Jim Turnour (Leichhardt, Australian Labor Party) Share this | Link to this | Hansard source

As I was saying last week when I started speaking on the Paid Parental Leave Bill 2010 and the cognate bill, Mr Costello described the Leader of the Opposition’s paid parental leave scheme as ‘silly’, with a silly tax on everything as its basis. The Leader of the Opposition cannot be trusted on paid parental leave and he cannot be trusted with the Australian economy. If elected he would introduce a paid parental leave scheme that would push up the cost of living for working families to pay millionaires $75,000 a year in parental leave payments. Under his scheme, income payments are capped at an annual salary of $150,000; so, for six months leave, those recipients would receive $75,000. But eligibility is not capped, so those on incomes above $150,000 would receive those payments. I do not believe, and neither do the Australian people, that those on higher incomes need to be supported by the government in this way.

The Liberal Party scheme is economically irresponsible and unfair. It is no wonder the Australian people see the Leader of the Opposition as a huge risk to the Australian economy. Mr Abbott is all over the shop on tax and he is all over the shop on policies as important as paid parental leave. Earlier in the year he said, ‘There’s no way we will increase taxes.’ He was talking about a possible future Abbott government, of course. Then a month later he announces a tax on everything that would push up the cost of living, to pay for his parental leave scheme. Right now he is running the mother of all scare campaigns on the government’s mining super profits tax—a tax that will ensure that the Australian people get a fair share of the nation’s natural resources. As a minister in the Howard government he told a Liberal Party function in Victoria:

Compulsory paid maternity leave? Over this government’s dead body, frankly.

It is no wonder he has been nicknamed Phony Tony—because what he says depends on his audience and the timing. He is the great weathervane of Australian politics and will blow in any direction depending on what is in his and the Liberal Party’s interest rather than the national interest.

The Australian people have a stark choice later this year at the election. They can vote for an extreme and erratic Leader of the Opposition who is a real risk to the Australian economy—a Leader of the Opposition who takes a policy on the run approach to serious issues like paid parental leave—or they can support a government that takes a serious approach to developing policy.

This bill and the government scheme are based on serious policy development by the respected Australian Productivity Commission. It is a scheme that is broadly supported by community and business leaders. It is a good scheme that gets the balance of responsibility right in terms of the family, business and government. I would encourage everyone in this House to support this legislation and the government’s Paid Parental Leave Scheme.

Wilson Tuckey (O'Connor, Liberal Party) Share this | Link to this | Hansard source

The member for Leichhardt, in concluding his speech on this important matter, just chose to recite the various items he has been given for attacking the opposition rather than present cogent arguments. It is a pity he has walked out of the chamber, because I just wanted to remind him that the principal town in his electorate, Cairns, presently has a 14 per cent unemployment rate—14 per cent. Western Australia is trying to do a bit to help them out in that regard, through trying to generate mining revenue for all Australians. There are now two 737s, I think—that would be about 300 people travelling east-west and west-east—flying directly from Cairns to Karratha. As I said in the House the other day, I doubt those on the flights would be going for the scenery in Karratha; they are going there for employment. As such, one would think that the member for Leichhardt would be taking the opportunity, as one Graeme Campbell did many years ago when the Hawke Labor government decided to introduce a tax on gold that had not previously applied, to cross the floor and vote against his own government.

Laurie Ferguson (Reid, Australian Labor Party, Parliamentary Secretary for Multicultural Affairs and Settlement Services) Share this | Link to this | Hansard source

These are the paid parental leave bills, mate!

Wilson Tuckey (O'Connor, Liberal Party) Share this | Link to this | Hansard source

I just thought that that was a fair and reasonable response to the closing remarks by the member for Leichhardt, who did not say one word in his closing statements about this important matter.

Returning to the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010 that are before us, it is a quite serious day in this House when a government moves to provide paid parental leave. I have spent many years in this place and I have seen attitudes on this issue change, both in the community and in this House. On my arrival in this place I would have been one of those who thought that probably the best arrangement was a single income family—which I, for instance, was raised in—where the responsibility of the female was to be the carer of the children of that marriage.

My mother never had paid employment until quite late in her career when she joined me in a couple of business enterprises. Not only was she a great help; she was a great innovator and clearly would have made a considerable contribution as an employed person during her married life had that been seen as the right thing to do. She was a very able woman and a great supporter of me in my ambitions. One of those was to go into business at the age of 18. She had none of the conservative views in that regard that my father had.

Here was a person in a period in my living memory probably denied the opportunity to contribute to the economy, if I can use that expression. She would have made a great contribution as a younger woman, but was denied that opportunity by community attitude. Of course, community attitude has moved on in many ways. Some of us with conservative views get a little shocked when we find out that the flower girl at a wedding is actually the child of the union. That is now commonplace. We have fiancees and partners. We have actually taken ‘husband and wife’ out of the vocabulary. Many people have happy lives without going through the process of marriage. I am concerned about that, but on the other hand it just shows how community attitudes have changed and that a response is required.

For numerous reasons the participation of women in the workforce—from the highest jobs, such as the Chief Executive of Westpac, to process workers and others—is now an economic necessity. It is always important—and I am sure the Parliamentary Secretary for Multicultural Affairs and Settlement Services, who is at the table, would agree with me—that the best stock breed. Quite some time ago in Singapore there was an initiative of the government—I do not know whether it was to restrict population growth or encourage it—and they found that the people not having children were the educated elite. Their economy was heavily reliant upon those sorts of people. The population was still growing at the other end of the socioeconomic scale, and that was of concern to them. Being as they are in Singapore, they very quickly admitted their mistake and moved away from it.

All of a sudden Australia is confronted with the opportunity and the necessity for women to be involved in the workplace at all levels. Those who can attract higher wage levels and whose genetic structure, if you like—and I will probably get criticised for this remark—means their children are more likely to be brighter than others should be encouraged to have children. I do not think there is any doubt that they will have pleasure and comfort from that decision anyway. I have an interesting family with two 20-year-old, one four-year-old and one two-year-old grandchildren. We are having so much enjoyment, as is their mother and father, watching those two younger children progress. I am pleased to say that the two-year-old can already count to 20. I am very pleased about that. She will no doubt pass her NAPLAN tests with little or no problem in future years. There are so many benefits in having children because of the contribution they make to a family.

On the other hand, we have seen the economic circumstances change. I want to take the parliament back to the days of my own parents. My father was a saver. He was nine years older than his wife. He took her into her family home the day after they were married. He had paid for it. He was a motor mechanic. He was not a man of great wealth or anything else. Therefore, when I arrived—the third child in the family—we could live on some £6 a week. He did not have a £5 a week mortgage.

What has happened now? Women must be in the workforce now because of the cost of housing and more particularly the cost of the block of land upon which it is constructed. I opened the Sunday Times in Western Australia the other morning and in the home section saw that there was a four-bedroom house available for $160,000 on your block of land. You will not buy a block of land in Western Australia for under $200,000 and in Sydney for probably under $300,000 or $400,000 because the state government I believe wants about $160,000 upfront anyway.

Here is a four-bedroom home with a TV room, an office and two bathrooms for $160,000 and we are paying, through the operations of this parliament, $800,000 for a school canteen. I thought to myself that something is wrong. Nevertheless, there is the cost. I read also that the recent interest rate rises are presently adding about $290 a month to the repayment schedule for a $250,000 mortgage. That brings us back to the fact that people need assistance in various ways if the female member of the family has to remove herself from employment when having a child or children.

The government have come up with a proposal. It is very modest. The internationally recognised standard is six months but they have not adopted that internationally recognised standard, but have chosen 18 weeks, hoping employers will top-up the leave entitlement to make it up to 26 weeks. They are looking at virtually the minimum pay rate for a person, notwithstanding the income that they forgo and, more importantly, the family debt associated with household mortgages and other investments that they might have made. I find it a bit worrying to watch all the whitegoods and TV retailers et cetera offering people no interest, no repayment offers—walk into the shop and walk out with a couple of thousand dollars worth of the goods they wish to market. There is always a point in time when that has to be paid and it often gives people an opportunity to accumulate other debts beyond their resources.

So this scheme is probably not sufficient to keep the family income up to a state where they can meet these excessive payments for home mortgages and things of that nature. There is a suggestion that possibly employers will make a contribution. This is probably not going to be much help and it could even be a disability because, as the Minister for Families, Housing, Community Services and Indigenous Affairs said in her second reading speech:

In particular, new provisions will make sure that, as intended, families receiving parental leave pay will not be able to receive the baby bonus, and family tax benefit part B will not be payable for the duration of the parental leave pay. Those families not eligible for Paid Parental Leave, or who choose not to participate in the scheme, will be eligible to continue to access the baby bonus and the family tax benefit if they are eligible.

