Recent Legislative Changes to Superannuation on Parental Leave Pay

Introduction

In a significant move towards gender equality and financial security for parents, the Australian government has recently passed legislation to include superannuation payments on government-funded Paid Parental Leave (PPL). This change aims to address the superannuation gap that often affects women who take time off work to care for their children.

Key Changes

Starting from 1 July 2025, parents receiving government-funded PPL will also receive an additional 12% of their PPL payment as a contribution to their superannuation fund. This legislative change is part of a broader strategy to improve the financial standing of women and ensure a more secure retirement.

Impact on Superannuation

This measure is designed to help bridge the superannuation gap between men and women, which is partly due to women taking more time away from work for caregiving responsibilities.

Administration and Implementation

The Australian Taxation Office (ATO) will administer these superannuation payments. The payments will be calculated and added to the superannuation fund nominated by the parent receiving PPL. This change follows recommendations from the Women’s Economic Equality Taskforce and aligns with the government’s commitment to supporting working families.

Conclusion

These legislative changes represent a significant step forward in supporting parents, particularly women, in building their superannuation savings while on parental leave.

For more detailed information, you can refer to the official announcements and updates from the Australian Taxation Office and other relevant government sources or reach out to one of our team on 07 5494 9173.