One year on: landmark reforms helping build stronger retirement futures for women
HESTA
2 July 2026
One year since super on Commonwealth Parental Leave Pay took effect alongside the super guarantee reaching 12%, HESTA modelling shows just how much these critical reforms can improve women’s retirement outcomes.
For a typical HESTA member who takes Commonwealth Paid Parental Leavei the payment of super can make a meaningful difference at retirement. The Fund’s previous modelling, based on 18 weeks of leave, shows the payment of super potentially adds around $6,500 at retirement. For those who take leave for two children, that benefit increases to nearly $13,000.ii
The first of these super contributions are imminent, with Australians who received Government-funded Parental Leave Pay during 2025–26 set to see this super arrive in their accounts from the Australian Taxation Office following the end of that financial year.
Further modellingiii shows womeniv beginning their careers with the full 12% super guarantee in place for their entire working lives could retire with $712,000 – a potential $411,000 boost compared to women modelled to have retired in 2025.v
HESTA CEO Debby Blakey said the one-year anniversary marked a genuine turning point for the Fund’s more than one million members, around 80% of whom are women, many working in typically lower-paid sectors including aged care and early childhood education.
“One year in and we’re starting to see the positive impact these important reforms are having – and will continue to have – on women’s retirement outcomes while making our super system fairer,” Ms Blakey said.
“Women have for too long retired with far less super than men, simply because the system didn’t account for the reality of their lives. These two reforms are starting to change that.”
HESTA had long advocated for the paid parental leave change, which addressed a structural gap that had seen Australian mothers miss out on well over $3 billion in super savings since the Commonwealth scheme was introduced in 2011.vi Meanwhile the lift in the super guarantee is set to deliver compounding benefits over decades.
“This reform will see money flow into the super accounts of mothers who previously would have missed out simply for taking time to care for a new baby,” Ms Blakey said.
“The 12% guarantee means women starting work today could retire with more than doubleii iv the amount of super compared to female workers who retired last year.”
Low-income earners are also set to benefit from upcoming Low-Income Superannuation Tax Offset (LISTO) reform, for which HESTA long advocated. From 1 July 2027, the maximum LISTO payment will increase from $500 to $810 and will be permanently linked to personal income tax thresholds, helping ensure low-income earners don’t pay more tax on their super than on their take-home pay.
Ms Blakey said it was important to keep the momentum going on positive super reform, as there was still much work to do to make Australia's retirement system fairer. She said HESTA is supportingvii research to design a workable model for superannuation 'carer credits'. This reform is needed to ensure those whose workforce participation is impacted by the need to provide unpaid care can get a better deal in retirement.
“Super on paid parental leave, LISTO changes and the 12% super guarantee should be seen as the foundation for further progress, not the end. There are still policy settings that disadvantage women and those on lower wages, and HESTA will keep advocating to ensure the system works for everyone,” Ms Blakey said.
Modelling prepared by HESTA and partner Laneway Analytics:iii
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Scenario 1: Retiring in 2025 (baseline) |
Scenario 2: Career begins in 2025 earning 12% super |
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Career Situation |
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Super Guarantee |
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Estimated Retirement Amount |
$301k |
$712k |
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Difference |
- |
$411k or 137% better off than scenario 1 |
i Commonwealth Paid Parental Leave was up to 24 weeks in the 2025-26 financial year, extending to 26 weeks from 1 July 2026.
ii Modelling prepared by Laneway Analytics in 2024, commissioned by HESTA. This is a forecast and is predictive in nature and as such the outcome cannot be guaranteed and may be different. Key assumptions used in the modelling include a retirement age of 67; AWOTE 3%; CPI 3%; investment return rate (real) 3% (above CPI figures, net of investment fees and taxes); investment return rate (nominal) 6%; wage growth (HESTA derived per industry as at 1/3/22); 32 weeks spent away from workforce (per child); age of mother 30, 32 and 34 for child 1,2,3 respectively. The modelling scenario assumptions are for an average HESTA member per industry, and include assumptions around current super balance, recent super guarantee activity, voluntary contributions (pre- and post-tax) and insurance premiums. Estimates on retirement amounts are in today’s dollars.
iii Modelling prepared by Laneway Analytics in 2025, commissioned by HESTA. This is not a prediction, is for illustrative purposes only and as such the outcome cannot be guaranteed and may be different. The modelling made assumptions including: Begin career at age 18; Retirement age 67; AWOTE: 3.7% pa; CPI 3.7% pa; Investment return net of investment fees and taxes CPI +3% pa; 18-year-old HESTA member account balance $1500; 18-year old HESTA member total contribution $1543 for first year of work, then contributions made annually thereafter based on HESTA’s assumptions around salary progression; Default insurance cover (premiums CPI-adjusted); Accumulation fixed fee $52 pa (non-indexed); Accumulation variable fee 0.15% pa (non-indexed); Full-time work at ages 18 to 30, 44 to 67; 26 weeks of super on Paid Parental Leave at ages 31 and 33; Part-time work (0.6 FTE) at ages 34 to 43; No other retirement savings.
iv Women representative of the average HESTA member.
v Compared to the Estimated Retirement Amount ($301k) for a typical HESTA member who started their career on 1 July 1976 and will retire on 30 June 2025, earning 3% super starting 1992 and taking account of historical super guarantee increases. Estimated Retirement Amount for a typical HESTA member who started their career on 1 July 2025 and will retire on 30 June 2074, earning 12% super is forecast to be $712k.
vi Modelling by Laneway Analytics (dated February 2024) estimated the benefit to Australian women as of 31 December 2023 ($3.3 billion) if superannuation had been paid as part of the Commonwealth Parental Leave Pay scheme since it was introduced on 1 January 2011.
vii With other profit-to-member funds, coordinated by Women In Super.
Ends.
About HESTA
HESTA is one of the largest superannuation funds dedicated to Australia’s health and community services sector. An industry fund that's run only to benefit members, HESTA now has more than one million members (around 80% of whom are women) and currently manages approximately $105 billion* in assets invested around the world.
*Information is current as at the date of issue.
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HESTA CEO Debby Blakey
