Monday, 31 May 2010
Paid Parental Leave Bill 2010; Paid Parental Leave (Consequential Amendments) Bill 2010
The original question was that the bill be now read a second time. To this the honourable member for Warringah has moved as an amendment that all words after ‘That’ be omitted with a view to substituting other words. The question now is that the words proposed to be omitted stand part of the question.
The Paid Parental Leave Bill 2010 is landmark legislation, legislation that brings Australia into the 21st century and legislation that places Australia in a comparable position with other OECD countries. Currently, Australia and the United States are the only two OECD countries that do not have a paid parental leave scheme. It is unfortunate that, for the 12 years the Howard government was in power, the current Leader of the Opposition failed to advocate a paid parental leave scheme. Now his solution is to impose a great big new tax on business—a tax that will be passed on to each and every Australian. This legislation is great for Australian families, Australian businesses and the nation as a whole. It will enable all eligible working parents of babies born or adopted from 1 January 2011 to receive 18 weeks of paid parental leave at the federal minimum wage.
The fact that there has been no paid parental leave scheme until now has cost families dearly. It has impacted on family income. It has made it really hard for families to make the decision about whether or not to start a family or to have an additional child. If they have made that decision, it has often caused the family to experience financial hardship. In many cases both parents have had to return to work earlier than they would have liked to.
I think it is really important to put this on the record given the contribution of the previous speaker in this debate: I value the contribution made to child rearing by each and every parent in this country. I know that some parents choose to stay at home and rear their children, that they are with their children until they start school. That is their decision. Other parents choose to go to work or need to go to work. That is their decision. Each and every one of those families needs to be supported. This legislation does that. It helps families make that decision based on the fact that they choose to stay at home or to go to work. The government will be offering them financial support for the first time in Australia’s history. From the family perspective, it is also very important because there are issues relating to the mother’s health. In most cases it is the mother that tends to be the person that cares for the baby in its early months. Quite often if there are enormous financial implications the mother will be forced to return to work sooner than she would like to. From a health perspective, that could be sooner than it would be wise for her to return to work. This legislation will enable her to take the time that she needs to allow her body to heal and to bond with her newborn child or her adopted child.
If both parents have to return to work very early in the piece, that impacts on a family’s dynamics. That does not allow the whole family to come together and bond and to see itself as a family unit. There is an enormous social cost associated with both parents being forced to return to work very early. It is noted that a parent’s exclusive care for their child improves the child’s development. Where a mother chooses to breastfeed that enables her to establish a breastfeeding pattern. It also works with bonding and nurturing. From a social perspective, that is very good for the whole community.
Businesses have also been adversely affected by the lack of a paid parental leave scheme. In the past the lack of a paid parental leave scheme has led to a situation whereby the primary care giver, usually the woman, is forced to leave the workforce. This in itself is a cost to business. The employer is losing a skilled and valued worker so it leads to the business incurring a cost. Studies have been conducted into this. I would like to refer to one by an Australian human research institute which cites research that has found that replacing that employee can cost up to 1½ times the employee’s salary. A global expert on restructuring, a professor at the business school of the University of Colorado in Denver, has conducted research that has found that in some instances, depending on the employee’s role in a company and the supply of suitable skilled workers, it can cost up to 2½ times the worker’s wage. That is a significant cost to business. The costs involved include exit interviews, interviewing and selecting new employees, overtime worked by other staff to fill the short-term vacancy and then the training of the successful applicant. Retraining in itself is a quite significant impost on companies. Using the 1½ times salary figure and an estimate of the average staff turnover within large companies in Australia of 12.6 per cent, the institute calculates that the cost to the Australian economy could be as much as $20 billion. That shows that this legislation which we have before us today is a very fine investment in Australia.
I note that the Minister for Families, Housing, Community Services and Indigenous Affairs is at the table. I would like to formally congratulate her in this House on all the hard work that she has done in developing this legislation. She has been a long-term advocate of paid parental leave. I know that without her efforts this legislation would not have come to fruition. Mr Deputy Speaker, forgive me for having been sidetracked for a moment. There is the cost to the nation as a whole because of the loss of skilled workers. Also there are the enormous financial implications when workers have to stay at home without any financial support and, as I have already mentioned, there are the long-term social costs.
This legislation has the potential to change the face of our society. It will deliver certainty and financial security to families throughout Australia. It is legislation the opposition should support. Listening to the contributions by members of the opposition, it is quite obvious to me that they do not support the legislation. If this legislation does not pass the parliament, each and every one of them will stand condemned. This legislation has the support of both business and unions. I refer to an article quoting a business leader on the legislation:
Australian Industry Group chief executive Heather Ridout, says the Government’s scheme is a “sensible approach” to an unresolved issue—
It has been unresolved for far too long. It was unresolved when the opposition was in government, when the Leader of the Opposition was in a position to bring about change. The article goes on:
“A taxpayer funded scheme providing payments to working mothers of 18 weeks at the level of the minimum wage is consistent with the recommendations of the Productivity Commission and is largely consistent with the Group’s proposals,” she said.
“The introduction of an appropriately designed paid parental leave scheme will provide many benefits to the community, not least of which is increased participation by women in the workforce …
Those are the words of industry. Those are the words that Ms Heather Ridout has spoken in support of the scheme. I also refer to a media release by the ACTU:
“Australian families and women in particular are counting on this scheme being in place on January 1 next year,” Ms Burrow said.
“This is an important reform in the way we help women especially to handle work and family commitments at an emotionally and often financially stressful time …
I think that says it all. This scheme has the support of both industry and the trade union movement.
There has been widespread community consultation. The Productivity Commission looked at the economic, productivity and social costs and benefits of a paid parental leave scheme. It also considered the health and developmental benefits for babies and parents. I referred to this earlier in my contribution to this debate, but from the mother’s perspective it is essential that in the first few months after she gives birth to a child she stays home to develop that bond, to allow her body time to recover and to establish breastfeeding, which is in the best interests of the baby. Further on, it allows the development of the baby to progress in a very measured and appropriate way.
The commission undertook extensive public consultation. The government also undertook extensive consultation with key stakeholders—trade unions, employer groups, families and community groups. This is well-researched legislation that has been thoughtfully developed. The legislation that we have before us here today is based on the recommendations of the Productivity Commission. This is not spur-of-the-moment legislation that is ill thought out, like the Leader of the Opposition’s tax on businesses with a taxable income in excess of $5 million—a great big tax on everything that will cause a burden to Australians, increasing the cost of living. This is a scheme that delivers to families, not a scheme that places enormous financial imposts on both businesses and families.
In the short time I have left in this debate, I will touch on a couple of key elements of the legislation. The scheme is for an 18-week period of paid leave, which must be taken in one continuous block. It will be paid at the national minimum wage. Parents can nominate when they wish to receive the pay, but it must be within the first 12 months after the child’s date of birth or placement, in the case of adoption. Parental leave pay can be received before, after or at the same time as employer-provided paid leave such as recreation or annual leave and employer-provided parental leave. A parent will not be able to work while receiving paid parental leave—and that is fair enough because that would defeat the purpose of the legislation—but they can ‘keep in touch’ with the workplace for up to 10 days during the period if this is mutually agreed between the person and the employer.
It is all about keeping workers connected to the workplace whilst giving them time to spend with their baby and, in the case of women, to allow their bodies to recover. This legislation is groundbreaking. It brings Australia up to the rest of the world as far as paid parental leave is concerned. We are no longer one of those outlying countries that does not provide support for parents to return to the workforce.
I conclude by imploring the Leader of the Opposition to abandon his flawed scheme and support this legislation, legislation that will benefit all Australians. We on this side of the House are very used to the Leader of the Opposition opposing anything just for the sake of opposing it. This legislation is far, far too important for him to adopt his oppositional politics on. All Australians look to him to show some leadership on this legislation, get behind it and see that it passes through both houses of this parliament.
I give notice that I will be tabling some amendments to the Paid Parental Leave Bill 2010 to remove the discriminatory aspect from the legislation. Whilst a woman who chooses to further her career in the marketplace and make a wonderful future for herself personally will get tremendous benefit from this legislation, those women who sacrifice themselves to stay at home and give their children a full-time mother will get absolutely nothing out of this legislation.
So the government is very generous to people—whether it is a good thing or a bad thing, and I am not saying it is a bad thing—who wish to further their careers and work in full-time employment. The deputy principal of the high school in Charters Towers resigned recently because she is having a second baby and believes that her children need full-time care. She will move from an income of $70,000 or $80,000 a year—something of that nature, I presume—to an income of nothing in order to do the right thing by her children. This bill will give her no benefits whatsoever and no remuneration whatsoever. I have given notice of my amendments, which I will speak to in due course, aimed at extending this benefit so that there is no discrimination in it and a woman who decides to stay at home and look after her kids gets the same decent fair go as some woman who decides that she will instead devote herself to her own interests. Good luck to her. But do not ask that the public purse discriminate in favour of her and discriminate against someone who is so self-sacrificing.
I was asked to do a chapter in a book that was published recently. It was a cookbook, and you did a story on your mother. I made mention of Clyde Cameron, one of the greatest old political warriors that ever set foot in this place. He was a man who, if he went after you, you said your prayers. He was one of the toughest men ever to set foot in this place and one of the most dangerous, and I mean that in a flattering and not a derogatory way. When they were interviewing him on the ABC on a program called The Confessions of Clyde Cameronwhich comes in the form of a book, and I would recommend that everyone in this House read it—they said ‘you had a very close relationship with your mother’, and his voice broke completely and he staggered through the sentence and said ‘I can’t really talk about my mother’. So here was this hardened old warrior whose mother had been dead for 20 or 30 years, and he could not talk about her. I say to you, Mr Acting Deputy Speaker, that 40 years ago my mother died, and I still cannot talk about her. Compare that to a career!
I am of the first generation whose women went on this career path. I know them all. They are the same age as me—that is, in their mid-60s or early 60s. They pursued their career, and now they are old, embittered, lonely people. They have no one to love and no one to love them. I feel very sad for them, and I think that the culture they lived in and the value system that was inculcated in them has left them bereft of all the finer things in life.
I am among those people who come from country areas and owner-operated business backgrounds. My family on my father’s side have been in owner-operated business ever since they came to Australia in the 1870s, and that is true to some degree of my family on my mother’s side as well. Those who know my family know that those businesses have to a very large degree always been run by the women—and run very, very successfully I might add. Those people were full-time mothers who also ran the family businesses and ran them magnificently well. My own family business was run so well—and this is going back a fair bit—that my great-grandad was able to give £3,000 to the general strike in the mid-1890s, which in terms of today’s money is nearly $1 million. I doubt whether there has been another person in Australian history who has donated $1 million out of his own money to a strike fund to back the workers because he believed in the cause that they were fighting for, and I say that with very great pride. So those businesses were carried to a very large degree by the mothers who were in them.
Having said all that, I would like to be very specific. There is the most extraordinary lady still alive in Australia. Her name is Lady Pearl Logan. Her husband was knighted, and she has an honorary doctorate from James Cook University. She spent her life on remote sheep and cattle stations, of which her family owned a number. She was the mother, and she was also running the business side of the operations. You could say she made a decision not to have a career, but let us just see what this lady has contributed to Australia. I say that she is the finest lady still living in this country and that nobody could come close to her achievements. She was heavily involved—along with her husband, who played the main role—in demanding a minimum price scheme for our wool industry, which was virtually vanishing in the late 1960s and early 1970s.
In the face of trenchant opposition from a lot of the rich wool growers themselves, two very great men—Sir William Gunn and Doug Anthony—introduced the wool scheme, and for every year for the next 20 years we had a nice increase in the price of our wool. By 1990, more than one-tenth of this nation’s income came from wool. Within two years of former Prime Minister Keating’s removing that scheme, our incomes had dropped by half, and now there is not much left of that wonderful industry that carried this nation from its very inception until 1990. There is only 40 per cent of it left, and I suspect that over the next 20 or 30 years there will be virtually nothing left of it at all. But let us not revel in the shame of what was done by the free trading policies of the governments of Australia; let us honour the lady who was one of the people instrumental in and responsible for securing the wool scheme. I was there the day that they ripped into Doug Anthony, who was a man big enough not only to take the pain but also to realise that these people were right and he should go back to Canberra and change the world in which we lived.
There was no such thing as equality in education when I was a young fellow in Cloncurry. We did not have the senior high school in Cloncurry. Those of us from well-off families—I would not say that we were rich, but we were well-off by Cloncurry standards—that is, six of the 66 boys and girls my age, had enough money to go away to boarding school. The other 60 got no secondary education. Their opportunities in life were truncated, because people from the country did not get a secondary education. Never mind about a tertiary education; they never even got a secondary education. There was a lot of class warfare in our town because, when the Aboriginal support systems came in to enable them to go away to school, they could afford to go away but a lot of the white fellas could not. The white fellas were very upset and angry about that. This inequality in education meant that over 20 per cent of this country could not get a secondary education because they lived in country areas without secondary education available to them.
Pearl Logan—a wonderful lady—decided that the government should put in some money to make it fair and give everyone an equal opportunity. After all, equality in education is one of the most basic freedoms that one can have in any society at all. One of the many reasons the great Huey Long of the United States was made famous was that he lived in a state where nearly 20 per cent of the population could not read or write and, within four years, he had provided reading and writing skills to some 100,000—arguably 200,000—residents of Louisiana. He instituted systems in the schools so that everyone would be able to read and write in Louisiana. Pearl Logan joined an organisation that was originally called the ICPA. I will not go into the details of political machinations, but what she did was very brilliant and very clever. She got a particular person appointed—an education minister—to the IOU and got him to submit to the Queensland cabinet a proposal for assistance to kids who lived in towns or outside of towns and did not have access to a secondary education. He took it to cabinet and cabinet rejected it.
Pearl Logan had connections with the CWA. She was not Robinson Crusoe. I do not want to make out that she did all of this by herself—far from it—but, if I were to look at who the most important figure in this battle was, I would end up saying that Pearl Logan was. She got over 5,000 telegrams—as we called them then; I suppose we call them faxes now—through the CWA connection to the state cabinet and the Premier. He got so worried about it all that they had a special cabinet meeting at the end of the week and reversed the decision. So we got our foot in the door. After 17 or 18 years of battle, when a child went away to the big boarding schools in Charters Towers—All Souls being the biggest boarding school in northern Australia—the entire cost for the student was met by the state and federal governments as a result of the energies of that woman. Equality in education is one of the greatest freedoms that we should have in Australia. It did not extend to nearly 20 per cent of us who lived beyond the big cities—those of us who did not have access to high schools—but suddenly we were given equal rights to the rest of Australia. What a wonderful contribution to a country.
I had the very great honour of serving in Aboriginal affairs in Queensland for the best part of a decade. I have received very glowing tributes which I did not deserve. Almost every initiative that was taken in those years was taken by the black-fella Australians themselves, not the white-fella Australians. The other person who facilitated that and stood between me and a government which could be brutal on some issues was Lady Pearl Logan. She delivered to those people. She delivered private ownership of their land and she delivered the right to run their own affairs. Both rights were taken off them by successive governments—including the LNP; mostly socialist governments. If I were a socialist I would deeply regret that I was associated with governments that did that. For those who like reading books, there are two textbooks—they are used in university courses throughout Australia: Rosalind Kidd’s The way we civilise: Aboriginal affairs, the untold story and Frank Brennan’s Land rights Queensland style : the struggle for Aboriginal self-management. You can read both of those books. They are a very fine tribute—not to Pearl Logan; she was a facilitator—to the people who drove that agenda.
Having said that, I move on. The Queensland Industry Development Corporation—which was the State Bank—was incorporated when I first came into this House. Pearl Logan decided that the bank should not be a plaything for the rich people, the slithering suits of the cities, like all the other banks were; it should be a bank that performed the duties that a bank should perform: facilitating and growing the real productive capacity of your country and giving people a fair go in times of trial and letting them drive ahead in good times. That is what a bank should do. I was referred to as ‘Pearl’s posse’. She made sure that I was in the driver’s seat with respect to QIDC. One-third of the sugar industry in Queensland would not be there today without the QIDC, and the QIDC would not have been there to help them without Lady Pearl Logan.
People talk about a career. Pearl Logan was a woman who had no career. She did not have enough money—her family were dirt-poor dairy farmers—to go away and get a university education. She did have some tertiary qualifications, but they most certainly did not amount to a university degree. She had to abandon her career to bring up her children and live with the man she loved. He had an obscure property out of Richmond. Did that destroy her as a person? Did that prevent her from achieving great things for this nation? There is no-one who could even get close to her. There is not a person in this nation who could even go close. And I have not finished yet.
There is not a member in this House who has not faced up to the horrific problem of a shortage of doctors in Australia. One of the reasons is that more than half of the graduates coming out of the universities are women—and God bless them. They decide to go out and have children and they stop practicing medicine, to a very large degree. That has resulted in shortages, but that was not the real problem. The real problem was that the existing medical schools, in fairness to them, could not—there were those who argued that they would not—expand. Then they would not allow the building of any other medical schools. There was one medical school built in 44 years in Australia. When I went to see the then minister for health, Michael Wooldridge, he said that the real problem was that we needed a medical school in Townsville. I saw the solution as that as well, but all we got was talk from the government. Then this tenacious lady was appointed chair of the committee. We had been promised by successive governments for 28 years a medical school for Northern Australia, and for 28 years we saw the promises broken. But when this tenacious fox terrier of a lady, in her mid-70s at the time, was made chair it was a different paradigm that we lived in. She was tenacious. I am very proud to say that my daughter was secretary to that committee. For seven years after that committee was formed—seven bitter, bloodthirsty years—they fought the battle and they secured the building of the first medical school in Australia, with one exception, in 44 years. What a magnificent achievement.
Because of the way they approached the problem, seven universities have now walked through the door that this wonderful lady opened. Every year now, there are 1,000 to 2,000 extra graduates pouring through the doors of those new medical schools. We have had the terrible problem of stripping doctors away from countries whose need is more desperate than our own. Time after time and case after case we have run into terrible difficulties bringing these doctors here. God bless them for coming to Australia but, unfortunately, a lot of them have great difficulties with the language, with the culture and also with their training, which in some cases—not all cases—is grossly inadequate. If the problem was solved—and it most certainly was—then this nation has a great debt of gratitude to that lady.
I conclude in my last three minutes on this note: it is not very nice to belong to a vanishing race. If you come back here in 100 years, as Bob Birrell said in a major landmark article in the Australian newspaper, there will be not 20 million Australians but seven million Australians. I thought that had to be rubbish, so I rushed off to the library and the demographer up there said: ‘Bob, if the birth rate, or the replacement rate, is 1.7, then when 20 Australians die they are replaced by 17 people. That happens five times in 100 years.’ It is simply mathematics: if you have a birth rate of 1.7, and you have 20 million people, then over 100 years the population will continue to grow to 36 million and then rapidly go into decline. As the baby boomers—the generation that came along five or 10 years behind me—die, they will not be replaced. If 20 of them die, they will be replaced by only 17 people. When my generation dies, we will be replaced. We have replaced ourselves; we have a positive population growth. People say, ‘Our population is not declining, it’s growing,’ but each year the number of net births is exceeded by the number of foreign people coming to this country. You might say, ‘God bless them for coming to our country,’ but they are foreign people; they are not Australians. (Time expired)
It is with great pleasure that I rise to speak in support of the Paid Parental Leave Bill 2010 and cognate bill, which will put in train for the first time in Australia’s history a national paid parental leave scheme. If this legislation is passed it will come into effect from 1 January 2011. It is noteworthy that we are one of only two OECD nations that does not currently have a national paid parental leave scheme. One might ask why it has taken so long for a progressive country such as ours to grasp the nettle and introduce a scheme of this sort. If we look over the past decade or so, we see that there has been much opposition, particularly from those who were in government and who are now in opposition. I welcome their most recent embrace of more progressive policies in this regard, but those in opposition were deadset opposed to the introduction of any scheme of paid parental leave. We all recall the former Prime Minister, John Howard, and we all recall each and every one of the members of the then cabinet standing up, one after the other, telling us that this was something the country could not afford. But it is something that the country cannot afford not to do. That is what the Productivity Commission has concluded, and that is the advice that this government is determined to take on board and to act on. The scheme that we propose to introduce will cover up to 18 weeks at the national minimum wage and will be open to eligible primary carers who have or who adopt a child on or after 1 January 2011. The primary carer must satisfy the work test, the income test and the residency test.
