Senate debates

Monday, 6 March 2023


Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022; Second Reading

10:02 am

Photo of Anne RustonAnne Ruston (SA, Liberal Party, Shadow Minister for Health and Aged Care) Share this | | Hansard source

I'm very pleased to stand today to speak on the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022. The opposition will be supporting this bill for a number of reasons, and we are glad to see the government has chosen the implement the former coalition government's reforms to paid parental leave which we announced as part of our March 2022 budget. The bill will provide increased flexibility, improve choice and ensure the Paid Parental Leave scheme is fit for purpose for modern families.

The bill increases the total number of weeks of available paid parental leave from 18 to 20 and removes some of the constraints around the two-week period of dad and partner pay and the 12-week/six-week paid parental leave period breakdowns currently in place. We understand the importance of these changes because we know parents make household decisions around caring arrangements to reflect their own personal circumstances, so increasing the number of weeks from 18 to 20, with enhanced flexibility on how those weeks can be shared, reflects this need for choice and flexibility in modern households. It is also important both parents are able to spend the time they choose to spend with their new child, and the increased flexibility encourages both parents to have a period of leave.

The bill removes the notion of primary, secondary and tertiary claimants, taking away some of the rigidity that exists—about who takes the leave, when and how—between the two parents. This bill also expands access to the scheme by introducing a $350,000 income test, which will ensure household income is considered when determining eligibility for PPL, rather than just the individual income of one of the two parents. We strongly support the increased flexibility this bill achieves, which allows parents to use the leave over a two-year period in a way they choose. This allows parents to take leave in one block, in multiple blocks or in whatever way works best for them and their particular family circumstances.

This reform goes to the heart of what the former coalition government sought to achieve in enhancing PPL, which is why we're pleased that our announcements from the March 2022 budget are included in this bill. The coalition has a strong record of supporting government funded paid parental leave, and through my former role as minister for social services I was very proud to be part of a government that made important amendments to strengthen paid parental leave during the last term of parliament. Our PPL scheme gave families flexibility in choosing how they accessed their payments, giving either parent the option, depending on individual households' circumstances, with the last six weeks being able to be shared or taken any time. Importantly, we introduced special circumstances, allowing a parent to meet the work test if they'd been impacted by family and domestic violence, by a natural disaster or by a severe medical condition. We allowed JobKeeper and the COVID-19 disaster payments to count towards the work test for PPL to prove a genuine connection to the workplace, and we introduced indexation on the income threshold for the first time since the scheme was introduced.

As this legislation implements, in the Women's Budget Statement in March 2022 we again underlined our strong commitment to the social and economic benefits of paid parental leave by announcing enhanced paid parental leave. Our enhanced paid parental leave represented an investment of $346.1 million over five years to expand PPL, giving working families full choice and control over how they used their 20 weeks of taxpayer-funded paid parental leave.

So, once again, the coalition will support this bill, given the vast majority of changes reflect the important reforms that we announced as part of our last budget to enhance the scheme and ensure parents are able to make their own caring arrangements based on their individual circumstances. We will support the government in any sensible measures that seek to support Australian families, particularly where those measures reflect the former coalition government's policies. I'm proud the coalition was a real steward of paid parental leave in government, and our enhancements to the scheme saw it become a mainstay in every Australian life. But, where there are enhancements and improvements that can be made, we will absolutely make sure that we stand with those improvements if they are to the benefit of Australian families.

At its heart, paid parental leave should make it easier for parents to make decisions that work for their particular families, that give them the opportunity to spend important time with their new child, unencumbered by the pressures of work where they choose to do so. The changes in this bill that provide greater flexibility for families to determine how they use those 20 weeks of leave reflect the changes in modern families, but this legislation also maintains what is a timeless aspect of paid parental leave, and that is the need to give parents time with their child. We absolutely understand the importance of paid parental leave in alleviating some of the additional pressures felt by families with the birth of a child, and we know that those pressures are particularly strongly felt at the moment, with cost-of-living pressures only rising under this government.

Of course, we'll support good and sensible reforms to paid parental leave, to ensure families are supported through the scheme to take off some of these significant pressures. We'll happily support this bill, acknowledging that a huge number of the changes and a significant proportion of the increased flexibility that this bill delivers were adopted from the policies of the coalition, who announced these important reforms in 2022. I commend the bill.

