Treasury Laws Amendment (Payday Superannuation) Bill 2025, Superannuation Guarantee Charge Amendment Bill 2025

Ms JARRETT (Brisbane) (18:10): I too rise in support of the Treasury Laws Amendment (Payday Superannuation) Bill 2025. Superannuation is another proud Labor legacy, and this bill further strengthens this legacy, our great superannuation system. It will make it stronger, it will make it fairer and it will make it more sustainable.

That's because this is a Labor government, and we are sure to help workers earn more, keep more of what they earn and retire with more. The history of superannuation really is Labor. It's about care, it's about equality and it's about fairness—those values that are at the heart of this government.

There was a time in Australia when there was no such thing as super. Many people just totally relied on the government pension. My grandparents were examples, and I'm sure there are many others whose grandparents needed the same sort of support just to put food on the table and to pay their bills.

This was despite working their entire lives. It was a Labor government that introduced the system of compulsory superannuation in 1992, under former prime minister Paul Keating. It was a system to deliver dignified retirement, and the unions and Labor were instrumental in getting this over the line.

They campaigned hard to secure compulsory superannuation and then later to increase the superannuation guarantee. Having a dignified retirement is really about ensuring that Australians have enough retirement income and financial security to live the lives they want to live. After giving so much, older Australians don't deserve to be worrying about whether they can buy their medicines, pay their bills or even buy their grandchild a small present for a birthday.

Labor introduced the system, and we are the only party that continues to grow and protect this scheme. Today it is Labor and the Albanese government that has increased the superannuation guarantee to 12 per cent and is now introducing payday super through this bill. In 1992, only 10 per cent of workers retired with super.

Now 90 per cent of workers in Australia have funds in super. And I really am proud to be part of a Labor government that continues to support and deliver for workers and for the people of my community, especially with increased wages and superannuation. But why are we introducing this bill?

Why did these steps have to be taken? First of all, this bill is needed because it makes it easier for employers and workers to know whether the right amount of super is being paid to workers. The ATO estimates that there was approximately $5.2 billion in unpaid super in 2021-22.

That's effectively wage theft. It deprives people of the money they need to support themselves later in life. Not to mention that by being paid earlier, workers get the compounding financial benefit of having super paid up front, and it reduces the risk of super being lost forever.

To bring some of these changes to life, I'll share a little story. I was recently with the Treasurer in my electorate in Brisbane at the classic Paddington Tavern. Paddington Tavern is known to us locals as the Paddo.

It's my local haunt; it's where I grew up. We met Sarsha and her workmates there. Sarsha is a hospitality worker.

Like all hospitality workers, she does an amazing job. She's friendly, she's out there, she's happy and she's looking after us, her customers. But she wasn't sure about the law changes that were coming in.

When we explained it to her, she was pretty happy to learn that what this means is that she'll get more money when she retires, even if she stays in this same job for the rest of her life. And why? Because she gets more in her super fund upfront, which will build up towards her retirement.

When you're a young 20-something, maybe not quite 20, retirement seems a long way off, and she did admit that, but then she did get it. She said: 'No, I really understand. This means I will have more money to retire on.' And that's exactly what this is about.

As a Labor government, we will do everything we can to make the super system fairer for workers like Sarsha and her cohort. During this time of cost-of-living pressures we need to do everything we can to help workers like Sarsha. That's why we're also helping her earn more and keep more of what she earns, with 20 per cent off student debt, a raise in the minimum wage, an increase in the low income super offset and, now, payday super.

We also know, as was mentioned earlier, that women are disproportionately impacted when they retire. They have less super in their bank accounts compared to men. So, to me, this bill is also about equality.

But let's go back to young workers for a minute. In my electorate of Brisbane, the median age is 34. This bill makes the super system fairer from top to bottom and will really benefit these younger men and women in my community.

As I said, we know that unpaid super disproportionately affects younger workers, workers in insecure work and women, who tend to make up the bulk of that workforce. These are the people that can least afford to miss out on retirement savings. Missing out on retirement savings has a compounding impact over time and means much less money at time of retirement.

By switching to payday super, a 35-year-old median income earner with quarterly super payments could be around $6,000 better off at retirement. That's not a small amount of money. But the bigger difference comes in for those who are missing out on super entirely.

A typical ATO case involves nearly two years of suspected unpaid super, costing a 35-year-old median income earner over $30,000 in retirement savings. That's a big jump. If the employer goes under, the employee often loses their super altogether, with some estimates of this hit as high as $90,000.