Having a child is one of the greatest privileges that any of us can have. Those who wish to do that and those who are fortunate enough to experience the joy of parenthood can all reflect upon just how significant it is. I have the great privilege of having four children and of having gone through three pregnancies with my wife, having had twins on the third occasion. Each of those pregnancies became the central focus of our lives. Each was something that we prepared for and something they we enjoyed and relished. We were often fearful of the challenges that came with that, but we also recognised that the great leap one takes in choosing to become a parent, if in fact one does have that choice, does not come without a financial cost.
I also reflect on an experience I had several years ago when I was the Mayor of Penrith City. Back in the year 2000 I decided to go out on a tour of all the local childcare centres that the council was managing. I recall visiting some of the centres, walking in and seeing some of the young children, in some cases as young as six weeks. It struck me on a number of levels. Firstly, one can never judge these cases because you simply do not know what the circumstances are, but in many cases I suspect the children were in child care at such a young age because their parents had no other option. Financially, they had to get back into the workforce in order to meet the financial demands of raising a family in an area like mine in outer Western Sydney where, over the years, house prices have continued to increase exponentially or at a much greater rate than average wages and salaries have increased. It is almost a necessity these days for families on average incomes in my electorate to have at least a second parent partly in the workforce, if not full time. Some families who are on a single income are doing it tough, others might be doing it that little bit more comfortably; but very few people can do it comfortably on one income in communities such as mine. That is the reality that many families and communities such as mine face.
There is the additional issue of choice of career—choice of the contribution that parents, both mothers and fathers, may wish to make. Certainly a lot was made of notions of career choice in the speech just given by the member for Kennedy. I think it is a great development that, over the years, opportunities have been opened up to women to pursue their skills and talents and to make a contribution in many areas of life that were previously closed off to them. With three sisters, three daughters and a very well educated wife, I am a great advocate of the importance of preserving those opportunities and making them available to all Australians, male or female. Science has only come so far, and when it comes to having babies the males are still in the passenger seat. It is the female that has to go through that experience and, more often than not, that becomes a reason why the female may spend a little more time out of the workforce in order to rear the child. The importance of breastfeeding is a consideration. As hard as I may have wanted to try, I would never be able to match my wife on that. These are the realities that we deal with.
On the one hand, there are the financial issues and, on the other hand, there are the career opportunities. Then there is the productivity that can be achieved under a scheme of this sort. I simply make the point that the Intergenerational report and its predecessors have very clearly articulated the case for why we need to boost productivity throughout our economy. We need to ensure that, where people are taking some time off to have children, their skills are preserved and they are given the opportunity to seamlessly move back into the workforce and, where possible, return to the work that they had left in order to have their children. Without a scheme such as the one that is proposed here, it simply would not be possible for some families to have children or an extra child that they may long for and hope to have. The financial pressures and the challenges that one faces in terms of career and career opportunity are considerations that actively weigh on the minds of parents and impending parents all around this country. That is why this measure is essential.
I am shocked by the approach that the opposition have taken to this scheme. For so long they were so opposed to having a scheme of this sort at all. We all recall none other than the now Leader of the Opposition when he was in government saying that a paid parental leave scheme would only ever be introduced over his dead body. Thankfully for the Leader of the Opposition, and thankfully for most Australian families, that is not going to be the case. With the passage of these bills, we look forward to seeing a system in place as of 1 January next year—a scheme of paid parental leave that will be fair to not only families but also business because it is funded by the government. I think that is an important point to acknowledge.
As I said a moment ago, the Leader of the Opposition has previously said it would be over his dead body. We have moved a long way. I think in his speech in this second reading debate he said that his position had evolved over time. This is hardly evolution; this is more like revolution. We have gone from ‘over my dead body’ to a position where he now proposes a scheme that basically will allow individual caregivers who were previously earning salaries of up to $150,000 to receive payments that equate to about $75,000. That is a hugely generous scheme that will impose a very significant burden on those 3,000-odd businesses that will be required to bear it.
A basic question that has to be resolved here is whether schemes of this sort should be funded by the taxpayer through the government or whether they should be borne by business. Clearly the opposition had decided that this was not a burden to be shared on all business, so they decided to impose this on big business alone, on those 3,200 businesses that the Leader of the Opposition says pay company tax on a taxable income of over $5 million. It beggars the question: if raising funds for paid parental leave is as easy as going and putting an indiscriminate tax on the 3,200 businesses that just so happen to be generating income of more than $5 million taxable income, why don’t we impose an additional levy on these same businesses to achieve certain other social policy goals throughout the community? Why stop at the 1.7 per cent levy? There are other needs in the community, whether it be infrastructure needs or whether it be the Leader of the Opposition’s much celebrated additional assistance to stay-at-home mums that went to shadow cabinet but was knocked over in shadow cabinet. Why stop here? It is an interesting question to ask and one that those on the other side have to come forward and respond to.
But we see, as we saw recently with the comments the Leader of the Opposition made on The 7.30 Report, that there is a distinction to be drawn between those comments that are supposedly carefully crafted, carefully scripted, the ones that are in the fine print, or at least in writing—the gospel truth, we are told—and those statements that are made in the heat of the moment.
I thought it was astonishing when, in December last year, the Leader of the Opposition came out and said, ‘There’ll be no new taxes.’ I find it astonishing because, contrary to the rhetoric you often hear from those on the other side, they have been pretty good in government when it comes to introducing new taxes. Remember the GST, perhaps the biggest tax to have been introduced in my lifetime? That was a great big fat tax, but we do not hear so much about that. In fact, at the time I think it was not described by those opposite, who were in government at the time, as a great big fat tax; it was described as the tax that was somehow going to ‘unchain our hearts’. Their taxes ‘unchain our hearts’ or are modest levies, whereas any tax that the government introduces is ‘a great big tax’ that threatens to bring the sky down.
The Leader of the Opposition, in his first statement on paid parental leave, said ‘over my dead body’. We have had subsequent statements from him, though. We also had a comment from him when the Productivity Commission handed down its report in relation to paid parental leave. I will read from an article in the Australian on 30 September 2008. The article reads:
Opposition families spokesman Tony Abbott attacked the scheme proposed by the Productivity Commission because it gave stay-at-home mums less taxpayer support than those who worked, creating “first- and second-class mothers”.
I thought that an interesting principle. We have seen the evolution of the Leader of the Opposition’s approach, the Tony Abbott approach, to paid parental leave. It started with no scheme, unless it was over his dead body. And then it moved on to, ‘I’m opposed to any scheme that treats stay-at-home mothers as if they’re second-class citizens’. I want to make the point that I value mothers whether they stay at home, whether they are engaged in the workforce or whether they are looking to re-engage in the workforce. Frankly, the role of motherhood is something that is one of the most important things that we ask anyone in our community to do. How mothers choose to balance their responsibilities is ultimately a matter for them and for their families. It is government’s role to provide as many opportunities, to give people the choices so that they can actually have choices and make those according to what suits their personal circumstances.
Notwithstanding that, we have the Leader of the Opposition moving on to his position that this would make a second-class citizen of the stay-at-home mother. Then we had the Leader of the Opposition come forward with his policy, and I understand that he did not take it through the usual party processes. This is one of those things for which he simply sought the subsequent forgiveness of the party room, which is one of those robust approaches which I guess could only occur in policy development as far as the opposition is concerned.
But in relation to his proposal, we have a 1.7 per cent levy on taxable income over $5 million for those 3,200 companies, and that would raise $2.7 billion. So, from the Leader of the Opposition who said he did not want a paid parental leave scheme—over his dead body—a Leader of the Opposition who said there would be no new taxes, we then have a Leader of the Opposition who comes forward, without consultation with his party, and proposes to introduce a new tax to fund a new paid parental leave scheme. It is extraordinary. Talk about evolution! That is not evolution but revolution coming from the Leader of the Opposition, who has already said publicly—it is all on record now, although it was not in writing—that if he says something when not in the heat of battle that is carefully scripted then it is gospel truth, although no-one has pointed out to me when you are not in the heat of battle when you are engaged in debate in public life. But if you are in the heat of battle and you happen to answer a question from a journalist—you might not be expecting that they are going to ask a question—and perhaps you have your guard down, and if the answer you give happens to be a bit of a porky, then no-one should be surprised, because that is all in the heat of battle. Frankly, that is absurd.
The interesting point about the statements that the Leader of the Opposition made when he said that he was opposed to any paid parental leave scheme that treated stay-at-home mums as second-class citizens, or ‘second-class mothers’, as he put it, is that the particular scheme that he proposed—and I say ‘he’ because it did not go through the coalition party processes—will in fact create a much larger differential between the government support that is provided to a stay-at-home mum and a mother who happens to be on a high income and takes a little bit of time off to have a child.
Just to put this in stark relief: the proposition we began with was that any scheme that discriminates against a stay-at-home mum is a bad thing. That is what the Leader of the Opposition said. Under his scheme, a woman who is currently on an income of $150,000, takes 26 weeks off and receives $75,000 will be almost $70,000 better off than a stay-at-home mum who receives a baby bonus but is not eligible to receive family tax benefit part A or part B. Under the government’s scheme, the differential is not very big at all. Mothers who take 18 weeks of leave will receive the equivalent of $9,788 or thereabouts. The difference between what is provided to women under this scheme and what is provided to stay-at-home mums is not much at all. But under the opposition’s scheme—and this is, after all, the opposition leader who said that this was one of those great maladies that he would never bring himself to support—there is a difference of almost $70,000.
The Leader of the Opposition cannot be trusted when it comes to paid parental leave. He has had a different position for all seasons. He once said he would support such a scheme over his dead body. He then said he did not want a scheme that would disadvantage stay-at-home mums. He said he would not introduce any new taxes. And now he has proposed a scheme that discriminates against stay-at-home mums. He cannot be trusted. He has no consistency. He has shown himself to be phoney.
It is wonderful to get the opportunity to speak to the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010, which would introduce Australia’s first public national paid parental leave scheme. A lot of people in this place have said it is historic, and it is. Australia is one of only two OECD countries—the United States is the other—which do not have a comprehensive paid parental leave scheme. It is long overdue. It is fair and just, and it is funded. I would like to thank Minister Macklin, Minister Plibersek and all the other women, in this place and in other places, who have lobbied long and hard for this scheme.
It is called the paid ‘parental’ leave scheme—it is for men and women. But the fact is that it is something for which women have campaigned for a long time and it will apply primarily to women. It is women who have the babies and primarily women who take the leave to stay at home with the babies, so I will direct a lot of my comments to women and the role they play.
It is a good feeling to be part of the government that is introducing this scheme. It was good to see it introduced in a costed, practical way, such that there will not be a big impost on small businesses—which I will turn to—and other organisations. It is a big win, it is popular and it is also necessary. For many years people said we could not afford it and it would be an impost on everybody. There was economic modelling and economic advice saying it was not necessary. For all those years, the advice was that we could not do it, when we know that we could have—it does make me wonder. On this scheme, the government sent a reference to the Productivity Commission. They had time to consider it and they took submissions from a broad range of people and organisations in the community. They came up with a costed model that would work without having all the imposts. I rejoice in it but, my gosh, it has been a long time coming. It makes me wonder why we could not have done it a lot sooner.
I remember the debates—I was part of them—that occurred outside of this place. We were told that this was a contentious issue and that these were not mainstream concerns. I wrote a piece in the Women Lawyers Association’s newsletter talking about issues that impacted on women, including superannuation, maternity leave, ART and RU486. I said that, when we had debates in the community on those issues, they tended to become contentious, they were not seen as mainstream and they were not debated in a rational way—and such it was with maternity leave for a long time. I am pleased that these are now mainstream issues. Having babies, paid maternity leave and paid parental leave are all seen as regular issues—as they always have been. That in itself is a milestone.
When the commitment was made to deliver this scheme, I did have some concern because of the global financial crisis, the global recession. Women often get asked to take a back seat when major events happen—including in families, where we often willingly take that back seat. I was concerned that might happen with this scheme. I am so pleased that we have stayed on track and are introducing it from 1 January 2011. It demonstrates the commitment from the government to support mothers, whether in paid jobs or at home. The baby bonus and family tax benefits will still be available for families not eligible for paid parental leave. We are committed to women who are in the paid workforce and women who are not, and that is a good thing. Those who choose not to participate in the scheme will also be covered.
The scheme is affordable and minimises the impact on employers, particularly those in small business. That should be a consideration at any time, but particularly with the advent of the global recession and the global financial crisis. In my seat of Page there are about 11½ thousand registered businesses that we know of and a lot more that we do not know of. It is important that they can share in the benefit of a paid parental leave scheme but do not have to wear the financial burden of it. They do not with this scheme. To give an overview, this scheme starts on 1 January 2011. People who are eligible can claim from October this year or they can put in a submission. I will not go into the minute detail of eligibility, because people will have worked that out when they apply. In general, it applies to the mother of a newborn child or to the initial primary carer of a recently adopted child. One of the concerns raised was that they should meet the paid parental leave work test before the birth or adoption occurs. They should have an individual annual income of $150,000 or less, be living in Australia and be an Australian citizen or permanent resident. Those criteria apply to many schemes or benefits that one can access from the government.
I campaigned in the lead-up to the decision to introduce the scheme in my local area and talked about it with many local women. I talked with parents, different groups, local small businesses and others. I was clear that it should not be a further impost on small business, but I said that employees in small businesses should be as entitled as anybody else to take maternity leave, paternity leave or paid parental leave. I also publicly supported the campaign, with New South Wales unions, about the ideal and visited childcare centres with them. I also supported the ACTU campaign, which supported the introduction of an affordable scheme. So there was lots of debate. There were lots of schemes thrown up for discussion and, of course, we all wanted the ideal. But it comes with a cost, so we have to be mindful of how it is introduced. I say it will be money well spent. The ACTU campaign was about affordability and accessibility to as many as possible. The scheme was proposed to be shared between the primary carers and adoptive parents and it was costed properly.
I note the Minister for Families, Housing, Community Services and Indigenous Affairs, Jenny Macklin, in her second reading speech thanked a number of people, including Marie Coleman, Heather Ridout and Pru Goward, who advocated a scheme when she was the Sex Discrimination Commissioner. I remember that Senator Stott Despoja introduced a draft bill or a private member’s motion on a paid parental leave scheme. I pay tribute to a whole body of women right across Australia from all sides of politics who recognised it made sense and was something we needed to do. It took time to convince some of our male colleagues in politics that it was something they had to come at, but eventually they did. I have heard other honourable members in here refer to the comments of the Leader of the Opposition, the member for Warringah, that there will be a maternity leave or paid parental leave scheme ‘over my dead body’. It seems as though he has had a change of view. He did come out with something that was not costed, did not seem to be affordable, would be quite an impost and would cost a lot of money. It is not a scheme as such; it was just something he announced. It struck me as rather an erratic approach to policy making, if one can call it that. When schemes such as this are introduced they do need work-up time, they do need to be considered carefully, they do need to have the cost and the modelling tested and we do need to seek input for it from all parties.
One of the other things that are really good features of this scheme is that women in seasonal, casual and contract work, along with the self-employed, will have access to paid parental leave, with most of them having access to it for the first time. We know that 25 per cent of women work in casual jobs. They receive no paid leave entitlements. One of the trends that has developed in modern times is the casualisation of the workforce. It is something that we have to be mindful of and rail against in some ways, because permanent jobs provide security. Sometimes they are essential if one wants to get a loan. But 25 per cent of women work in casual jobs and receive no paid leave entitlements. Under this scheme, for the first time they will be eligible. That is a very good thing.
Eligible families can choose whether to participate in this scheme, depending on their individual circumstances. I said early on in my contribution that there would still be the baby bonus and things like that. People will be able to elect to be with the particular scheme that they want to be with, the baby bonus—except in multiple birth cases, which recognises that is a special circumstance that warrants extra assistance—or paid parental leave.
The notes that are published on the website about the scheme say that the paid parental scheme will have a net cost to the government of $731 million over five years. When you think about $731 million, that does not seem a huge amount for such a significant benefit for and impact on our community. It brings me back to the question of why it took so long when it is not a mammoth amount of money that is being spent. And that is over five years. Going back to what the Leader of the Opposition has said about the idea that he announced on International Women’s Day, when you look at it, the tax increase of up to nearly two per cent through the company tax regime for over 3,000 businesses would cost something like around $3 billion. That does not make sense and shows that it is not a scheme that is costed well and is instead a rather extreme idea.
I would like to reiterate some key points about the paid parental leave scheme. It will start on 1 January 2011. It is funded by the Australian government. It is fair to business and fair to families, which is not something which is always easy to achieve. That is what is aimed for; it is a guiding principle. With this scheme, it works. It will help Australian families balance work and family commitments and it will help employers retain the valuable skills and experience of their staff. Turning to employers, from reading the information that is available about it—and there is quite a good deal of information—it will not be a big impost upon employers. They will not have to do all of the extra work that so often has to be done by small business when changes come in through schemes and systems. They often have to do a lot of that work—like with the GST and a whole range of other things. That is one thing that pleases me, and I know that it pleases small business as well.
Australian families have been waiting decades for this. The time has finally come. The government’s paid parental leave will be able to be taken in addition to existing employer funded schemes, either at the same time or consecutively. The government’s paid parental leave scheme will help employers enhance the family friendly workplace conditions that many already offer. This is an extra for them. It will give families more options to balance work and family by allowing the primary carer, which is usually the mother, as we know, to transfer any unused parental leave pay to their partner, provided that they are also eligible. That is a good mix, particularly with modern life and the demands on modern families. 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.
The minister, in her second reading speech, committed to monitoring and evaluating the paid parental leave scheme. There will be about $3 million allocated for that purpose. There are two issues that the government committed to look at in the review and the evaluation. One was the superannuation contributions for the period of paid parental leave. I would like to make a comment on that. So often, superannuation is a great thing. It is good that is going from nine per cent to 12 per cent. But for many years it, for a whole range of reasons, did not advantage women as much as men, like a lot of areas. It is one of those issues that we have to be constantly mindful of and working at to make sure that women are not disadvantaged. I welcome the review which will look at that. That is an area that I will watch very closely. I commend this historic bill to this House.
I rise today to speak in wholehearted support of the Paid Parental Leave Bill 2010, an incredibly significant and long-awaited reform that will better support Australian families, encourage greater workforce participation, increase the assistance to women who want to find a workable balance between their professional and family lives, and give children the best possible start to life. This bill is a reform that is in keeping with a policy commitment that Labor made in 2002, and it is a scheme that was designed with guidance from a comprehensive report from the Productivity Commission. It has also followed from the momentum created by the Human Rights and Equal Opportunity Commission’s 2002 report, Valuing parenthood: options for paid maternity leave.
From 1 January next year, for the first time in Australian history, eligible mums or dads will be entitled to receive the federal minimum wage—currently $543 a week—for a maximum period of 18 weeks, and will be able to transfer any unused portion of that leave to the other parent in the event that the first parent returns to work inside that period. Eligibility requires that a worker—whether ongoing, casual, self-employed or a contractor—has had continuous employment for 10 of the 13 months prior to the birth, and has worked for about one day a week across the period. Eligibility is also limited to families in which the primary carer has earned $150,000 or less in the previous financial year. This ensures that the government’s fully-funded scheme will be targeted to those who need support to balance their financial and family obligations in the critical period when their children are coming into the world.
Though the scheme operates from 1 July next year, families are able to lodge claims with the Family Assistance Office from 1 October this year, and it is expected that this landmark Australian reform will be available for take-up by some 148,000 eligible parents, most of whom will be women. Families, if they prefer, can choose to receive financial support through the baby bonus and family tax benefit B instead of paid parental leave during that 18-week period, and those who received support through the paid parental leave arrangements may still receive payments under family tax benefit A. An online paid parental leave estimator will be available from September to assist families in considering their support options.
New mothers who are ineligible to receive support under the Paid Parental Leave scheme will remain eligible for the baby bonus and family tax benefits, subject to the normal eligibility tests that apply to those payments. Parents who have twins or triplets—or more—will receive the baby bonus for the second and third child, and so on, in addition to receiving parental leave payments. And of course because all new mothers remain entitled to a full year of unpaid leave under the new National Employment Standards, there is the option beyond the 18-week period of paid leave to stay at home for the full 12 months before returning to work. There is also now the right to request an additional 12 months of unpaid leave, and it is important to remember that the 18 weeks of paid parental leave can in fact be taken any time during the first 12 months after the birth of the child.