10:07 am

Photo of Nita GreenNita Green (Queensland, Australian Labor Party) Share this | | Hansard source

I rise to speak on this important bill, the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022, and I do so as part of a government filled with so many incredible women. In the week of International Women's Day, it's a pleasure to speak on such an important bill for Australian women and for Australian families. I think back to last International Women's Day and, especially, the one before that, and I think how much things have changed for Australian women—not only for women across Australia but also for women in this place.

Our government took to the election very real commitments that had positive impacts on Australian women, from improving access to child care and making child care cheaper to closing the gender pay gap. Since the election, we've also made commitments to ensure that we end gendered violence within a decade. I know that some of these reforms are ambitious, but our government is committed to delivering them and to bettering the lives of Australian women.

It starts with bills like this one today—bills that level the playing field and make things fairer and more equal for all families. The Albanese-Labor government is getting on with the job of delivering for Australians. The bill is just the start of the largest reform to paid parental leave since Labor introduced it back in 2011. It is really good economic policy to deliver these types of reforms. It will see fairness and equality in the way parents take leave. It will also see more flexibility in how leave is taken and will ease transitioning back to work for parents.

I thought I would share a personal point of view for this bill. It's almost exactly a year ago that my wife and I welcomed our first child into the world. We celebrated her first birthday a few days ago. We had a really beautiful christening and family celebration. It's been a really busy year. It is really a time when you look back and think about those first couple of weeks, those first couple of months, and how important that time is together. When you have a new, little baby, it is an incredibly stressful time, and you want to spend all of your time with this new, perfect human. You don't really want to have to worry about going back to work.

I'm incredibly lucky, and my family is incredibly lucky, that my wife works in a heavily unionised industry with a very good enterprise agreement which already allowed for flexible parental leave arrangements, meaning that she could take maternity leave while also having days that she could return to work. I think it's that open employer-employee relationship that allowed her to stay connected to her colleagues and her role that really made transitioning back to work easier. This transition option helped ease both my, and my wife's, mind in such a new and vulnerable position. I'm so grateful. Some families don't get that opportunity.

People will tell you, time and time again, that babies are only little once and that time spent with these little, tiny humans is so important. It's so important for mums. It's so important for dads. It's so important for every type of family. Most of the time, though, it is mothers who are left without that work connection, deepening the economic gap between men and women in our country. That's why this reform is so important.

We have also heard this, time and time again, across the country, particularly at the jobs and skills roundtables I held in Far North Queensland last year. We held forums in Mareeba, Cairns and Townsville. The No. 1 thing that was coming up was women returning to work—how difficult it was to get childcare places but also how difficult it was to manage the transition between paid parental leave and returning to work. I had women tell me that, even though they were the larger income earner, the system worked against them, making them take leave instead of their partner. We heard it again in the successful national Jobs and Skills Summit our government held last year. We listened and we are acting.

Right now, the current scheme does not do enough to provide access to all parents, whether they're mothers or whether they're partners. It limits flexibility for families to choose how they take leave and transition back to work. The eligibility rules are unfair to families where the mother is the higher income earner. Our bill fixes these issues. It gives more families access to government payments, it gives parents more flexibility in how they take leave and it encourages parents to share care to improve gender equality.

From 1 July 2023, the bill delivers six key changes. It will combine the two existing payments into a single 20-week scheme. It will reserve a portion of the scheme for each parent to support them both to take time off after the birth or adoption. We will make it easier for both parents to access the payment, by removing the notion of primary and secondary carers—which, I have to say, in a same-sex relationship is something that's quite interesting. But it's a really helpful idea that not one parent is the primary carer because we know both parents play an incredibly important role. We're expanding access by introducing a $350,000 family income test, which families can be assessed under if they exceed the individual income test. We are increasing flexibility for parents to choose how they take leave days. We are also allowing eligible fathers and partners to access the payment irrespective of whether the birth parent meets the income test or residency requirements.

This bill goes a long way for Australian families. Around 181,000 will benefit from the changes in this bill. That's including more than 4,000 people who are eligible under the scheme. While the former government had an attitude of 'let's make some announcements just before the election', the Albanese Labor government are listening to Australians, and we're delivering this change in our first term of government.