The problem with that is: which one do I take? I doubt that the loss of the baby bonus is even fully compensated by the amount of money that is being offered as parental leave under this arrangement. It is of course at the lowest end of the scale in terms of the remuneration that people are paid.

One of the great issues, as I am advised, is that small business will be burdened with the red tape of having to pay the government’s parental leave to employees who are participating and they may be liable for state payroll tax and workers compensation for those employees on parental leave as well as for their replacement. This adds cost and red tape which the business sector deeply resents. Furthermore, I read into that that in fact the employer will pay the parental leave and, presumably, seek reimbursement from the government. I could not find that particularly identified within the second reading speech but it follows, if that sort of payment is being made and those risks are inherent in the government scheme, that that is a huge financial burden for a small business. They are paying the absent worker and obviously a replacement. It could in fact tip such a business into the payroll tax regime, because payroll tax of course in most states has a threshold under which the business is not responsible for paying payroll tax but, if you add another salary, they could be. That has always been a criticism of payroll tax: that it frequently prevents the employment of people because the small business would have a situation where they had to pay payroll tax if they put another worker on. They might need another worker, but they say, ‘No, the business is not going to grow anymore because the net result is detrimental to so doing.’ Here we have that situation forced upon a small business employer by law and that seems extremely unfair.

That is why, having a changing attitude on the issues and recognising the changed circumstances between my childhood and today, I was quite amenable to the proposal of the Leader of the Opposition, Mr Abbott, when he said, ‘Okay, we will tax or raise a levy against the higher income earners across the board.’ He did not pick the mining sector or the financial sector or anything else. If you are an incorporated company and your taxable profit exceeds $5 million—not your turnover, your taxable profit exceeds $5 million—he proposes a modest levy to raise the funds necessary so that women deciding to leave their employment for the purpose of having a baby will be reimbursed to the extent of their salary up to $150,000 a year.

I have said in this place on many occasions that $150,000 is not a lot of money anymore if, for instance, you are raising a family, looking at their long-term education needs, and you have a mortgage on a $1 million house—or a $600,000 or $700,000 house. So it is grossly unfair and very negative to be saying to those people in that higher salary bracket: ‘Don’t have any kids. You can’t afford it. Wait till you’re 40.’ I think that is sad, because they will live such a short period of their life with their children and grandchildren. So I support the concept of remuneration relevant to the salary forgone in the period when they are having children.

I also note that many of the enterprises that will be so taxed already pay significant parental leave anyway. Under the Abbott proposal, they will have the full wages of those people paid to them and they will therefore not have that responsibility. I have not seen the sums. It is a pity that someone has not pointed out how much parental leave is already paid, typically, by large organisations and government, who will be relieved of that cost under the Abbott scheme. So for many—and, I think, most—the tax will be compensated by the payments that will be refunded to their employees under that arrangement. I think that is worth understanding. It just makes the point that the initiative was needed but that the response of the government seems to be a failure as compared to the proposal put forward by the opposition. I think that is pretty important.

This has to work. It has to be sensible and it has to recognise the realities of the modern family. To say, ‘You’re rich and almost famous if you are on $150,000 a year,’ is simply not true. Sometimes in the family—and I can quote examples known to me—the female partner is the big earner, frequently earning twice as much as the husband. When you take that into account in a family budget, that is another argument why the amount of salary earned by the female partner should be the one refunded.

Amanda Rishworth (Kingston, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to support these very important bills, the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010. This is Australia’s first national Paid Parental Leave scheme. It is integral to providing the necessary support that parents expect and deserve. It is increasingly difficult for parents to balance work and family commitments. This is echoed time and time again in my electorate. Complex modern life does make it difficult to balance work and family commitments. Paid parental leave is one of those things that will go a long way to alleviating some of the financial pressures that families are facing.

The introduction of paid parental leave in this country has been a long time coming. We know that for many years Australia was one of the few nations in the OECD that did not have a paid parental leave scheme. So I am very proud to be part of a government that has acted so that parents can receive the benefit of paid parental leave from 1 January 2011. This is in stark contrast to the previous government, who actively opposed paid parental leave for the 11 years they were in office. Indeed, if we believe some of the reports about the coalition party room coming out in the media, there are still people in the party room who oppose paid parental leave.

Paid parental leave is a good thing for employers, a good thing for employees and a good thing for children. The introduction of the Paid Parental Leave scheme will assist employers to retain experienced staff without a significant cost burden on business, especially small business. For employees it provides job security and ongoing connection with their employer but also flexibility at that critical time when a baby is born. Most importantly, the scheme ensures that parents get the opportunity to stay at home with their children in those vital early months just after the birth of a child. As evidence continues to show, this is a critical time for a primary caregiver to be at home with their child. The scheme is designed to be flexible, being available to either mothers or fathers, and allows for the primary caregiver to transfer unused parental leave pay to their partner, ensuring that there is flexibility to meet differing family arrangements. While I recognise that there will be many more women choosing to take paid parental leave, this flexibility does allow individual families more options. It allows them to really look at what works best for their family.

The government’s paid parental leave initiative is fair for employees and fair for families, so these bills are very significant. Many parents in my electorate have not previously been lucky enough to work for companies that have offered paid parental leave as part of their employment contract. This has often been the case for casual workers, who have experienced financial stress when having a baby because of the cessation of the second income. Many mothers have told me that they have had to return to work earlier than they would have liked because of financial pressures on their family.

The Paid Parental Leave scheme before the House today is the government’s response to the Productivity Commission’s report into paid parental leave, entitled Paid parental leave: support for parents with newborn children. The Productivity Commission reported that there were compelling reasons for a paid parental leave scheme, including the improved wellbeing of families and, in particular, child and maternal health. It found that such a scheme encourages women to maintain their lifetime attachment to the workforce, improves gender equality and ensures that there is an emphasis placed on the balance between work and family life.

The government has accepted the recommendations of the Productivity Commission to balance the interests of both employers and employees and develop a scheme that is affordable and responsible and does not put all the burden onto employers. That is why the government accepted the Productivity Commission’s recommendations that a paid parental leave scheme be a government funded scheme that pays parents for a maximum of a continuous 18 weeks at the federal minimum wage, currently around $543. To be eligible for paid parental leave a person must be the primary carer of a newborn child or adopted child and must have been in paid work. Paid work is defined as being engaged in work continuously at least 10 out of 13 months prior to the birth or adoption of a child. That person has to have worked at least 330 hours in the last 10-month period. This means that parents may be regarded as working continuously if they have worked part time or casually, if they have had multiple employers or have recently changed jobs. This government initiative provides a realistic test and accommodates real-life situations, which include a mobile workforce. The scheme will mean that people who are primary caregivers who earn less than $150,000 in a financial year will be eligible for the Paid Parental Leave scheme. Importantly, as I have already mentioned, the parental leave is transferable. The paid leave period can be taken at any time in the first year after the birth or adoption.

The government’s Paid Parental Leave scheme is due to start on 1 January 2011. This is really important to a lot of people in my electorate, as I am sure it is around the whole country. It means that couples who fall pregnant now will know that they will be able to get access to government paid parental leave at the time of the birth of their child. From 1 October 2010 parental leave may be started to be applied through the Family Assistance Office, which will ensure that parents will be able to put the wheels in motion.

The scheme the government has announced does not put undue burden upon business and imposes minimal new costs. The government will fund employers to pay eligible long-term employees as part of the scheme who have been employed for over 12 months. The Family Assistance Office will ensure that funds are made available to employers in advance of the provision required of them to pay paid parental leave, which will ensure that paid parental leave payments will be made available in the usual payroll cycle. This initiative provides long-term benefits for business, keeping that parent who has had time off work connected with their employer, connected with their career, and promoting their return to work after the paid parental leave has concluded. This is very important for employers. A lot of employers talk about the cost burden when a person might leave the workforce, the training costs associated with skilling them up. There are a lot of very good employees out there and employers want to have provisions that ensure that they can hold on to these employees.

