Aussie mums miss out on more than $1.6b in retirement
Australian mothers have missed out on more than $1.6 billion in retirement savings as their super is not paid by the government during parental leave, according to Industry Super Australia (ISA).
In the 2019-20 financial year 170,860 women might have missed out on $216.7 million in their super payments.
Currently parental leave was one of the only forms of paid leave that there is no requirement to pay super and the government did not pay the super guarantee on its scheme.
However, according to ISA’ “Workplace Gender Equality Agency” report, paying super on parental leave could help address the gender savings gap.
The report called on:
- The Federal Government to set an example and pay super on Commonwealth Paid Parental Leave;
- State and territory Governments to pay all its staff super on paid parental leave; and
- More private companies to pay super on their parental leave scheme.
The report found that less than 7% of enterprise agreements included a provision top pay superannuation on paid parental leave.
The study also found that it was women who overwhelmingly were missing out as 99.5% of the Commonwealth Parental Leave Pay applications were women.
According to ISA’s analysis, a mother of two who received super on Commonwealth Parental Leave Paid from their employer would have $26,500 more super at retirement.
“Unless the Federal Government acts, millions of women will continue to pay a price for taking time out of the paid workforce to raise a family, missing out on super and ending up with thousands less at retirement,” ISA’s advocacy director, Georgia Brumby, said.
“This is an opportunity for the Prime Minister and governments of all levels to lead the way and ensure super is paid on parental leave. Otherwise, we’ll continue to see too many women to retire into poverty.”
Source: ISA
AUTHOR
Oksana Patron
Recommended for you
Unveiling its performance for the calendar year 2024, AMP has noted a “careful” investment in bitcoin futures proved beneficial for its superannuation members.
SuperRatings has shared the median estimated return for balanced superannuation funds for the calendar year 2024, finding the year achieved “strong and consistent positive” returns.
The second tranche of DBFO reforms has received strong support from superannuation funds and insurers, with a new class of advisers aimed to support Australians with their retirement planning.
The financial services technology firm has officially launched its digital advice and education solution for superannuation funds and other industry players.
