Will waiting to have a baby after 1 July 2025 be worth it? For those taxpayers who are intending on having a family.….it may well be.
The latest announcement from the Labor government this week involved proposed changes to the Paid Parental Leave scheme. Under the current arrangement, parents who adopt or give birth (and fulfil other eligibility criteria) to a child, receive up to 20 weeks paid leave. This leave can be shared between both parents.
After this week’s announcement, not only will new parents be eligible to paid leave, they’ll also be entitled to have super paid on this paid leave. In a landmark proposal, set to cost the government an estimated $250 million a year, women will receive (if passed) 12% super (paid to a nominated superfund) in addition to up to 20 weeks paid parental leave.
It’s been estimated up to 180,000 families each year currently receive paid parental leave. The data is clear – that when women take time out of the workforce to raise children it impacts their retirement incomes with women retiring, on average, with about 25% less super than men.
This new initiative is being touted as a way to narrow the gender super gap, however at an estimated $106 per week for up to 20 weeks, it still has a way to go before the gap would be narrowed. However…..it’s a start.
Author
Kim Jay
