Other Post-Employment Benefits (OPEB) Explained for Australians in 2025

When it comes to retirement planning, superannuation grabs the spotlight in Australia. But there’s another important piece of the puzzle: Other Post-Employment Benefits (OPEB). As 2025 brings new policies and growing scrutiny around long-term financial security, understanding OPEB is more critical than ever—whether you’re an employee, retiree, or business owner managing workforce obligations.

What Are Other Post-Employment Benefits (OPEB)?

OPEB refers to the suite of benefits—other than superannuation—that employers provide to retirees. These may include:

• Health insurance or medical cover post-retirement

• Life insurance after leaving employment

• Dental, vision, and other supplementary health benefits

• Long-term care or disability insurance

• Subsidised access to employer services or facilities

In Australia, OPEB are less common than in the US, but they do exist, especially in the public sector, legacy corporate schemes, and some union-negotiated arrangements. With rising health care costs and shifting demographics, these benefits are under increasing financial and regulatory pressure.

2025 Policy Changes and Why OPEB Matters Now

In 2025, several policy updates are reshaping the landscape for OPEB in Australia:

• Public sector review: The Federal Government has implemented tighter reporting and funding requirements for state-owned enterprises and government agencies regarding unfunded retiree health and insurance liabilities.

• Corporate transparency: ASX-listed companies must now provide more detailed disclosures on long-term employee benefit obligations in their annual reports, in line with updated AASB 119 and international accounting standards.

• Taxation updates: The ATO has clarified the fringe benefits tax (FBT) treatment of post-employment medical and life insurance, which may affect employer willingness to offer such perks.

For individuals, these changes mean it’s more important than ever to:

• Know exactly what post-employment benefits you’re entitled to

• Understand how those benefits integrate with Medicare and private health insurance

• Monitor the financial health of your employer or fund, especially if benefits are unfunded or only partially funded

How OPEB Could Impact Your Retirement Planning

While superannuation remains the backbone of most Australians’ retirement income, OPEB can provide vital support—particularly for healthcare needs that often escalate with age. Here’s how OPEB can play a role:

• Reducing out-of-pocket medical costs: Retiree health cover can fill gaps not addressed by Medicare or private policies, such as dental, vision, or extended hospital care.

• Improving financial security: Knowing that life or long-term care insurance continues after you leave work offers peace of mind and helps you plan with greater certainty.

• Supporting dependants: Some OPEB schemes extend benefits to spouses or dependants, which can be a significant family safeguard.

But there are risks: with employers under pressure to cut costs, some are scaling back or restructuring OPEB. In 2025, several legacy corporate schemes in the resources and manufacturing sectors have announced transitions from defined benefit to defined contribution structures, shifting more risk to retirees. Public sector reforms in states like NSW and Victoria have also led to reviews of unfunded liabilities and benefit caps for new entrants.

What Should You Do Next?

If you’re approaching retirement or already drawing benefits, here’s how to stay proactive:

• Request a written summary of your OPEB entitlements from your employer or fund

• Review the latest annual report or financial statements for updates on funding status and changes

• Compare your OPEB cover to current market rates for private health, life, and long-term care insurance

• Consider seeking professional advice on integrating OPEB with your super, pension, and government benefits

Staying informed about OPEB is not just for accountants or HR managers—it’s a crucial step in securing a comfortable, predictable retirement in Australia’s evolving financial landscape.