We are listening to businesses who are also crying out for these changes to support their employees, including the women in their workplaces. We are fixing and improving our systems that just aren't functioning the best way they can. We want Australians and their families to get ahead and not be left behind. We want parents, especially mums, to have good, secure jobs and families, and not to have to choose between work and taking care of their kids. That's what this bill will achieve.

The changes in this bill send a clear message that treating parenting as an equal partnership supports gender equality. Our government value the care that men do as well, and we want to see that reinforced in workplaces and our communities. When fathers take a greater role from the start, it benefits mums, dads and their kids. We know this and we know that there are so many fathers out there that will really welcome the introduction of this scheme. The government's Paid Parental Leave reform is good for parents, it's good for kids, it's good for employers and it's good for the economy.

I couldn't be prouder to be part of an Albanese Labor government, with its ambitious yet practical reforms that will change the lives of Australians for the better. It will particularly change the lives of Australian women for the better. It's always Labor governments that bring the country forward. It was a Labor government that introduced Paid Parental Leave back in 2011, and it's a Labor government that is today delivering a fairer and more flexible scheme.

I commend this bill and I thank all senators who will be supporting this bill today. Parents will be better off. Women will be better off. Men will be better off. Employers will be better off. And this is just the beginning of delivering for Australian women.

10:16 am

Photo of Larissa WatersLarissa Waters (Queensland, Australian Greens) Share this | | Hansard source

Happy birthday to Senator Green's little one. This bill is a step in the right direction, but they are baby steps, if you'll pardon the pun. One of the strongest messages coming from last year's Jobs and Skills Summit was the economic and social benefits of stronger paid parental leave. It was a theme that was repeated in the landmark work and care inquiry chaired by my colleague Senator Barbara Pocock. That inquiry has been hearing for women, families, businesses and academics around the country about the critical role that paid parental leave plays in keeping women connected to the workforce and in allowing families to juggle work and care responsibilities.

A report released today from the Impact Economics and Policy group estimates that, since the introduction of paid parental leave just a little over 10 years ago, there has been an $8.5 billion rise in GDP due to the increased participation of parents, predominantly mothers. That report again confirms the importance of maintaining a link between parents and their workplaces during leave.

Economists, families, women's organisations, unions and the business sector all agree that fairer, gender-neutral, flexible paid parental leave will unlock women's workforce participation and help close the gender pay gap, which, sadly, has persisted for decades now. Fairer paid parental leave will break down traditional gender roles and encourage more equitable sharing of care between parents. It will improve maternal and infant health by allowing time to recover from birth and establish breastfeeding where that's possible. It will give kids the best possible start, and it will set up good parenting habits for life.

Yet, despite all of that, despite the clear benefits of a strong paid parental leave scheme, Australia's scheme is the second worst in the developed world. At just 18 weeks for birth parents and two weeks for partners—prior to this bill—it falls well behind the international best practice of 52 weeks, with structured 'use it or lose it' provisions for partners and higher rates of pay. After a decade of inaction, Australia is now playing catch up, and we're going too slow.

This Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill is a welcome recognition of the need for reform and a recognition that the way we design paid parental leave needs to be stronger. We do support, of course, removing a distinction between primary and secondary carers that has locked mothers into the primary caring role. It's 2023 now; we can have a broader view on that. Combining the existing primary-care and dad and partner leave entitlements into a single entitlement that can be shared between both parents acknowledges that both parents have a critical role and allows families to decide how they want to share that care.

We support the increased flexibility in how leave can be taken, and the introduction of a family income threshold to address the inequity of a family missing out because the woman is the higher income earner—a situation which does happen now because it is 2023 but which out laws had not countenanced prior to this bill. But it must be said, and it was said by almost all the submissions to the inquiry into this bill, in which I participated, that much more needs to be done.

This bill doesn't increase the amount of leave available to families. It does increase by two weeks for single parents—and, of course, those are predominantly women. The government has committed to a staggered increase in paid parental leave entitlements, but it's not until 2026 that those increased weeks, up 26 weeks, will flow. Parents who have been calling for fairer leave entitlements for a decade are being asked to wait for another three years to get the international minimum standard. There is no reason to delay the implementation of good policy. Australian parents should have immediate access to at least 26 weeks of paid parental leave, and I'll be moving a committee stage amendment to make that so. Further, the government should be providing a pathway to 52 weeks of paid parental leave by 2030, as the ACTU, The Parenthood and many others are calling for.