In terms of practicality, it is not in the hands of the employers to decide who is eligible. For my electorate this means whether you are a small business in Morphett Vale, Moana or Willunga you do not have to bear the brunt of assessing who is and who is not eligible. Eligibility will be conducted by application to the Family Assistance Office. In real terms, this means that businesses will not have to dedicate time and funds to assessing eligibility of employees. The government will expect that employers will pass on payments to their employees and the bill contains integrity provisions such as compliance rules and the right to review for employees. This will ensure that parental leave is paid to eligible parents when they require it, ensuring for working parents certainty and security of 18 weeks pay. Employers will not have to change their employees’ usual pay cycle, set up any special bank accounts or report back to the Family Assistance Office. There will be no additional rigmarole for employers. They will only be required to pay the parental leave through the normal means and also deduct tax for it.

For employees this bill goes a long way to alleviating the financial burden so often experienced by mothers and primary caregivers immediately after the birth of a new child. Talking with many of my friends and many of my constituents, that time immediately after the birth of a new child is a very stressful time. It is emotionally stressful and also very financially stressful, but at the same time incredibly rewarding and a wonderful experience. By providing financial support this bill will take a little bit of the pressure off parents and allow them to spend time at home with their newborn baby. Importantly, workers who often miss out on many entitlements afforded to permanent staff will receive paid parental leave. Workers who may be casual, contract or self-employed will be eligible.

The bill offers real financial support for many parents who have not received paid parental leave in the past. The 2008 ABS data shows that less than a quarter of women on very low wages, less than $400 a week, have access to employer paid parental leave schemes. So it has been those medium- to low-paid workers who have missed out on paid parental leave, and this bill for the first time will give these women access to paid parental leave. Importantly, however, for those who are already receiving paid parental leave, the government has made it clear that the government funded Paid Parental Leave scheme is not a replacement for parental leave provisions currently in any industrial agreement. For those new parents already eligible for employer funded schemes, the government paid parental leave initiative can be taken in addition to existing schemes. Parents can take paid parental leave before or after or at the same time as other legal entitlements. This is very important. Employers cannot withdraw any existing entitlements for the life of the industrial agreement, and modifications if companies choose to do so, including perhaps modifying it to be a top-up payment for the 18 weeks, will need to occur at the time of bargaining any new agreement.

This new scheme is characterised by flexibility and allows parents to make their own choices. Parents may nominate when they wish to receive their pay. The start date can be on or after the date of birth or, in the case of an adopted child, the placement date. All pay must be received within the first 12 months after the relevant date. As previously mentioned, the government’s paid parental leave initiative gives parents the option to share their parental leave benefits. This means a mum will be able to stay home with her new baby but will have the choice to return to work when it suits her, knowing that her partner may be able to take paid time from work for the remainder of the 18 weeks. Parents electing to receive paid parental leave will not receive the baby bonus except in the case of multiple births.

Parents who fall outside of these provisions, outside of the paid work test, will still be able to access assistance from the government. Those that do not receive paid parental leave will continue to be able to access the baby bonus, if they fit the eligibility criteria, and family assistance under the current rules. Alternatively, parents who meet the eligibility criteria for paid parental leave can also choose whether or not they will elect to receive the paid parental leave or whether they will receive the baby bonus and family assistance in lieu of paid parental leave.

I have been contacted by many people in my electorate, both mothers and fathers, who are in great support of a national paid parental leave scheme. In particular, Kerry, of Huntfield Heights, told me specifically that this bill will provide her and her family with the financial security she needs to take time off work and to spend more time at home when her child is born.

In this debate we have talked a lot about the benefits to parents, but there are also significant benefits to children. Paid parental leave represents not only our commitment to working parents but also our focus on the welfare of children. Evidence suggests that early parent-child interactions are incredibly important for babies’ social, emotional and cognitive development. Evidence also suggests that ensuring mothers have the capacity to breastfeed is incredibly important to the healthy development of the child. Paid parental leave provides parents with the option of staying at home with their newborn and giving them the best start to life without the financial pressure of returning to work. As I said before, many parents have told me that because of that financial pressure they have felt the need to return to work earlier than they would have liked and earlier than they thought was best for their child.

The benefits of the scheme have been supported by many people. The benefits for children have been supported by the New South Wales Commissioner for Children and Young People, Gillian Calvert, who said when the scheme was announced:

Research shows the continuous interaction between babies and parents in the baby’s first twelve months of life shapes the brain wiring—affecting how a child regulates their emotions, communicates, solves problems, thinks logically and reacts to the world.

I am sure everyone in this chamber will agree that those types of skills and developmental milestones are incredibly important and do set a child up for a good, healthy life.

The bill before us today is an historic one. Australians have been waiting for paid parental leave for too long. It took the election of the Rudd government to introduce such a scheme. The previous government demonstrated regularly that it had no interest in this issue. For over 11 years, the previous government refused to even consider a paid parental leave scheme. However, I would go so far as to say that the previous government was not only not interested in a paid parental leave but actively opposed to it. This was made especially clear—and this has been regularly quoted but I think it is really important to put it on the record again—by the now Leader of the Opposition when, as a minister in the previous government, he said:

Voluntary paid maternity leave: yes; compulsory paid maternity leave: over this Government’s dead body, frankly. It just won’t happen.

That was the attitude of the previous government to paid parental leave—it was never going to happen. That quote does make it clear that neither the previous government nor the current Leader of the Opposition intended ever to support paid parental leave being available to working parents in Australia.

Obviously we have seen a change of heart by the opposition leader in—I would suggest—perhaps a desperate bid to try and appeal to women. He has announced a paid parental leave scheme that, on the face of it, sounds quite generous. However, the opposition have yet to reveal most of the details of their scheme. Importantly, what a lot of parents want to know is: when will it start? There has been no start date for the opposition leader’s scheme. It was mooted when it was first announced that it was perhaps starting in 2013—maybe. That would mean that parents would have to wait at least an extra two years for an opposition paid parental scheme than for the government scheme—that is, indeed, if it gets introduced at all. Parents have communicated with me that they are making decisions now about having children and about their financial circumstances. They do not want to wait until 2013 to know whether or not the coalition, if it were to get elected, would do another policy backflip on the issue of paid parental leave. We have seen that Australian families do need certainty. Families are having babies now and they need to know what assistance will be provided to them.

In addition, the coalition’s announcement of the 1.7 per cent levy to pay for their parental leave scheme—if it indeed does come to fruition—will be, as is often quoted, ‘a big new tax on everything’. It will hit consumers at the checkout, it will hit consumers when they buy services and it will hit consumers across the board. This is in light of, a few months before, the Leader of the Opposition promising he would not introduce any new taxes. And the Leader of the Opposition had previously said there would not be an introduction of a paid parental scheme and that the introduction of a paid parental scheme would happen ‘over his dead body’. So I think the people of my electorate would be justified in wondering why the Leader of the Opposition does continually backflip or backtrack on what he says. The Australian people have a right to question which statement made by the Leader of the Opposition is indeed the gospel truth. That is a valid question for the Australian people to ask.

In comparison, our policy has a start date; our policy has a real and practical system of implementation; our policy does not slug medium and large businesses and put the burden onto them; our policy will not hurt the consumer. Our scheme is fair, balanced and economically responsible. (Time expired)

Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Deregulation, Competition Policy and Sustainable Cities) Share this | Link to this | Hansard source

It is a real pleasure to engage in this debate on the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010 today, for a number of reasons, most of which have been canvassed by previous speakers and which I will take a few minutes to touch on.

It is interesting to characterise the debate on the basis of what you hear from this parliament. What we seem to be in heated agreement about across the chamber is that paid parental leave is a good thing, that it is desirable and something our nation should put in place for the benefit of the microhumans—the babies—coming into this world, for their parents, for the broader economy, for productivity in our workplace and for engaging the incredible gifts of women in Australia so that our participation rates in the workforce are in keeping with the goals and ambitions of Australian families. That seems to be undisputed. Everyone seems to be of one voice in expressing that view in this parliament. What then happens though is that the debate falls away rather quickly. From those very thoughtful and considered remarks we move into a bit of an argument over backflips and the like. It is quite extraordinary to hear Labor members in this chamber suggest that there may be a coalition backflip, with no basis whatsoever to support that claim. This is in the incredible context of backflip after backflip from the Prime Minister on things like climate change—‘the greatest moral challenge of our time’—which he suggests are ‘deeply ingrained in his soul’. This is language that you would normally only hear during wartime. Our Prime Minister is happy to go into that hyperbole at the drop of a hat when it suits him politically, and then just abandon the idea without any explanation or any alternative plan.

If we are going to have a real discussion about backflips and where this might leave families in Australia in relation to paid parental leave, my assessment, and I think the assessment of the Australian public, would be that that is not a good tactic for the Rudd Labor government and Labor members to go down. Their form on this is notorious. If big moral challenges of our time represent no impediment to the Rudd Labor government doing spectacular backflips, paid parental leave would be an easy one for them.

