Paid Parental LeaveSpeech
I rise to speak on the Paid Parental Leave Amendment (Flexibility Measures) Bill 2020 and to support the amendment moved by my colleague the member for Barton. The opposition supports the bill, which builds on the national Paid Parental Leave scheme introduced by Labor, which commenced on 1 January 2011.
On this side we are very proud of the scheme. You will recall, Deputy Speaker Goodenough, that, when the legislation was passed, Australia was only one of two OECD countries, along with the United States, that did not have a Paid Parental Leave scheme. The purpose of the Paid Parental Leave scheme was and is to provide financial support to primary carers of newborn and newly adopted children in order to allow those carers to take time off work to care for the child after the child's birth or adoption, enhance the health and development of birth mothers and children, enable women to continue to participate in the workforce, and promote equality between men and women and the balance between work and family life. It provides two payments: paid parental leave of 18 weeks at the minimum wage for the primary carer and leave of two weeks for the dad or partner. Paid parental leave signals to employers and the Australian community that parents taking time out of the paid workforce to care for a child is essential and a part of the normal course of life. It also enables participation of women in the workforce. A high workforce participation rate is important in the context of an ageing population. It is also crucial to our economy and retaining skilled staff. Importantly, it helps to address the gender pay gap, particularly for those women on low and middle incomes who often have less access to employer-funded parental leave.
Almost 150,000 parents a year benefit from the Paid Parental Leave scheme introduced by Labor. Nearly half of all new mothers benefit from the scheme each year. The scheme has had its ups and downs. The scheme was not 22 or 26 weeks of paid leave, as it is in many other countries. The research tells us that the optimum time for bonding between mother and child is around 26 weeks. Our 2011 scheme was more modest than many would have liked, but it was affordable and it worked. And, of course, the scheme was always intended to be supplemented by bargaining in the workplace, which would allow additional weeks at the worker's usual rate of pay. An agreement derived entitlement could be taken either simultaneously with the PPL entitlement or added to the minimum 18 weeks PPL scheme.
In the last seven years, we have fought coalition attempts to absorb bargaining outcomes against the scheme entitlement—in other words, to reduce the maximum 18-week payment, currently $13,330, by the amount received under an enterprise agreement. Scandalously, on the other side this was called, to both bargaining entitlements and legislative entitlements, double-dipping. Thankfully, that legislation was defeated in the Senate. It would have seriously disadvantaged lower- and middle-income workers, like cleaners, carers, teachers and nurses, who have often negotiated additional benefits under enterprise. Thankfully, this bill doesn't go down that path. It is one that we can support and which belatedly fixes problems which weren't necessarily contemplated a decade ago.
This bill will enable working mothers and families in my electorate of Corangamite and across the nation to split their paid parental leave entitlements into blocks of time over a two-year period, with periods of work between. Currently, the scheme only allows paid parental leave to be taken as a continuous 18-week block within the first 12 months after the birth or adoption of the child, and then only when the primary carer has not returned to work since the birth or adoption of the child.
The bill will change the paid parental leave rules by splitting the 18 weeks of paid parental leave into a 12-week paid parental leave period and a six-week flexible paid parental leave period. The 12-week paid parental leave period entitlement will only be available as a continuous block, but would be accessible by the primary carer at any time during the first 12 months, not only immediately after the birth or adoption of a child. The six-weeks flexible paid parental leave period will be available at any time during the first two years, and that does not need to be taken as a block. These changes will apply to children born or adopted from 1 July 2020. In practice, this will mean families can split their entitlements over a two-year period, with periods of work between. As with the current rules, the primary carer can be changed during this time. It is likely the most common use of the increased flexibility will be parents returning to work part time and spreading flexible paid parental leave period over several months. This bill may encourage greater take-up of paid parental leave by secondary carers by allowing mothers to transfer their entitlements to their partner at a time that suits the family. This is welcomed. While the changes are modest, we hope they will allow more families to share parenting responsibilities in a way that works for them. Around 4,000 parents each year are expected to use these proposed flexibility changes. Again, that's a good thing, and the entitled cost of $25 million over the forward estimates is a modest price to pay for these changes. There is some concern the proposed changes will be complex in administration, with required interactions between Centrelink and families accessing paid parental leave increasing severalfold. Given the history of Centrelink managing complex interactions, there is a worry that there will be unnecessary grievances and disputes. This will need to be monitored.
It should also be noted that this bill does not increase paid parental leave entitlements for Australian families. Australia is falling behind internationally in the support it provides new parents. This bill does nothing to change that. According to 2019 OECD data, Australia's paid parental leave scheme ranks amongst the lowest in terms of both duration of leave and the amount of pay replaced. In contrast, other countries are rapidly expanding the support provided to fathers and partners to encourage them to spend more time at home in the first year of a child's life. In Iceland, fathers are entitled to three months paid parental leave. In Finland, the government has announced plans to provide each parent with more than 6½ months of paid leave, with a further six months to share. Parents are also able to transfer some of their leave to their spouse. Single parents will receive both allowances.
Australia has one of the lowest rates of investment in parental leave—just a third of the OECD average. Our public expenditure on maternity and parental leave per live birth in the 2019 OECD comparisons leaves us seventh-lowest of 34 countries, wedged between Israel and Chile. The 2019 OECD comparison on the percentage of usual wage replaced again sees Australia as the eighth-lowest of all OECD countries, with our minimum wage being only about 40 per cent of the usual wage. All but 12 countries—including the US, which still has zero paid parental leave—provide more than 20 weeks of paid leave. So, it is high time that the Scott Morrison government started thinking about improving the scheme in a fundamental way.
Another issue that affects the ability to take time off and spend time with family is the gender pay gap. The gender pay gap remains a problem in Australia, despite the Treasurer's recent contention, in question time on 9 September 2019, that 'the gender pay gap has closed'. Female workers in Australia still earn 14 per cent less than their male colleagues. It is a fact that the gender pay gap in Australia has remained stubbornly high over the past two decades. If the Treasurer and the Prime Minister were genuinely serious about fixing the gender pay gap, they would oppose cuts to penalty rates. The vast majority of workers who have had their penalty rates cut are women. The cuts to penalty rates are exacerbating the gender pay gap, making it harder for women to pay the rent and cover the bills. Of course, we don't hold out much hope for any consideration of marked improvements to the scheme when more minor issues have taken years to fix.
In 2019 the government changed the eligibility rules for the Paid Parental Leave scheme and extended access to women who work in dangerous occupations usually occupied by men or who have irregular employment. Labor supported the changes to the legislation, which took effect on 1 January this year, but, welcomed as they were, those changes were very slow in coming, and too many Australian women and their families have missed out on the benefits of paid parental leave as a result. For example, in 2013 the Australian Jockeys Association publicly identified the access problem and called on the Abbott government to fix the legislation. The community had to campaign for many years before the unfair access issue was fixed. We hope the change will encourage more women to consider careers in roles historically dominated by men. While Labor supports this bill, it is time for this government to do more to build on Labor's Paid Parental Leave scheme and do more to support our nation's young families.Share Tweet