HESTA has welcomed measures from tonight's Federal Budget focused on improving outcomes for women and providing further cost-of-living relief, as well as progress of key reforms to pay super on Commonwealth paid parental leave and at the same time as wages.
HESTA CEO Debby Blakey said that, while the Budget delivered positive news for members, there was still work to do to close the gender super gap, which sees women retire with around 25% less super than men on average.
"Many of our members have felt the weight of higher cost of living impacts and further measures of relief are good news. This includes new tax cuts, a further energy bill rebate and previously announced plans on early childhood education and medicine," Ms Blakey said.
"We are also moving closer to implementation of key superannuation reforms announced previously – including super on Commonwealth paid parental leave from July this year and payday super reform next year. These are important changes that can help deliver better retirement outcomes for Australians."
HESTA has been a long-term advocate for the introduction of a universal early childhood education and care system, with the removal of the Child Care Subsidy Activity Test a welcome first step.
"The removal of the Activity Test will make a significant difference for working parents and children. This change can significantly benefit our more than 1 million members, with around 42% of HESTA members providing unpaid care, including caring for children," Ms Blakey said.
"The change is expected to ensure around 126,000 more children can access early learning and almost 40,000 parents can return to work or increase their working hours.
"We know women's workforce participation is crucial as it helps narrow the persistent gender super gap."
Ms Blakey also welcomed Budget measures related to health and community services, a sector where most of HESTA's members are employed. This included an additional $2.6 billion to fund pay rises for aged care nurses, complementing recent pay rises for the early childhood education and care workforce.
The sector will also be supported by the aforementioned spending on early childhood education, a funding boost for women's health and a significant investment in Medicare, which includes an initial $662.6 million to strengthen Australia's health workforce such as through new scholarships for nurses and midwives.
Ms Blakey added that legislated support for critical minerals, together with new funding for green metals, can provide the catalyst needed to help Australian industry transition to a low carbon economy.
In its pre-Budget submission, HESTA highlighted opportunities to drive a fairer super system across four areas: a more equitable distribution of super tax concessions; valuing care work; reimagining retirement design to reflect the modern experience; and addressing unintended gender-blind spots in policy making.
The reforms HESTA is calling for include:
- Paying super contributions on the Carer Payment;
- Adjusting the Low Income Super Tax Offset (LISTO) to align with the second marginal tax threshold of $45,000; and
- Making sure retirees' incentives to work are not diminished by indexing Work Bonus payments thresholds to keep pace with Average Weekly Ordinary Time Earnings (AWOTE).
"While our super system is one of the world's best, gaps remain that disadvantage those earning lower wages and women," Ms Blakey said.
"Around 80% of HESTA's one million plus members are women – and these proposed changes could make a significant impact to their retirement outcomes.
"Dignity in retirement should be for everyone, and we will continue advocating for change to support our members' capacity to retire on their terms."