I think it is an empty argument and I think it is quite courageous for the Rudd Labor government to go down that pathway of backflips again. But, in going down that pathway, they highlight the real difference between paid parental leave and the debate that we should be having in this place—that is, which paid parental leave scheme is best for Australia? On that basis, it is a lay-down misere that the coalition proposal outperforms the Rudd Labor government’s Paid Parental Leave scheme in every measure. That is probably why the Labor members in this chamber do not want to talk about those issues; they would rather scurry down the pathway of ugly arguments, personal attacks on the Leader of the Opposition and some ridiculous notion that the opposition has some proclivity to backflip, when really the Rudd Labor government has no hesitation in backflipping.

That is really what this debate is about. The bills before us are about a proposition for 18 weeks of paid parental leave paid at the minimum wage. That minimum wage represents about $543 per week, and that is for those who qualify on the basis of residency, income and work tests and who bring into this world or adopt a child after 2011. That idea represents a small step forward on paid parental leave; it does not represent a substantial move to implement the kind of scheme that Australian families and our economy actually needs.

Where we are at the moment is in a debate over which scheme would best support families and employers and be best in our long-term interest. As I mentioned in my opening remarks, the coalition scheme outperforms Labor’s in every respect. The Productivity Commission and others have looked at this issue and undertaken research on paid parental leave, and their report is very interesting. It confirms—in fact almost all studies confirm—that paid parental leave is a good thing. But it also points out that 26 weeks is really what paid parental leave should be about. Yet Labor’s bills are 18 weeks. So even in relation to that very fundamental period of time when parents can be with their children, the Labor proposal falls short. The coalition proposal addresses what is necessary in the eyes of nursing mothers associations and early childhood development experts—that 26 weeks is pretty much right. So, on that benchmark, the coalition proposal outperforms the Labor proposal.

In relation to the funds that are paid, the coalition proposal again outperforms the Labor proposal. In the coalition’s proposal, we advocate what is effectively described as a ‘wage or salary replacement proposal’. This actually goes to the heart of the difficult decisions families face. Whilst the Rudd Labor government proposal talks about the minimum wage, which is currently $543.78 per week, the coalition proposal actually takes account of what women are earning at the time they leave the workforce to bring a child into the world with the best possible start it could hope for. That child does not all of a sudden move into a household that is geared, framed and budgeted on the minimum wage; that is not the case at all. That child is entering a household where there are income traditions and trajectories that have set in place things like the capacity to pay mortgages, the capacity to pay car-financing charges, decisions about health care and the costs of living that that family unit accommodates in its normal course of events.

Those things just do not stop. You do not get the bank ringing you up and saying: ‘Congratulations on your newborn. We’ll now change your mortgage to what your mortgage might be if you were on the minimum wage.’ That does not happen. The finance company to whom you may be repaying a loan for a vehicle or home appliances does not send you a letter, a nice bouquet and maybe a little gift saying: ‘Congratulations on the microhuman who has come into your family. We will now adjust all of the expenditure commitments you have to reflect a household which has been living and shaping its life on the basis of a minimum wage.’ That does not happen. That is not the way the world works. All of a sudden people do not move house. They do not change their debt and financing obligations. They do not find their mortgages suddenly paid for. The electricity company does not say, ‘Despite the increasing cost of living which is happening in every aspect of your life, we will change everything so that your financial responsibilities reflect a minimum wage level of income.’ That does not happen. That is a ridiculous idea, nonsense, which sits behind the Rudd Labor government proposal.

People’s financial responsibilities do not change—the way in which their household budgets need to address the costs of their home, their cost of living and expenditures which last well beyond the immediate period of support for a newborn. This is why the coalition’s proposal is infinitely superior to the Rudd Labor government proposal. The coalition’s proposal is for a replacement wage so that all the normal expenses of a household, which are not relieved purely because of a microhuman coming into the world, can be accommodated. That is an enormous comfort for couples planning a family, to have a new child as part of their lives. Under the Rudd Labor government, wherever you look there are financial risks and uncertainties at a time of increasing costs of living. So having financial security, your personal economic security, knowing your circumstances and understanding the income needed to maintain your financial commitments and the living standards you have worked so hard for, all that is very important.

We had a discussion in my office earlier today in preparing for this speech. Among the group in my office and among our network of friends, it is hard to identify a family with young children where both parents are not obliged to work. It is hard to conceive of that family with housing costs being what they are, the cost of living pressures having so accelerated under this Rudd Labor government and further cost concerns into the future about great big new taxes on everything under the cryogenically frozen Rudd Labor government ETS, even on the cost impact of the mining supertax and how it will push up by $20,000 the cost of the average home and add to energy bills, the cost of construction, food and in so many things in life. These are real cost of living concerns. The coalition proposal is responsive to those and the Rudd Labor proposal ignores them.

The idea of a replacement wage is incredibly important for families, realising when they are thinking about having a family that the running joke is they might be nesting; no, they are ‘nest-egging’, trying to get the cash together to make payments which are not relieved purely because a child has come into the world. They are not adjusted to a minimum wage income. After the child arrives, they continue as they were before the child arrived.

The other thing which is important is 26 weeks over 18 weeks. I have touched on why that is relevant. Significantly, in the coalition’s proposal there are two weeks paternity leave, two weeks as part of the 26 weeks for dad to be involved, providing support during the early life of the child who has come into the household. That is not provided for under Labor’s scheme. Not only does the coalition’s scheme offer a replacement wage up to quite a responsible cap but also it extends for longer and recognises that dad wants to do all he can too, particularly in the first couple of weeks after a microhuman comes into your world. People say: ‘You’ve got a newborn. What’s it feel like?’ It is often hard to describe. The answer is: ‘Our world’s been bumped into another orbit. Everything’s different. It’s all hands on deck.’ I am pleased the coalition proposal is responsive to that.

Some questions are asked about the start date for the coalition’s proposal. I have a simple answer to that: it will be pretty smartly after the end of the Rudd Labor government. And hallelujah! What a great day that will be. The sooner we can get rid of this crowd the quicker the coalition’s superior paid parental leave can come into effect. I am not sure when that will be as the Prime Minister is holding his own counsel about when the election may be.

The other things I want to touch on go to some very specific portfolio interests relating to the small-business community. There was a very strange proposition embedded in the Labor proposal, a proposition which again illustrates why the coalition’s paid parental leave idea is superior. In the Rudd Labor government’s proposal the Paid Parental Leave scheme obliges small business employers to be the paymaster, to carry an administrative burden and a compliance risk for transferring payments to the benefiting employee. As you read through the Productivity Commission’s report, you see that there is an interesting commentary in a number of passages about compliance costs, the risks and the administrative complexities which accompany the Rudd Labor government’s scheme. There has been some effort by the commission to identify different ways of addressing those shortcomings.

I commend the Hair and Beauty Australia organisation, the Master Grocers of Australia, Clubs New South Wales, COSBOA and other small business organisations, VECCI and ACCI and the like, all of whom have made their concerns known: why should a small business be injected into this process where effectively the Rudd Labor government sees the government making a payment to the eligible recipient, where the federal government’s Family Assistance Office is involved in that process but does not actually make the payment? So you are requiring a small business to be a part of that scheme, when that exercise adds no value whatsoever to the scheme itself and, in fact, puts the small business at a significant disadvantage and quite significant risk for inadvertent noncompliance with the scheme.

The proposition that the Rudd Labor government has brought forward that requires the small business community to be a part of this exercise of transferring money from the government to the eligible person has been justified on the basis of ‘keeping in touch’—that there are some similar provisions in the United Kingdom and that they thought there was some advantage in ‘keeping in touch’. I can tell this parliament that every small business organisation I have spoken with sees no upside whatsoever in this ‘keeping in touch’ notion and they would much rather be kept out of this process.

It is simply a transfer of funds, requiring a small business to alter its payroll and administrative systems, to account for the receipt of the funds and then the payment of them, to be responsible for whatever variation there may be in tax liability and obligations, and to be at risk of not doing what is being imposed upon them and therefore at risk of penalty for noncompliance—and then also having that payment being paid by the federal government but being run through their books being taken into account for other things such as workers compensation liabilities and payroll tax. You could imagine that a small business sees no upside in any of those risks and no advantage in any of those additional cost burdens. Yet, having heard from the small business community over and over again, the Rudd Labor government is persisting with this flawed idea as part of its flawed and underperforming scheme and requiring the small business community to be a party.

