The super sector has welcomed the government’s payday super legislation, calling it a landmark step for fairer retirement outcomes.
Australia’s superannuation sector has thrown its weight behind the government’s payday super legislation, describing it as a simple – yet transformative – reform that will protect workers from unpaid entitlements and boost long-term savings.
The Payday Super Bill, set to be introduced into the House of Representatives today (9 October), will require employers to pay superannuation at the same time as wages, rather than quarterly.
The move has been widely praised by industry bodies and funds alike, all of which have urged for the swift passing of the new laws.
Mary Delahunty, CEO of the Association of Superannuation Funds of Australia (ASFA), said the reform would mark a decisive step in tackling unpaid super, which costs Australian workers billions each year.
“Payday super is a simple but powerful reform that will boost the retirement savings of every Australian employee and help address the problem of unpaid super,” Delahunty said. “Australians have been waiting three years for this policy to become law.
“It’s time. Let’s get it done.”
She added that the change would also strengthen fairness across the workforce.
“Super belongs to the employee who has earned it, as soon as they’ve earned it,” Delahunty said. “In many cases, the money is held in an employer’s bank account for months, earning interest for the employer instead of the employee. Payday super will correct it.”
The shift, however, is expected to significantly increase the administrative workload for super funds, which will process contributions up to 12 times more often.
Delahunty said the industry had spent years preparing for the transition through ASFA’s In Practice initiative, which brings together funds, administrators, software providers, and regulators.
“The higher transaction volumes that will flow once payday super begins have required years of behind-the-scenes work to get our systems ready. We’re confident the sector will handle this major shift cleanly and efficiently,” she said. “This has been one of the best Australian examples of an entire industry cooperating towards a positive change.”
The benefits of earlier contributions are expected to compound meaningfully over time, with ASFA modelling showing a 25-year-old on an average wage will retire $5,000 better off if super is paid fortnightly instead of quarterly.
Missing just one year of contributions could reduce a 30-year-old’s balance by $25,000, while the Australian Taxation Office estimates over $5 billion in super goes unpaid each year, disproportionately affecting tradies, younger workers, and low-income earners.
The Super Members Council (SMC) echoed ASFA’s call for urgency, describing payday super as a “gamechanger” to tackle unpaid super, which costs workers $5.7 billion a year.
“Payday super is a simple, fair and urgent reform to help ensure every dollar owed to workers makes it into their super account on time and in full,” said SMC CEO Misha Schubert. “Millions of Australians cannot afford to wait.”
SMC data shows 3.3 million Australians missed out on super in 2022–23, losing an average of $1,730 each. Over a lifetime, that gap can leave workers up to $30,000 poorer in retirement. Women, who already retire with a quarter less super than men, remain among the hardest-hit.
Rest Super has also endorsed the reform, saying it will particularly benefit part-time and casual workers.
Chief strategy officer Tyrone O’Neill said aligning super guarantee payments with payroll cycles would “help unlock the power of compounding returns” and make it easier for members to track contributions.
“We congratulate the government on introducing this important reform,” O’Neill said. “We urge Parliament to pass this legislation as soon as possible so our members, and all working Australians, can benefit.”
With the industry’s systems primed and public support strong – ASFA polling shows 80 per cent of Australians back the change – the sector has delivered a unified message: payday super is long overdue, and the time to legislate it is now.