This might be a very simple change, but it is going to make a very big difference to people's lives. It's a much-needed reform for younger workers, who will benefit from it the most, but for older workers it also represents a minimum of around $300 extra in super payments per annum. Every single worker in Australia will benefit by receiving the super they're owed when it is owed to them.

I often speak in this House about the impacts of the laws this government is introducing and in particular the impacts on women. This bill is really important because women retire, on average, with one-third less super than men. That's mainly because of career gaps and child-caring responsibilities.

This bill is part of a range of measures to make sure women do not continue to retire with less super than men. That's also why, from 1 July, those claiming government funded paid parental leave will now have super paid on that leave. If you're not entitled to paid parental leave from your employer, from July you will be eligible for the government funded 24 weeks—up from 22 weeks—and this, too, will now include super.

Paying super on payday is part of Labor's work to ensure Australians earn more, keep more of what they earn and retire with more, including those who, in the past, have been left behind or unfairly impacted. Payday super is a once-in-a-generation reform that further builds and expands the superannuation scheme and protects workers' retirement savings. Currently, employers only need to pay super quarterly.

That means—and I don't know how often you check your super balances or check whether your employer has put your super into your pay sheet—that unpaid or underpaid super can hide for many months and sometimes not even be noticed. I want to go back to the $5.2 billion in unpaid super that I talked about earlier. That's $100 million every week that workers earn but never receive.

This reform will help ensure that workers actually receive the super they're owed when they are owed it. These changes are the culmination of extensive consultation with consumer groups, employers, super funds and payroll providers—all those who will need to be prepared for the changes. There is a lead-in time for that preparation to happen; these changes do not come into effect until 1 July 2026.

And, again, these changes will benefit every employed worker in Australia. The onus will be on employers to ensure that contributions are received by an employee's super fund within seven business days of payday. These changes, taken together, will make it easier for employees to track their super and for the ATO to detect missed payments earlier—before debts become unrecoverable.

Employees can check their super fund to confirm that contributions have been received. Most funds offer online portals or apps for easy access. This bill also updates the superannuation guarantee charge, which is the penalty employers face when they fail to pay super on time.

Under the new framework, the super guarantee charge will apply for each payday an employer fails to pay super in full and on time. These changes will mean that employees are compensated for any notional earnings they may miss out on when the employer fails to pay on time. Employers will also face choice loading, which is an additional penalty if they fail to pay on time.

These are sensible and pragmatic changes designed to prompt employers to fix mistakes quickly and to ensure that workers are fairly compensated when employers fall short. How will this be enforced? The ATO will use Single Touch Payroll data—STP for those who love acronyms—which employers already report.

They will match that data with data from super funds to detect missed payments in real time—or as close to real time as possible. This data-matching capability allows the ATO to intervene earlier, reducing the risk of large debts building up and increasing the chance of recovery. The government has committed over $400 million to support the implementation of this process.

Again, there is a transition period so that everyone can get on board. This is real action that can happen only when we have a government that will back a program like this with real and deliverable outcomes and real money. Australia, including my constituents, made the decision earlier this year to support a stable Labor government.

It's a government that takes real action, as opposed to an alternative through which parties block real action or deny superannuation increases. I do want to say one thing about low-income super. Payday super comes on top of the Low Income Super Tax Offset, LISTO, to help deliver a more secure retirement for 1.3 million Australians.

Labor will increase the Low Income Superannuation Tax Offset by $310—it will be just over $800—and raise the eligibility threshold from $37,000 to $45,000 from 1 July 2027. This change, combined with the other changes, will help deliver a more dignified retirement to 1.3 million Australians. The Albanese government is delivering, in every way, on super.

It is delivering more help to low-income workers and reforming the superannuation system to make it stronger, fairer and more sustainable. In conclusion, I go back to where I started. Superannuation is a Labor legacy, and I am really proud to be part of a government that continues to build on this legacy.

Labor is backing workers, whether they be nurses, teachers, sparkies, cooks or care workers. Some of them were in my office today, meeting with me. Women and young people, in Brisbane and around the country, will be better off under these changes.

These changes will help make our super system fairer. The unions and Labor will always fight for the right of workers to a dignified retirement. Workers deserve it.

They work their entire lives. They pay their taxes. They deserve to live a life and not have to worry about whether or not they can pay for their medicines.

Every Australian should be able to retire with dignity and respect—and this bill delivers on that.