All in all, this provides a flexible and substantial system of support for new parents and their children. It is a fully-costed government funded scheme that will not place a financial impost or any related uncertainty on Australian business. Indeed, there is every reason to expect that the support this scheme provides will make it easier for women and for families to navigate through the difficult shifts and changes in work/family balance that occur when children are born or adopted, and that in many cases this will make it easier and more attractive for women to maintain professional continuity, which will deliver those continuity benefits to their employers and the productivity benefits to the Australian economy.
The scheme will cost $1.04 billion over five years, and as an important item of expenditure it follows the principle of targeting government assistance to where it is needed most. This Paid Parental Leave scheme is subject to a means test and it is set at the level of the minimum wage. This means that it will provide support for those families that are not in a position to make adequate financial provision for the parental time out of work that having a baby involves, and it will be at the same level irrespective of family income. This is a fair and economically responsible approach.
In celebrating the arrival of this Paid Parental Leave scheme, I want to acknowledge the critical advocacy work of those who have called for this long overdue action. Unfortunately, this is not a reform about which we can say that Australia has played a leading role within the international community. While we have in the past done so in areas like universal suffrage, in this case, as many have noted, we were until now the only country in the OECD other than the United States to be without a comprehensive paid parental leave scheme. At last, we move ourselves out of that old-fashioned and outdated club.
The union movement has called for a comprehensive paid parental leave scheme for many years, and I want to particularly mention the advocacy on this issue by Unions NSW in the past two years. A number of passionate and indefatigable Labor women have argued the case for this reform for many years, including my predecessor as the member for Fremantle, Dr Carmen Lawrence. In recognising Carmen’s enormous contribution to this area of policy, I want to emphasise a point that she made in addressing the Public Service Association of NSW’s annual conference in 2002. In that speech—titled ‘Is paid maternity leave enough?’—Carmen Lawrence said the following:
Australia needs a sea change in the policies and attitudes that are hindering the capacity of families, and particularly women, to take on and survive the complex responsibilities of work and family. And we must oppose the message that those in the [Howard] government send that these policies are for the corporate high flyers with nannies and housekeepers, as they are really for the millions of Australian mothers whose jobs are the safety net in their family’s economic survival; who work to pay the bills and to support their families. These families simply can’t afford to have one parent at home full-time for five years, and many of these women can’t afford to lose their connection to paid work, and the skills and confidence that are so important to ensuring their security in our rapidly changing world. To do this requires the development of more responsive models of parental leave and income support, improved access to high quality, affordable childcare, and a modern industrial relations agenda with options like longer unpaid leave with guaranteed job security, part-time work, working from home, and job sharing.
I am glad that with this scheme, and in combination with the new National Employment Standards, this government has addressed some of those necessary changes, and I recognise that there is more to be done.
On parental leave itself, however, it is interesting to read that speech again and look at the statistics and facts it marshalled. The fact that in 2002 the Howard government resolutely believed that parental leave should be left for employers to choose to provide or not, as they saw fit, ignoring the fact that those who needed the financial support most were those working in the less secure and lower paid employment circumstances where the likelihood of an employer-provided scheme was next to nothing. At that stage only 0.7 per cent of all Australian workplace agreements provided paid maternity leave, while only 3.4 per cent of private sector agreements contained such provisions. Agreements containing any kind of paid maternity leave fell from around 10 per cent of all agreements in 1998-99 to seven per cent in 2000-01. And, according to the Australian Centre for Industrial Relations Research and Training, 65 per cent of managers and administrators had access to some paid maternity leave, compared to only 18 per cent of clerical, sales, and service workers. It is for all those reasons so many hardworking advocates have been calling out for Australia to join the rest of the civilised and sensible and economically forward-thinking countries of the OECD and introduce a paid parental leave scheme that covers all working Australians who need financial support.
I also want to acknowledge the fact that the former Democrats senator and leader Natasha Stott-Despoja tabled draft legislation for paid parental leave in the Senate eight years ago, which was at the same time that Labor committed to the introduction of a scheme like the one we debate today. As Natasha pointed out in an op-ed piece in the Australian last week, her proposal was also for a fully costed, fully funded scheme, and for 14 weeks, which was then in line with the minimum recommendations of the International Labour Organisation.I hope that Carmen and Natasha and all the many Labor women, especially the minister, Jenny Macklin, and the advocates, men and women, from unions, research institutes, business and community groups who have argued long and hard for this belated reform take some due pride, credit and satisfaction from this achievement—because they have certainly earned it.
As for those who can take no credit whatsoever for progress on this critical policy issue, I note that when in government the then Minister for Finance and Administration, Senator Minchin, described it as middle-class welfare, at a time when it was only the middle class and above who had any hope of enjoying the scanty and inconsistent maternity leave arrangements that were then available, and at a time when his own government was finding new and ever more profligate ways to expand non-means-tested payments for its own benefit. Furthermore, the Leader of the Opposition has previously declared that parental leave would be introduced over his dead body, but he appears to have achieved a remarkable kind of self-resurrection on this issue and is now in favour of it. It is genuinely difficult to know what the opposition leader believes.
But this is not a time to dwell on the naysayer and the dissemblers on this issue; this is a time to mark and celebrate a big step forward. I congratulate and commend the Minister for Families, Housing, Community Services and Indigenous Affairs with all my heart for working with her cabinet colleagues, the caucus and the community to bring about this momentous achievement. This Paid Parental Leave scheme will change for the better the lives of hundreds of thousands of families and children in the years to come. It will mean that parents spend more exclusive time with their new babies, which we know is better for health and learning outcomes and better for their emotional wellbeing and security. It will increase participation rates for women and it will help employers retain continuity and the corporate knowledge and accrued skills of their employees.
This Paid Parental Leave scheme is a very significant change to the basic fabric of Australian life. It is a massive improvement in the guaranteed working conditions of all Australians, and so it is in keeping with the long tradition and progressive agenda of the Australian Labor Party. I commend the bill to the House.
I speak in support of the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010 as moved by the Minister for Families, Housing, Community Services and Indigenous Affairs. This bill proposes Australia’s first national paid parental leave scheme, which I think is a cause for great celebration, not only for working mothers but for all working families. At present Australia is one of only two OECD countries without a national paid parental leave scheme, for which I hold the Howard government responsible. Even New Zealand, whose employment conditions generally trail Australia’s, has now had a paid parental leave scheme for the last four years. With the exception of the United States, every one of the other 29 countries in the OECD has paid parental leave, which is an indictment on the Howard government and all of its ministers, who would not countenance introducing such a scheme when in government; rather, they were too occupied by driving down working people’s wages and conditions. As a condition, paid parental leave never stood a chance under Work Choices. What chance could an employee who was forced to sign a ‘take it or leave it’ Australian workplace agreement ever have of getting paid parental leave, when many of these secret agreements did not even contain a pay rise for up to five years?
The Rudd Labor government has introduced this bill to catch up with the rest of the developed world and provide a paid scheme for working parents. Eligible working parents of babies born or adopted from 1 January next year will receive 18 weeks parental leave pay at the federal minimum wage applicable at the time. The government’s scheme provides security and support for families and will make many households in my electorate of Deakin feel much better about the challenge of having a child or further children.
In the lead-up to and during this debate it has been interesting to take note of the reaction of the Leader of the Opposition, Tony Abbott, to our policy. Not long after we introduced our plan, the opposition leader decided to introduce his own parental leave thought bubble—and, as I understand it, his plan did not go through the coalition party room; he just made an announcement without even consulting his own parliamentary members. It was quite an amazing turnaround by the Leader of the Opposition, who, whilst the Minister for Employment and Workplace Relations, did nothing to introduce a scheme for paid parental leave. In fact, by his own admission he was actively working against a paid parental leave scheme and is quoted as having said at a Liberal Party function in Victoria in 2002:
Compulsory paid maternity leave—over this Government’s dead body, frankly.
He must have had some sort of conversion, because recently he has come to look back on the wasted years and say:
I was part of the government that could have done better in this area.
But I think we should ignore his crocodile tears and look into his record on paid parental leave. He opposed it and fought against it. For 12 years the government that he was part of, the Howard government, followed his line and did nothing to start a paid parental leave scheme.
The opposition leader is on record as opposing a paid scheme and he did nothing whilst minister for workplace relations. Yet he now turns around and proposes a scheme—his thought bubble—that will cost Australian business $10.8 billion over four years. It is a great big new Liberal Party tax on employers; it is a tax on 3,200 businesses at 1.7 per cent, coming on top of the existing 30 per cent company tax rate, and will push cost of living increases right through our economy. I have no doubt that working families will be hit hard should the opposition leader ever have the chance to get his parental leave thought bubble through parliament. It would mean higher grocery bills, higher petrol bills and bigger electricity, gas and phone bills—the list is almost endless, and each and every one of those commodities comes from large companies. If you look at the supply chain, there is a large company there. They will get hit with that tax and the costs will flow on. Those costs will not stop at the first user; they will go right through the economy, which means there will be no escape for the household budget.
This comes at a time when the Rudd Labor government is proposing tax cuts for businesses that will reduce the company tax rate to 28 per cent whilst the Liberal Party is committed to increasing the rate to 31.7 per cent, a 3.7 per cent difference that will come straight off the bottom line of company profits. For some large employers this extra cost is $100 million or more per year. This Liberal Party great big new tax on companies compares with a comprehensive paid parental leave scheme that is fully budgeted and funded without increasing the tax on employers.
In February 2008 the Rudd government asked the Productivity Commission to look at the economic, productivity and social costs and benefits of paid maternity and parental leave. The Productivity Commission analysed the evidence from Australian surveys and international research. It undertook extensive public consultation on proposals for the scheme and it sought public submissions and conducted public hearings. The Productivity Commission’s final report recommended the introduction of a government funded statutory scheme of paid parental leave, paid at the level of the national minimum wage for up to 18 weeks. In last year’s budget the government committed more than $250 million a year to Australia’s first paid parental leave scheme, which was based closely on these recommendations from the Productivity Commission.
The Rudd Labor government has delivered for Australian working families a paid parental leave scheme, delivering on its promise to working families to help them in the challenge of raising children, which involves a huge cost, as we all know. The government estimates that each year around 148,000 people will be eligible for paid parental leave under our scheme. The scheme will provide eligible working mothers and initial primary carers of children born or adopted on or after 1 January 2011 with up to 18 weeks of paid parental leave, at the national minimum wage, whilst they stay at home to look after their baby or adopted child. This rate is currently $543.78 per week and can be taken in conjunction with other existing leave entitlements. All up this figure equates to almost $10,000 to assist working families adjust to the loss of income whilst the primary carer is not at work. This amount will rise in line with the national minimum wage.
Another important aspect of this scheme is that it will apply to women working part-time, in seasonal, casual or contract work, and also the self-employed. For so many years employees in most of these groups have missed out when it comes to paid leave. That is why this is one of the best components of the scheme. The extension of paid parental leave to casual workers, seasonal workers and those who own their own business is fantastic news. It will mean that many workers will able to access paid parental leave for the first time even though they may not have access to sick leave or annual leave or many of the other types of leave that most employees do have access to solely due to their type of employment. So a mother may be eligible if she has worked continuously for at least 10 of the 13 months before the birth or adoption of her child and has worked for at least 330 hours in that 10-month period, which is around one day a week. To meet the needs of contractors and seasonal and casual workers who have irregular work patterns, a parent can have a break of up to eight weeks between working days and still be considered to have worked continuously. Parental leave pay will also be available to parents who work in their own business or a family business, such as a farm or a milk bar or even a small contracting operation.
For many full-time workers who do not have a paid scheme at their workplace this government policy is great news. In my former job as a construction electrician, I and my colleagues had pretty good workplace conditions but we did not have paid parental leave. It was not in the award and not in the enterprise agreement. I suppose when you look around at the people that I was working with it was another barrier to women actually getting into that trade. I can think of large construction sites that I worked on that had 1,000 people working on them, with three of them being women. That needs to change. We need to get women involved in traditional trades. The barriers to that at the moment are big and longstanding. This addresses one of them and I hope it is a small help in that area of the economy.
Earlier this year I visited a local childcare centre, the Knaith Road Child Care Centre in Ringwood East. I went there with the Minister for Families, Housing, Community Services and Indigenous Affairs, Jenny Macklin. We held a low-key forum with staff and the parents who came in to drop off their kids for the day. We explained to them the benefits at that time of the proposed paid parental leave scheme. I think the most well-received part of the briefing that we had there was that for the first time childcare professionals would have paid parental leave. Curious staff came up and asked for more information as it had always been an irony for them that, although their work was to care for and help educate babies and young children in their community, they as childcare professionals had never had paid leave for when they had children. I can only imagine that the news of a paid scheme is being celebrated in many other industries that have not had paid leave in their awards and agreements.
Another aspect of the government’s scheme is that it is a parental leave scheme, so the payments can be for the partner to stay with the child if the mother returns to work. Generally, it will be mothers who claim parental leave payments in the first instance as they usually provide the primary care of their child during the initial months of the child’s life. We can well understand that. However, it is becoming increasingly common for men to spend some time being the primary carer of the child during its first year. Our paid parental leave scheme is flexible and will allow parents to make their own work and family choices.
The legislation allows all or part of the parental leave pay to be transferred to the child’s other parent, provided they also meet the eligibility requirements and are the primary carer of the child. Paid parental leave must be taken in one continuous 18-week block within 12 months of the child’s birth or adoption, including in cases where the payment is transferred to the other parent or carer. A parent cannot work during the paid parental leave period, although they can stay connected with their workplace through keeping-in-touch provisions. These keeping-in-touch provisions provide for an employee to attend the workplace for up to 10 days during the period of the leave to attend training or planning days with the agreement of both the employer and themselves. Employees who participate in the keeping-in-touch provisions will also receive their normal rate of pay in addition to their parental leave pay. Paid parental leave can be taken before, after or at the same time as other leave entitlements, such as annual leave or employer funded maternity leave, to best suit a family’s circumstances.
A parent will be eligible if they have individual income of $150,000 or less in the financial year before the claim or the birth of the baby, whichever is the earlier. This is a generous income test but consistent with the principle of targeting government support to those most in need. Unlike the Liberals’ policy, which allows million-dollar salary earners to receive payments from the taxpayer, our scheme targets those working people who need it most. The thought bubble from the Leader of the Opposition would have some parents paid at the rate of $2,884 per week for paid parental leave whilst others would receive only $543.78 per week. So some people would receive roughly five times the amount for the same event, being the birth of a child and the subsequent period of leave.
We know that all mothers ‘work’ regardless of whether they are at home or in a paid job and that most mothers will spend time in and out of the workforce depending on their circumstances. We will continue to support mothers whether they are in a paid job or at home. The baby bonus and the family tax benefit will remain available for families not eligible for the scheme and for those who choose not to participate in the scheme. The government’s scheme will help employers enhance the family-friendly workplace conditions many already offer. The paid parental leave of 18 weeks is additional to any paid scheme already provided by an employer.
For many Australian workers, there will be a substantial increase in their entitlements and as such they will be able to consider a more extensive period of paid leave. For example, University of Melbourne staff with more than five years experience receive 24 weeks of leave at full pay, and the addition of the government’s scheme will increase the total paid leave to 42 weeks. Many industries have parental leave schemes that have been built up over many years through industrial agreements negotiated between unions and employers. They change wildly depending on the industry and, quite often, the employer. Australian unions and employers that have been involved in those negotiations over the years to bring about advances in workplace conditions, especially for working women, should be congratulated. The scheme that we have now put on top is in many cases a fantastic bonus. This new government scheme will augment current entitlements and extend paid leave to employees that do not have any form of paid leave and to business owners.
The government’s Paid Parental Leave scheme is fair, balanced and economically responsible. The scheme will benefit employers by assisting them to retain skilled and valuable staff without having to fund parental leave pay. Employers are integral to the rollout of Australia’s first national paid parental leave scheme. Most women will receive government funded paid parental leave through their employers. By receiving parental leave pay through their usual pay cycle, just as other workplace entitlements are paid, women will remain connected to their workplaces and, I hope, be more likely to return to work at that workplace. Previously, to access some form of leave, some women would resign their jobs and receive their leave entitlements. As the employment relationship had been severed, returning to that employer was always going to be less likely. Employers will provide parental leave pay for their long-term employees—those with at least 12 months of continuous service. Other working mothers will receive parental leave pay from the Family Assistance Office.
The Paid Parental Leave scheme has been introduced at a time when the right to request a return to work on reduced or flexible hours has been enshrined in the changes that were part of the scrapping of the Work Choices legislation. Very soon Australian families will be able to incorporate the government’s Paid Parental Leave scheme, any employer scheme they may have and a return to work at reduced hours into their plans. This will mean that leaving the workforce for a period to care for a baby and then returning to the previous position becomes the norm for our community, as it always should have been. This will have great benefits for our community, reducing the financial pressures on young families, and it will have great benefits for Australian businesses as they can retain their skilled and knowledgeable employees, who will be much more likely to return to their workplace. I commend these bills to the House.
I am proud to stand to speak to the Paid Parental Leave Bill 2010. I have been looking forward to its introduction to parliament, as have many people in my electorate. As of 1 January next year it will deliver, for the first time in Australia’s history, paid parental leave. This bill will go down with the great Labor reforms—the pension, Medicare, compulsory superannuation and now paid parental leave. It is that important. It has been a very, very long time coming. There are many people in the community who have been working for decades towards a national paid parental leave scheme. We are so far behind that we are currently one of only two—yes, two—OECD countries without a national paid parental leave scheme. But, as of 1 January next year, eligible parents will receive 18 weeks paid leave at the minimum wage. That date will be an extremely important one for many people in the community.
Our Paid Parental Leave scheme is fully costed and funded and delivered as promised. Early in our term, I am sure there were many women out there who had lobbied so hard for this for so many years who held their breath. We finally had a government prepared to introduce a paid parental leave scheme and we were faced with a global financial crisis that wiped an estimated $210 billion off the bottom line for the government over the forward estimates. Many people wondered whether the budget that was coming up would contain a paid parental leave scheme. Many people held their breath. But it was there. It is being delivered in spite of the financial downturn and here it is in the parliament today.
Currently there are around 176,000 employed women who have babies each year. They have been entitled to unpaid parental leave until now. Some have been receiving paid parental leave but many have not. Most return to work following the birth of their child. Quite a substantial number—about 126,000 of that 176,000—return to work with the employer they had prior to the child’s birth. Around 11 per cent return to work before the child is three months old, 26 per cent before the child is six months old, 57 per cent before the child is 12 months old and 74 per cent before the child is 18 months old. The Paid Parental Leave scheme increases the flexibility for parents. I am sure we all hope that parents who might be in financial difficulties with the birth of a child will be able to spend some more important time with their baby in those early months.
For many people in the workforce, paid parental leave already exists. According to the ABS in 2008, 40 per cent of the then 8½ million employees were entitled to paid parental leave, while 44.9 per cent of female employees were entitled to paid maternity leave. The highest coverage was in areas of public administration and safety—where 82 per cent of employees were covered—and in electricity, gas, water, finance and insurance and education and training, which are mainly government and similar kinds of organisations. The worst coverage was in areas such as cafes, restaurants, the retail trade, administrative and support services and arts and recreational services—that is, many of the industries that have the highest numbers of female workers. Submissions to the Productivity Commission indicate that many of the bigger businesses will continue to offer the added benefits of paid parental leave as a way to attract and retain quality staff and they will do that over and above the entitlements in this Paid Parental Leave scheme. The scheme has been designed so that government paid parental leave can run concurrently with or after any leave that is provided by an employer.
For many parents—and I say ‘parents’ because both the father and the mother are entitled to leave under this scheme, although not at the same time—particularly those in low-paid jobs, there is very little opportunity for paid parental leave at this time, and that causes so many of them to return to work far earlier than desirable. It also leads to those parents using up other forms of leave in order to be able to spend as much time as possible at home with their child. It also leaves them short of leave later in the year and adds considerable stress to families. Families do incredibly important things for the community. They raise children, they educate children and they support those children until they reach working age. We all benefit when it goes right and it costs us all when it goes wrong. It costs us in health, in crime, in welfare benefits and in public housing. These are all costs that we would rather not have, particularly if they come from the difficulties that a child has in its family life.
This bill normalises what actually happens in the workforce: parents work, stop work for a while when a child is born and then return to the workforce. Requiring businesses that have these ongoing employees to make the payments through their normal payroll process helps keep the worker in touch and normalises what happens in the workforce for both employers and the community. The bill also provides support for a family at a very critical time. The birth of a child profoundly changes the world and adds new complexities and, sometimes, strains on the relationships both between the parents and among others in the family. The mother also requires time to physically recover and establish a bond and a feeding routine with the child. If the mother chooses to breastfeed, paid parental leave is, of course, incredibly important. It is worth focusing on that for a small part of this speech.