You see in the Productivity Commission report example after example about why this is not a good idea. COSBOA, in their statement in March, in welcoming what they said was ‘small business support for Abbott’s paid parental leave plan,’ go on to highlight its better suitability for the small business community and its ability to attract women to small business employers and the small business family generally. They went on to talk about the compliance cost obligations and the risks. They talked about those things as being a concern and that the Abbott coalition plan overcomes those concerns by the streamlined, tidy and uncomplicated way in which the Family Assistance Office will be responsible for the administration of the payments.

I cannot for the life of me understand why the Rudd Labor government is turning its back on this clear and consistent message from the small business community. All they have done—and I believe inspired purely by getting this off the agenda, they hope—is said the Family Assistance Office for the first six months will handle the Rudd Labor government Paid Parental Leave scheme in the way in which the coalition’s proposed its scheme would be handled. My message is simple: if it is good enough for the first six months and all the investment in putting those systems in place with the Family Assistance Office makes sense, why not just keep doing it?

The coalition insists that the small business community not be left holding the parental leave cheque because they do not need to. There is no advantage to it and there are plenty of disadvantages to that model as I have outlined in my contribution already. So if the Rudd Labor government has any interest whatsoever in regulatory and compliance burdens and has listened to the legitimate and substantiated concerns of the small business community, they will not force them to be the ones handling the cash with the risks that are attached to that and the inevitable costs of changing their own internal systems, payroll systems and the like; the reporting obligations back and forth to the FAO and to the employee; the concerns about triggering an increased financial liability for workers compensation and payroll expenses because their payroll budget is inflated by that amount. It adds no advantage whatsoever.

If the government would follow the call of the opposition and the small business community, it would also bring some comfort to the small business community. As we have heard from speaker after speaker, the Labor plan is not quite right. It is underdone. It is too short. It is not recognising the real cost-of-living impacts on families—and there is every possibility many on the Labor side of the parliament recognise that. If you build in a payment handling reporting and compliance requirement for the small business community, this idea that employers may if they choose top up the contribution coming from the government can quickly morph into an obligation to do so if you set all that machinery in place.

Most people, except those opposite in the Labor Party, agree that 26 weeks is better than 18, and that replacement wage outperforms minimum wage any day. So if the Rudd Labor government comes to that conclusion and it is allowed to implement these administrative costs and obligations on small business, they will be fitted up with topping it up. (Time expired)

Sharryn Jackson (Hasluck, Australian Labor Party) Share this | Link to this | Hansard source

The Paid Parental Leave Bill 2010 for me presents an opportunity for celebration. This bill, if passed by the parliament, will deliver Australia’s first national paid parental leave scheme from 1 January 2011. The scheme is funded by the Australian government and it is fair to business and fair for families. For the generation who campaigned for the rights of working women, paid parental leave is now finally being achieved by their daughters and granddaughters. This bill, as I said, is a cause for celebration.

For the working women who at the turn of the century watched their working conditions being steadily eroded by Work Choices and despairingly confronted the fact that they were about to become the first generation to pass on worse conditions of employment to their children, this bill in conjunction with the Fair Work Act brings relief and of course a cause for celebration. This bill represents a gigantic step forward for working women in Australia. It will help Australian families balance work and family commitments and help employers retain the valuable skills and experience of their staff. I want to commend and congratulate ministers Macklin and Plibersek especially for their work on this wonderful achievement for women.

The Paid Parental Leave Bill 2010 has been attacked and criticised by those opposite as symbolism. They say that it does not match pay and it does not pay superannuation. To them I say: the bill is a real leap forward for equity for all working women, not just for those on or near the minimum wage like cleaners, aged care workers and hospitality workers. This bill promises working women 18 weeks to spend bonding with their baby, coping with the stresses and enjoying the rewards that a newborn baby brings secure in the knowledge that they are still being paid and remain a valuable member of the Australian workforce.

Of course, the government’s paid parental leave can be taken in addition to existing employer funded schemes, either at the same time or consecutively. I want to take this opportunity to congratulate those forward-thinking employers who have already implemented substantial paid parental leave schemes in their own workplaces, because I think they truly value and recognise the contribution of working women to their enterprises and businesses. This scheme will help employers, especially small business employers, enhance the family-friendly workplaces that, as I said, many already have on offer.

After 12 years of refusing to deliver paid parental leave while they were in government, the opposition now claim that they support it and would have had ‘a better scheme than the government’. But the opposition intend to hit business with a great big tax to pay for it. Frankly, the opposition, the party of Work Choices, lacks credibility on this issue. I know firsthand from the work of the House of Representatives Standing Committee on Employment and Workplace Relations that women workers in Australia suffered under the provisions of Work Choices and, indeed, were greatly disadvantaged under individual contracts in this country. It seems somewhat hypocritical to me that the opposition, which had 12 years in government to try and address these issues, chose not to do so.

Today I want to celebrate the achievements of working women. I have said that, in addition to this legislation being a substantial step forward in improving conditions for working women, paid parental leave also represents a significant achievement for Australian women in their campaign for equal rights. It is like the time when women got the opportunity to attend university or, in my own state of Western Australia, when Edith Cowan introduced the Women’s Legal Status Act in 1923—a private member’s bill in the Western Australian parliament which provided the breakthrough that enabled women to practice law and other professions. It is like 1966 when the marriage bar was lifted in the Australian Public Service, 1973 when the marriage bar was lifted in the Western Australia public service or 1972 when the Women’s Electoral Lobby was formed and for the first time conducted surveys of political candidates on issues associated with women’s rights. They held their first conference in January 1973 and were addressed by then lawyer Mary Gaudron, who had been asked by the new Whitlam government in its first week of office to reopen the equal pay case. In 1972 the Commonwealth Conciliation and Arbitration Commission handed down its decision on equal pay for work of equal value. In 1973 the first maternity leave was approved in the federal Public Service, with a period of paid as well as unpaid maternity leave. However, in its terms, it was clearly opposed to any flow-on to the private sector.

Towards the end of 1975, we saw an equal opportunity employment section created within the Public Service Board. We saw the abolition of women-only and men-only job restrictions in the Public Service, although not in the private sector until the Sex Discrimination Act in 1984. In 1977, the Working Women’s Charter was adopted by the Australian Council of Trade Unions. It called for equal pay and the provision of child care for working women and it condemned sexual harassment in the workplace. I still vividly remember as a young woman the campaign run by many during 1978. This was a period of high unemployment of some 7.1 per cent, and there was anger towards married women for ‘taking jobs from men and boys’. In 1979 the Arbitration Commission handed down a decision for 52 weeks unpaid maternity leave and, importantly, the right of women to return to their job. This was done well ahead of prevailing community attitudes—and that was only 30 years ago.

In 1984, then Senator Susan Ryan championed and then implemented the Sex Discrimination Act. In my own state of Western Australia, the Hon. Yvonne Henderson introduced and championed the Equal Opportunity Act. Finally, legislation was beginning to establish rights for women to live and work in environments free of discrimination. In 1984, Anne Summers, then an adviser to the Hawke government, pushed the government to make an election promise of 20,000 new childcare places in Australia. As recently as 2002, HREOC recommended in its report 14 weeks paid maternity leave at the minimum wage for all women. Unfortunately, this was hijacked in 2004 by the introduction of the baby bonus—then a $3,000 non-means-tested welfare payment, totally unrelated to work or the preservation of the rights of working women.

I have always campaigned for the rights of working women. I cannot let an occasion such as this pass without acknowledging that this legislation is a real step forward, irrespective of the different views in this House and in the other place, I trust and hope that it will be a real improvement for all working women in Australia. I want to talk a little about the baby bonus because, unfortunately, I think it was presented in such a way that it polarised working mothers against stay-at-home mothers. In truth, this distinction is largely false for a couple of reasons. Anyone who has stayed at home to raise children would know that it is very demanding work. In addition, there are a broad range of ways in which mothers return to work—a day a week, two days a week, three half days a week, full-time, nights, weekends and work from home. There is no clear point whereby the hours or the income indicate when a woman stops being a stay-at-home mum and becomes an employee. I believe the failure to recognise women’s unpaid work is one of the great failures of our national economic accounts and theories.

