Treasury Laws Amendment (Payday Superannuation) Bill 2025, Superannuation Guarantee Charge Amendment Bill 2025
Mr MONCRIEFF (Hughes) (19:17): One of the fundamental principles of finance is that money has time value; a dollar today is worth more than the same amount in the future. Australian superannuation is money that belongs to Australians, and they deserve the time value associated with it. For too long they haven't been receiving all of that value.
The Australian Taxation Office estimates that $5.2 billion in super went unpaid in 2021-22. That is $100 million every week that workers earned but never received. Unpaid super disproportionately affects younger workers and those in insecure work.
These are the people who can least afford to miss out on retirement savings. In a typical ATO investigation of an unpaid super case, a worker has missed out on nearly two years worth of super contributions. For the average 35-year-old, failing to recover this money could reduce their retirement savings by around $32,000 in today's money.
Australians believe in the superannuation system, and they trust that it will be there for them when they retire. Most Australians aren't engaging with their superannuation on a day-to-day basis, with most treating it like a set-and-forget system. As few as one in 10 are actively engaging with it regularly.
When employers go bust, the impact is even more severe. For an average 35-year-old, missing out on super from a liquidated business could leave their retirement balance more than $90,000 worse off in today's money. When Australians aren't paid what they are owed when they are owed it, not only does it deny them the financial security they deserve but it undermines the Australian community's confidence in the superannuation system.
This government is taking action to fix that. Payday super is a once-in-a-generation reform to fix unpaid super. It will help ensure that workers actually receive the super they're owed when they're owed it.
Working Australians deserve to receive the super they have earned when they have earned it. This reform will fundamentally strengthen the benefits that Australians receive from what they have earned and ensure that every working Australian receives the super they are entitled to, on time every time. For far too long workers have had to wait months, sometimes even years, to see contributions reach their super accounts.
These wait times are not minor inconveniences or administrative annoyances. They are real financial losses and they have the worst impact on those who are younger, casual, part time or changing jobs frequently. For the average 25-year-old worker's retirement balance, this is the equivalent of receiving an extra $6,000 in today's dollars.
If a worker is missing out on their super the impact is even more significant. In a typical unpaid super case for a 35-year-old, the recovery of their super leaves their retirement balance more than $30,000 better off in today's dollars. For a nurse living in my electorate and working in Sutherland Hospital, that money can go a long way to ensuring that they get the comfort to which their decades of hard work should entitle them.
While most employers do the right thing, based on the most recent financial year data the Australian Taxation Office estimates $5.2 billion worth of super went unpaid. From 1 July 2026, under the Treasury Laws Amendment (Payday Superannuation) Bill 2025, it will be a requirement for superannuation guarantee contributions to be paid at the same time as wages instead of quarterly.
Employers must ensure that contributions are received by the employees' super funds within seven business days of payday. This change will make it easier for employees to track their super and for the ATO to detect missed payments earlier, before debts become unrecoverable. The legislation 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. The updated super guarantee charge includes notional earnings, which compensate employees for the investment returns they missed out on due to the late payments. It also includes administrative uplift, an additional charge to reflect the cost of enforcement and to incentivise voluntary rectification, which can be reduced for employers who voluntarily disclose and have good compliance history.
It also includes choice loading, which is an additional penalty if an employer fails to pay into the employee's chosen fund. Employers who continue not to pay, even after the ATO has raised an SG charge, will face higher penalties of up to 50 per cent of the unpaid amount. These changes are designed to prompt employers to fix mistakes quickly and ensure workers are fairly compensated when employers fall short.
Wage theft is still wage theft, even if it's superannuation. Enforcement will be an important part of this. The ATO will use Single Touch Payroll data, which employers already report, and match it with data from super funds to detect missed payments in near-real time.
This data-matching capability will allow the ATO to intervene earlier, reducing the risk of large debts building up and increasing the chance of recovery. This government has committed $404 million to support implementation. This is the latest reform to the modern superannuation system set up by Labor governments to ensure that Australians get the secure retirements that they deserve.
When the Labor government released the 1991 budget, it introduced the superannuation guarantee: a compulsory system of superannuation support for Australian employees. A scheme to be paid for by employers, the first year of this new act boosted super coverage for Australians to 80 per cent. Over the next decade, coverage rose to 91 per cent, and the superannuation guarantee increased to nine per cent.
Today, Australia's superannuation system is a world leader, with more than $3 trillion invested in superannuation assets. We have seen superannuation become an essential part of ensuring the financial security of Australians. This reform adds to that and means that Australians will have access to even more value from the system.
Many in Hughes, from small businesses in Wattle Grove and Engadine to industrial powerhouses in Ingleburn, already understand the value of timely contributions. This legislation ensures that those doing the right thing are not disadvantaged and that those failing to meet their obligations are held accountable. Wage theft is wage theft, even when it's superannuation.
What small business and employees want is certainty. Employees want the certainty of knowing their superannuation will be there, and employers want the certainty of knowing what's expected of them. Small businesses and employees in my community need this legislation to pass as soon as possible to give employers, payroll providers, super funds and the ATO time to build the systems needed for implementation by 1 July 2026.
Businesses need certainty and confidence to operate, and they need time to adjust to new systems. We will not leave businesses in the lurch with these changes. The ATO will adopt a facilitative compliance approach in the first year.
Employers who make a genuine attempt to comply, even if they face technical issues, will not be targeted by ATO compliance. The reform will help employers by aligning super with payroll, reducing end-of-quarter admin pressure and reducing the risk of large liabilities. The longer we wait, the more workers miss out on and the harder it becomes to recover unpaid super.
Ultimately, this bill is about trust—trust that, when Australians work hard, the system protects their earnings; trust that the decades of contribution to their superannuation will yield a secure and dignified retirement; trust that this Labor government protects fairness, equity and long-term economic prosperity for Australians. I commend the bill to the House.