Overall evidence suggests that there are significant benefits from exclusive breastfeeding for up to six months. The benefits include: reductions in a wide range of infant conditions—for example, respiratory tract infections and eczema; cognitive gains; and reduction of potential adult impacts such as obesity, diabetes and high blood pressure. There is considerable scientific evidence which demonstrates the benefits to us all of a strong breastfeeding culture. Mothers also gain psychological benefits, faster recovery from the birth, reduced risks of breast cancer and ovarian cancer and possibly a reduced risk of postmenopausal hip fractures and osteoporosis. For many women who have to return to work because of the financial circumstances of their family, breastfeeding is not possible for as long as they would wish to do it. This bill is extremely important in that regard. It does provide mothers with greater flexibility to determine how they raise their child.
Many decisions need to be made in designing a paid parental leave scheme: how long the leave is to be, who is to pay for it, whether fathers can access it and much more. This scheme has been developed over two years of work. It is not, like the one proposed by the opposition, a thought bubble. A substantial contribution to its development was made by the Productivity Commission, which delivered a report that in the main has been accepted by the government and its recommendations incorporated in the bill. It was necessary to do that substantial research because debate on the scheme had essentially been stalled under the previous government. We heard the now Leader of the Opposition say quite openly while he was in government that paid parental leave would be introduced over his dead body. So while the community were still talking about it and parents were still talking about it, the debate had been well and truly stalled under the former government.
Women make up a substantial part of the workforce and have been incredibly affected by the lack of paid parental leave until now. Around 45 per cent of those in the working population are women, but our participation rate during the peak child-bearing years is lower than for women in other leading industrialised countries. In Australia, workforce participation by single women is rising while by single males it is actually falling slightly. By partnered females, there has been a substantial increase in workforce participation and a slight decrease by partnered males. So the trend is overwhelmingly that of an increase in the number of women working, yet around one-third of mothers return to work very quickly—that is, within six months—of the birth, and around two-thirds of those return to work because they need the money.
This Paid Parental Leave scheme provides real choices for parents and is remarkably flexible. It allows parents to choose to remain with the baby bonus and family tax benefits if they prefer that option. It allows parents to transfer the 18 weeks from one parent to another if they choose to share the role of primary carer over that period of time. That 18 weeks must be taken in a block, but it can be taken at any time within that 12-month period. So the scheme allows parents to consider the use of other forms of leave and it allows parents to share the role with other family members—it provides an incredible amount of flexibility.
We expect that businesses that already have substantial paid leave will add to this scheme. Submissions to the Productivity Commission confirm that businesses that offer levels of paid parental leave now in order to attract and retain good quality staff are likely to build on this scheme and continue to offer benefits over and above this scheme. We have heard from some that the range of things being discussed with employers range from child care to topping up this scheme and extending leave beyond this scheme. Again, it is incredibly flexible for businesses to offer greater incentives to attract and retain staff.
Our scheme is in complete contrast to the thought bubble put forward by the Leader of the Opposition. Our scheme is costed and funded. It is carefully thought through and is backed up by substantial work by the Productivity Commission and consultation across the community. On the other hand, the opposition’s scheme was an idea for the moment. They are still trying to explain it and define it, and of course it is paid for by a great big new tax on business. It is not costed. As the Productivity Commission report noted—and they considered a range of options similar to this—the opposition’s scheme favours those on the highest salaries. On the other hand, our scheme tends to be more powerful for those on lower wages and casual workers. It is very strong on making sure that people in casual work can access the scheme.
A mother may be eligible if she has worked continuously for at least 10 of the 13 months before the birth or adoption of her child and has worked for at least 330 hours in that 10-month period. That is around one day a week. In addition to full-time workers, women in part-time work, seasonal work, casual work or contract work and the self-employed may be able to access the Paid Parental Leave scheme—many for the first time. Because many contractors, seasonal workers and casual workers work irregular patterns, the scheme allows a person to have a break of up to eight weeks between working days and still be considered to have worked continuously. Parental leave will also be available to parents who work in their own business, a family business or on a farm. A person will be eligible if they have an individual income of $150,000 or less in the financial year before the claim or the birth of their baby, whichever is earlier. It is based on an individual income of $150,000, not a couple’s income.
Casual workers are by far the big winners from the first Paid Parental Leave scheme. Women are far more likely than other workers to be casual. They make up almost 57 per cent of all casual employees in Australia. Almost 20 per cent of employed women work in casual jobs and receive no paid leave entitlements at this point. For them this is a major step forward. Arguably, casual workers would be under the most financial strain after the birth of a child. Under our scheme, an eligible mother who is a contract worker but whose contract finishes before the baby is born will still receive parental leave pay, providing she meets the work test. Parents who are not employed at the time of the birth of their child will be paid directly by the Family Assistance Office. Those who were employed until the birth of their child will receive the payment via their employer. Essentially, their parental leave pay will go through the usual pay cycle. That, again, helps women remain connected to their workplace. This scheme is introduced without significant additional burdens on the employer.
It is estimated that around nine per cent of all businesses will be involved in the Paid Parental Leave scheme in any year and only three per cent of small businesses will be involved. So for businesses, in terms of their company payroll, it will be business as usual, but for families this will be a major step forward in allowing them to spend time with the new addition to the family—bonding as a family and setting up important routines. Importantly, it will provide the mother with an opportunity to recover physically from the birth.
The government understands the importance of reviewing schemes such as this. We have allocated almost $3 million for this purpose. We have committed to a review of the scheme in two years. That is incredibly important. I am sure that many of those who fought so hard for this—they have been acknowledged by several speakers today and I acknowledge them again—have not finished. In the two-year review, I am sure they will be back again and they will be watching this scheme very carefully in the interests of families around the country. We have committed to look at two issues in particular: paid paternity leave and superannuation contributions for the period of paid parental leave. I am particularly glad that we have considered looking at those two issues. They have both been raised by people in my community since we first made announcements about the scheme.
We have waited far too long for this. Australian families have waited too long for a national paid parental leave scheme. I am glad to see it introduced to the House at this time. I hope that the opposition decides to vote for it. At the moment, you never know what the opposition will do in the Senate, but I am hoping, for the sake of Australian families, that they get behind this scheme and vote for it. It is a major win for Australian families. I thank the minister for her work and commend the bill to the House.
In rising to speak on the Paid Parental Leave Bill 2010, the Paid Parental Leave (Consequential Amendments) Bill 2010 and the amendment moved by the opposition, I highlight the fact that we actually have competing policies in the way paid parental leave should be tackled. Clearly the participation of women in the workforce is a key issue in discussing the way in which the best policy development is made. If we simply look at what is on offer, we see that both the coalition’s scheme and Labor’s scheme are opt-in schemes subject to eligibility, and the default is the baby bonus. After that, the two schemes part company quite dramatically.
The coalition is offering 26 weeks of paid maternity leave; Labor is offering 18 weeks. The coalition is offering a replacement wage or federal minimum wage, whichever is the greater, with a cap of $150,000 per annum; the Labor Party is offering only the minimum wage of $543.78 per week. The minimum payment for 26 weeks under the coalition’s scheme would be $14,138 gross; under Labor’s scheme, $9,788 gross for 18 weeks. There is a cap, as I said, under the coalition’s scheme. The replacement wage would be paid up to an annual salary of $150,000. A carer earning over this amount would be limited to the cap. Under the Labor Party’s scheme, there is no paid parental leave if the primary carer’s annual salary exceeds $150,000. Quite clearly, the Labor Party is biased against women who are in any way successful or indeed who may be the primary income earner for their family. There is no consideration of the fact that things have changed. Labor still thinks that it is just men who are the dominant earners and that women can get by on part-time work. The coalition has a totally different consideration of the way the world has changed and knows that there are more and more women who are in fact the dominant earner.
Under the coalition’s proposal superannuation would be paid in full at nine per cent; under the Labour Party’s proposal there is no superannuation payment at all. Under the coalition’s scheme, full-time, part-time and casual workers would be eligible if they worked at least one day a week for at least 10 months of the 13 months prior to the expected date of birth or adoption—and I was very pleased to see adoption feature in both policies, because it was a strong recommendation of a committee that I chaired in the last parliament. Under the Labor Party’s scheme, full-time, part-time and casual workers who work one day a week for at least 10 months of the 13 months prior to the expected date of the birth or adoption will be subject to a similar requirement. Under the coalition’s scheme there would be paternity leave of up to two weeks of the 26 weeks, subject to consultation; under Labor’s scheme, none.
The net cost of the scheme proposed by the coalition would be funded by a 1.7 per cent levy on companies, based on taxable income above $5 million. Under Labor, the entire scheme would be funded by the taxpayer from consolidated revenue. The coalition’s scheme would be administered by the federal government through the Family Assistance Office, which would be responsible for the administration of paid parental leave. The importance of that is it would not add to the costs of businesses, who would have to make those payments. However, under Labor’s scheme, the employer would be responsible for the administration of those payments, with some exceptions.
The cost of the scheme under the coalition would be $2,700 million and under Labor a paltry $260 million. It is a case of getting what you pay for. Labor’s scheme really is nothing more than a slight extension of the baby bonus scheme introduced by the coalition. That was introduced at the $5,000 mark, representing then the equivalent of some 12 to 14 weeks of paid maternity leave but without discriminating between women who were in the paid workforce and those who were not. But it has become quite clear, with the dependence on productivity in this country resting on the participation of women, that it is about time that we had a serious paid parental leave scheme.
Again, during the last parliament I chaired an inquiry into balancing work and family, and it produced an excellent report, which I can still recommend. We highlighted certain facts in that report that are pertinent to this debate. For instance, one chapter in the report covered financial disincentives to starting a family in terms of loss of salary and wages. The evidence we took showed that if a woman loses salary—if she leaves the workforce for a period or reduces the hours that she works—that can be a disincentive. People who leave the workforce or decrease their hours either stop accruing on-the-job skills and experience or accrue them at a reduced rate, which affects the hourly wage rate. If they are absent from the labour market, that leads to an atrophy in their skills and experience, reducing the employee’s hourly wage rate. It was found that the simple fact of having a child can reduce a woman’s lifetime chance of being employed by seven per cent. The authors of the report that made that finding, Matthew Gray and Professor Bruce Chapman, also found that on average a woman would lose 37 per cent of her lifetime earnings by having one child.
By having paid parental leave which is at the same salary that you are receiving, and by being able to have that for six months and to readjust your family circumstances, your chance of returning to the workforce at your full capacity increases dramatically. To have a sort of subsistence payment where you will stay out for just 18 weeks is more likely to have the effects that were found in the report as lessening the skills of women and their capacity to earn.
It was interesting taking evidence from the Association of Professional Engineers, Scientists and Managers Australia, who noted of their female membership that 69 per cent did not have children. By comparison, the current estimate for the Australian population generally is that 16 per cent of women are likely to remain without children. They concluded that the very high proportion of childless female professionals found in the association’s surveys reflects the reality that professional women with children are leaving the workforce or reducing their level of workforce participation due to family responsibilities. This is clearly a loss of women of that calibre to the nation as a whole, let alone for their own personal use of their skills and their qualifications.
In this inquiry we also commissioned Access Economics to do some research for us about the importance of the participation of women in the paid workforce. They found that GDP in Australia could increase by 4.4 per cent more than that estimated by the government in the Intergenerational report. As a reform initiative, increased women’s participation would be placed above the 2000 tax reform at a 2.5 per cent increase in GDP and below national competition policy of 5.5 per cent. In their analysis, Access Economics commented that women’s employment had risen more quickly than predicted in the 2002 Intergenerational report, but they found that, if women’s participation only grew through part-time work, the increase and benefit to the nation as a whole would be far less than if it was an increase in full-time work.
For anybody who has had a child, coming home with that child is a fair shock to the system. We are not really very well prepared for what it means, but you have to learn quickly. To be able to have full remuneration at your proper salary through that period and adjust your life and get it ready so that you can utilise the skills that you have acquired and not lose them is a very, very important fact for women.
When we talk about the impact that policy has on the participation rate, it cannot be stressed too much. OECD research has shown that women are very sensitive to policy initiatives. They do make an analysis and consider the impact that a policy will have on them personally. In other countries in the OECD where they have paid parental leave there is a much higher return to full-time work than there is in Australia. We rate very poorly. I think this initiative by the coalition to give true parental paid leave is a huge step forward.
I have heard many cynical comments from those opposite—they get repeated ad nauseam, so presumably they were put out in their speaking notes—saying that Tony Abbott has said previously that he was not in favour of paid paternal leave. They find quotes from the past, but when Tony Abbott stood at this dispatch box and spoke to this bill he said quite clearly he had listened to his wife and his now grown-up children on this question. To me, that shows someone who is prepared to see that life has changed, and all the snide comments from across the other side will not make a dent in the fact that here is a man who is prepared to listen to a female point of view. And the female point of view is quite clearly that we are sensitive to policy and, if the policy is a good policy and enables women to benefit from it, we will respond in a positive way. The coalition’s paid parental leave scheme means that there is a real chance for women to organise their lives and have children as well.
The baby bonus—which, as I said, was initiated as a start to paid parental leave—has had a desired effect. Our birth rate was below replacement levels. As a result of the baby bonus, our birth rate has risen. You can try to find arguments to the contrary, but empirically that is just the case. The result is that we have made a start. The Labor Party is merely extending those weeks and the pay rate is at the minimalist rate. We have been criticised by those on the other side for saying we want the cap to be $150,000 but that people who earn above that can have up to that $150,000 because we would like women who are successful to have children as well. I would put to you that the women who gave evidence that I referred to earlier—who are engineers and scientists and managers—are just the sorts of people we would like to have children as well as others. We do not want them to be discriminated against so that they are forced into not choosing to have a family as well as having their professional life.
I simply say that, in speaking to this bill, we are in the position where we have two competing policies. One is worth $260 million, which makes not one iota of a difference to the decision-making ability of women to say, ‘This is good for me.’ But what is on offer from the coalition at $2.7 billion in cost means that women will have a real choice to have a family, to have a good bonding time, to prepare themselves during the six months to return to the paid workforce and to add to the productivity of the nation.
As I said before, you cannot have productivity gains in this country unless women are participating in the workforce. We are dependent on that participation. And in the future it will be the case that more women will have tertiary education qualifications than men. We cannot afford to force them out of the workforce by treating paid parental leave as some sort of tokenistic gesture. The time has come to be really sensible and serious about it, and by making this announcement Tony Abbott has done just that.
The legislation that is before us has had an amendment to it moved. We said we will not deny the bill a second reading. But, clearly, come the election, the people will have a real choice and they will be able to decide that the only way they can get a decent paid parental leave scheme is to change the government.
Today I rise to speak on the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010 that are before us. These bills have been a long time coming and I am proud to be a part of a government that is introducing them to the Australian parliament. The Australian Conciliation and Arbitration Commission granted men and women the equal minimum wage back in 1972. This was a big step toward equality, a very substantial step forward. But, in reality, the gulf between male and female pay and benefits at that point in time was very great, and many steps have been required to be taken since. In fact, we still today have a very large gap between female and male wages. The average industry pay gap today between men and women is still about 17 per cent.
In my own electorate of Corangamite there are some 6,000 women working in clerical and administrative jobs, nearly 5,000 women working as community service workers and some 4,000 working in sales. These women are also likely to be employed as casuals and part-time workers, and are more likely to have interrupted work patterns as they take time from the workplace to have children The flow-on implications include women being more likely to be dependent on pensions as they get older, and having accumulated less superannuation.
Incredibly, the pay gap has actually grown since 1992. In one of the world’s great privileged societies that we live in here in Australia, we also have one of great shames—that is, we still do not have, in a meaningful way, equal opportunity between men and women, particularly in the workplace and in terms of taking time off to rear one’s family. In plain English, this is just not fair; it needs to be fixed. That is of course what the Rudd government is very determined to do. We want to redress the trends and the prejudices of the Howard government.
The bills we have before us today will go some way in helping to bridge the gap of the pay inequality between men and women in Australia. I know in my electorate, thousands of mothers, and for that matter fathers, will certainly be helped by paid parental leave. I thank the minister for these particular bills and the policy work undertaken in the lead-up to the 2007 election and beyond. Government funded paid parental leave will pay mothers and adoptive parents who have been working and have had a baby or adopted a child on or after 1 January 2011. This is very positive news for working families across my electorate, and indeed across this nation.
To be eligible for the scheme parents will need to meet the paid parental leave work test, income test and residency requirements, spelt out within the act. The parents must also be the primary caregivers of the children. The parent will also be entitled to 18 weeks of paid parental leave. Today, as these bills begin their passage through the Australian parliament, is a great moment for working families. These bills will allow families the freedom to have children and not be completely hamstrung by their household budget. This gives working Australians real choice as to when they can have a family. These bills give more choice by allowing parents to choose when they receive their paid parental leave.
Parents can start receiving payments on the birth of a child or, in cases of adoption, on the placement of that child into their care, and they will receive all payments in the first 12 months. These payments must be taken in a continuous sequence. In reality parents have a choice to take the 18 weeks whenever they think they need to in the first 12 months of their child’s life. This will provide much more flexibility for parents when deciding to have children. Importantly, these bills give the opportunity for both parents to receive the payment. As a father, along with many fathers in this chamber and in this nation, I know that we also want to participate in the rearing of our kids. If a parent returns to work before the 18 weeks, their partner maybe eligible to receive the unused proportion of the paid parental leave arrangement. This is great news for working families, particularly those who choose to jointly raise their children. Significantly, when planning these bills, the circumstances of a very wide range of families has been taken into consideration.
We have tried to make sure that we cater for people in different circumstances. Not every family is the same, and we have tried to make sure that the government recognises that with these arrangements. Because of these bills, many families in my electorate of Corangamite will have real options when making decisions about having children. Under these arrangements, they will have more options as to when to take time off, when to have children and who will have responsibility for raising the children.
These bills also provide for subordinate legislation to give eligibility for parental leave pay to other carers. These cases will be exceptional circumstances, and the pay will be provided to the primary claimant or a secondary claimant. Exceptional circumstances will be granted where parents are incapable of caring for a child or where there have been orders resulting in a mother and her partner no longer caring for a child. Parents who are not eligible for, or do not choose to receive, paid parental leave may be eligible to receive the baby bonus and the family tax benefit under the usual rules.
The Rudd government is committed to making life easier for working families. It will launch an online paid parental leave estimator in September to assist families in making these critical decisions. The process for parents will be simple, and they will be able to use the agency that they deal with already. Claims will be lodged with the Family Assistance Office and the office will assess these claims. To give parents more flexibility, they will be able to lodge claims three months prior to the expected date of birth of a child or the placement into their care of an adopted child. When the scheme is fully implemented, parental leave pay will be provided by employers to their long-term employees. Someone who has been employed for 12 months or more prior to the expected date of birth will be classed as a long-term employee. These procedures will make applying for paid parental leave very easy for working families across this nation and in my seat of Corangamite. A notice to an employer will be sent by the Family Assistance Office if they are required to pay employee parental leave pay.
These bills provide an easy process for parents and also for employers. This is a great step forward for working Australian families. The Family Assistance Office will ensure that funds are made available to an employer in advance so the employer can meet their obligation to provide parental leave payments. This will make life very easy for businesses, including small businesses, in my electorate. If employers adhere to their normal and proper pay practices when providing parental leave pay, they will not breach any of their obligations under the paid parental leave scheme.
I am very excited for the many parents in my electorate and I am confident that this will assist small businesses across the country. I believe the opposition should support these bills to ensure that working men and women across this nation can access paid parental leave. Most of those opposite supported the Work Choices legislation, which made it much more difficult for women, including women in my electorate. I know those opposite have a leader that is deeply committed to Work Choices and deeply committed to denying women the opportunity of taking paid parental leave.
On the other hand, the Rudd government is committed to real, practical assistance for young families in accessing paid parental leave, to ensure that we close the wage gap between men and women. I ask Tony Abbott and the opposition to support the government’s efforts in this regard. There is one woman that I would particularly like to pay credit to for her contribution to my life and the lives of many working Victorians. That is my former employer, Karen Batt, the state secretary of the Community and Public Sector Union. Karen has been in that office for a very long time. When she was first elected as state secretary of the Community and Public Sector Union, most of the Victorian public service did not have paid parental leave, maternity leave or carers leave. Through her efforts and the efforts of the union, when I left that union in 2007, almost all of the Victorian public service had arrangements that enabled families to choose when to take time off. I would like to commend Karen Batt and her colleagues for that tremendous work, and commend these bills to the House.
