Pat Conroy (Charlton, Australian Labor Party) Share this | Hansard source

I am very pleased to speak on the Paid Parental Leave Amendment Bill 2014 because it gives me a good opportunity to talk about the importance of paid parental leave and the other associated factors with workforce participation of females, particularly childcare assistance. I have a particular interest in this area as my first child, Rachel, has just turned one and my wife and I are very conscious of the importance of government support for new mums and dads as well as the cost of child care.

One of the most significant achievements of the last Labor government was the introduction of Australia's first national paid parental leave scheme. The scheme was created on the basis of recommendations from the Productivity Commission. The commission supported a flat rate minimum wage payment as the fairest and most effective way to design a paid parental leave scheme. Since the scheme was introduced on 1 January 2011, more than 340,000 families have benefited from Labor's scheme, including my own family. Until this scheme was introduced, approximately 55 per cent of working mothers did not have access to paid parental leave. The majority of women who did not have access to this leave were working in low-pay jobs or were casual or self-employed workers. Today, because of Labor's scheme, around 95 per cent of working mothers have access to paid parental leave and Labor can also be proud of the fact that 40,000 dads and partners have benefited from dad and partner pay since that began in January last year. The current scheme is financially responsible and socially fair.

I was bemused by the previous speaker's, the member for Robertson, complaint about the compliance costs of this scheme. There are compliance costs for this scheme, and the previous speaker for Labor, the member for Gellibrand, acknowledged that, but to try to compare the $48 million of compliance costs of Labor's scheme to the $5½ billion that the rolled gold, gold-plated scheme of those opposite will cost the economy every year is just ridiculous and shows how out of touch the coalition government is. And this is a surprise since the Prime Minister, in the past, has stated that a paid parental leave scheme would be introduced in Australia over his dead body. Like many other matters, he is weathervane and he will do what is electorally popular or what he assesses will secure votes from certain segments of the population rather than make good policy.

On the other hand, I am proud that a Labor government introduced this historic reform. It contrasts quite markedly with the coalition plan, which demonstrates the warped priorities of the Prime Minister and the government. Under the current proposal from the coalition, we will see millionaires receive $50,000 of taxpayers' money for having a child while a woman on the minimum wage would only get $16,000. At every level this is fundamentally unfair, and the proposal is a blatant insult to low- and middle-income women and their families. It clearly prioritises and benefits women in high-income jobs at the expense of all taxpayers.

Eighty per cent of women of child-bearing age in Charlton, my electorate, have an income of less than $42,000—this is a very conservative estimation as this $42,000 figure includes government payments—therefore, 80 per cent of my constituents would receive less than $21,000 if they had a baby under the coalition's scheme. In fact it is likely to be well under $20,000. Yet millionaires will receive $50,000. I ask: why is a baby in Charlton worth $29,000 less than a millionaire's baby? The truth is it is not, and it demonstrates the fundamentally inequitable nature of this policy.

This is the type of scheme that has also been criticised by the Productivity Commission, which concluded:

Full replacement wages for highly educated, well paid women would be very costly for taxpayers and, given their high level of attachment to the labour force and a high level of private provision of paid parental leave, would have few incremental labour supply benefits.

So from an equity point of view and from a policy efficacy point of view, this is an awful policy. And it is an awful policy highlighted by division within the coalition. For example, the member for Mitchell, before the last election, wrote:

Women I have spoken to on high salaries understand that this is a stretch. Their attitude is a quintessentially Australian response: 'If you are offering, I'll gladly take it-but do I think it's right, no. Do I need it, not really.'

The member for Mitchell, in the same article, also noted that the coalition's scheme will cost more than three times Labor's scheme in its first year alone. The member for Dawson has stated:

I have significant concerns about introducing this scheme without a significant policy that would assist stay at home mothers.

And the Deputy Prime Minister has acknowledged opposition to the scheme amongst the Nationals. If their own party room opposes this policy, why should Australia cop it? We should stick with the current tried and true Paid Parental Leave scheme, which gives equity as well as assisting mothers stay at home to look after their babies for a certain amount of time.

I would also draw the attention of the House to the fact that although there is considerable division within the coalition about the Prime Minister's scheme, the Australian Greens support a similar scheme. The Prime Minister has previously stated that the Greens have 'fringe economic policies to put it at its kindest', yet this is a fairly apt description of his leave proposal. It yet again demonstrates the hypocrisy of the coalition—that is, they are prepared to side with the Greens rather than the Productivity Commission in providing an efficient and equitable Paid Parental Leave scheme.

I would also draw the attention of the House to the fact that this scheme is not a workplace entitlement, as the workers' employer is not paying for the scheme. It is taxpayer funded. The proposed increase in the company tax rate will not cover it. As the Parliamentary Library stated:

The designs of both the current and Coalition … [scheme] contain elements that make them as much like an Australian Government welfare payment as they are workplace entitlements. For example, rather than being funded and run privately by employers or funded (as occurs in most OECD countries) through a social insurance scheme, they are:

fully or substantially funded from taxation revenue and

fully or substantially administered by the Department of Human Services.

In fact, in the bill we are debating the, the government is trying to centralise administration of paid parental leave as we speak. Yet again we need to emphasise this point. This is not a workplace entitlement; this is a form of welfare, and why should a family in Charlton received $29,000 less welfare for having a baby than a millionaire in the Treasurer's seat of North Sydney? It is fundamentally inequitable and based on faulty principles.

