In this guide
Super to be paid on parental leave
The Federal Government announced in early March that it would pay superannuation on Paid Parental Leave (PPL) from 1 July 2025.
“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,” minister for women Senator Katy Gallagher said.
“Paying super on Government parental leave is an important investment to help close the super gap and make decisions about balancing care and work easier for women,” minister Gallagher said.
“In the long term, this important change means a more dignified and secure retirement for more Australian women,” treasurer Jim Chalmers added.
Labor is also looking to extend the current PPL to 22 weeks from 1 July his year and if its expansion to PPL is passed, families will also be able to access 24 weeks leave from July 2025 and 26 weeks from July 2026.
No new taxes to fund aged care but the wealthy should pay more
The final report of the government-appointed Aged Care Taskforce has not recommended a new tax or levy to pay for aged care but has suggested that wealthier Australians could contribute more to the cost of aged care.
“Increasingly people still have accumulated wealth and income streams when they need to access aged care services,” the report said.
“As a result, there is more scope for older people to contribute to their aged care costs by using their accumulated wealth than in previous generations.”
The report’s third recommendation outlined that it was appropriate older people make a fair co-contribution to the cost of their aged care based on their means.
The Association of Superannuation Funds of Australia (ASFA) chief executive officer Mary Delahunty was pleased the taskforce had ruled out “ringfencing” part of super for aged care.
“The Taskforce also has proposed that refundable accommodation deposits (RADs) be phased out. This will lead to retirees having greater confidence to draw down their superannuation in retirement,” Delahunty said.
“However, even with a maturing superannuation system, many individuals will have only modest superannuation balances when they are in their 80s and 90s. The Superannuation Guarantee going to 12% and there being no further widespread early release of superannuation, such as for housing deposits, will be crucial for future retirees to meet their living expenses, including for aged care when appropriate,” Delahunty added.
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