I would like to start my comments in relation to the Paid Parental Leave Bill 2010 and the cognate bill by saying how wonderful it is to be in this place debating not whether we should have paid parental leave but what it should look like. As a mother of three who had two children without paid parental leave and one child with it, I can say from personal experience what a difference parental leave pay makes. I am sure that many families around Australia can tell of similar experiences.
I want to talk about the history of paid parental leave. I think it is important to look back and see how we got to this point today. I want to go back to 1973, when maternity leave for Commonwealth public servants was introduced by the then Whitlam government. It was the first form of paid maternity leave for public servants in this country. What a landmark decision that was. In 1979, the ACTU, the Australian Council of Trade Unions, put forward a test case which allowed for maternity leave to be inserted into federal awards. In 2002, there was a HREOC, Human Rights and Equal Opportunity Commission, discussion paper which talked about paid parental leave and its implications for women in the workforce. It talked about the impact of women not having access to paid parental leave on their participation in the workforce and the productivity losses that caused in this country.
We have come a long way since then, thank goodness. Although Australia is one of only two OECD countries without a national paid parental leave scheme, we are here today not debating whether we should have one but debating what it should look like—and I am really pleased about that. The Productivity Commission report, which we commissioned some time ago, has some key points that I want to talk about. In 2007, around 2,000 female employees—or 54 per cent of women in the workforce—had some form of paid parental leave available to them. Some of them had paid parental leave in full-time highly paid work and others were part-time workers. While all employees were covered by unpaid parental leave legislation, not all employees met the eligibility criteria. Around 17 per cent of employee mothers and 15 per cent of employee fathers were ineligible for any unpaid parental leave. Around 72 per cent of mothers in paid work take leave around childbirth. The vast majority of women not taking leave resign from work, and 75 per cent of fathers in paid work take leave around the time of childbirth. On average, mothers taking leave from paid work remain on leave for around 37 weeks. A mother’s leave is usually a combination of several types of leave. The use of leave is normally reflective of the availability of the leave and under what conditions it is paid. Unpaid maternity leave makes up the majority of the leave taken. Most of the leave fathers take is annual leave.
Of mothers in paid work prior to childbirth, 11 per cent return to paid work within three months, 26 per cent return within six months, 57 per cent within 12 months and 74 per cent within 18 months. Casual employees rely heavily on unpaid parental leave and other unspecified types of unpaid leave and are marginally more likely to return to work early and less likely to return in the long run. Mothers with more children are more likely to be outside the workforce prior to childbirth; however, if those women are already in the workforce prior to childbirth, they are much more likely to return to work. So it is important that we have some form of leave that covers parents that want to take leave when they have children. I am particularly pleased that in our paid parental leave scheme, as the member for Corangamite mentioned before me, fathers are included—it is a paid parental leave, not a maternity leave scheme. As a mother of three children, I know that my own husband has taken much leave in the rearing of our children, and he would not have missed that for anything in the world. I am sure that many working families in my electorate appreciate the choice that this Paid Parental Leave scheme offers to parents. It is available to either parent, and I think that is really important.
Our Paid Parental Leave scheme will be available for around 148,000 people each year. It will commence on 1 January 2011, should it get passed by the parliament. It will provide up to 18 weeks parental leave at the national minimum wage, which is around $545 per week, while parents stay at home to look after their baby or adopted child. In addition to full-time workers, as I have said before in referring to the Productivity Commission report, it is important that women working part time, those in seasonal or casual contract work and the self-employed are able to access paid parental leave—many for the first time. I think that is a really important part of our scheme. A mother will be eligible if she has worked continuously for 10 of the 13 months before the birth or adoption of her child and has worked for at least 330 hours in that 10-month period or around one day per week. To meet the needs of contractors and seasonal or casual workers who have irregular work patterns, a person can take a break of up to eight weeks between working days and still be considered to have worked continuously. Paid parental leave will also be available to parents who work in their own family business, such as a farm. Generally, it will be the mother who claims the payment in the first instance, as she usually provides the primary care for the child during the initial months of the child’s life. However, it is becoming increasingly common for the father to spend time as the primary carer of their child during the first year.
The legislation allows all or part of the parental leave to be transferred to the child’s other parent, provided they also meet the eligibility requirements and are the primary carer of the child for that time. The paid parental leave must be taken in one continuous 18-week block within 12 months of the child’s birth or adoption, including in cases where the payment is transferred to the other parent or carer. A person cannot work during the paid parental leave period, although they can stay connected with their workplace through ‘keeping in touch’ provisions. A person will be eligible for the Paid Parental Leave scheme if they have an individual income of $150,000 or less in the financial year before the birth or adoption of their child. This is a generous income test but is consistent with the principle of targeting government support to those who need it most. To apply, a person must be living in Australia and be an Australian citizen or permanent resident.
Families receiving paid parental leave will not be entitled to receive the baby bonus or family tax benefit part B for the duration of their paid parental leave. The government estimates that more than 85 per cent of families will be better off taking paid parental leave. These families will, on average, receive around $2,000 more than if they had chosen the baby bonus. This is after tax has been paid and other family assistance has been taken into account.
Our plan is fully costed and fully funded and is expected to commence on 1 January 2011. We have previously debated in this chamber what form of paid parental leave we may have, but we must not lose sight of the fact that we need some certainty for parents. There are parents or families out there now, planning to have children, and they need some certainty about whether or not the Paid Parental Leave scheme will be in place from 1 January 2011. I urge those opposite to consider supporting our scheme regardless of whether their own amendments get up or not and to not delay its passage through the Senate—or in any other form in the parliament—so that mothers, fathers and families have some certainty as to when the Paid Parental Leave scheme will start.
We have heard from those opposite about their scheme, which I understand includes a 1.7 per cent tax on 3,000 or 5,000 companies at a cost of $2.7 billion. It is six months, often for very wealthy individuals. There is no income test and no payment for stay-at-home parents.
It is a very high income test. The parental leave is available to most working mothers, even those on very high salaries. That is in stark contrast to the Labor Party’s plan, which is fully costed and fully funded and which has a commencement date. Previously the Leader of the Opposition said that there would be a paid parental leave scheme over his dead body. He is now saying that he has seen the light or something. I do not know whether that is the ‘gospel truth’ or whether it is another commitment that will be discontinued in the election campaign.
But I hope that the opposition are sincere about this. I hope that they are debating it in good faith and that they pass a paid parental leave scheme regardless of whether or not their amendments get up. People out there will be listening carefully to whether or not the opposition intend to support the scheme, regardless of whether their amendments get up. People are planning to have families. It is really important that those opposite do something that is in the best interests of the families of this country, stop opposing just for opposition’s sake and support what is a very important scheme that will have a very large impact on the lives of the working families in this country.
I am very pleased and very proud to rise to speak in support of the Paid Parental Leave Bill 2010 and the related bill. For me, this is legislation that represents all of the good things that Labor governments always strive for: empowering everyone in their communities, empowering women. This is also the sort of legislation that occurs when women represent women. I am very proud of the women on this side of the House. I congratulate Minister Macklin. It is good to have people who understand the importance of paid parental leave in this country and the importance of that leave to women. I am a woman who has been in the workforce for almost four decades. This should never have taken this long. It has been overdue for so long. We thought that the 1970s were the enlightened era, yet this has taken until now. It is about time. This is historic legislation. It is legislation that families and women in Australia will cherish forever. They should mark the passing of it in their calendars as a special date to celebrate.
It is to the shame of the previous government that we are only one of two OECD countries that have not already introduced a paid parental leave scheme. Finally, with this legislation, we will catch up to the rest of the world. It is truly astounding. Traditionally, only half of Australian women had access to paid parental leave. It is absolutely undeniable that the women who have had access to paid parental leave are generally public servants working for governments and people in higher paid professional positions. That is certainly not fair. This Labor government cares about equity, fairness and opportunity for everyone. This legislation addresses that inequity and makes sure that all Australian women who work have access to paid parental leave. With the safe passage of these bills through the House, it is expected that almost 150,000 families across Australia will benefit.
The Rudd government staged its seventh community cabinet in the Hunter on 27 September 2008 and on that same day the Productivity Commission report was handed down. After congratulating the staff of the John Hunter Hospital, our big regional hospital, for their care, the Prime Minister—with Jenny Macklin, the Deputy Prime Minister and the Treasurer all there—made this statement:
Having just visited the midwives and looked at some of the outreach work that they do, it’s quite plain that one of the essential services they provide is this combination of pre-natal care and post-natal care. Post natal visits out to new mums, to make sure that mum and bub are doing well.
In fact we met a new bub today, his name is Carson who now shares a birthday with the Deputy Prime Minister, Happy Birthday Julia. Carson is 5 hours old, Julia is just a little bit older than that.
But this brings us to the whole question of part of the challenge for the future which is the future needs of the Australian economy. The Australian economy of the future will have stay at home mums who we’ll be supporting with the baby bonus, but also mums in the paid workforce who we will also be supporting with paid maternity leave and it’s time Australia bit the bullet on this.
It’s going to be a challenge to make sure we get the exact policy settings right because we are in the midst of serious global economic challenges. But we are determined to get that balance right for the future.
We’ve had 12 years of neglect on this, it’s time Australia bit the bullet on paid maternity leave, we intend to get on with the job and we will get the policy setting right once we work our way through the detail of this report.
Thank you, Prime Minister. As a women and a mother of two women, I was very proud that first commitment to paid parental leave was made in my electorate. I am proud to stand here and see it being delivered. We will get to the opposition’s role in that later.
This legislation will support women to maintain their connection to the workforce and at the same time boost workforce participation. For the first time, casual and part-time workers, as well as contractors and the self-employed, will be eligible for paid parental leave. More importantly, it will ensure that new parents will have the financial security to take the time off work to give a newborn baby the attention that it needs and deserves. And we will see businesses benefiting from the retention of skilled female staff while not having to pay for that maternity leave. That is rather vital. It is an important difference between the opposition’s policy and ours. When you push the burden of paying for parental leave onto business, you make women very undesirable as workers. That is never acceptable. It is a sensitivity that the opposition overlook. You cannot have business see the employment of women as a risk factor or as a burden in any way. That would be a detriment to the whole skill base of our nation and to the strength of our economy.
This scheme is the right one and it is the culmination of a long campaign to install Australia’s first ever paid parental leave scheme. There are many individuals who have worked tirelessly to see it come to fruition, too many to name here. The legislation before the House is primarily based on recommendations from the Productivity Commission, which undertook an extensive inquiry to get the scheme right. As a result, we have come up with a fair, equitable and fully costed scheme that will benefit families and small business.
From 1 January 2011, new parents will be eligible for up to 18 weeks paid parental leave. This would consist of $544 a week at this stage to take time off to care for their child, either a biological child or an adopted child. It will be available to parents who earn less than $150,000 a year, live in Australia and meet residency requirements. They must have also worked roughly one day a week for at least 10 of the 13 months prior to the birth or adoption of their child. I think that provision is important recognition of the fact that women do like to stay in the workforce on a casual basis between having children and while raising their family.
The Rudd government will still cater for parents who cannot access the proposed scheme. Families who are not eligible or who choose not to participate will still be able to access the baby bonus and family tax benefits as long as they are eligible for those payments. It is estimated that 85 per cent of families will be better off under the scheme. On average, they will receive around $2,000 more than if they choose the baby bonus alone.
This government funded paid parental leave can be taken in conjunction with or in addition to employer provided maternity and other leave. It is a really wonderful thing to think that if you have already got an entitlement to paid parental leave you can add that on to the beginning, the end or anywhere you like with our scheme. I hope the fact that parents are able to get two lots of paid parental leave will drive more employers into accepting they have a responsibility to their workforce and establishing a paid parental leave scheme in the workplace. It is something that can enhance what we are doing.
Parents will not be obliged to return to work once their 18 weeks of paid parental leave have concluded. Under the new National Employment Standards, new parents have a right to a full year of unpaid leave and the right to request another 12 months unpaid leave. The 18 weeks of paid parental leave can be taken at any time in the first year after the birth.
There are several amendments included in this bill. They go to the definition of income, the definitions and rules around social security and the payments, clarifying the integration of paid parental leave with family tax benefit payments. The amendments also serve to avoid breaches or deal with breaches of social security arrangements. That is the correct way.
This is a well-rounded scheme, one that is fully workable. It has garnered and enjoyed support from across the industry spectrum, from Sharan Burrow of the ACTU—and I praise Sharan for all her hard work and leadership in this area, and I wish her great success in her international appointment—to Heather Ridout, CEO of the Australian Industry Group, and Katie Lahey of the Business Council of Australia. It certainly has the support of women in the Rudd government and women in the community. It is wonderful to see women leading because, as I say, when women represent women, these are the outcomes.
If the Leader of the Opposition can be believed, even he now supports a paid parental leave scheme, although his plan for funding it seems ironic to this side of the House: the Liberals taxing big business to help families. It is a strange way for us to see them approaching this important policy area. Tony Abbott, the Leader of the Opposition, was quoted in the Sydney Morning Herald last week as telling his colleagues in a party room meeting:
“We have to demonstrate that we have moved on from the Howard era view that mothers should stay at home with their kids …
Apparently Tony Abbott wants to move on from the Howard era. Who would have thought it? That is not exactly the way it looks to us. It looks like they are still stuck back in coalition policy behind that white picket fence where all sorts of abuses of human rights were secretly carried out. I think it is a wonderful, healthy thing to see a policy that empowers women and supports women. But it was Phoney Tony who in 2002 said that paid parental leave would happen over his dead body. We cannot escape the fact that the Liberals had 12 years to introduce paid parental leave and did nothing. That is shameful stuff.
Regardless of the Leader of the Opposition’s flip-flopping position, we know that this is an important piece of legislation, something that our nation needs. I repeat that any scheme that pushes the burden of parental leave onto business can only have a detrimental effect on the employment of women. It perpetuates that myth that employing women is risky because they might get pregnant and leave you after you have invested all this money in their skill base. Well, no; with paid parental leave paid for by the people of a country through their taxes, through their government, we share that burden and we share the wealth that it creates.
As the Productivity Commission inquiry found, once a paid parental leave scheme is in place, it will be seen as a standard contract arrangement. The inquiry report, Paid parental leave: support for parents with newborn children, states:
The more that parental leave arrangements mimic those that exist as part of routine employment contracts, the more they will be seen by employers and employees as standard employment arrangements, with the dual effect of:
- promoting employment continuity and workplace retention (thus helping to preserve job and employer-specific skills that would be reduced if parents were to resign or move to another employer) and reducing training costs for employers
- signalling that a genuine capacity to take a reasonable period of leave from employment to look after children is just a normal part of working life.
And that is how it should be. The Productivity Commission report went on to say:
… there is compelling evidence of child and maternal health and welfare benefits from a period of absence from work for the primary carer of around six months …
So what will it mean if that becomes part of the way that we do things? It will mean better relationships between women and their children. It will mean greater opportunities for breastfeeding of babies. It will mean, I would hope, over time, less postnatal depression among women and a reduction in the dreadful burdens and choices that women always have with the financial impost that comes when their income is suspended. This will have wonderful benefits for our women and our children. There is compelling evidence, I agree, of those benefits. There are sound rationales for stimulating women’s labour force participation rates to overcome the disincentives imposed by the existing welfare and tax systems on that participation. It is what women do. It is what women want. Just like men, they want to be able to choose their careers and they want those careers to prosper, but in most cases they also very much want to raise families. The commission report also stated:
- PPL could advance broad social objectives, such as achieving greater gender equity and balance between paid work and family life.
These three points sum up the need for the Paid Parental Leave scheme for me. It will benefit families, it will benefit the workforce and it will progress us as a society. This is a good thing. I believe it is a fundamental characteristic of a socially inclusive society to have a paid parental leave scheme like the one we are debating here today.
It is the inalienable right of a woman to choose to have children; it is also the inalienable right of a woman to pursue a career. I look at many of my successful female colleagues in this parliament—frontbenchers, backbenchers, senators and those from the opposition—who juggle family commitments and the demands of new babies and see that they are often not extended the understanding that that is okay. This happens in every sector of the workforce. Women are contributing much to the workplace, to their families and to their community. They should be encouraged to do so and they should be supported to do so.
In this year’s federal budget we spoke of further strengthening the national economy, of helping families and of securing real future growth. This is exactly what paid parental leave is about—preparing our nation for the future. It reflects our child centred approach to family policy, which is fundamentally about what is in the best interests of children. The scheme will deliver crucial benefits to us, both in the workforce and at home. It will encourage workforce participation and productivity, both now and into the future. Most importantly, it will help cement the bonds of countless numbers of families across Australia—the benefits of which are difficult to quantify but which we all know are vital to family happiness, family harmony and the strength of the social fabric that underpins the society we depend upon, we want to belong to and we are proud of. I absolutely welcome this legislation and commend these bills to the House.
I rise today to speak on the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010. This is a historic moment for Australian working families, particularly for Australian working women, who will finally have a federally funded paid parental leave scheme. The Paid Parental Leave Bill 2010 introduces Australia’s first national, government funded Paid Parental Leave scheme as of 1 January next year. The scheme will cost the government over $1 billion over five years, but it will be money well spent.
From 1 October 2010 parental leave pay will be claimed through the Family Assistance Office, along with other family assistance payments, up to three months before the birth or adoption of a child. The government will fund employers to pay their eligible long-term employees as part of the scheme. This scheme will apply to parents who are primary carers of a child born or adopted after 1 January 2011. It will complement other leave entitlements, such as unpaid parental leave in the National Employment Standards. This leave can be combined with or complement existing entitlements to paid leave, such as recreation, annual and employer provided maternity leave.
Families that do participate in the scheme will not receive the baby bonus or family tax benefit part B; however, families can elect on the basis of their circumstances which is the best option for them. Payments will be delivered either through the primary carer’s employer or through the Medicare Family Assistance Office branches located in most major centres. Parents will be able to lodge their claims up to three months prior to that birth or adoption.
The role of employers is being phased in over the six months of the scheme to help employers transition to the new arrangements. Employers can choose to provide parental leave pay to their employees from the commencement of the scheme with their employees’ agreement. Employers may be required to provide parental leave paid to eligible employees from 1 July 2011. Employers will only be required to pay their long-term employees—that is, people who have been with their employer for 12 months or more—prior to the expected date of birth. In other cases the Family Assistance Office will make the payment directly to the parent.
In terms of the possible impacts of parental leave on employers, the scheme will not result in the accrual of any additional paid leave entitlements by employees nor will it affect the calculation of notice periods, severance pay or workers compensation or accident insurance premiums. The government is also working with state and territory governments to ensure paid parental leave is not subject to payroll tax.
To be eligible for the payment the primary carer, usually the mother, must meet eligibility criteria relating to their work, income and residency. Specifically, a primary carer must have been engaged in work for a total period spanning at least 10 of the 13 months prior to the expected birth with a break of no greater than eight weeks between working days. They will also have to have undertaken at least 330 hours of paid work during the 10-month period, which averages out at around one day of paid work a week—not a particularly onerous requirement.
A parent will be eligible if they have an individual income of $150,000 or less per annum before the claim or birth of the baby, whichever is the earlier. This income test is consistent with our ideal of targeting government support to those who are most in need—a proposition that the opposition seems to ignore. This government recognises the irregular working patterns of contractors and seasonal and casual workers with inconsistent work patterns. A person can have a break of up to eight weeks between working days and still be considered to have worked continuously.
Casual and part-time working mums as well as sole parents have not been ignored in the bill. In fact, casual workers are said to be the big winners from Australia’s first Paid Parental Leave scheme—a fact that has not been commented on much. Women are more likely to be casual workers and make up almost 50 per cent of all casual employees in Australia. Almost 25 per cent of employed women in work are in casual jobs and receive no paid leave entitlements.
Parents who are not employed at the time of the birth of their child but have satisfied the work test will be eligible under the Paid Parental Leave scheme. Many casual workers have irregular work patterns and are in fact unlikely to be in work immediately before the birth of their child for fairly obvious reasons. Under our scheme an eligible mother who is in a contract position but whose contract finishes before her baby is born will still receive the parental leave pay providing she meets that work test that I outlined earlier. Eligible parents not employed at the time of the birth of their child will be paid directly by the Family Assistance Office.