Mothers who are not eligible for paid parental leave or who choose not to receive it may still be eligible for the baby bonus and family assistance under the usual rules. I think that is appropriate. The Paid Parental Leave scheme does not need to make a distinction between stay-at-home mums and mums in the paid workforce, because paid parental leave is not a welfare payment. It is an employment benefit. It is the creation of a new right conferred upon employees who are pregnant. As such, employees may elect to take advantage of this benefit. It is not means tested against the family income; it is means tested against the primary carer applying for the benefit. This bill is not about the social or private aspects of raising a family. Clearly improvements in work based conditions mean improved conditions at home. This bill is directed squarely at the industrial issue of parental leave.

The proposed scheme will start on 1 January 2011 for eligible parents of children born or adopted on or after 1 January 2011. Eligible working parents will receive government funded parental leave pay at the national minimum wage for a maximum of 18 weeks. A person may be eligible for paid parental leave if they are the mother of a newborn child or the initial primary carer of a recently adopted child, have met the paid parental leave work test before the birth or adoption occurs, have an individual income of $150,000 per year or less, are living in Australia and are an Australian citizen or permanent resident. Paid parental leave will be for eligible working parents, including full-time, part-time, seasonal and casual workers, as well as contractors, the self-employed and, importantly, people who have had multiple employers.

Our scheme gives Australian families more options to balance work and family by allowing the primary carer to transfer any unused parental leave pay to their partner, provided the partner is also eligible. This means that an eligible father can get up to 18 weeks paid parental leave if the mother is eligible for the scheme but returns to work. Our scheme is based closely on the Productivity Commission’s expert recommendations for Australia’s best economic interests and follows consultation with employers and employer groups.

As I said before, the government’s Paid Parental Leave scheme is fair to business and fair to families. By providing time to parents to spend at home with a newborn baby, the scheme will help promote early childhood development and maternal health. The government’s Paid Parental Leave scheme will also help employers enhance the family friendly workplace conditions which, as I said, many of them already offer. This scheme will also provide long-term benefits for business as more women of child-bearing age stay connected with the workforce and their careers. It will help employers retain their skilled staff. Frankly, I also think it will help with the stereotype that unfortunately still exists in some workplaces in Australia—the assumption that a woman will not stay as long or will not be as committed to a particular employer purely and simply because she is the one likely to take time out of the workforce to bear children.

I am also very pleased this scheme contains provision that it will be reviewed in two years to enable the question of superannuation, in particular, to be reconsidered along with other things. I say that because this is an important consideration in closing the pay equity gap. As I said, in November last year the House Standing Committee on Education, Employment and Workplace Relations tabled the report of its inquiry into pay equity and associated issues relating to increasing female participation in the workforce, entitled Making it fair. As it followed so closely behind the Productivity Commission report on paid parental leave, Making it fair did not dwell upon the issue. However, a key observation of the report was the impact of interruptions to continuous employment on the pay gap and the resulting substantial differential in accumulation of superannuation over a lifetime.

It is my strongly held personal view that women should not be punished in their retirement as a result of having had and raised children during their working lives. As I said, the pay equity gap has widened. The gap today stands at some 17 per cent. In industries such as finance and insurance, it is 31.9 per cent and in WA during the last mining boom, it was 37.5 per cent. The undervaluation of women’s work in the industries in which women’s employment is concentrated still remains to be addressed. I look forward to the government’s response to the Making it fair report so that I can stand in this place and also congratulate them for taking genuine steps in addressing that pay equity gap.

Initiatives such as paid parental leave are a step towards closing the pay equity gap and enabling women to retain continuity of employment. That, as I said earlier, is something that should be a cause for celebration, especially for the women in this place, although I note that it will still be a little while before, and that we still have a little work to do to make sure, our numbers equal those of our male counterparts. This bill demonstrates an understanding that women do not automatically withdraw from the workforce when they have children. I am proud and delighted to be able to speak on this legislation and I commend it to the House.

Joanna Gash (Gilmore, Liberal Party, Shadow Parliamentary Secretary for Tourism) Share this | Link to this | Hansard source

I agree with the previous speaker, the member for Hasluck, that we have come a long way in recognising the worth of women both at home and in the workforce. While the Paid Parental Leave Bill 2010 and related bills may no longer affect me, unfortunately, they will certainly affect my five granddaughters. Therefore I am pleased to have the opportunity to place on record my views about this government’s Paid Parental Leave scheme. I would also like to take the opportunity to highlight the inadequacy of this government’s scheme as well as point out the strengths of the coalition’s proposal, which I think this government should consider.

My first point relates to the period of leave or time frame each policy grants to a new parent. Labor’s proposal allows for 18 weeks compared to the coalition’s 26 weeks or, in other words, around four months versus six months, which is crucial for breastfeeding and for adapting to the lifestyle of having a newborn baby in general. I well remember my own experience with both my daughters who were each breastfed for 6-8 months.

The next weak point I see within Labor’s policy relates to the rate at which new parents are paid. Labor will offer the minimum wage of $543.78 per week unless a mother’s salary is above $150,000. If it is more than that she does not qualify for the scheme and would simply, maybe, get the baby bonus, whereas the coalition will offer a replacement wage, that is, the equivalent amount to what she was earning up to $150,000. Anyone earning more than $150,000 will simply have their payments capped to the value of $150,000 as this is the limit. A woman earning, say, $175,000 will receive a replacement wage to the value of $150,000 for six months. However, if a woman is only working one day a week, under the coalition’s scheme she is entitled to receive the minimum wage as opposed to her regular wage, whichever is greater. Some of you might be asking: what about the non-primary carer—dads in many cases? Well, dads, you will be entitled to two weeks ‘use it or lose it’ parental leave to bond with your newborn. The coalition’s scheme will signal to the community that taking time out of the workforce to care for babies is good, healthy and normal.

Now for the fine print. Labor will not pay anyone who has not worked a minimum of 330 hours in 10 out of the 13 months before the child’s birth. Their legislation will not guarantee time off work to take advantage of the PPL scheme. A woman may find that her employer will not allow her the 18 weeks off to take advantage of the scheme. In fact, Labor have refused to amend the scheme to create a legal entitlement for leave. But there is more bad news. Businesses will actually have to administer this whole scheme for their employees under Labor’s proposal, which is something I am sure they do not need to do with their spare time—what with all the pressures on small businesses of high interest rates and just making ends meet so that they can continue to employ people. I would worry that it might even turn some business owners off employing young women just so they can avoid the administrative nightmare.

By contrast, the coalition’s scheme can be for anyone who has worked even one day a week either in their own business or in the workforce in 10 out of the 13 months prior to the birth. This means employees, contractors and the self-employed who meet the work eligibility criteria are all entitled to payments. They will also get super contributions at the mandatory rate of nine per cent—unlike Labor’s proposal. Better still the Family Assistance Office, not small business, will be responsible for administering it. Furthermore the taxpayer will not need to foot the bill for the coalition’s scheme, instead big businesses who have a taxable income or profit of more than $5 million, will. That is, of course, after all their deductions and expenses. Out of all the businesses in Australia, this will affect only 3,200. They will pay a levy of 1.7 per cent to pay for this scheme. This levy will be reconsidered when the budget gets back into surplus. No small business will have to pay the levy, only 3,200 large businesses will, many of whom already have some sort of PPL scheme in place, which could be rolled into this one.

The Liberal Party is not traditionally the party in favour of more taxes and to some people this announcement has been surprising, but there are several reasons why this scheme is just too important not to do so. With the high cost of living as well as high mortgage and interest rates it is becoming harder and harder for families to live on one income. I certainly know that is so in the electorate of Gilmore. Women need a replacement wage if they are to be enticed out of the workforce to have a child and then return to work. Productivity is essential to driving economic growth in this country. Keeping the experience and skills of our women in the workforce is crucial. We need our Australian families to have more babies so our workforce will not have to import workers from overseas. Australia is actually the second last OECD country to adopt a mandatory paid parental leave scheme. It is considered vital for the future around the world, which is why it is alarming that Labor’s scheme is so inadequate.

Lastly, we need fairness restored. All women no matter where they work should have access to the support they need at such a crucial and life-changing time. This actually benefits small business as well because women do not have to weigh up which maternity leave scheme is better when choosing where they will work—and believe me they do this now. Therefore the scheme at a local small business should be just as attractive as at a major firm in the city. Also it is important that small businesses especially do not have to deal with the paperwork of figuring out who gets what.

Obviously as I said earlier it would be preferable if this essential scheme did not have to be funded by a levy and in the future under a coalition government it will not be. The coalition has unequivocally stated that this is temporary and we would prefer to pay for this from a surplus in the budget, like the one we left the current government. We all know that it simply does not exist anymore. It is gone and all we are left with is a $100 million bill for each day, or $700 million a week, just to pay the interest on this government’s spending. Paying off this government’s massive debt will be our first priority when we return to government. Then we will be able to do such things as lower taxes and take this modest levy off big business.

