Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

I rise in support of the Paid Parental Leave Amendment (Adding Superannuation for a More Secure Retirement) Bill 2024. I'm proud to support these important reforms, which are essential to the economy, essential for families and essential for gender equality. You can always trust a Labor government to make the large-scale reforms that change Australian lives for the better, and this amendment to paid parental leave follows in that tradition. It builds on the Gillard government's introduction of paid parental leave way back in 2011. Who can imagine being in the parliament way back then, in 2011! I spoke in this place at the time about how proud I was of the introduction of 18 weeks of government funded pay and how valuable it was to everyday Australians. For many parents, it was the first time they could access any paid parental leave.

The 2009 Productivity Commission inquiry had laid the groundwork for paid parental leave initiatives and highlighted its numerous benefits. One of the key benefits was the improved wellbeing of families. In particular, there was a focus on the benefits for both child and maternal health that were associated with an extended period of absence from work around the birth of the baby and, crucially, secure financial support during this period. Other benefits include women maintaining their participation in the workforce and the expression of community values. This included the belief that having a child and taking time out for family reasons are part of the usual course of work and life for many people in the paid workforce, including fathers.

These points may all seem very obvious in 2024, but 13 years ago this was momentous legislation. As the Minister for Social Services said, paid parental leave is a proud Labor legacy, and we will always work to strengthen it. Consequently, it has been one of the priorities of the Albanese Labor government to modernise the Paid Parental Leave scheme. That's why, from 1 July last year, we enabled more families to access the payment due to a more generous family income test. It's also why we have made it easier for parents to share care and increased the flexibility of the scheme to help with parents' transition back to work. That is some low-hanging fruit when it comes to productivity gains.

Most recently, the Labor government extended the length of the Paid Parental Leave scheme. From 1 July this year, we increased it by two weeks, expanding the scheme from 20 weeks to 22, and the scheme will increase by two weeks each year until it reaches 26 weeks of paid parental leave in 2026. This bill is a continuation of these significant reforms. It has acknowledged that women undertake the majority of unpaid care in Australia, whether that's looking after children, aging parents or other family members for various reasons. I certainly would like to commend my wife for doing that while I've been running around in Canberra. She had two young children, also got a law degree and changed careers at the same time—an amazing woman.

Time spent away from the workforce during this crucial work unfairly affects women financially, and that is understating the effect. The Women's Budget Statement from May described:

Spending more time on unpaid care than their male counterparts impacts women's lifelong economic security by limiting their labour force participation, career progression, and leadership opportunities.

The Albanese Labor government not only recognises the long-term economic consequences of the disproportionate share of unpaid care work that women primarily do; with this bill, we are doing something positive about it. The Women's Budget Statement drew on Working for women: a strategy for gender equality, when it stated:

To achieve an Australia where people are safe, treated with respect, have choices and have access to resources and equal outcomes no matter their gender, women and gender equality must be at the centre of Australia's economic plan.

That is what this bill does.

The Albanese Labor government is investing $1.1 billion over the forward estimates to pay superannuation on government paid parental leave from 25 July. This will directly address the current inequitable situation where women with children experience an average 55 per cent drop in income in their first five years of parenthood. This compounds over time with more children to the point that women retire with around 25 per cent less in their superannuation than men—yes, 25 per cent. This bill means that all eligible parents will receive an additional 12 per cent of their paid parental leave directly into their super fund from 1 July next year, and it will continue to match the superannuation guarantee rate. The ATO will make the contribution annually after the end of each financial year. The payment will include an additional interest component to address any issues resulting from the payment not being made more frequently. We anticipate that around 180,000 families will benefit from these changes, and, once the Paid Parental Leave scheme reaches its full 26 weeks in 2026, a family will receive a superannuation contribution of around $3,000.

Beyond the financial benefits, I think it's important to note that paying super on paid parental leave will go a long way to normalising paid parental leave. This means making it a standard in every workplace, like annual leave or personal leave. It also signifies that care work is highly valued, a much-needed cultural shift, and enables it to be shared between parents. Businesses, unions, experts and economists acknowledge that a key factor in boosting productivity and participation is to provide more support and choice for families, which results in more opportunities for women. The benefits for business include the retention of trained and valued staff, the reduction of recruitment costs and the enhancement of staff morale and productivity. This bill also contains some technical amendments. It ensures that the paid parental leave framework in the Fair Work Act is in sync with the Paid Parental Leave scheme.