Parental leave pay can also be available to parents who work in their own business or a family business such as a farm. This will have a very positive impact on the many women who have worked in small business, such as myself, and on many of the small businesses that are staffed and manned and managed by women on the Central Coast. Parents can determine the period in which they wish to receive their parental leave pay. The start date cannot be before the child’s birth, and parental leave pay must be in one continuous 18-week period. The 18 weeks, though, can be shared between both parents.
The government’s Paid Parental Leave scheme is fair, balanced and economically responsible. It helps employers retain valuable staff, reducing the time lost to recruiting and retraining, and it imposes no new taxes on business, being entirely government funded. This scheme recognises that taking time off to have a baby is a normal part of life and a normal part of working life as well. This bill and its complementary legislation will encourage businesses to progress the family-friendly provisions that many are already embracing. The government will review the scheme two years after its inception and will continue to evaluate adjacent issues as paid paternity leave and superannuation contributions for the period of paid parental leave.
I would like to relate the experience of one family in my electorate who are eagerly awaiting the passage of this bill into law. Lindsay and Gerrard live in Davistown in my electorate of Robertson on the New South Wales Central Coast. The mother, Lindsay, works in a cafe, and the father, Gerrard, is a police officer. They have a two-year-old boy and are hoping for another child in the near future. For this Central Coast family the government’s Paid Parental Leave scheme is a promise of support and security in a financially stressful and physically exhausting period.
During the birth of their first child, Lindsay was required to have an emergency caesarean. It was an unforeseen event, as it often is, and it delayed Lindsay’s recovery considerably. The result was a much longer recovery time for her, and her husband took several weeks off work on carers leave to support his wife and the new baby. With no additional financial support and constraints on the period of time available to Gerrard to remain on paid carers leave, the stress on the family was considerable. This is just one of the unplanned-for contingencies that can occur with the arrival of a new baby. In these instances, the support of paid parental leave can help a great deal. Particularly in circumstances where the father is taking time off work to support the mother and cannot work extra shifts and is only being paid basic wages, it can have a very serious financial impact on the family.
You can see in circumstances such as this that this bill will have great beneficial effects. Firstly, the mother was unable to work and therefore received no income, and the father’s wages were dropping due to his need to spend more time with the family. With the introduction of the Paid Parental Leave scheme, Lindsay’s income would be replaced by the federal minimum wage for 18 weeks. It would relieve the pressure on her to return to work sooner than she might otherwise want to and it would allow the financial obligations of the family to be met. I know that this is one family that will be very happy and grateful for the support for the family, but of course they only represent the many, many families out there in the Australian community that will be assisted by this particular bill. The Paid Parental Leave scheme takes the weight off the whole family in many individual cases across Australia.
Many mothers do ask themselves: do I put my young baby in childcare or do I stay home; do we have the financial resources to meet the additional financial burden; how will we pay the mortgage while I take additional time off work? The Harvester case, which in the past determined that wages supported a father, his wife—not working—and at least two children, no longer applies, and really, the single wage is seldom enough to support an entire family. As much as many of the opposition would like us to be in the 1950s and have those sorts of priorities set for families in Australia, it is not the present circumstances so the passing of a Paid Parental Leave Bill such as this, which provides financial support for families at a time of the birth of their child, is essential.
Women should have a genuine choice to determine within economic and family realities whether to spend an extended time with their babies after their birth, and the fact is that in the economic circumstances that exist today many women do not have that genuine choice. This parental leave bill provides a choice for them. I refer particularly to the sleep deprivation that invariably accompanies a new baby. I know I do not have to belabour this point, so to speak, with the members of the House, but certainly, even though my boys were born some 20 years or more ago I can still remember how difficult it was to get up and go to work after having spent sometimes six hours with a young child who would not sleep at the convenient time that suited my work patterns.
I am disgusted at the opposition’s grandstanding on this bill. After 11 years in government, in the period when most other OECD nations took the initiative to introduce support for working mothers, the coalition sat on their hands and did absolutely nothing. Worse, they stand in this place and claim with false sincerity that they would pass the measures they have moved as an amendment. I simply do not believe them. There is nothing more here than a cynical exercise in political expediency, and the public knows it. This is not a scheme that in government they would implement. Paid parental leave, a real scheme to benefit Australian working families, does not factor on their priority ‘to do’ list. I do not believe that the Leader of the Opposition is genuine in the maternity scheme that he proposed in February or March. Ostensibly, he is proposing six months maternity leave for all mothers, who would receive a payment equivalent to their wages up to a maximum of $150,000 per anum plus superannuation. Mr Abbot proposes that it should be paid for by a ‘big new tax’ on businesses with taxable incomes of more than $5 million per year. This proposal is really more about the opposition leader trying to soften his image with women voters rather than a genuine desire to bring equity to the workforce or to recognise the value of women in balancing work and family life.
If the opposition leader had been genuine about his proposal, he would have put a lot more work into developing a scheme. He would have consulted with employers, with businesses and even with the members of his own party room. He certainly took everyone by surprise with his announcement, almost guaranteeing that this scheme would never come to fruition. Immediately, Katie Lahey from the Business Council of Australia, Heather Ridout from the Australian Industry Group and Peter Anderson from the Chamber of Commerce and Industry said that they did not support the scheme. The Leader of the Opposition also shocked his own party room, which was strongly critical of his scheme. You might expect someone like the member for O’Connor, good old ‘Iron Bar’ Tuckey, to be opposed to this scheme, but even the more socially outward looking member for Paterson seemed to see that there was some difficulty with the scheme. The soft hearted members, like the member for Canning and the member for Gippsland, also saw that they could not support the scheme.
The opposition leader should stop play-acting and support the government’s maternity leave bill, which introduces a genuine scheme which has been thoughtfully considered. Consultation has taken place with business, employees, unions and many parents. That is also what he should do if he really wants to see paternity leave put in place for mothers, fathers and families. I suggest that the coalition cease their cynical politicking on this issue and pass that bill when it arrives here and also support it in the Senate. I would certainly be proud to see a paternity leave bill pass this House. I suggest that, in the interests of Australian families, the opposition support the bill we are currently debating and abandon the cynical exercise that they are proposing as an amendment.
I am happy to be following the member for Robertson to speak very much in support of the Rudd Labor government’s historic Paid Parental Leave scheme. Firstly, though, I would like to take this opportunity to commend the extraordinary efforts of the Minister for Families, Housing, Community Services and Indigenous Affairs, the Hon. Jenny Macklin. The minister’s efforts in introducing Australia’s first ever Paid Parental Leave scheme are to be commended and, I am certain, will give her a well-deserved place in the history of this chamber.
Jenny Macklin is one minister and one member of the parliament who is best placed to understand the importance of this legislation to Australian women, Australian men and indeed Australian families. Like most of us in this place, she is first and foremost a working parent and, like an even smaller number of us in this place, she is a working mum. Although her boys are now young men, she came here all those years ago as the mother of two young children, as I did, along with many of my female colleagues. So we are very well placed to understand the significance of the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010 being debated in the chamber this evening. Although parental experience is not required in order to appreciate the meaning and value of these bills to the Australian community, those of us who are parents and carers of children understand the practical aspects of balancing work and family and, as such, we understand the significance of these bills before us today.
Through the introduction of this legislation and the debate it has generated, the Rudd Labor government has placed Australia in a social and economic position deserving of an advanced modern economy. In Australia, there is now a recognition of the necessity for a universal scheme that is responsive to the interests of working families. There is recognition that Australia can no longer do without such a scheme. I want to remind the House that currently we are one of only two OECD countries without a national paid parental leave scheme, and that can no longer do. With the introduction of these bills, the federal government—and, in particular, the minister—has managed to do what no other Australian government has done before. Put simply, this national scheme gives working parents of babies born or adopted from the very beginning of next year 18 weeks of parental leave paid at the level of the federal minimum wage.
We came into government just over two years ago committed to protecting working families in Australia from the aggressive Howard government’s Work Choices offensive, aimed at stripping back our most basic rights at work, that inevitably would have hurt the nature and quality of working family life. Not only have we preserved the rights of working Australians but we have further strengthened them in a comprehensive way through the introduction of these landmark bills.
With a scheme that is fully costed and funded by the government, Australia now joins all other OECD countries, bar one, in the internationally recognised provision of pay during a period of parental leave. This international recognition is enshrined in the United Nations Convention on the Elimination of All Forms of Discrimination Against Women, which states:
Parties shall take all appropriate measures … to introduce maternity leave with pay or with comparable social benefits without loss of former employment seniority or social allowances.
With the introduction of these bills, the government is not only carrying out its commitment to UN conventions by satisfying the recommendations of the Australian Human Rights Commission; it is also aligning itself with the International Labour Organisation’s standards for paid maternity, through the Convention concerning the Employment of Women before and after Childbirth. It is important to recognise that the ILO’s convention provides for maternity leave of not less than 14 weeks. The Rudd Labor government, in its recognition of the importance of parents being able to maintain both themselves and the child in an appropriate condition of health and with a suitable standard of living, advances on the 14 weeks recommended by the ILO by providing working families with a further four weeks of fully funded parental leave.
Often—and I am always conscious of this argument—the issue of discrimination against women in employment because of the likelihood of falling pregnant is raised whenever there is mention of paid parental leave. That is why it is important to recognise that the effectiveness of this scheme lies in the manner in which it is delivered. By allowing families to make their own work and family choices through the ease of transferring leave between mums and dads, it does not provide a basis from which employers can discriminate against the employment of women. This is because the role of a primary carer in our modern Australia is not assigned to gender. In fact, as the minister noted, the scheme benefits businesses through the retention of skilled and experienced staff whilst having minimal adverse impact, as they will not be forced into funding parental leave payments. It reflects a government which assumes the responsibilities associated with the role it plays within our society—a role which determines that governments are there to make things better, as well as fairer, for members of their community.
The roll-out of this national scheme will preserve the link between workers and their employers and in doing so will help retain skilled and valuable staff and do away with the added uncertainties of whether a parent, which in most cases is the mother, will return to work. The linking of the parental leave pay with the normal pay cycle of an employee, along with other workplace entitlements, will continue to strengthen the connection between work and home and is more likely to encourage a return to work.
If we are to give Australia’s children the best possible start in life, we need to provide the necessary level of support to the primary caregiver in order for them to help build the child’s emotional, physical and cognitive development at the most crucial stages of the child’s life, the early stages immediately following the birth of the child. With this in mind, 148,000 mothers and primary carers will be given access to Australia’s first comprehensive, statutory paid parental leave scheme in order that the critical early months in the life of a child are recognised as such, and treated with the necessary level of care as parents adjust to the very important task of raising a child.
When it comes to the Paid Parental Leave scheme, the government does not discriminate between workers and the conditions under which they are employed. For most women in seasonal, casual and contract work, as well as the self-employed, it will be the first time that the women will have access to paid parental leave, because the government is responsive to the facts. These facts are that women, who in most cases will be the primary carer during the immediate period following birth, not only make up more than half of the casual workforce in Australia, but that 25 per cent of working women are employed in casual jobs that do not offer any paid leave entitlements.
In aligning this important social policy with Australia’s economic reality, the government asked the Productivity Commission, as Australia’s leading and independent research and advisory body, to establish an inquiry into the feasibility of a paid parental leave scheme and the models associated with its introduction. The commission itself concluded that one-on-one care of a child, through the introduction of a national government funded statutory scheme of paid parental leave, would provide the best possible effects on the child’s development.
In recognition of this reality, I want to highlight the meaning of the Paid Parental Leave scheme for the working men and women of Calwell. I had the opportunity to discuss this bill with two women in my electorate. One of my constituents, Saja, who recently gave birth to her first child, Jamal, is now on maternity leave but Saja’s working entitlements did not include a provision for paid maternity leave. Naturally, this has meant that she has had to deal with coping with the birth of her first child, along with assuming the responsibilities—and the running around, of course—of trying to obtain whatever entitlements she has access to through Centrelink.
Beyond the financial advantages of a paid parental leave scheme, Saja describes a situation where, had this long-overdue scheme been in place, it would have allowed her to maintain her connection with her work more effectively and would have removed from her and her husband the burdens of uncertainty, especially financial uncertainty, in their lives. Saja explained that this connection is important because it allows mothers, especially first-time mothers, to be secure in the knowledge that they are performing an important function and that the link between work and home, between family and employment, remains an important part of the social and economic fabric of our society.
This view is also shared by Ann, also from my electorate, who is now on a career break following the birth of her first child. Ann, who is obviously very delighted about the introduction of Australia’s first-ever Paid Parental Leave scheme, notes that had this scheme been in place during her time, she might have reconsidered her options about returning to work.
These two examples, when put together, demonstrate the importance of developing policy that recognises the link between the social and economic direction of our country. The Australian Human Research Institute, in a study on human resource replacement costs, found that it can cost up to 1.5 times an employee’s salary to replace that employee. With this reality in mind, and taking into account the average staff turnover in Australia at large companies, the AHRI approximates that the cost to the Australian economy could be as much as $20 billion. With all this in mind, the real cost of not having a paid parental leave scheme is too great to ignore any longer. Australian families can today be proud of their achievements in not only preserving their rights at work, but also of progressively building upon them to address a reality that working families have had to face for far too long.
It is important to recognise that advocacy groups and unions, as well as the business community, have welcomed the financial and non-financial benefits that this scheme provides to working families. In acknowledging the Australian Industry Group’s position on what it called an important economic and social reform, I felt it important to draw the House’s attention to what working mothers of newborn children in my electorate of Calwell have said about this national scheme, because ultimately it is with these people in mind that this policy has been conceived.
This bill is responding to the years of campaigning by women and men who have been so committed to this cause. These are women and men who lead peak organisations such as the ACTU, the National Foundation for Australian Women, sex discrimination commissions, the Australian Industry Group and the Business Council of Australia, but there are also the myriad of women and men from the broader community, those who have lobbied us as members of parliament, our constituents, community groups, from factory floors to corporate boardrooms—such was the broad based call for a paid parental leave scheme that its arrival in this House was inevitable. Today it is their achievements that we celebrate, and I commend the bill to the House.
I would like to commend my colleague the member for Calwell for her contribution. As a mother and a member of this place, I know that she has worked tirelessly with the minister in helping formulate the Paid Parental Leave scheme. There are a great many women on our side as well as in the opposition, and men, who will have a great deal of satisfaction that this piece of legislation has come through. I remember that as a young campaigner in 2007 it was with a great deal of pride that I knew it was part of the platform that the Labor Party undertook to implement, a paid parental leave scheme fully funded by the Commonwealth. I thought that was significant, and it is with a feeling of honour that I participate in the debate tonight on the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010.
The introduction of this legislation on 12 May represents one of the most significant achievements of the Rudd government. I was thrilled to be in the chamber when the Minister for Families, Housing, Community Services and Indigenous Affairs introduced the bill because it was truly an historic moment for Australia. As a result of our reform, new mums and dads will receive up to 18 weeks government funded paid parental leave. It is big news for Australian families and it is great news for the working families in my electorate of Solomon, in the Darwin and Palmerston areas. I am very proud to be a member of the Rudd government because—make no mistake about this—it is the only government that has shown the commitment to introduce a paid parental leave scheme across Australia. It was all very well for those opposite to talk about a paid parental leave scheme for the last 12 years they were in government. If they were fair dinkum about it, they would have introduced it. However, it was probably something they were going to get to in their 13th year, similar to climate change.
I will take the interjection from the shadow minister. I do not remember during the campaign the coalition ever talking about a paid parental leave scheme. They never spoke about it. However, there was a thought bubble. We all know about the thought bubble. It was the Leader of the Opposition who decided that he would introduce a paid parental leave scheme. I read through his speech because I was very interested in how Phoney Tony had evolved into this great man that he is.
Mr Deputy Speaker, on a point of order: I ask you to remind the member, pursuant to the standing orders, that he should address members of this chamber by their correct title. The Speaker has already ruled on that particular expression that he is using.
I accept that, Mr Deputy Speaker, and thank the shadow minister for the interjection. What I will say is that I was reading it and so it is probably true. He read his speech and said in his contribution to this debate, ‘I have listened to my colleagues.’ We know that is a lie because the Leader of the Opposition did not listen to his colleagues. It came as a surprise to them that suddenly he had found this new-found socialistic bone in his body and was going to bring in a paid parental leave scheme. I continued to have a little bit more of a look at his contribution to this debate. I always wondered why in 12 years, sitting on big surpluses, not once did they try to introduce a paid parental leave scheme. This goes to the core of this debate because it is about the honesty of the Leader of the Opposition when it comes to this issue. He suddenly comes into this House and expects the Australian public to believe that he has a paid parental leave scheme that is bigger and better than anything that has ever been put forward before. I will get to how he is going to fund it, because that is a separate issue altogether. After being a cabinet minister for the last 11 years, right in the inner sanctum of the coalition government under John Howard, and then driving to work—or he might have been riding his pushbike because I do not think he uses Commonwealth cars and I commend him on that—he suddenly thought: ‘Yep, I’ve got the scheme. I’ve got it. I am gonna nail it. This is what I am going to do.’
He forgot, because he has got a little bit of a selective memory, that in 2002 he said ‘over my dead body’ would there ever be a paid parental leave scheme. But suddenly the Leader of the Opposition has found this great socialistic reform that will come to pass. It came to him in this bubble that he first took to the press, where he does most of his best work, and then took to the party room. I remember that, back in December when he was preparing to lead the coup against the former Leader of the Opposition and when he did not want to be called a climate sceptic, he decided that the reason—
Mr Deputy Speaker, I draw your attention to what this bill is actually about. I ask you to draw the member’s comments back towards the legislation before the parliament.
The point I was making was that he was prepared to say the reason that he led the coup was not that he was a climate change sceptic but the fact that the then Leader of the Opposition, the member for Wentworth, had not brought his views to and had not debated them properly in the Liberal Party room. That was the fundamental reason that he said: ‘I had to stand up and I had to say something. That’s not the way the Liberal Party operates. We debate issues; we have personal opinions.’ That was why he led the coup. He went outside that and changed his position on that. He decided that he could introduce legislation through the media.
I quote from the Leader of the Opposition’s contribution to this debate:
Of course, all policies have to be paid for. Only members opposite think that there is some endless source of finance, some magic pudding from which to pay for all the things that they desire to create a better society. I make no bones about the fact that this policy will be paid for by a levy of up to 1.7 per cent on taxable company incomes over $5 million a year. I wish it were otherwise. Were circumstances different, it could have been different. If we had a $20 billion surplus, we could have done it differently. But given the situation that this government places us in, given the fact that this government in just 2½ years has turned a $20 billion surplus into a $57 billion deficit, given that this government has put us in the position where we are borrowing $700 million a week, this is the least bad way to bring about an effective paid parental leave scheme any time soon. And it must be done soon. The women of Australia and the families of Australia have waited too long and they ought not be denied this visionary piece of social policy, this important economic reform, any longer.
Who believes that? If you believe that he is honestly going to bring that in, you believe in the Easter bunny, you probably leave a light on at night for Harold Holt and you probably think Elvis is in Tennant Creek driving a cement truck, because there is no way in the world that this Leader of the Opposition will implement his paid parental leave scheme.
They had a $20 billion surplus and they still did not do it. They are still in denial over the global financial crisis. They are still in denial that the Treasurer, the Prime Minister, the Treasury and the Reserve Bank have been able to guide Australia through the global financial crisis, leaving us better off than any other country. They are still in denial that our debt was looking at something in the high twenties and we have been able to keep it at around six per cent. They are still in denial. And it just shows how out of touch this Leader of the Opposition is with what real people out there in the community are thinking. He was out of touch when he was a cabinet minister when it came to paid parental leave. He cannot be trusted on this issue.
Many of my colleagues tonight have touched on where the bill is at. Many of my colleagues have spoken about different parts of the bill—the money, the eligibility aspects and all those types of issues. But, for me, this is more about the credibility of the opposition in regard to a paid parental leave scheme. It is only Labor that will deliver it. There is no doubt about that. The Leader of the Opposition says he wants to slug business with a 1.7 per cent tax. We are looking to bring corporate taxes down, through the mining tax, by two per cent. It is roughly a four per cent tax turnaround for small- to medium-sized businesses.
I put this to the Leader of the Opposition: who carried Australia through the global financial crisis? It was not the big miners; it was small- to medium-sized businesses in this country, aided by targeted stimulus spending. Those businesses showed discipline and courage by sticking with their workforces. The reward for them from this side of the House is to look at a two per cent decrease in the corporate tax rate. That is what we on this side of the House are doing. We are saying to small- and medium-sized businesses in this country: ‘We felt your pain. We gave you money through stimulus. We acknowledge the fact that you continued to put apprentices on, you did not lay people off and you showed courage and discipline in very tough times.’ What does the coalition do? What does the Leader of the Opposition do? He wants to kick small- and medium-sized businesses when they are at their most vulnerable, coming on the back end of a global financial crisis. He wants to whack a tax on them to pay for his paid parental leave scheme. It is unbelievable. What have businesses done to deserve that? I thought that the coalition were the party for small- to medium-sized businesses.