In conclusion I would like to state that a paid parental leave scheme is critical to empower parents to make decisions for their families. It is crucial for the future economic sustainability of this country and it is crucial for the job security of all mums and dads. While I am very conscious that many mums did not get this support in their time, it is fair to say that family pressures and circumstances have changed. We need to encourage Australians to continue to make this country what it is. I am very proud to be part of a party that is putting forward a bold policy on this issue.

Sid Sidebottom (Braddon, Australian Labor Party) Share this | Link to this | Hansard source

As much as I admire the member for Gilmore and, indeed, I will be seconding one of her private member’s motions today, it is really important that the member for Gilmore perhaps reflects a little bit on the history of the passage of the Paid Parental Leave Bill 2010 and related bills, which I hope the opposition will be supporting. The first thing to note is that this Paid Parental Leave scheme has been in the making for decades. At last a government is prepared to commit to it and act on it.

I found it a bit rich that the member for Gilmore and, before her, the member for Dunkley were parading before us the alternative parental leave plan of the opposition, which is uncosted and essentially unknown—uncosted and essentially unknown—and then tagged with what they term ‘a levy’ of 1.7 per cent on so-called large companies when in actual fact that levy is a tax. Treasury has modelled this taxation plan of the opposition and compared it to the government’s tax plan, and I have to tell you that the opposition’s tax plan is a negative for the Australian economy in so many ways: on wage growth, on gross domestic product and on consumer prices. That is the effect—lost, I must add, in the whole hullabaloo surrounding the Resource Super Profits Tax. Finally, although those on the other side stand up here and say that their alternative, uncosted proposal is so much better than the government’s, they are led by an opposition leader who said that there would be paid parental leave in this country over his dead body. I think that speaks for itself.

I would like to now turn to the positive in this debate and congratulate the government and everyone else who has worked so hard to get a paid parental leave scheme in this country. The government funded scheme will provide parental leave pay to mothers and adoptive parents who have been working and have a baby or adopt a child on or after 1 January 2011. I think everyone in this House would agree that we have never got the balance between family and working life right, and we may not have it right even with this positive legislation; but it goes a long way towards trying to restore and encourage a balance between working life and family life, particularly, in the main, for women and our mothers, who carry the greatest burden and indeed the greatest pleasure, I suppose, of the nurturing role in our society. So this is a positive, and it was a long time coming.

The government’s Paid Parental Leave scheme is fair to families and also fair to business. Paid parental leave will give babies the best start in life, it is hoped and it is intended. It means one parent has the financial security to take time off work to care for their baby full time at home during the vital early months of social, cognitive and physical development—a very, very important development stage. The government’s scheme meets the challenges and realities of modern family life, giving more parents time at home with their new baby and helping them balance their work and family responsibilities. It also supports women to maintain their connections with the workforce and boosts workforce participation. The government’s scheme, fully costed and fully funded, lets families make their own work and family choices. Parents can transfer the leave, so mums and dads have more options for balancing work and family life. So this scheme contains options, and modern families need the flexibility of options.

Also, under the government’s scheme, women in particular in seasonal, casual and contract work and the self-employed will have access to paid parental leave, most of them for the very first time. This is a sector of the workforce that has been inhibited for a long time in trying to balance work and family life because they have not been eligible for parental leave schemes in the private sector and/or, in some cases, in the public sector.

To be eligible for the scheme, claimants will need to meet the paid parental leave work test, income test and residency requirements. The claimant must be the primary carer of the child from birth or adoption and have verified the child’s birth or adoption. Under the government’s scheme, paid parental leave is for a maximum of 18 weeks and must be taken in one continuous block. It will be paid at the rate of the national minimum wage, which currently is $543.78 per week before tax. Parental leave pay will be treated in the same way as other taxable income. Parents can nominate when they wish to receive their pay. The start date can be on or after the child’s date of birth or placement but not before, and all the pay must be received within the first 12 months after the date of birth or placement.

Now, parental leave pay can be received before, after or at the same time—and it is very important to remember this—as employer provided paid leave, such as recreation or annual leave, and indeed employer-provided parental leave. A parent will not be able to work while receiving parental leave pay but may, in the words of the legislation and in the literature that has been provided on the scheme, ‘keep in touch’ with the workplace for up to 10 days during the period if this is mutually agreed between the person and their employer. So again there is flexibility there. There is the option to keep in touch with, importantly, what is happening in the workplace and of course to maintain the social connections that are so important in the workplace itself.

If a person returns to work before they have received all of their 18 weeks of paid parental leave, the person’s partner may be able to receive the unused amount of paid parental leave, subject to meeting the eligibility requirements that I mentioned earlier. Again, this offers families the flexibility to make choices in relation to paid parental leave. If this option is not taken up by the family for one reason or another, the paid parental leave will stop when the person returns to work.

The bill provides for subordinate legislation—indeed, which we are dealing with—to give eligibility for parental leave pay to other carers in exceptional circumstances, either as a primary claimant or a secondary claimant, where the parents are incapable of caring for the child and are expected to remain so for at least 26 weeks. It can also cover situations where there are parenting orders resulting in the mother and her partner no longer caring for the child. There may be unfortunate circumstances affecting families, particularly of newborns. This provides financial support for those who become the primary carer for whatever reason and in whatever exceptional circumstances may exist.

If parents are not eligible for or do not choose to receive paid parental leave, they may be able to receive the baby bonus and family tax benefit under the usual rules. An online paid parental leave estimator will be available from September 2010 to help parents choose the option that is best for them. Indeed, this has potential benefit payment and taxation implications like similar schemes elsewhere. It is important that families and individuals take note of how it will affect their financial circumstances. The estimator is designed to allow people to do that.

Parents will lodge their claim at the Family Assistance Office. It will assess the parent’s eligibility. Claims can be lodged up to three months prior to the expected date of the birth or placement, so this allows people to prepare for this scheme and provides some options for them. Once the scheme is fully implemented, parental leave pay will be provided by employers to their long-term employees. That is the intention of the scheme once it is fully operational. A ‘long-term employee’ is a person who has been an employee of the employer for 12 months or more prior to the expected or actual date of birth or placement of the child.

The Family Assistance Office will send a notice to an employer if they are required to pay an employee parental leave pay. It will also advise the parent of this. In other cases the Family Assistance Office will make the payment directly to the parent. The Family Assistance Office will assist both employers and employees to make the scheme work efficiently and effectively for everyone involved. The Family Assistance Office will ensure that funds are made available to an employer in advance of the employer’s obligation to provide parental leave pay to an employee. These funds may be received in as few as three equal instalments. If employers adhere to their normal and proper pay practices when providing parental leave pay to their employees, they will not breach any of their obligations under the Paid Parental Leave scheme. Parental leave pay is not a leave entitlement and does not convert unpaid leave into paid leave or result in the accrual of any additional paid leave entitlements by employees.

That is the heart of the government’s Paid Parental Leave scheme. It is designed to assist families and to offer them flexibility and options at a time when they need financial assistance. Most importantly, it will allow the primary carer to have that time, whether out of the workforce or not, to try to balance the importance of family life and employment. It is also very important, if you look at the economic bottom line, as a productivity issue. It allows us to keep people in the workforce—most importantly, females—who play such an important part in the productivity of our nation and in the social capital of Australia.

In conclusion, I want to reiterate some of the key points of the scheme. First and foremost the scheme will take effect as at 1 January 2011. It is funded by the Australian government. It is fully costed and fully funded. It is for mothers who have been working before the birth of their child but it can be transferred to the other parent. It is paid at the national minimum wage, currently $543.78 per week before tax. It lasts for up to 18 weeks and can be taken at any time in the first year after birth. It is also available to adoptive parents.

Nola Marino (Forrest, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Paid Parental Leave Bill 2010 and Paid Parental Leave (Consequential Amendments) Bill 2010 which introduce a national government funded Paid Parental Leave scheme from 1 January 2011. Many families in my electorate certainly need the two incomes to meet their commitments—the costs of raising their families, the costs of education particularly if they have to send their children away for tertiary education, as well paying their mortgages. As we know, 280,000 women have babies each year in Australia, and 60,000 of these return to work within six months of giving birth. When I speak to young women, many say to me also that women should not have limits placed on them when it comes to employment.

