Queensland mothers have missed out on almost $320 million in retirement savings as the government denies them superannuation payments on top of its parental leave scheme.
A study completed by Industry Super Australia indicates more than 280,000 mothers in Queensland have received Commonwealth Paid Leave Pay in the last ten years, taking time out of paid work to raise children, and consequently being made to give up their retirement savings, leaving them thousands of dollars worse off.
This can cost a mother of two up to $14,000 from their final retirement savings.
In Queensland, 99.4 percent of women applied for the state’s Commonwealth Parental Leave Pay while 0.6 percent were men.
In the 2019-20 financial year, 33,465 women in the state missed out on $57.5 million in super payments.
Georgia Brumby, Industry Super Australia’s Advocacy Director believes that Queensland women are being made to sacrifice their retirement savings in order to have children.
“It’s hard enough trying to juggle work and raising a family” she said. “It’s not fair that thousands of women are also missing out on thousands from their super as well.”
“This is an opportunity for the Prime Minister to lead the way and ensure super is paid on parental leave. Otherwise, we’ll continue to see too many women retire into poverty.”
In the northern part of Brisbane, women in the electorate of Lilley lost the most amount of super in the state, with up to 12,330 mothers missing out on $13 million in super payments.
Parental Leave is one of only a few mechanisms of paid leave where there is no requirement to pay super. The government does not pay the super guarantee on its scheme.
Unless an employer voluntarily pays super on leave, an employed mother’s savings continue to fall further behind.
The super payment linked to the Commonwealth’s 18-week paid parental leave scheme is paid at minimum wage and available to most working mothers.
It remains an important equity measure to make sure women’s savings keep pace. Missing out on years of super payments can have a dramatic impact on a woman’s final balance.
A female employee who spends five years out of the paid workforce in their late twenties and early 30s can be almost $100,000 worse off.
In Queensland, women have 30 percent less super than men. The median super balance of a woman in the state approaching retirement is $131,500, which is roughly $50,000 less than the median balance of a man near retirement, which is $185,700.
Overall, women in Queensland have less super than men, although the gap widens drastically when women are reach their thirties — a period when many take time out of paid employment to raise children.
According to a 2016 Senate report, one in three women retire with no super balance at all.