Kate Chaney (Curtin, Independent) Share this | Hansard source

I rise to provide my support for the Paid Parental Leave Amendment (Adding Superannuation for a More Secure Retirement) Bill 2024. Parental leave is not a holiday; parental leave is not sipping cocktails on a beach. It is also not some form of long-term illness. But when people take leave because they're sick or they're having a holiday, they don't return to the office with a lower superannuation balance than their colleagues. It's so important that we pay superannuation on paid parental leave so that we're not disadvantaging parents in their retirement.

Many members of this House are lucky to have experienced parenthood and the challenges of their child's first year firsthand. Whilst new fathers are increasingly taking parental leave, it remains the case that women are still the primary caregivers in Australia more often, taking time out from their careers to do so. My personal experience lines up with this. I had a rewarding job before having kids. I took time off after having each of my three children. Even with a supportive husband, who is also a committed father, I subsequently returned to work part time instead of full time and sought out and accepted different types of jobs based on the need to balance my work responsibilities with the time I needed and wanted to spend with my kids. I worked part time for 17 years while my kids were young, and I fully understand the impact that caring for kids has on earning capacity and superannuation.

Economists refer to the motherhood penalty, which is how much of their previous earnings levels the average mother gives up after having children. In Australia it's huge at about 55 per cent, which is much larger than in most OECD countries. The average loss on earnings lasts for at least 10 years. While I made my choices freely, this data rings true in my own experience. I was very aware of this motherhood penalty in my own earnings and life journey. We've seen statistics showing that women aged 60 to 65 retire with 25 per cent less superannuation than men of the same age. Much of this is attributed to the caring responsibilities women take on.

While this bill will not completely fix this issue, it does start to rectify this gap. This bill will benefit about 180,000 families annually by providing an extra 12 per cent of their government funded paid parental leave as an annual lump sum payment of up to $3,000 to their super fund. The Parenthood has done financial analysis that shows that the compound interest on this contribution to superannuation could be as much as $30,000 extra in retirement savings per family per child.

I'm supporting this bill because it goes some of the way to mitigating the motherhood penalty. Families in the current cost-of-living crisis are having to make difficult decisions every day about how they spend their money, whether to take on a mortgage, which parent returns to work and how much parental leave they can afford to take. Paying super on paid parental leave gives parents better financial security in the longer term, something that's not top of mind at the time but makes a big difference over a working life.

Industries with a higher proportion of women in their workforce are particularly supportive of this bill. For example, it will greatly benefit nurses, midwives and assistants in nursing, who suffer inequity through loss of super while taking time out of the workforce to have children. An industry representative points out that women make up 89 per cent of the Australian nursing and midwifery workforce who, on average, retire with up to 40 per cent less super than men. That must change if working women are to have any chance of reaching a secure retirement with a comfortable standard of living.

It has been suggested that this superannuation entitlement be restructured to give women the choice of a cash payment or additional leave instead of a super entitlement. While a cash payment or more leave would, no doubt, always be welcome, I wouldn't support such an amendment because the purpose here is to remove the disadvantages for women as they approach retirement. It would be too tempting to take the additional payout without a thought for the long term. If the intention of those amendments that I have heard proposed is to increase support for women, or indeed parents generally, I'm very happy to consider additional supports, but they should be as well as the super entitlement, not instead of it.

I'm also supporting this bill in its current form because recognising the loss of superannuation during time taken off to look after children normalises paid parental leave as a workplace entitlement, the same as sick leave or annual leave. So, while there is more to do to address the motherhood penalty, I welcome this step to normalise paid parental leave and start to close the gap for women when they get to retirement age. I commend this bill to the House.

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