Financy welcomes the economic-equality significant announcement that the Albanese Labor Government will pay super on government paid parental leave from 2025 but questions why wait to an election year.
“For the past seven years we have pushed for superannuation payments to be part of government paid parental leave by highlighting in the quarterly Financy Women’s Index (FWX) report that based on current trends women face nearly a two decade wait for gender equality in retirement,” said Financy founder Bianca Hartge-Hazelman.
“News that the government has listened to so many gender equality advocates and the Women’s Economic Security Taskforce is fantastic and once it takes effect will dramatically improve women’s financial security for younger generations.
As it stands women face a 25% gender gap in median lifetime super balances and a 17.7 year wait for gender equality to be achieved in retirement savings, the Financy Women’s Index shows.
“Our only concern is the wait to 2025 which takes us to an election year, and we already know that past Liberal Governments have not supported the move to pay super on government-funded paid parental leave, and that this Labor Government has already benched the proposal once before,” said Hartge-Hazelman.
From 1 July 2025, the Government will pay 12 per cent superannuation on top of Commonwealth Paid Parental Leave to those taking Commonwealth Paid Parental Leave.
This is expected to directly benefit more than 180,000 women who receive parental leave payments a year, making up 99.5% of Commonwealth Paid Parental Leave payment recipients.
“These women will have more money in retirement and will have more financial control over their futures. Too often do we hear of women over 60 years who are homeless because they have no retirement savings,” said Hartge-Hazelman.
The announcement comes just a day after the release of the latest scorecard on gender financial equality, the Financy Women’s Index (FWX) showed a 17.7 year wait for gender parity in the superannuation balances of women and men.
The Index also showed that progress to economic equality in Australia went backwards. The FWX fell 1 point (pt) to 75.5 pts out of 100 over the 2023 calendar year, with the December quarter (-2pts) firmly putting the brakes on progress.
The results were largely affected by a deterioration in the gender gaps in the Underemployment Rate (-1.56 pts) and Unpaid Work (-2.19 pts) which offset improvement in the Gender Pay Gap (+1.29 pts).
Financy covers gender finance, diversity, inclusion and ESG issues. We advocate for gender equity change through the Women’s Index report and help businesses take action on DEI through tech solutions like IMPACTER.
