Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Hansard source

This is an important opportunity for the parliament to listen to and respond to very legitimate concerns about the compliance burden, the cost and the regulatory risk to employers in implementing the government’s Paid Parental Leave scheme. What I need to make absolutely clear at the outset, given the mischievous and ill-informed comments the minister has made today, as reported in the media, is that this in no way changes the nature of the benefits available under the Paid Parental Leave scheme or the eligibility criteria and in no way impedes the introduction of the scheme from 1 January. In fact, from 1 January, the scheme will be administered by Centrelink. It is Centrelink that will be handling the paperwork, making arrangements for the payments, confirming eligibility and resolving any disputes that may arise so that the Paid Parental Leave instalments are paid directly to eligible recipients.

The proposition contained in the Paid Parental Leave (Reduction of Compliance Burden for Employers) Amendment Bill 2010, is a very simple one: maintain that system. Keep that investment, the infrastructure to deliver the Paid Parental Leave services and all the systems that go along with it that the government is putting in place for the first six months, by continuing those arrangements indefinitely. The bill seeks to ensure that that is the case, because the government’s stated plan and the provisions that exist within the Paid Parental Leave Act actually enable the government to require employers, big and small, to carry out the pay clerk function for the Paid Parental Leave scheme after its first six months of operation. This bill seeks to ensure that that does not happen and that the government continues, through Centrelink’s Family Assistance Office, to administer these payments.

In June 2010, parliament passed the Paid Parental Leave Act, and it comes into effect from 1 January next year. The scheme provides for eligible recipients to receive up to 18 weeks paid parental leave per child, paid in instalments, at the national minimum wage. Under the scheme, payments are administered by Centrelink’s Family Assistance Office for the first six months, after which employers will be obliged to receive payments from the Commonwealth for forwarding on to eligible employees, and employers will need to account for these transactions. Significant fines may be imposed on employers that fail to meet the numerous obligations and compliance requirements imposed under the scheme.

Let me reiterate that this is not about changing the scheme, the nature or amount of the payments or the eligibility criteria; it is about the way in which the scheme is administered. It is completely mischievous of Minister Macklin to suggest this would in any way hold up the scheme.

Employer organisations and the small business community are deeply concerned about being forced to be the pay clerk for the government’s Paid Parental Leave scheme, because of the costs, the red tape and compliance burdens and the risks it will impose. These unnecessary and avoidable costs and risks include the need for employers to become aware of and familiar with their obligations and responsibilities under the government’s scheme—to make necessary changes to their payroll and accounting systems; to train staff; to receive, handle, process and make payments in a timely way, in instalment amounts. There are compliance, verification and reporting requirements, and of course the opportunity cost of this displaced effort and these resources. From the government’s own information, there will be more than a dozen transaction points that will need to be handled by an employer, big or small, and they need to put in place the systems to ensure that they are undertaken in the way the law requires.

This bill is about removing that administrative and compliance burden and the costs and risks that the government wants to impose on employers by obliging employers of eligible recipients to carry out this pay clerk function. The effect of the bill will be to indefinitely maintain the role of the secretary to administer the payments to eligible recipients through Centrelink’s Family Assistance Office beyond the first six months of the scheme. What is extraordinary is that the government sees fit and believes it to be entirely appropriate, safe and thoughtful to have the Family Assistance Office administer the scheme for the first six months but not after that. It is an arbitrary cut-off arrangement where no credible justification or persuasive argument has been presented. The bill will not change any of the scheme’s parameters or the provisions about eligibility.

When the original paid parental leave bill was considered by parliament in June, the Senate agreed to support the coalition’s amendments, and these amendments are replicated in this private member’s bill. But the government threatened to delay the entire scheme if the Senate insisted on these amendments. I have not seen such an extraordinary overreaction and piece of parliamentary bullying in the 15 years I have been representing the Dunkley community here. On an issue of relieving employers, big and small, of a pay clerk compliance obligation, the government was prepared to delay the entire scheme. It makes you wonder: what is really going on here? There has been a chorus of concern raised right across the country—from small businesses, big businesses, representative organisations and thoughtful and leading thinkers such as Peter Strong, the Executive Director of COSBOA, who is in the gallery here today—for the government to abandon this nonsense.

But what do we get instead? Minister Macklin was reported in this morning’s paper as saying the coalition wants to delay the start of the scheme. What utter nonsense! There is nothing in this bill that will cause any delay to the scheme. It was the government that threatened to delay the entire commencement of the scheme if the coalition, given that the Senate supported our amendments, insisted that those amendments be captured in the law.

You do not necessarily have to agree with me, but I would like to think that Minister Macklin might agree with herself, that the Prime Minister might agree with herself and that Minister Plibersek might agree with herself. I take them back to their 13 July 2007 media release. This was a joint media release from shadow ministers Plibersek, Gillard and Macklin headed ‘Maternity leave’. It stated:

Labor will not support a system that imposes additional financial burdens or administrative complexities on small business …

Those were their words. They not only said they would not support it but demanded it; they insisted on not having those kinds of burdens imposed on small business and other employers. Otherwise they threatened to delay the entire commencement of the scheme. If for no other reason than personal integrity and implementing election promises, all sides of the parliament should back this bill. In fact, Labor ministers are running around the countryside talking to small business and employer organisations, saying that they agree with the proposition in my bill but that they did not win the argument within Labor. I think it is interesting that even the ACTU, in its Productivity Commission submission in May 2008, stated:

The simplest administrative system would seem to be that the government provides the safety net components—

it handles the payments—

to all the new mothers via the existing welfare system, as it does with the baby bonus. Employers would provide any additional top up payment to employees as per their usual methods.

That is the union movement’s position, a position reinforced more recently when the exposure draft was developed and entirely consistent with the position reflected in its May 2008 submission. What is quite extraordinary is that the government has gone ahead with a thing completely opposite to what it promised as articulated in its July 2007 press release.

So what are we left to conclude? We are left to conclude that the government has no interest in hearing from and responding to the concerns of the small business community. COSBOA Executive Director Peter Strong astutely picked up how the Gillard government’s decision to impose this PPL pay clerk responsibility on smaller employers shows that the government:

… does not value the time and effort put into the economy by small business by continuing with this.

What Mr Strong was saying is that small businesses are not machines; they are run by people, and the people are saying, ‘We have enough of a burden trying to maintain the viability of our businesses and the employment and economic opportunities that they facilitate without having this pointless and completely unjustified imposition distracting us from that work.’ COSBOA has been consistent in its criticism of the government’s imposition of the additional red tape and compliance burden, rightly questioning:

Will the government never learn the simple needs of small business?

I fear not. It seemed to know it when there was an election in the air; it made clear statements that it now turns its back on.

So what are we left to conclude? I think that what we are left to conclude is that something else is going on here. It cannot actually be the substance of the issue. Why would the government threaten to delay the entire commencement of its Paid Parental Leave scheme because of the opposition and the Senate simply wanting to continue the administrative arrangements the government itself was putting in place for the first six months? Why would it want to junk the whole scheme, and why would it make statements of a similar ilk today in opposing this private member’s bill that should have the support of all members in this parliament, particularly any Labor member who wants to stand behind election promises from their side of politics? So what could this be? The government has failed to provide any persuasive justification. There must be something else going on here, not only requiring the administrative arrangements but putting this system in place to fit small business up to top up the commitments. (Time expired)

See this speech in context