopting international best practice not only in the payment of superannuation on paid parental leave but also in ensuring 26 weeks is the minimum leave entitlement for any family, phasing the scheme up to an eventual 52 weeks of paid leave while maintaining the principles of shared care and flexible arrangements, and furthering the 'use it or lose it' provisions to encourage greater shared care.

ABS data from 2021- 22 showed 24.7 per cent of respondents cited caring for children as the main reason they were not available for work, with women of all ages spending nine hours more per week on average on unpaid care work than men. While 26 weeks of paid parental leave covers the child's first six months of life, there are indisputable benefits in introducing 52 weeks of paid parental leave, spread across two parents. An increase from 20 to 26 weeks of paid parental leave alone boosts GDP by $900 million a year thanks to the increased workforce participation by mothers, while also boosting the average mother's lifetime earnings by $30,000.

We have an opportunity to increase these economic and social benefits even further by committing to expanding the Paid Parental Leave program to 52 weeks. When I surveyed my electorate of North Sydney, 75 per cent of respondents indicated to me that they felt the time they had off for paid parental leave was too short. We must also consider access to early childhood education and care, which, along with paid parental leave, is the other key policy to support employed parents with young children. Indeed, in many countries, these policies are coordinated in the sense that an entitlement to leave leads immediately into or coincides with an entitlement to early childhood education and care. Early childhood education and care is a vital input for our entire economy, which cannot function to its potential unless parents are able to work. Along with paid parental leave improvements, we need to ensure families have access to quality and affordable care to allow those that either wish or need to return to work to do so.

It's clear that families in my community face hardship when it comes to child care and returning to work. As one person said to me:

I've been on a waiting list since my son was 4 months old for daycare. We've decided to use a nanny, family and have split days off. My son is nearly 1 and it's been financially challenging, especially trying to buy a house in Sydney.

From my conversations with childcare operators, workers and parents, it's clear more federal government leadership, coordination and support are needed. Childcare centres are struggling with skills shortages while existing workers are overwhelmed and underpaid. Meanwhile, families cannot find space and affordability is a massive issue, with some facing fees of up to $200 a day.

Finally, alongside these changes to ensure superannuation is paid on parental leave, we must pursue other measures to achieve equality in super. The low income super tax offset should be changed to reflect current tax and super settings so lower paid workers don't pay more tax on their super contributions than their wages. The tax offset gives eligible taxpayers of annual incomes of $37,000 or less a refund capped at $500 into their superannuation account to help them save for retirement. Low-paid workers, who are predominantly women, are ultimately paying more tax on their super than they would pay on their take-home pay, and this is ridiculous.

We must also look for ways to reduce the impact of unpaid care on super balances. The Women's Economic Equality Taskforce report found women spend over 30 hours per week on unpaid care and housework, while men do 22 hours. It's work that props up the economy, but it's not valued or well understood and it certainly doesn't attract super. Proposals such as carer credit to compensate parents for super lost due to unpaid parental leave should be seriously considered by our government and our nation, particularly as the need for care is growing and we know it's performed, unpaid, by women.

In closing, this legislation is deserving of celebration. It is a modest step, but it is absolutely a step in the right direction. I truly thank this government for taking it. I'm not convinced that a government of another colour would have done so. However, in celebrating this progress, I urge us all not to lose sight of how much more work there is to do and there is to be done to elevate Australia's parental leave scheme and early childhood education and care schemes to ones that will truly allow women equal economic opportunities. This is instrumental in closing the gender pay gap, and it will mean all Australians, no matter their gender or financial situation, will be able to have families. Better parental leave and childcare policies not only could dramatically improve women's participation in the workforce but will also, importantly, shift our society forward. In that context, I encourage this government to see this development as a stepping stone on the road to a system that will rival even our Nordic counterparts. That's the kind of ambition we need to bring to Australian politics.

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