I move that this Bill be now read a second time.
Today I am proud to introduce the Treasury Laws Amendment (Payday Superannuation) Bill 2025.
This Bill reforms our superannuation system to help ensure more Australians get the secure retirement they need and deserve.
From waiters and nurses -
To builders and teachers -
Aged carers and hairdressers -
This Bill makes sure their superannuation is paid on time.
Speaker,
Workers should be paid their super at the same time they are paid their salary and wages.
That's exactly what this Bill enshrines into law.
It is a meaningful change that will take effect from July next year.
It's a change that will strengthen Australia's superannuation system.
And it's a change that will help deliver a more secure retirement for millions of Australian workers.
Speaker,
Workers will benefit from more frequent and earlier super contributions, that will grow and compound over their working life.
For the average 25‑year‑old workers' 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, recovering their super leaves their retirement balance more than $30,000 better off in today's dollars.
Speaker,
The need for this reform is clear and compelling.
While most employers do the right thing, some disreputable ones are exploiting their employees.
On the most recent financial year data, there was almost $5.2 billion in unpaid super that should have gone to workers.
That's $5.2 billion that should be helping thousands of Australians in their retirement but isn't.
This issue disproportionately affects more vulnerable Australians and women.
That's because those on lower paid, casual and insecure work - who are more likely to be women - are most at risk of missing out on their super.
Super is an entitlement of workers, like salary or wages, and unpaid super is a form of wage theft.
This Bill will help put a stop to it.
It will also help the Australian Taxation Office enforce the law and more quickly identify employers not making contributions.
Currently, over a third of outstanding super debt is owed by insolvent businesses.
This is because unpaid super is being picked up too late.
When the ATO responds to an employee complaint, they are investigating almost 2 years of potential unpaid super, on average.
As part of this reform, we're also investing into the ATO's capabilities, so it can detect suspected non‑payment of super in near real time.
Speaker,
There is a productivity dividend here too.
Smaller, more frequent super contributions will help employers manage their payroll more smoothly.
This legislation also redesigns the superannuation guarantee charge to be fit‑for‑purpose and make Payday Super work.
The current charge is a blunt tool that isn't tailored to employers' circumstances.
And it is complicated for employers to correct late contributions and calculate their liability.
The redesigned charge will prompt employers to quickly rectify late or missed superannuation contributions.
And it simplifies the process.
Employers will no longer need to choose which period their late contribution should count towards or calculate their own liability.
This will all happen automatically.
At the same time, the new charge will deliver significant consequences for employers that repeatedly fail to pay their workers or let super go unpaid for long periods.
And it will make sure workers are accurately compensated for lost earnings if their employer is late in paying their contributions.
Speaker,
We thank the unions, industry, businesses and the broader community for their feedback, engagement and views to get to this point.
From the years of advocacy for change, through the consultation on the policy design in 2023 and more recently the draft legislation and ongoing engagement with the ATO working group.
We recognise that implementing Payday Super will require an economy‑wide transition.
Not just for employers but also software providers, clearing houses and super funds.
Because of this, the ATO has advised it intends to consult on its approach to compliance for the 12 months after the change starts.
The ATO's approach will differentiate between low and high‑risk employers.
This approach will mean that employers who are making the effort to pay contributions in line with each pay cycle will fall into the low‑risk category.
This approach will address the feedback we've heard to ensure we are getting the implementation of this policy right, and workers and businesses will be better for it.
Speaker,
At the core of the economic plan we laid out in our Budget earlier this year is a simple objective.
Our government is ensuring more Australians earn more, keep more of what they earn and retire with more too.
That's what this legislation is about.
You can see that in everything we've done since coming to government in the superannuation sector.
It's why we legislated the objective of super - to provide income for a secure retirement.
We've increased the superannuation guarantee so it has finally reached 12 per cent.
We expanded the coverage of the superannuation performance test from around 80 products to more than 800 in 2023.
We legislated to align financial reporting requirements by funds with those of public companies.
We've also announced mandatory service standards.
And we're better targeting superannuation tax concessions and reforming the retirement phase of superannuation.
Our plan is making a meaningful difference, and wages are moving in the right direction again.
In the 5 quarters leading up to the 2022 election, real wages fell in annual terms.
They have now grown for the last 7.
We've recorded the strongest annual real wages growth in 5 years.
We're now on the longest run of real wages growth above 0.7 per cent in a decade.
And real incomes per capita are growing now too.
Speaker,
This legislation is another important step in implementing that plan.
It's about getting your super when you get your salary.
So there's more super savings for more Australians and more secure retirements.
And that's why we are proud to introduce it to the House.
Full details of the measure are contained in the explanatory memorandum.