If I can come to the cost of the scheme, the coalition has long talked about Australia facing a budget emergency and the need to drastically cut government spending. It should be stated that this is a false and confected budget emergency. Leaving that aside for a second, why then, if they believe their own rhetoric, would they want to introduce a $5 billion a year parental leave scheme which overwhelmingly benefits those people who are employed and in relatively high-paying jobs? This huge cost should be seen in the light of cuts that have already been made as well as those proposed by the government. They have abolished the schoolkids bonus for working families; they are cutting the payments of Australia's 2.3 million aged pensioners; they want to impose a GP tax on all Australians, which will mean the end of universal health care in Australia; they are cutting $80 billion from schools and hospitals; and they are attacking families through their draconian revisions to the family tax benefit B arrangements. Contrast this with the $5½ billion they are going to be spending on the Paid Parental Leave scheme each year.

The Treasurer has famously declared that 'the age of entitlement is over'. Given the introduction of this scheme, this statement should be qualified: the age of entitlement is over for everyone except the wealthy. In his age of entitlement speech the Treasurer stated:

The road back to fiscal sustainability will not be easy. It will involve reducing the provision of so called "free" government services to those who feel they are entitled to them.

What an insult to the millions of Australians who rely on Medicare, on public hospitals and public schools, as well as the aged pension, they should be on notice that the Treasurer believes that these government services need to be reduced but that wealthy families are entitled to unfair Paid Parental Leave scheme. In the same speech, the Treasurer also declared:

As a community we need to redefine the responsibility of government and its citizens to provide for themselves, both during their working lives and into retirement.

Given the proposed scheme, the Treasurer is clearly of the view that this re-defining means wealthy Australians get extra support from government, whilst everyone else needs to provide more for themselves. It is unconscionable to be drastically cutting funding to health, education, the aged pension and family support at the same time as giving extra support to the most well-off Australians. This is why we need a general debate on the Paid Parental Leave scheme and this bill offers a good opportunity to start that.

I would like to draw to the attention of the House, recent comments by the Treasurer that women will only qualify for paid parental leave if they guarantee that they will return to work. While we are yet to see concrete details of this thought bubble, it is clearly impractical, as child care is still a luxury in some areas and we need to be providing more resources to child care. I would also say, by contrast, that the current scheme, places no obligations on the 95 per cent of women who access it to return to work. They can access the leave if they qualify for it. This is only fair. This is an entitlement to help, usually, young mums, but often fathers, spend time with their baby before returning to the workforce if they choose. That is an equitable and efficient way of administering a scheme rather than draconian the provisions that the Treasurer has highlighted, which would see money being clawed back from people after they receive payments.

This leads to my next point around child care funding. This is a very important aspect in this debate—whether we have Labor's tried and true Paid Parental Leave scheme, which we are debating now, or the rolled gold unconscionable scheme that the coalition is proposing. In the debate you need to look at the child care provision that accompanies it. Labor has a proud record on child care. The last Labor government increased the Child Care Rebate from 30 per cent to 50 percent of out-of-pocket expenses up to $7,500. In contrast, the Abbott government will freeze the child care benefit threshold, which will cut access to child care. Indexation of the child care rebate will also be stopped. The heartless budget we saw delivered a fortnight ago has cut over $1.3 billion in support for child care. Under their ridiculous scheme, how can mums return to the workforce if they cannot find child care?

Importantly, in her submission to the Productivity Commission's inquiry into child care and early childhood learning, my colleague the member for Adelaide requested that the commission examine whether the funding for the government's Paid Parental Leave scheme could be distributed through an alternative scheme to achieve its objectives more effectively and equitably, and whether some of these proposed funds could be better utilised in the childcare sector. This is a very important point. A study by the Grattan Institute has demonstrated that childcare funding is twice as effective as paid parental leave in promoting workforce participation amongst women. If those opposite were really serious about increasing workforce participation amongst women they would maintain a Labor's tried and true Paid Parental Leave scheme and invest the excess money into child care. But they won't, because it is all rhetoric. Their scheme was designed to try and lock in the vote of women and families before the last election rather than really tackle serious problems.

Their scheme is a clear example of an out-of-touch government introducing an expensive new entitlement at the same time as it is attacking Medicare, putting up fuel excise, and cutting pensions and support for families. The feedback from my constituents in Charlton is abundantly clear: they oppose the government's unfair and inequitable Paid Parental Leave scheme. They would rather keep Labor's scheme. The contrast is even more marked as we have seen the impact of the budget. As I said earlier, the coalition scheme would pay a millionaire $29,000 more to have a baby than 80 per cent of women in my electorate. When we add into that the draconian cuts to family tax benefit, where we see a family on $60,000 a year losing over $6,000 of family income, which represents 11 per cent of their income, we see what this government really is about. This government is about attacking low- and middle-income Australians, attacking pensioners and people who want to go to doctors and instead supporting the wealthy by paying them $50,000 to have a baby.

Labor stands for fiscally responsible and socially fair paid parental leave scheme. The current scheme delivers this. The coalition's proposal is an outrageous and ideological scheme being introduced at a time when the government is cutting services and telling us we need to provide more for ourselves. Labor will continue to oppose the unfair scheme and support our equitable and efficient scheme.

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