Women also tell me that when they cannot afford to have children they have to postpone the time in their lives when they do have children. This can have impacts later in their lives in their capacity to have children. Many believe they should not have to choose between a career and a family or be restricted by the timing of that decision. They want to be able to make that decision at a time that is right for them and right for their family. They also need flexible workplace arrangements throughout their working life cycle—something which can be easier to deliver in larger enterprises than it is in small business workplaces. These are the same women who play an invaluable role in our workforce, often being the primary earner in a partnership, but who are also critically concerned with the interests of their children. And we do know that Australia’s women are some of the best educated in the world.

As we know, Australia is one of only two OECD countries without a mandated paid parental leave scheme, the other being the USA. Having said this, Mr Deputy Speaker, larger private businesses, government agencies and departments in the public sector have been offering paid leave schemes for over 25 years for their employees, including maternity and paternity leave. This has certainly encouraged women to seek this type of employment and to use the paid maternity leave option. In fact in 2005, 76 per cent of women employed in the public sector used paid maternity leave compared to 27 per cent of women who are employed in the private sector.

There is no doubt that each day parents spend with their newborn babies is very precious. Anyone who has ever had a child knows how incredibly precious and important the first days, weeks and months of their baby’s life are, and that it is important both for you as the parent and for the baby. I suspect that there are many of us who see every single day of our children’s lives in exactly the same way.

For mothers, this time can also include having to manage breastfeeding, recovering from sometimes difficult pregnancies, as well as recovering from the birth itself. There is also the adjustment at home with a newborn in the house, often complicated by babies who do not simply eat and sleep all the time, as some believe they should. In many cases, for women in families and small businesses as well as those in the workforce, managing work, family and community voluntary expectations also continue during this time. I have seen women who put their babies into care and want to keep breastfeeding, having to leave their workplace with the agreement of the employer to go and do exactly that so that they can maintain their employment during that time.

Under this legislation the government is proposing 18 weeks of leave at the national minimum wage for primary carers who can satisfy work, income and residency tests, and who have, or adopt, a child on or after 1 January 2011. There is no provision that requires employers to continue their own, often more generous, schemes and many small to medium businesses cannot afford to top-up a new scheme in the way the government may hope that they can. Women will also have to choose between receiving other family payments, such as the baby bonus and family tax benefit, or the Paid Parental Leave scheme. They will have to use a calculator to assess whether they will be better off under these existing payments or the government’s proposal.

The government has also ruled out including superannuation payments in the first three years. It is a fact that the work patterns of women inevitably mean that they are in and out of the workforce with family and caring commitments over the course of their careers and lives, which inevitably leads to a lower level of retirement funds at their disposal. The government has excluded superannuation payments from the commencement of the scheme, which fails to address the long-term retirement requirements of women. As we know, the majority of age pensioners—75 per cent of them—are actually women who have not had, and do not have, the financial capacity to support themselves in their senior years. The coalition has included superannuation contributions at the mandatory rate of nine per cent in our paid parental leave scheme.

I have very serious concerns about the additional burden on small to medium businesses and, essentially, how the government’s scheme will actually work in practical terms within these businesses on a daily basis. Exactly what employers will have to do to discharge their responsibilities, and how, has yet to be explained, but it will be another administrative and compliance cost for the businesses concerned. The government has also failed to address the payroll and workers compensation impacts on the employer to continue and to retain and pay the workers on parental leave on their books. How will this scheme work for self-employed and family business operators, for women in the farming sector, those doing seasonal work and contractors in the workforce? I would also like to know how this scheme is reflected in the government’s workplace relations laws and where the provisions are. I am concerned that the minister’s officials have indicated that the rules accompanying this legislation will not be provided until at least October this year.

We should also not underestimate the challenges small to medium businesses will face in finding replacement workers for the parental leave period. It will be far more difficult in areas of skills shortages as well as in regional and rural areas. Understandably, small businesses are very wary and extremely concerned about both the extra costs and compliance issues that will be imposed by this legislation.

As a result of a lack of consultation with the sector, the government is having to introduce a six-month phasing in or moratorium period, during which time the administration of payments will be borne by the government. Future estimates will reveal what the cost has been to government during this period and give some insight into the additional cost to business over the longer term. This is, unfortunately, just another example of the government’s rushed rollout of policy and programs and continues its pattern of failure to consult with stakeholders.

Under this legislation, small businesses will have to manage the government’s parental leave payments to employees who are participating. Small business may be liable for state payroll tax and workers compensation for employees on parental leave, as well as for their replacements. This will add further compliance costs to individual businesses. Under the coalition’s scheme, small businesses will not pay the levy; nor will they administer it.

The government is borrowing $100 million a day, $700 million a week, and will have a deficit of $57.1 billion on 30 June of this year. It has a history of rushed and bungled programs. The coalition’s scheme will provide payment to all full-time, part-time and casual workers, providing primary carers with 26 weeks of paid parental leave and up to two weeks of paternity leave—very important for so many fathers who also want time with their newborn baby. This will be available to all employees, including contractors and the self-employed, who meet the work eligibility test. The coalition’s scheme will be administered by the Family Assistance Office, not by employers.

Parents have to balance work and family life year after year, as you would know, Mr Deputy Speaker, until their children become fully financially independent. As well as privately negotiated benefits, the Australian government provides a range of family payments and subsidies, including the baby bonus, which are, in comparison with other OECD countries, relatively generous.

I would like, at this time, to acknowledge the extremely valuable contribution made by mothers who make the decision to raise their own children. I see this every day in my electorate. These are the same women who often make an invaluable contribution to regional and rural communities as volunteers in so many ways, as you would know, Mr Deputy Speaker Scott. They are in school canteens, they are at sports days, they are mums’ taxis, they are supporters of community sport and often the flag wavers, and they are part of community service organisations as well.

The challenge of finding affordable housing and managing on one wage is a very real issue for many young people. The Labor government has made decisions which affect families—for instance, the decision to cancel 260 new childcare centres. Families in my electorate of Forrest who do manage to secure a place for their children at a local childcare centre while they work can find it almost impossible to afford, depending on their wage. We will see $86.3 million in government cuts to the childcare rebate over the next four years. This comes despite the fact that families are facing a $13 to $22 a day fee increase per child in the next year to meet childcare quality reforms. As we know, accessible and affordable child care is key for parents, especially mothers who stay in the workforce. The family is the foundation of our society and our small communities. Assisting families, particularly those with newborn children, is not only a right but also a matter of importance for this nation.

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

I would like to start by taking up a few points made by the previous speaker, the member for Forrest. She expressed a concern for business, yet the opposition’s proposal is all about implementing a great big new tax on business. I think that is a bit of an anomaly. She talked about seasonal workers. If she took the time to read the legislation properly, that would answer the question. She talked about a lack of consultation. That really goes beyond the pale because I do not think there has ever been legislation that has had more consultation than this particular legislation, the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010. The Productivity Commission has reviewed the legislation and there has been consultation with community groups throughout Australia, yet the member on the other side states that there has been a lack of consultation. Lack of consultation happens on that side of the House, not on this side.

The member for Forrest talked about rushing out policies. We only have to look at the performance of the opposition and statements made by the Leader of the Opposition to see what rushing out policies amounts to. They make policies on the run—policies that affect Australians each and every day. We have learned from the Leader of the Opposition that the only policies that they roll out that we should take any notice of are the ones that are written and considered. I really think that it is quite strange that the previous speaker would raise this issue.

Another point that she made caused me some concern. She thanked the women in the community who raise their own children. I think all women are committed to raising their own children. Just because a woman decides to return to the workforce does not mean that she is not committed to raising her own children. I am absolutely disgusted by that comment from the member for Forrest. She talked about cancelling childcare centres. I put on the record that if the opposition were in power there would be no new childcare centres. Their record in relation to child care was absolutely appalling.

I find it strange that members on the other side of the House can come in here and talk about paid parental leave when, under their government, when they were in power under John Howard, there were 12 long years when they did absolutely nothing about paid parental leave. The opposition have a very, very sorry record on giving benefits to women and children. I think that they stand condemned for their inaction in the past. They come in here and hypocritically talk about what they will do for women in the future when in the past they did absolutely nothing.

I would like to congratulate the Minister for Families, Housing, Community Services and Indigenous Affairs for this legislation. I would like to congratulate her and all the people she consulted with to develop such a fine piece of legislation that has the interests of families at its heart. So I say to those on the other side of this House: stop being hypocritical. Get behind the legislation that we have before us today. Support this government legislation and support the families of Australia.

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! It being 2 pm, the debate is interrupted in accordance with standing order 97. The debate may be resumed at a later hour and the member will have leave to continue speaking when the debate is resumed.