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Timing everything on super paid on PPL

Mike Taylor14 May 2024
Hand holding currency

The superannuation sector has emerged as a Budget beneficiary with the Federal Treasurer, Jim Chalmers, confirming that $1.1 billion to pay superannuation on the Government-funded Paid Parental Leave scheme.

However, the initiative will only apply to parents of babies born after 1 July, next year and superannuation funds will be required to pick up much of the administrative burden.

Chalmers had signalled the Government’s intentions over the weekend and the Budget documents said the Government was “recognising the important contribution parents make to society by paying superannuation on Government-funded Paid Parental Leave (PPL) for parents of babies born or adopted on or after 1 July 2025”.

“The Government will provide $1.1 billion over the forward estimates, with payments being made annually to individuals’ super funds from 1 July 2026” the Budget documents said.

It said this will reduce the impact of career breaks to care for young children on superannuation balances and support parents to achieve a more dignified retirement.

“This initiative builds on the Government’s $1.2 billion investment from 2022–23 to 2026–27 to enhance the PPL scheme which will expand by two weeks each year from 1 July 2024 to reach a total of 26 weeks by 1 July 2026” it said.

Mike Taylor

Mike Taylor

Managing Editor/Publisher, Financial Newswire

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