They were, possibly, 20 years ago—that is right, Member for Moreton—but not now. They stand over the top of businesses, and on this occasion the Leader of the Opposition wants to kick businesses when they are at their most vulnerable. And it will only be the Labor Party and it will only be the Rudd government that will stick by small business. That is a 3.7 to four per cent turnaround in tax if Tony Abbott becomes Prime Minister of this country. That would be bad for the country.
But do you know what? You can see, in his comments about the $20 billion surplus, that he has given himself the out. This can only go one of three ways. The first possibility is that he will not bother implementing it at all. He will say: ‘Times are too tough now. We have to pay off Labor’s debt. We will have a look at it another time.’ It will be a bit similar to the phrase, ‘Work Choices is dead.’ Who believes that? Flexibility—
Yes, his ironclad guarantees. No-one believes him on that. That is the first thing that could happen—scrap it, put it on the backburner. The second thing that could happen is that he may implement the 1.7 per cent tax on small- to medium-sized businesses—but I doubt it. The third thing he might do is, if he does do the 1.7 per cent, he will bring back Work Choices. And that will be his payback to big business. He will say: ‘Look, suffer for a while. Just take it easy. I am going to get rid of their penalty rates. If a woman happens to fall pregnant, we will bring in a clause along the lines of unfair dismissal, and you can get rid of her for operational reasons—because she can no longer contribute.’
This Leader of the Opposition is probably the worst Leader of the Opposition out of the three. The other two had some integrity, but not this bloke. He will do anything and he will say anything; he freely admits that himself. He did it a couple of weeks ago with Kerry O’Brien. Everyone knows. If it is written down and he is reading it, you know it is pretty well close to the truth. But, if he is talking off the cuff—and he prides himself on that; he always tells the Prime Minister off for reading notes—there is a good chance he will throw in a few lies here and there, throw in a few little curve balls. But that’s Tony. That is the way this Leader of the Opposition operates.
Does anyone honestly believe that this Leader of the Opposition is committed to a paid parental leave scheme? You are kidding. He is not committed to it. He was never committed to it in government. He has given himself so many little outs—you can see that in his speech in the second reading debate. This Leader of the Opposition loves to put little curve balls, little deceptions and all the rest of the stuff into his speeches. And he loves to talk to the media the same way.
In his speech in the second reading debate, Mr Abbott said:
As I said, the government’s measure is a small step in the right direction. I believe we should go much further and that is what the amendment in my name will do. I say to members of this House that, if you want to see a long overdue reform, it is important to support the coalition’s policy on this point. If we are to have a better society in the future than that which we have experienced in the recent past, it is important to change the government. If you want to stop the great big new tax on mining, you have to change the government. As was clear from the announcement that the coalition made this morning, if you want to stop the boats, you have to change the government. And, if you want to give families a fair go through a decent paid parental leave scheme, you have to change the government.
No-one is buying that for a moment. ‘Change the government’ is the common theme in there.
That is right. Thank you for the interjection, Parliamentary Secretary. He too would have worked long and hard on this particular bill.
So the common theme in everything that the Leader of the Opposition said is changing the government. There is no substance to what he said and he would not even guarantee that the boats would stop. There is no substance to what the Leader of the Opposition says. He has no credibility whatsoever when it comes to paid parental leave, and that was picked up in the policy that he introduced on 9 March while he was riding up the hill in his lycra. It was picked up on by the CEO of the Australian Industry Group, Heather Ridout, in an interview that she did about this. In referring to the Leader of the Opposition’s policy, she said:
… on any measure this is bad parental leave policy and it’s bad tax policy.
Well from a parental leave perspective it puts a huge cost on big companies. It will be anti the employment of women. It will be—it’ll cause a bias towards the employment of men.
In terms of tax policy, it will deter investment in the sense that we already have in Australia a high reliance on capital taxes such as company tax compared to other countries.
In terms of tax policy, it will deter investment in the sense that we already have in Australia a high reliance on capital taxes such as company tax compared to other countries.
And small medium sized economies like ours are reducing their company tax rate and not putting it up. That will—putting it up will deter investment into Australia and particularly into sectors that aren’t going to be the big darlings of the mining boom.
We just can’t afford this kind of operation, so on any measure it’s a poor policy.
I will finish off with this last quote from Heather, when she said what she thought of the opposition’s policy:
It is a most inequitable scheme and I don’t know who thought it up, but they’re not a rocket scientist.
That just about sums up the Leader of the Opposition: surely not a rocket scientist, and we all know that.
Be careful, I say to the working women of Australia and their partners. Be very careful when it comes to paid parental leave schemes being put forward by this Leader of the Opposition. He did absolutely nothing as a cabinet minister for 11 years. In 2002 he said, ‘Over my dead body will I ever be part of a paid parental leave scheme,’ and then he came into this place and decided he was going to slug business with it by putting the company tax up by 1.7 per cent. But we know there is always a hidden agenda with the Leader of the Opposition. No-one falls for it. Not one person in this place falls for it and I know that the Australian public—
They did not know about it. They would have fallen for it, but they did not know about it. I know that the Australian public will not fall for it either, because this guy has form. We saw his form with Kerry O’Brien two weeks ago. We saw his form when he openly admitted, ‘If I’m reading off notes I sort of tell the truth but, if I’m not, anything goes.’ Anything goes—and this guy wants to be Prime Minister.
As the shadow minister interjects again, this debate fundamentally goes to the credibility of the Leader of the Opposition, and he has no credibility when it comes to paid parental leave. I am absolutely rapt that the minister has introduced this bill. I fully support it, I fully endorse it and I commend the bill to the House.
I rise to give my strong support to the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010, and I commend the member for Solomon on his contribution. The Paid Parental Leave Bill introduces Australia’s first national, government funded paid parental leave scheme, a truly magnificent event to be a part of. I thank the Minister for Families, Housing, Community Services and Indigenous Affairs, Jenny Macklin, upfront, as I will at the end of this speech, because it is quite an honour to speak on this particular piece of legislation—one that I will be telling my grandchildren about, hopefully.
The road to equality has been a long and often difficult one for the women of Australia. Australia did have some early runs on the board. We were one of the first countries in the world to give women the right to vote and to sit in parliament, but progress since has been chequered to say the least. It was not until 1949 that our first female federal cabinet minister was appointed, and up until 1966 women working in the federal Public Service were required to resign when they married. I do not remember that year well—it was the year I was born—but if my mum had been working in the Public Service rather than for hospitals she would have had to resign for the fact that she was pregnant. It was not that long ago.
In the last 50 years much has been achieved for women in terms of equality in education and the workplace, safe contraception and access to childcare facilities. I would like to say this is also true in terms of equal pay but, having been a member of Sharryn Jackson’s House of Representatives Standing Committee on Employment and Workplace Relations, I cannot quite say that. If I read from our report, in 2007 women in Australia earned only 83.9 per cent of each dollar earned by males for full-time ordinary time earnings. Prior to 2007 the gap between male and female average earnings remained relatively constant. In May of this year Australia’s gender pay gap stood at 16.2 per cent for weekly earnings and at about 11 per cent for hourly earnings. The gap declined between 1985 and 2001 but has recently increased slightly. So there is not always a progression towards equality but, nevertheless, in terms of contraception, childcare facilities, education and the workplace there has been a lot of improvement.
In 1984 the federal government banned discrimination on the basis of sex. Today more women than men are educated at secondary schools and university and more women graduate from university with bachelor degrees. In 2006 women made up nearly 55 per cent of tertiary students and 47.5 per cent of students enrolled in vocational education and training courses. Forty per cent of Australia’s small business operators are women and 57 per cent of the Australian Public Service are women, with women holding around 36 per cent of senior executive positions. Unfortunately, in the private sector it is a slightly different story: only 12 per cent of management jobs are held by women. In this parliament, even though the Deputy Prime Minister and the Deputy Leader of the Opposition are women, only 30 per cent of elected representatives are women. So more work needs to be done there.
In Queensland, the state climate change minister, Kate Jones, recently became the first woman to have a baby while a member of the cabinet, and congratulations to Kate and Paul. Following in the steps of many others, I note my former campaign manager and the parliamentary secretary at the time, Karen Struthers, who is now the housing minister and the minister for the status of women in Queensland, also has a child. And obviously our own minister, Tanya Plibersek, is also going to repeat that later on this year, so all the best to them.
Paid parental leave is not the final frontier. There is still a long way to go, including wage equality, as I touched on previously, but the bill before the House, in black and white, is a great leap forward. This bill introduces Australia’s first government-funded paid parental leave scheme, and it is long overdue. Almost all modern countries have a paid parental leave system in place—leaving out the United States. To the best of my research, Australia is all alone with, as I said, the United States and Swaziland in southern Africa as the countries without a paid parental leave scheme. Even Sudan and Rwanda are progressive enough to have funded schemes in place. So it is long overdue in terms of looking around our colleagues in the United Nations.
But this does not stop the Leader of the Opposition in his opposition to a paid parental leave scheme. The opposition leader might have recently possibly had a change of heart on paid parental leave, but the reality is he had 12 years in the Howard government, where he served as an employment minister, and he never made any attempt to introduce paid parental leave. When he had the power and the opportunity, he did nothing, nada, not a thing. In fact, he vigorously campaigned against the interests of women, including paid parental leave. That is the measure of the man: what he did when he had the power and the opportunity, not the shadow promises he is trotting out now. In 2002, he told a Liberal Party function in Victoria—I do not know whether these comments were carefully scripted or in the heat of the moment, so I cannot vouchsafe their veracity:
Compulsory paid maternity leave? Over this government’s dead body, frankly.
Does the opposition leader really expect us to believe that he is now going to deliver a paid parental leave scheme if by chance the good people of Australia vote him in as Prime Minister? It is obviously not something that he believes strongly in. In fact, ‘over the government’s dead body’ were the words that he used. The Rudd government, however, is responding to the needs of modern families, while Tony Abbott is responding to results coming out of focus groups which tell him he needs to improve his standing with Australian women. It is certainly pretty easy to give a list of the concerns some of my female friends—not just Labor friends, but female friends—have had about some of Tony Abbott’s comments over the years, but I will not go there.
The Rudd government values the hard work of mothers, whether at home or in a paid job. We have brought in some quite reasonable approaches to support mothers. I note that we brought in means testing of the baby bonus, which is obviously a common sense thing to do. It did cause some concern for one of the voters in my electorate—my wife—because she was pregnant at the time we said it was going to be means tested and it was not a nine-month lead in. It was slightly less than that, so consequently, when my son was born on 19 January, the baby bonus was means tested which, as I say, caused some concern for my wife. She assures she will consider who she votes for at the next election pretty carefully.
Having a new baby on the scene is one of the most enjoyable and rewarding times of anyone’s life, but obviously it is also a very challenging time—whether you are an MP or anybody else. Obviously a new child creates lots of challenges. New parents usually have to adapt to life without sleep and also, more significantly, often life without their normal income, despite some of the ongoing bills and new bills that come with children. That is why the Rudd government supports families through the baby bonus, family tax benefits and from 1 January next year—not very far away at all—Australia’s first paid parental leave scheme.
This scheme is fully-costed and fully-funded by the government, and it does not impose an unfair big new tax on business. As previous speakers have touched on, we are talking about a four per cent differential in terms of our approaches to treating businesses, rising to a two per cent cut to company taxes for all companies, but for SMEs particularly, versus those opposite who are going to slug big business with a two per cent tax to fund their fanciful scheme.
The Rudd government’s paid parental leave scheme gives one parent the financial security to take time off work to care for their baby at home during the early months of their baby’s life. It gives mothers time to recover from birth and to bond with their baby, and any psychologist or person who works in the maternity sector will say that that is the most crucial time, early on, when children do their bonding with mothers and fathers.
This bill provides up to 18 weeks parental leave pay at the national minimum wage to primary carers who have a child or adopt a child after 1 January next year. It is currently $543.78 a week. To ensure greater flexibility for families, parents can nominate when they wish to receive their pay. However, all pay must be received within the first 12 months after the date of birth or the placement of the adopted child. This will help families balance annual leave, their employer provided paid leave and the Paid Parental Leave scheme to ensure it works the best for them. Carers will also be required to satisfy work, income and residency tests. A parent will not be able to work while receiving parental leave pay. However, if agreed with their employer, they may do up to 10 days to ‘keep in touch’ with their workplace, which can then make the transition back to work calmer and less stressful. The government will fund employers to pay their eligible long-term employees and eligible claimants who are not paid by their employers will be paid by the Family Assistance Office. Families who are not eligible or who choose not to participate in the scheme will still be able to access family payments such as the baby bonus and family tax benefit.
This bill provides meaningful support to families but it will also be good for employers. By providing financial support to new mothers, they will keep connected with their workplace, retaining skills and knowledge, and make sure they are ready return to the workplace when they are ready. As anyone who has ever worked in HR would know, the cost of replacing employees is quite significant. So a scheme that ensures employees who are familiar with a workplace are ready, willing and able to go back is a great scheme. It makes good sense for employers. This scheme will help families balance their work and family responsibilities and give Australian families the kind of support almost all other countries take for granted. I thank the minister for families, Jenny Macklin, for introducing such a historic piece of legislation—it has obviously required vision and courage and determination for her to do so—and in doing so I commend the bill to the House.
I welcome the opportunity to speak on the Rudd government’s Paid Parental Leave Bill 2010 and the cognate bill, the Paid Parental Leave (Consequential Amendments) Bill 2010. Being one of the final speakers on this debate, many of the relevant matters relating to this proposal have already been raised by other speakers, particularly from this side of the House. I will, however, outline once again the key provisions of the government’s Paid Parental Leave proposal. The government funded scheme will provide parental leave pay to mothers and adoptive parents who have been working and who have a baby or adopt a child on or after 1 January 2011. To be eligible for the scheme, claimants will need to meet the Paid Parental Leave work test, income test and residency requirements. Paid parental leave will be for a maximum of 18 weeks and must be taken in one continuous block. A person will be eligible if they have individual income of $150,000 or less in the financial year before the claim or birth of the baby, whichever is earlier. Parental leave pay will be paid at the rate of the national minimum wage, which is currently $543.78 per week before tax, and will be treated in the same way as other taxable income. Parents can nominate when they wish to receive their pay and all the pay must be received within the first 12 months after the date of birth or placement. Parental leave can be received before, after or at the same time as employer provided paid leave, such as recreation or annual leave and employer provided parental leave.
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 eligibility requirements. Otherwise paid parental leave will stop when the person returns to work. 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. Parents will lodge their claim with the Family Assistance Office, which will assess their eligibility. Once the scheme is fully implemented, parental leave pay will be provided by employers to their long-term employees. I understand there will be a six-month transition period before employers take responsibility for providing the pay. 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 Rudd government’s Paid Parental Leave scheme follows an extensive consultation period in August, September and October 2009 with key stakeholders, including major employee and employer peak bodies, representatives of small business, family and community stakeholder groups, tax professionals, payroll specialists and payroll software developers. There were also consultations with the state and territory governments. I understand that 32 consultation meetings and teleconferences were conducted with over 200 representatives. Feedback from the consultations was taken into account in the development of the Rudd government’s scheme.
Unpaid parental leave is already provided for under the National Employment Standards in the Fair Work Act. Under those provisions, employees have the right to separate periods of up to 12 months of unpaid parental leave relating to the birth or adoption of a child. There also exists the right for a parent to request an additional 12 months of unpaid parental leave, and that request can only be refused by the employer on reasonable business grounds. The National Employment Standards also provide rights relating to flexible working arrangements for parents. These, however, are unpaid provisions. Whilst there are some private employers with schemes in place, it is only with the introduction of these bills that parents for the first time ever have a government funded national paid parental leave scheme in place.
Australia lags well behind the rest of the world in supporting new mothers. It is my understanding that over 157 nations around the world have some kind of paid parental leave provisions already in place. The consequence of Australia not having paid maternity leave is that Australia has one of the lowest levels of workforce participation for women between the ages of 25 and 44 and is ranked 23rd out of 24 OECD nations. Australia and the United States are the only two OECD countries that do not offer paid maternity leave at the moment. It is estimated that under this scheme about 148,000 parents, mainly women, will be eligible for assistance.
I welcome the support for a paid parental leave scheme from some of the members opposite, although I notice that there is not unity on this issue amongst all coalition members. I also notice that there have not been a large number of opposition members prepared to come into this place and speak on this bill. I wonder whether that reflects the fact that they do not all support it or that they do not support their own leader’s amendments.
Since the Leader of the Opposition has now proposed his own paid parental leave scheme, I take this opportunity to make some observations on the coalition’s stance on this issue. I note the comments already made by the member for Solomon and the member for Robertson earlier on, and more recently by the member for Moreton, in respect of the opposition leader’s position on this very important issue. My first observation is the criticism by some members opposite that the government’s scheme does not include superannuation payments within it. These are the same opposition members who right now are opposing the government’s efforts to raise the superannuation guarantee levy from nine per cent to 12 per cent. When it suits their purpose they believe in superannuation; when it does not they oppose it. Coalition members simply cannot have it both ways when it comes to the question of superannuation. If it is so important that it ought to have been included in this scheme, then it is important enough for them to be supporting the government’s measures to increase the levy for the working people of Australia from nine to 12 per cent, as the government is proposing to do. Yet they do the exact opposite and oppose it. Clearly, that is hypocrisy.
Let me address the alternative policy on leave put forward by the opposition leader. In a desperate act by a desperate opposition leader, who knows he only has one shot at becoming Prime Minister and who is prepared to do and say whatever it takes, we saw the opposition leader go from one extreme position to another extreme position. This is the man who said in 2002, and I will quote him as did the member for Moreton a moment ago:
Compulsory paid maternity leave? Over this government’s dead body, frankly. It just won’t happen …
He has now taken that extreme position to a completely new level—and I heard his address to this parliament in respect of this bill in which he talked about how he had changed his mind and the like. But in fact he had five years as a member of government after he made that statement in 2002, if he had changed his mind or was coming around to understanding the importance of paid parental leave, in which to move some kind of amendment or even to suggest that he had a different view of the matter. He never did, so in effect this is a policy reversal that has occurred in just over a period of two years. Effectively he has changed his position from the time he left being in government to then being in opposition. That has happened in just over a two-year period.
Having changed his mind in just over two years, he now wants the Australian people to believe that he is legitimate and serious as to his proposal. It might seem absolutely reasonable in normal circumstances to change your mind. But in this instance, in changing his mind, he has gone from one extreme position to another. He now wants to take us from no scheme at all to a scheme that pays some mothers up to $75,000. It is pretty hard to believe and, quite frankly, I do not think too many people do believe it. Perhaps he is hoping that he can stand on the platform of a scheme that will pay mothers up to $75,000 while knowing full well that this bill will get through the parliament and then he can quietly distance himself from his original proposal. So that gives him the opportunity to walk both sides of the fence at the same time.
But that is only one element of the opposition leader’s extreme position on paid parental leave. His policy was developed without any public consultation whatsoever, without any government inquiry or investigation to support it and without any consultation with his own coalition members. It is pretty extreme when he is prepared to come into this House with that kind of a policy, having gone through none of those processes, and say that he stands for something. It is pretty extreme, but one should not be surprised. This was the opposition leader’s policy and his alone. He made it—as he makes other statements, without thinking—believing that this was one way that he could win back the support of women voters in this country. How can it be taken seriously? Quite frankly, it cannot. How can the Australian people have any confidence that if elected this opposition leader will even implement a paid parental leave scheme, let alone a scheme which imposes a 1.7 per cent tax on larger businesses? Does anyone seriously believe that larger businesses will allow the opposition leader to do that if he is elected? Does anyone seriously believe that they will allow him to get away with that? I certainly do not.
