Labor passes laws to give families government-paid super on parental leave

Women who give birth to or adopt babies after July 1 next year will be eligible for an increased cash boost aimed at lowering the “motherhood tax”.

Women who adopt or give birth to babies after 1 July of next year will receive a weekly $113 boost to their superannuation, after Labor passed its Paid Parental Leave Bill on Thursday.

The $1.1bn plan aimed at combating the “motherhood tax” is expected to help about 180,000 families each year.

Currently women can access 22 weeks of government-boosted super, but this will increase to 24 weeks by the start of the next fiscal year, and finally to 26 weeks by 2026, totalling to a maximum top up of about $3000.

The payments will be made in a lump sum through the Australian Tax Office (ATO) into a nominated superannuation account at the end of the financial year, and will also include an interest component that’s consistent with other superannuation payments.

Social Services Minister Amanda Rishworth said the payment boost would “directly reduce the impact of parental leave on retirement incomes.”

Social Services Minister Amanda Rishworth said the payment would help reduce the gender pay gap. Picture: NewsWire / Martin Ollman

“By investing in these reforms, we are ensuring families can get the most of Paid Parental Leave, exercise more choice and flexibility and have a more secure retirement,” she said.

“This reform signals that caring for babies is valued and helps to normalise parental leave as a workplace entitlement.”

Minister for Women Katy Gallagher said the legislation would help balance the super outcomes for women, who typically retire with 25 per cent less super than their male counterparts.

“This move not only strengthens Labor’s legacy of compulsory super but ensures greater fairness and financial security for Australian women,” she said.

“This is an important statement about the value that we place on parents taking time out of the paid workforce to care for the next generations — because you shouldn’t have to sacrifice your future financial security to care for your babies.”

More to come

Originally published as Labor passes laws to give families government-paid super on parental leave