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Super has transformed the lives of millions of Australians. But right now, Australian women are still retiring with a third less super than men. This is despite typically retiring earlier and living longer. 

The gender super gap has narrowed over the years with increased female labour force participation, but progress has slowed while other key factors contributing to the problem remain unaddressed. 

What drives the gender super gap 

Key drivers of the gender super gap are inequalities across women’s working lives – lower wages, more time out of the workforce caring for children and ageing family members. 

Super tax settings – while an important longstanding feature of the super system that compensate people for deferred access to savings and encourages contributions – magnifies these differences over time. Super is taxed at a flat rate, which effectively means those on lower incomes receive fewer concessions compared to those on higher incomes, who receive a greater proportion. 

Helping to close the gender super gap in the short-term 

SMC modelling shows a few targeted changes would go some way to closing the gender super gap. These include improvements to the Lower Income Superannuation Tax Offset (LISTO) and paying super on the Commonwealth parental leave, which could boost the super balances of the lowest paid women by 21 per cent. 

  • Paying super on the Commonwealth Parental Leave Pay Scheme would leave a mother of two $12,500 to $14,500 better off at retirement. With the typical woman retiring with around $50,000 less than their male counterparts, this would make a meaningful reduction in the gender super gap. 

In March 2024, the Australian Government’s announced its decision to pay super on its parental leave scheme. The SMC congratulates the Government for this historic decision, which is due to take effect on 1 July 2025. 

  • Increasing LISTO would mean workers earning up to $45,000 receive a full tax refund on their ‘Super Guarantee’ contributions. This change would boost the super of more than 1.2 million Australians – 60 per cent of whom are women – by an extra $500 million in the 2025‑26 financial year alone. 

Longer-term fixes also needed 

The gender super gap is ultimately caused by broader issues, which we should be addressing longer-term: women’s lower workforce participation rates, the fact that highly feminised industries and jobs continue to attract lower wages, and social norms around unpaid caring responsibilities. 

SMC will continue to look at all the factors contributing to this issue – large and small – and is committed to working with all Governments in the future to find ways to keep lifting the retirement savings of women to close the equity gap.

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