Carina Garland (Chisholm, Australian Labor Party) Share this | Hansard source

The Paid Parental Leave Amendment (Adding Superannuation for a More Secure Retirement) Bill 2024 is a really significant piece of legislation before the House. It brings together really important and vital areas that Labor has always championed, which are universal superannuation, delivering paid parental leave and gender equality. I note, too, that this month marks the 30th anniversary of affirmative action being placed in the Labor Party rules. This legislation, like so much legislation, is an example of what happens when you have women at the decision-making table and when you think about the kinds of communities all of us here represent. This is good for families; it is good for children; it is good for the economy; and I am so proud to be part of a government advancing this.

It's really important, too, to reflect that many people have campaigned for a long time for superannuation to be paid on Commonwealth parental leave payments, to ensure that there are fairer retirement outcomes for women. That has been true since paid parental leave was legislated by a Labor government. That's a very long time of advocacy, and I want to pause and pay tribute to my friend—our friend, on this side of the House—the late Senator Linda White, who was passionate about this reform and fought tirelessly for this change. I am pleased that she was able to be part of a government that is now going to be delivering this significant and historic change, and I am really proud to have had the opportunity to work with her in the parliament and outside the parliament.

More than 180,000 women receive parental leave payments each year, making up 99.5 per cent of Commonwealth parental leave payment recipients, which means the inequity of the loss of superannuation has been felt almost entirely by women. From 1 July next year, the government will pay 12 per cent superannuation on top of Commonwealth paid parental leave to those taking Commonwealth paid parental leave. We also know that Commonwealth paid parental leave is much more likely to be accessed by those on lower than average incomes, which means there is an enormous benefit in paid superannuation to those families on lower incomes.

Analysis completed by the Association of Superannuation Funds of Australia shows that paying superannuation on paid parental leave, combined with the legislated increases to the super guarantee and the duration of paid parental leave to 26 weeks, will lead to an increase in superannuation balances at retirement of around $5,100. For a woman who received paid parental leave at age 28 for her first child and at age 30 for her second child—let's imagine that—the increase in her superannuation balance would be around $10,700. That is really significant, because we need to remember that superannuation leads to compound interest accumulating over time.

That's why I am very troubled to hear of the amendments put forward by those opposite which effectively ask women to steal from their own futures, to steal from their retirement and to lose that compound interest which is really key to the success of a superannuation system, and which, therefore, will do nothing to address the gender inequity that we see in superannuation balances between men and women. That is of course a really key consideration. An objective of this bill is to promote gender equality in superannuation. That cannot be realised if we entertain the awful suggestions from those opposite. I really would invite them to reflect on the robbery they are suggesting women commit from their own futures and on the gender inequity they'd entrench through their terrible suggestions.

We know that improving paid parental leave is critical reform. It's critical for families, critical for women and critical for the economy. Our government knows this well, and we know this well because that's what happens when you have 52 per cent of your party room comprising women. We know that paid parental leave is vital for the health and wellbeing of parents and their children. We know that investing in paid parental leave benefits everyone in our communities across our economy. We know that, if the settings are right, paid parental leave can advance gender equality.

Businesses, unions, researchers, experts and economists all understand that one of the best ways to boost productivity—which I think we all, in the chamber, agree we like to do—and participation in the workforce is to provide more choice and more support for families and more opportunity for women. Ever since we were elected and indeed before, when we were in opposition and throughout the last election campaign, those of us on this side of the House have been working hard to work to improve gender equality and to close the gender pay gap. Central to this have been the efforts put into improving paid parental leave for working families.

First, we made changes from 1 July 2023 to give more families access to the payment. We made it more flexible to support parents in the transition back to work and made it much easier for parents to share care by creating a single payment that both parents were able to access. Then, from 1 July this year, we delivered the largest expansion to paid parental leave since Labor established it in government in 2011. By expanding the scheme to a full six months by 2026, families will receive an important extra six weeks of paid leave following the birth or adoption of their child. And, importantly, while the government is supporting parents to take time off work after the birth or adoption of their child, we're also taking action here to ensure that this doesn't impact their retirement income. Through this bill, we are investing $1.1 billion over the forward estimates to pay superannuation on government paid parental leave from 2025. This is significant. This has been hard fought. This is going to make an extraordinary difference to many people's lives.

Taking time out of paid work to care for children is a normal part of working life for both parents. Paying super on government paid parental leave will help normalise parental leave as a workplace entitlement, just like annual and sick leave, and reduce the impact of parental leave on retirement incomes. The data is clear. When women take time out of the workforce to raise children, it impacts their retirement incomes, with women retiring on average with about 25 per cent less superannuation than men. Unfortunately, we know that one of the cohorts at greatest risk of homelessness and poverty are women who are over 65, who may not be able to access an adequate retirement income. This measure works to address that inequity and to take a really meaningful step to ensure that in the future women will not find themselves in that position.

Paying superannuation on government parental leave is an important investment, a vital investment, to help close the superannuation gap and make decisions, frankly, about balancing care and work easier for women—easier for families. For babies born or adopted from 1 July next year, all parents who receive paid parental leave will receive an additional 12 per cent paid directly to their superannuation fund. Importantly too, the contribution will be made annually by the Australian Taxation Office after the end of each financial year, and this will then include an additional interest component to address any forgone superannuation fund earnings—that compound interest I was talking about earlier—as a result of the payment not being made more regularly. Most parents won't need to do anything further to receive their superannuation payment, and the claim process for paid parental leave will not change.

On this side of the House, we know investing in paid parental leave is an investment in families. It's an investment in women's economic security, both now and in the future. Given the way superannuation works, it is about people's future security. It is also an investment in the broader economy. Our government's historic reforms cement paid parental leave as a Labor legacy, and I think they make really clear, again, the importance of the contribution of superannuation to the experience of people in this country, which has been something that only Labor was able to deliver. It was Labor that first introduced paid parental leave and superannuation. Labor always invests in a better future for Australian families. I'm really pleased to commend this bill to the House.

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