Stop slugging women’s super for having children: KPMG

 — 1 minute read

There are three key law reforms that could help close the gender divide in superannuation savings, according to KPMG, if Australia chooses to recognise the unpaid work women take on.

A new paper from KPMG has found that a lower female workforce participation rate and a higher proportion of unpaid, caring work compared to other OECD countries have led to Australia maintaining a well-established gender pay and superannuation gap. 

The pay gap now sits at around 20 per cent, with KPMG estimating that if the rate of reduction for the four years prior to the pandemic continued, it would be eliminated in 2046. The superannuation gap can range from 22 to 35 per cent in the years approaching retirement age.


But the new report has also projected that when accounting for the value of both paid and unpaid work in Australia, including caring for children – women do half of all the work performed in Australia. 

“The gender pay and super gaps stem from the fact that in Australia, our policy settings are still based on a model in which fathers do most of the paid work while mothers do part-time paid work but more of the unpaid work,” Alison Kitchen, KPMG Australia chair said.

“In effect, paid work, dominated by men, is valued more highly than unpaid work, which is mostly performed by women.” 

In northern Europe, men were found to complete around 75 per cent as much unpaid work as their female counterparts. Australian men completed just over half as much. 

The divide between male and female workforce participation rates in Australia was also found to be 10 per cent, placing the nation 16th highest of OECD countries. 

Looking specifically at mothers, the proportion of Australian mothers in paid work is 69 per cent, lower than 23 other OECD countries. Of mothers who are employed, almost 60 per cent of those with a child under the age of six work part-time, compared with less than 8 per cent of employed fathers.

For mothers whose youngest child is aged six to 14 years, close to half of all employed mothers work part-time compared to less than one in 10 employed fathers.

While there has been an increase in women’s workforce participation since the 1970s, KPMG has noted the rise has almost been entirely in part-time work. 

The report has made three key recommendations to reforming the superannuation laws, in order to combat the retirement gap: 

  • Including superannuation guarantee (SG) contributions in the Commonwealth Paid Parental Leave scheme.
  • Allowing unused concessional contributions to be made for recipients of Commonwealth Paid Parental Leave without time limit.
  • Amending the Sex Discrimination Act to ensure employers can make higher superannuation payments for their female employees if they wish to do so.

Linda Elkins, KPMG national sector lead for asset and wealth management commented the five-year limit on catching up on contributions after receiving parental leave often disadvantages women who have taken time out to raise children. 

“There is no good policy reason why this cannot be changed,” Ms Elkins said.  

“The tax and transfer systems penalise women trying to get back to work,” Ms Kitchen added. 

“Everything else flows from this. It is perverse that taxpayers will willingly subsidise part of the cost of university degrees, which are attained by more women than men and yet the same tax system penalises those women for trying to get ahead in the paid workforce.

“Male taxpayers often complain that the top rate of 47 per cent is a disincentive to work – yet women trying to get back fully into the workforce can face effective rates of over 100 per cent, when considering lost childcare benefits.”



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Stop slugging women’s super for having children: KPMG
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Sarah Simpkins

Sarah Simpkins

Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth. 

Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio. 

You can contact her on [email protected].


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