This reform is in the tradition of the life-changing economic and social initiatives of former Labor governments. I'm talking about the governments who gave the nation Medicare, the Pharmaceutical Benefits Scheme and the National Disability Insurance Scheme—all devoted to helping the collective. Reforms in both unpaid and paid care are a key focus of Working for women: a strategy for gender equality. The Women's Economic Equality Taskforce stated:

Despite women's work, both paid and unpaid, acting as the backbone of our economy during the COVID-19 pandemic, today women's work is still undervalued.

Superannuation on paid parental leave is an important way of addressing this issue and narrowing the gap in the use of and access to paid parental leave. It is a key outcome. Paid parental leave supports parents when they're caring for newborn children and helps families balance their caring responsibilities with work, and now it will support them when they retire.

The Albanese Labor government's tranche of reforms is the largest expansion to paid parental leave since it was established by the Gillard government. I commend the bill to the House.

Zoe Daniel (Goldstein, Independent) Share this | Link to this | Hansard source

More than 11,000 women in Goldstein have received Commonwealth parental leave pay since the scheme began, in 2011, and they've lost out as a result of superannuation not being paid on the scheme. A fair paid parental leave system has the potential to be a game changer for families, the economy and women's economic security in this country.

It's a bold statement, but not many policy levers have the power to bring about the sort of cultural change that's needed to elevate Australia's recent poor record on gender equality. Women don't start out behind. Australian women are among the most highly educated in the world and have similar levels of labour force participation to men, until they have children. This triggers a pattern of unequal care and work during prime working years for both parents, with the responsibility of care falling more heavily on women. This results in women's participation in the workforce sitting well below that of men.

When mothers take time out of the workforce to care for their children, they not only struggle to maintain a meaningful connection to work but also can go years without receiving any super. Unpaid care, part-time and casual employment, and the gender pay gap—these are the drivers of the gender super gap. Leading up to retirement, the median superannuation balance for women is a third less that of men. That translates to around $50,000 less. The super gap becomes evident around the age of 30, when women take time out of work and reduce their hours to have and care for children. The gap continues to increase until women are in their early 50s, when it's common to care for ageing family members. Women at this stage in their life are often caring for their own children and their parents, a life stage referred to as the sandwich generation.

Progress in closing the gender super gap has been slow. Australian Taxation Office statistics show that, over the eight years to 2021-22, the gap in average balances for those aged 18 to 59 has only narrowed by five percentage points, from 28 per cent to 23 per cent across all ages. However, for women in their 30s, the gap has failed to narrow, remaining around a stubborn 20 per cent. Paying super on paid parental leave is one way to reduce the super gap and reduce the impact of parental leave on retirement incomes.

The Paid Parental Leave Amendment (Adding Superannuation for a More Secure Retirement) Bill 2024 is another step towards a fairer system, and I commend the government for building on the changes to paid parental leave that came into effect last year, including expanding the payment to six months by 2026. Eligible parents with babies born or adopted from July next year will receive an extra 12 per cent of their government funded paid parental leave as an annual lump sum payment to their super fund. This will benefit about 180,000 families annually. Super Members Council analysis shows that paying super on the government scheme could boost a mother of two's retirement savings by about $14½ thousand.

Paying super on PPL was one of the recommendations of the Women's Economic Equality Taskforce. Central to this recommendation is a recognition of the value of care work and the need to better share caring responsibilities. While the number of men taking primary carer parental leave increased by 0.6 per cent in 2022-23, women still make up 86 per cent of employees taking the carer leave option, according to the HILDA Survey of Australian households. The use of parental leave by fathers in Australia is very low by global standards. Because caring patterns are established in the first year of a child's life, that entrenches stereotypical gender roles. We should be encouraging men to take up parental leave to normalise flexible work and shared care responsibilities and to strengthen women's workforce participation and financial security. But it's not only good for women; it's healthy for men. When fathers take parental leave, fathers, their children and their partners all benefit from stronger relationships. This is why I've strongly pushed for super on paid parental leave in this place and in my many conversations with families in Goldstein.