There is another aspect of the opposition leader’s scheme which I also find fundamentally wrong. It is my view that all mothers should be valued equally if they forgo working income to have a child. Under the opposition leader’s scheme, some mothers could be paid around five times as much as others. If you want to argue that the basic minimum wage is insufficient, then do that—and that is a legitimate argument to have—but do not differentiate between mothers for payments which ultimately come out of the public purse from tax. This parental leave scheme is paid for out of a public tax revenue. Whether it is revenue raised by adding a 1.7 per cent tax on larger businesses becomes irrelevant. The money goes into general government revenue. We do not provide unemployment benefits to Australians at the rate of their last employment income. We do not provide pensioners with pension payments at the rate of their last employment income. They are all treated equally when Australian tax revenue applies—and quite rightly so. They will also be treated equally under the Rudd government scheme but not under the opposition leader’s scheme. It is a major flaw in that scheme.
Other speakers have spoken in this discussion about the financial pressures on families and the costs of parenthood, and I agree with the views generally expressed. There are, however, other social consequences and costs which I believe a paid parental leave scheme may assist with. In fact, I am quite confident that it will assist. Statistics over recent decades confirm that mothers are having children at an older age. In 1975 the median age of mothers was 24 years. In 2000 it had risen to 29 years of age. Whilst I do not have the latest figures, the median age of first-time mothers is expected to reach 31.2 years this decade. In other words, the median age of mothers has risen by seven years, from 24 years of age to 31 years of age, over the last three decades.
The wish to have financial security and financial independence has been identified as a primary cause of the higher median age for first-time mothers. In other words, the reason why many mothers are having their children at a later stage of their life is that they want to ensure that they have the financial security to look after those children. That is being quite responsible. We have all heard about the financial pressures on families today. But the fact is that financial pressures are driving mothers to have children at an older age in life.
Providing paid parental leave may begin to lower the average age of mothers having children. Having children at an older age causes some concerns and complications. Firstly, conceiving a child becomes more difficult. Secondly, the risk of pregnancy complications or serious health issues for both the baby and the mother increases considerably as the mother’s age increases. For example, for a woman aged 20 the risk of Down syndrome in the child is one in 1,000. By the age of 30 this risk increases to one in 600. At the age of 35 it is one in 225 and by the age of 40 it is one in 62. So it goes from one in 1,000 at the age of 20 to one in 62 at the age of 40.
There are numerous other health risks for both the mother and child as the age of the mother increases; health risks which have social, emotional and financial consequences. So it is in the mother’s interest, the baby’s interest and the nation’s interest for mothers to have children in their 20s rather than in their 30s. Paid parental leave will enable many of them to do exactly that.
I want to conclude my remarks by commenting on one aspect of the amendment that the Leader of the Opposition has moved. He has moved that the House:
(10) acknowledges that the bill places a totally unnecessary impost on Australian businesses by requiring employers to act as paymasters for eligible employees …
The member for Solomon raised this matter as well. If anything is going to put additional pressure on businesses, it is the 1.7 per cent levy that the opposition leader’s proposal places on them. To suggest that the flaw in the government’s system is that employers will be making the payments and to ignore the real burden that the opposition leader’s proposal would put on them is absolute nonsense. I simply say, as I have said in this place on many occasions before, if you look at the track record of the Rudd government since coming to office you will see that this is a government that is truly supporting business out there in the community. The addition of a 1.7 per cent levy on businesses around Australia who turn over more than $5 million—and you do not have to be a big business to do that today—would be an impost that many of them simply do not need.
This bill complements other measures already taken by the Rudd government—for example, raising the child care tax rebate from 30 per cent to 50 per cent and providing education rebates of $375 for primary school children and $750 for secondary school children. This scheme is fully costed and fully funded. I am also pleased to see that the minister has announced that this bill will be reviewed within a couple of years of being in operation.
Finally, the measures in the Paid Parental Leave (Consequential Amendments) Bill 2010 relate to fixing up anomalies in respect of social welfare payments and income provisions of the taxation laws. Whilst I will not go into the detail of them, I believe that the bill needs to be supported because, if it is not and the parliament supports the Paid Parental Leave Bill 2010, then there will obviously be ramifications for a whole range of other payments that are currently being made to people. I commend the minister and everyone who has been associated with this legislation and I commend the bills to the House.
I rise, like my colleagues, to support wholeheartedly the Paid Parental Leave Bill 2010, which sees the introduction of paid parental leave by the Rudd government. It is landmark legislation because for the first time we are saying and really meaning that women do not just have the right to work but are a valuable part of the workplace and make a valuable contribution to the prosperity and work of this country. For that reason alone, this bill is a significant achievement. It is also historic because it recognises, as a result of that, that allowing women to care for their families is a part of any government’s industrial relations and workplace policies, that women have the right to work, that they make a valuable contribution to the workforce and that they can do that better if we allow them the flexibility to be able to care for their families in a meaningful way.
As this is such a historic piece of legislation, before I go into the detail of it I would like first of all to pay tribute to the many Australian women who have gone before and who have campaigned for many decades to see this legislation introduced. I begin by paying tribute to Jenny Macklin, the Minister for Families, Housing, Community Services and Indigenous Affairs, who has managed to bring through the cabinet a historic piece of legislation that also is detailed, fair, acknowledges the flexibility needed by women in the workforce, ensures an equitable distribution of the leave, and does all this in a way that is administratively simple for employers to be a part of.
Last week in my family was a very sad week for all of us. My mother passed away. On Friday her seven children and their seven partners, her 18 grandchildren and her 19 great-grandchildren farewelled her at her funeral. She was nearly 91 years of age. She was born the year after the Great War, in 1919. She lived through the Depression. She worked for a small period of time as a maid in a hotel before she married my father. She was a very bright and intelligent woman but, like many women of her generation, left school at 12—although they wished her to stay on—because she was needed to help on the family farm in western Queensland. She looked after her children through World War II, the fifties, the sixties and the seventies and she even made it into 2010.
She was a woman who not only cared for her family and believed that her priority was to be a mother who stayed at home and cared for her children but also believed that those children, particularly her five daughters, should always have better opportunities than she had had in her lifetime. She encouraged all of us to get an education, all of us to get a tertiary education and all of us to make the most of the opportunities that she and my father had worked so hard to give us. She believed very strongly that her sacrifice should see that we truly fulfilled our potential. She was also a fierce supporter of Labor governments. Indeed, being a woman of the bush, she constantly reminded me that in her experience of growing up in the bush it was not necessarily just conservative governments but also Labor governments that gave farmers, whose contribution was valued not just for their role in the sustenance of our country but also for their financial contribution to the country, the support they needed when they truly were struggling. She always reminded me of the role that Labor governments played in supporting those who were in need, and I cannot think of any more fitting tribute in saying goodbye to her than to be standing here as a woman in the first Labor government to introduce paid parental leave.
This legislation is, as I said, significant not only because of what it puts before us but also because of the way it has been detailed and administered by the minister. It is fair and equitable because it targets low- and middle-income earners. Under this scheme, something like 85 per cent of parents will be better off than if they had simply chosen the baby bonus. It is important because it does not preclude women who choose to stay at home and not participate in the workforce from receiving assistance—they will still be able to access the baby bonus and family assistance. It also gives all women who are working the same amount of money. It acknowledges the support that families need at a time when one partner at least is at home caring for a newborn baby and provides everybody with a guaranteed $543.78 per week for 18 weeks.
Importantly, this paid parental leave can also be passed on to a partner. Since the age of 21 I have been a mother, and in all that time I have been either studying or working. Unlike my mother or, indeed, my older sisters, I was the beneficiary of a Medicare scheme that supported me when I had small children with all sorts of ailments. I was also the beneficiary of affordable and available child care. But today we see another milestone reached. When I was pregnant with my second child, I had the great privilege of being a member of the Brisbane City Council—that is, an elected councillor in local government. I was fortunate that I had a partner who was very supportive of a work-life balance and, although I was an elected official and the amount of time I could take off to support our first child together was limited, he was able to take time off. It was important because it meant not only that I could continue to fulfil my role but also that my husband was able to bond with our newborn baby. That was his first child, and although she is 18 next week and has provided him with many challenges along the way, the bond between them is more significant because he had that opportunity to be at home.
It is wonderful that, as a result of this legislation, many fathers will not only be able to share that same bond but also be able to do so in a climate of greater financial security if that is what the family chooses, and I would certainly say that that is an important thing. As you would appreciate, Madam Deputy Speaker May, my being an elected official having contractions in the council chamber and having to get a pair the next day because I was in labour was a fairly nerve-racking way to introduce a father of two to staying at home and looking after a child. Nevertheless, it was right for our family at the time and I think it has improved the relationships that both of us have with our two children.
What is also important about this legislation is that it provides administrative simplicity and certainty for employers and employees. This scheme will be administered either directly through the Family Assistance Office or by employers where they have an employee taking paid parental leave who has worked for them for 12 months or more prior to the birth or adoption of the child. It is important that the eligibility criteria outlined in the bill be mentioned, because once again the minister’s attention to detail has been very important in this area. You are eligible for the leave if: you are the mother of a newborn child or the initial primary carer of a recently adopted child, you have met the paid parental leave work test before the birth or adoption occurs, you are living in Australia and an Australian citizen or permanent resident, and you have an income of less than $150,000. I fully support this income test, because I acknowledge that this is a taxpayer funded scheme and that, although the government needs to support and promote the right of women to flexibility in the workplace, this should not be done to the extent that the taxpayer is unnecessarily burdened. I also believe that that limit represents a reasonable balance in acknowledging the need for financial support.
Also significant about this scheme is the fact that the working parents eligible for leave include those who work full-time and part-time, those who are seasonal or casual workers, those who are contractors or self-employed and those who have multiple employers. I make that point because the vast majority of people who make up the casual workforce are women. To make sure that casual workers are included in this scheme is not easy to do, because you have to have calculations around hours worked and period of time in full-time work or the equivalent, and I pay tribute to the minister because she has managed to come up with a formula that does acknowledge casual workers and allow them to have access to the scheme.
While supporting this legislation, I am very concerned about the amendments moved by the Leader of the Opposition and his position on paid parental leave. Many of my colleagues have already outlined their concerns about the opposition leader’s policy—not just his policy but whether we can actually believe his policy. We have heard comments like ‘over his dead body’ and the fact that, whilst we are one of only two OECD countries that do not have a paid parental leave scheme, this was never a priority for the previous government in the many long years that they controlled the government benches. What I am more concerned about is that the Australian community cannot really be certain that, even though the amendments are moved and it is supposedly the policy the opposition leader puts forward, we can believe him. The Australian community should be concerned about whether this is simply, as many have said, a grab for more support from women in the electorate or some way of trying to balance his bike-riding, budgie-smuggling image with a man who cares for women and their families. His policy is simply not fair.
The reality is that if you are going to pay six months paid parental leave to any woman—six months of their $150,000 income; effectively paying up to $75,000—by putting a tax on industry, what you are saying is that the very people who need financial support the most, the middle- and low-income workers in this country, will be supporting high-income earners through an increase in consumer prices and through their taxes. Not only is that unfair in terms of the way that the finances of the Leader of the Opposition’s scheme are arranged but also it does not acknowledge the fact that something like 70 per cent of high-income earners who are women currently have access to paid parental leave as opposed to less than 25 per cent of low-income earners. So not only is it financially irresponsible and it imposes a great big new tax that is not fair and equitable; it does not acknowledge the discrepancies that this legislation is trying to address by creating a fairer, more equitable and broad-based Paid Parental Leave scheme.
I would warn people who may be attracted to the idea of receiving six months of their income. We know full well the opposition leader’s history on industrial relations. We know full well his support for Work Choices legislation. We know full well that he was part of a government that sought to strip conditions from working people in this country rather than enhance them. So I would be very suspicious about someone like that who guarantees six months paid parental leave. I would also say to women and men: just think about what he is going to do to the rest of your working life. You might get six months paid parental leave, but what happens when you go back to work? What happens to your job security? What happens to your income security? What will the opposition leader’s policies do to your superannuation? What will they do to your penalty rates and all of those added working conditions that particularly working families rely on to maintain the work-life balance, which we all know is a struggle when you are trying to bring up a family? So do not be seduced by six months of income that is paid for by a big new tax on industry that ultimately low-income taxpayers will pay for. Also be very mindful of what that will mean for the conditions that you have in employment for the rest of your life.
I commend this legislation. I thank the minister. I pay tribute to all the women who have gone before her and have campaigned for this. I am very proud to be Mum’s daughter and to be voting in a Labor government for paid parental leave.
I would like to thank all of the members who have contributed. Some have made outstanding personal contributions, as you just have, Kerry. Congratulations to you and to your late mother as well. I really appreciate the contributions of all of the people who have participated in the debate on what is a very significant piece of legislation.
This debate has been about both the Paid Parental Leave Bill 2010 and the related Paid Parental Leave (Consequential Amendments) Bill 2010. In a moment I will go through some of the specific issues that have been raised during the course of the debate, but at the start I want to make some general remarks. These bills will introduce Australia’s first national government funded Paid Parental Leave scheme from 1 January 2011. This is landmark economic and social reform for Australian families and for Australian businesses. Our Paid Parental Leave scheme is fair to both businesses and families. It will provide 18 weeks parental leave pay at the national minimum wage to the primary carer of a newborn baby or adopted child. Our scheme will be transferable between parents who share the care of their child, allowing both mums and dads to spend time with their newborn babies. That is what this is all about: mums and dads having more time to spend with their newborn babies. Paid parental leave will give more babies in our country the best start that they can have in their lives, being cared for by their mums and dads. This scheme has been very carefully considered. It is practical, fully costed and will be fully funded out of consolidated revenue, not by imposing a new tax on Australian business, like the scheme proposed by the opposition.
Australia is one of only two OECD countries which has not had a comprehensive paid parental leave scheme. When this bill is passed and becomes law, for the first time we will catch up with the rest of the developed world and finally have a paid parental leave scheme that we can all be proud of. Our scheme has several complementary objectives. First and foremost is the objective to enhance child and maternal health and the development of the child by enabling mothers to spend longer caring for their newborn child. The Productivity Commission estimated that this scheme would increase the amount of time new mothers can spend with their babies to around six months.
Second, we want to facilitate women’s workforce participation. This will improve Australia’s productivity. Modelling by Econtech released last week by the Deputy Prime Minister says that the government’s Paid Parental Leave scheme could lead to an average increase of 1.9 per cent to baseline GDP to 2040. These are real economic benefits arising from paid parental leave.
The third objective of the scheme is to promote gender equity and encourage work and family life balance, especially for women, who for so long have been juggling family responsibilities with their careers and the challenges of working life. Taking time off work to look after a newborn child is now a normal part of a woman’s working life.
This Paid Parental Leave scheme has been developed after a report and recommendations from the Productivity Commission. Once again, I thank them for their very considerable efforts. The report followed extensive consideration and consultation with a range of groups over a two-year period. We have designed a scheme that balances the needs of all the different parties involved and also delivers very real benefits to families and real benefits to business.
I will now go to some of the specific issues that were raised during the debate. Opposition speakers have called this landmark reform inadequate. They say we should have gone further. This is extraordinary, coming from a party that had 12 years in government to introduce paid parental leave but did nothing. In fact, as we are all very familiar with now, the Leader of the Opposition was so against paid parental leave that he said it would happen over his dead body. So basically you just cannot believe anything that the opposition says on paid parental leave.
What we have heard is that the opposition wants to introduce a very big tax, a new tax, on business that will, of course, hurt families. By contrast, the government’s Paid Parental Leave scheme is fair for families and fair for business. It is fully costed, fully funded and affordable. It will cost around $260 million a year in net terms. The opposition, by contrast, has proposed a $3 billion a year alternative, funded by a very, very big new tax on business. And let us be clear: this is not just going to be a tax on business; this tax will flow through the economy and put up prices for families. Economic modelling by the Treasury has shown that the opposition’s proposed tax on business, which would fund their paid parental leave scheme, would reduce growth and investment while adding to inflation. So, far from helping families, the opposition’s scheme would increase the cost-of-living pressures on all Australians and hurt the economy.
The Leader of the Opposition, during the second reading debate, managed to make two completely contradictory arguments that seem to me to be at the heart of their position on paid parental leave. First he critiqued the government’s scheme as a social security measure rather than a workplace entitlement, and then he went on to criticise our scheme for involving businesses in making the payment of parental leave pay to eligible employees. It is precisely because we see paid parental leave as adding to the workplace entitlements for working parents that we are asking employers to provide parental leave pay to their eligible long-term employees in exactly the same way that they currently pay them other workplace entitlements.
We want paid parental leave to be considered a normal part of employers supporting women to take leave from work after birth to care for their child. We see parental leave as a benefit to the community, and ours is a government funded scheme as a result. The government is only requiring employers to be the paymaster for their long-term employees, and employers will of course reap the benefits through retention of skilled staff. The Family Assistance Office is making payments to other parents. There is no requirement for employers to pay people who will not return to work for them. This balances the interests of parents and employers. Our scheme is fair to all parties.
During the debate, members highlighted that women on low salaries do not generally have an entitlement to employer funded parental leave. It is true that low-income women are the big winners from this scheme, as the member for Bonner highlighted in her remarks. That is why passage of this legislation is so important. There are far too many Australian mothers missing out on parental leave.
In relation to superannuation and paid parental leave, the government has said that we will review the scheme in two years time, and the introduction of superannuation will be one of the matters considered. This is the approach to superannuation recommended by the Productivity Commission in its final report.
The Paid Parental Leave (Consequential Amendments) Bill introduces transitional provisions for employers who will have six months to adjust to the scheme. Business will not be required to pay parental leave until 1 July 2011, but they can choose to participate earlier if they wish to do so. To provide this transitional time for business to adjust to the scheme, the Family Assistance Office will provide parental leave pay during the first six months to claimants who are not paid by their employer. To make it easier for employers, we have designed the scheme so that the Family Assistance Office informs them of their role. They will not be required to work out if their employee is eligible. All of this will be done by the Family Assistance Office for employers. The Family Assistance Office will send sufficient funds to the employer before the payment date so that employers will not be out of pocket and payments will not affect their cash flow. There will be no need for business to change their payroll systems because full funding will be provided before the payment date so that payments can be made in line with their existing pay cycle.
Workers compensation premiums will not be payable on parental leave. I make it clear that employers cannot absorb parental leave pay into existing employer funded schemes and withhold parental leave pay owed to an employee. Where an employee has an existing entitlement to paid parental leave under an existing industrial instrument, it is enforceable as provided for under that instrument. The Paid Parental Leave Bill establishes a separate statutory obligation on an employer to pay an instalment where the relevant conditions are satisfied. An employer must pay an instalment of parental leave pay if required under this bill. Meeting this obligation under the Paid Parental Leave Bill does not offset an obligation under an existing industrial instrument.
Finally, we have had a number of speakers mention payroll tax. We have been working with the states and territories for some time now and they have all been given copies of the bill. The Deputy Prime Minister has written to them to obtain final advice about whether parental leave pay would already be exempt under existing legislation or whether they would need to amend their legislation before the scheme begins. They have been asked to come back to us with their final advice on the matter as soon as possible. Our intention is clear: paid parental leave will be exempt from payroll tax.
The Paid Parental Leave scheme introduced by these bills is landmark reform for Australian families. This Paid Parental Leave Scheme is based on sound evidence, rigorous analysis by the Productivity Commission and consultation with a wide range of stakeholders over two years. Of course, as a result of that, the scheme balances many interests and we do believe that we have these balances right. Women will get 18 weeks of parental leave pay to help them take more time off work. These payments are funded by the government, not by any new taxes or levies. Payments will generally be made by employers just like other leave entitlements. Any costs involved in paying employees will be tax deductible for businesses.
The Australian people get an affordable scheme which will help to increase women’s workforce participation and alleviate the impacts of an ageing population on the workforce. Australian families have waited too long for a national paid parental leave scheme and, with this bill, we are finally catching up with the rest of the developed world. It has been a long campaign for many, many people. I particularly take this opportunity to thank the hardworking staff of the Department of Families, Housing, Community Services and Indigenous Affairs along with their colleagues in the Department of Education, Employment and Workplace Relations, the Department of Human Services and Centrelink. Delivering this scheme would not have been possible without their considerable commitment.
It also has been very important to have the support of my parliamentary colleagues and I particularly thank the Deputy Prime Minister, especially in her role as the Minister for Employment and Workplace Relations. I also thank the Minister for the Status of Women. Both have had a long-term commitment to the development of paid parental leave. Their hard work, along with that of countless other women, has finally made this policy a reality. This is a scheme that is delivered for Australian families by a government that believes in paid parental leave, a government that wants to support Australian families and Australian business to make sure that the future is a better one for all the babies who are going to be born and benefit from this landmark development of paid parental leave in Australia.
That the words proposed to be omitted (Mr Abbott’s amendment) stand part of the question.