As I've said before, it's time we stop punishing women for the burden of unpaid care work that they carry. Taking time out of the paid workforce to care for a child should be part of the usual course of life and work for both parents. The evidence is clear: accessible and well-funded paid parental leave is crucial if we want people to stay connected to the workforce. It's also vital to support the health and wellbeing of women, men and children and to improve wider gender equality outcomes.

I commend the government for adding super to paid parental leave, but there are also other things the government can do to reduce the super gap. The low income superannuation tax offset, or LISTO, is not indexed. It has not kept pace with increases in the super guarantee rate and current tax brackets. The current cap means workers earning up to $45,000 are paying more tax on their super than they should be. Low-income women would be the biggest beneficiaries of updating the LISTO. Another policy area of potential benefit to women is adjusting the rules around catch-up contributions to allow women to put more money into super as they're approaching retirement.

The Goldstein community elected me on a platform of gender equality, and at every opportunity I'll continue to work with the government to improve women's economic security. Adding super to paid parental leave goes some way to achieving that. Consider the more than 11,000 women living in Goldstein who've received Commonwealth parental leave pay since the scheme began in 2011. They've missed out on a combined $13.1 million in superannuation. About 850 women in Goldstein per year are set to benefit from the government's commitment to pay super on parental leave each year. It's long overdue, and I commend this bill to the House.

Joanne Ryan (Lalor, Australian Labor Party) Share this | Link to this | Hansard source

The Paid Parental Leave Amendment (Adding Superannuation for a More Secure Retirement) Bill 2024 is an important and absolutely critical piece of legislation from this government. It will add superannuation for a more secure retirement. That of course is the name of the bill. This is an important thing, in particular for women across the country. We all know that women finish work with less in their superannuation. In fact, they often have half of what the male population finish work with. Some of that is due to the child-bearing years, and some of that is due to the time they spend out of work because they're caring for children.

This superannuation added to PPL will make an enormous difference to the end outcomes for women. Of course we have the compounding interest impact of those superannuation savings over the course of decades. That will make a difference in terms of what's happening to women's superannuation when they're in their 20s and their 30s, all adding to a finish. If I take my superannuation, for instance, I'm sure that, in real terms, my superannuation lump sum is going to be very different from that of some of the men sitting in this chamber now, because I was a teacher, I'm a mother of three and I took six years out of employment in my child-bearing years to have my family. So my superannuation has already been impacted by that because, of course, there was no paid parental leave superannuation when I was having my family. So this is a critical piece of legislation, and it needs to be passed in this chamber. We need to ensure that it comes into law so that women can have the surety that their superannuation on retirement will come near matching that of their partners, their brothers and their fathers.

It is a hallmark of this government that we take seriously women's participation in the workforce and women's financial security, not in terms of welfare for women but in terms of women's earning capacity and their legitimate right to the same outcomes as the male population. It is not an accident that a 15 per cent pay rise for the feminised workforces in aged care and in early childhood education is coming from this government, because it's a government with a majority of women—women who are driving policy to improve the lives of women. That includes the financial lives of women, ensuring that they have a similar retirement capacity to men. It is critical that this bill be passed through this House uncontested. I would suggest that anyone who stands in the way of this bill—

Milton Dick (Speaker) Share this | Link to this | Hansard source

Order! In accordance with the resolution of the House, a scheduled test of the House of Representatives emergency procedures is going to be undertaken. The member will have leave to continue speaking when the debate is resumed. I ask that sound and vision broadcasting now cease.

Sitting suspended from 19:30 to 19:57

Members, in accordance with the resolution of the House, the sitting is resumed. Sound and vision broadcasting has resumed. The lockdown exercise has concluded. Lockdown infrastructure has been lifted and returned to its normal operating state. Thank you for your participation in the exercise. All emergency advice from this point forward must be treated as a real emergency and should be acted upon immediately and accordingly. The House stands adjourned until 9 am tomorrow in accordance with the resolution agreed to earlier today.

House adjourned at 19 : 57