We welcome that this bill sets up the infrastructure for 'use it or lose it' provisions. Co-parents, especially fathers, need encouragement, sadly, to take up more responsibility for the direct care of young children. Currently only one in 20 fathers in Australia takes more than the two weeks of dad leave. The bulk of leave, and the bulk of care, still falls to mothers. The experience in other countries puts beyond doubt that 'use it or lose it' provisions do help increase men's in participation in caring, and they do so by reducing the stigma around shared care and flexible work arrangements. In Scandinavian countries, the number of fathers taking leave increased dramatically with the introduction of 'use it or lose it' provisions. Fairer sharing of care has now been sustained for more than a decade. When Canada introduced paid parental leave on a 'use it or lose it' basis, the percentage of partners taking leave in the first year doubled. We know that it works, we know that it creates a better system for all parents and children, so we support the introduction of the 'use it or lose it' component to paid parental leave under this bill. However, the two weeks 'use it or lose it' allocation in the bill, which effectively just replicates the existing provision for dads and partners, will not be enough to provoke that deep cultural shift towards shared care that we need, so we would like to see a significant expansion of the 'use it or lose it' allocation. The Women's Economic Equality Taskforce is, I understand, looking at this issue at the minute, and we very much look forward to seeing its recommendations implemented sooner rather than later.

'Use it or lose it' provisions must be supported by campaigns to educate families about the benefits of shared care, incentives for employers to encourage both parents to take leave, flexible working initiatives to support juggling care responsibilities, and more affordable and accessible early childhood education and care. When I say more affordable and accessible, I mean free early childhood education, no matter where you live. That's the kind of revolution that we need to have equality in the workforce. Critically, Services Australia also needs to ensure that its staff are trauma informed and able to identify and respond to coercive behaviour, where abusive partners attempt to use the increased PPL flexibility as yet another weapon of control.

We also support measures in the bill allowing partners to take leave, even where the birth parent does not meet the income or residency tests. This is a welcome extension of eligibility. However, the inflexible work and residency tests remain a barrier. The bar is too high and too rigid, and too many people are missing out. It's important that all families are supported to take leave in the early years of parenthood, regardless of their circumstances. My colleague Senator Faruqi will be moving an amendment to close a gap that prevents postgrad students from accessing PPL.

I want to talk briefly about the rate of paid parental leave—sadly, yet another area where Australia has fallen behind other countries. It's currently set at the woefully inadequate minimum wage—a rate which we believe should be raised for everyone, and of which, I might add, women are disproportionately the recipients. It's set at that woefully inadequate minimum wage, and, as no surprise, it is now one of the lowest rates of paid parental leave in the OECD. Parents taking leave to care for kids marks a significant break in their career and their earning capacity. Women who take leave often return at reduced hours, defer promotions and reduce their overall retirement income. Replacement wages ensure that parents are not financially punished for taking time to care for their children. Higher rates of pay would also encourage shared care. Leave paid at well below normal wages forces families to make difficult decisions about how long they can afford to take leave for and who takes it. Without a change in the payment rates, parental leave will continue to be taken by the partner earning the lower wage, and, more often than not, sadly, this is still the woman. The Greens will continue to call for the rate of PPL to be increased to replacement wages, capped up to $100,000 per year, but we also note alternative models proposed by witnesses to the inquiry into this bill, including lifting the rate to the average wage, applying a livable wage or encouraging employers to top up government payments. The Greens urge the government to invite the Women's Economic Equality Taskforce to review the options for a PPL payment rate that will incentivise parents to take their leave entitlements.

Finally, we know that periods of parental leave and part-time work on return from leave have been a contributor to the superannuation pay gap. A gap in super earnings for parents taking leave compounds over time and can result in that parent—mostly women—being around $20,000 worse off in retirement. We do have a retirement income gender gap, and this is part of the reason why. It has been a longstanding policy of the Greens, of unions and of women's economic security advocates to pay superannuation on paid parental leave. This has also previously been a policy of the Labor Party. As far as gender equality measures go, it's a no-brainer, yet it's not part of this bill. I will move a second reading amendment calling on the government to urgently reconsider that decision and include superannuation contributions on paid parental leave. I move the Greens amendment on sheet 1827:

At the end of the motion, add ", but the Senate:

(a) acknowledges:

(i) the persistent gender superannuation gap that sees women retire with significantly less in retirement funds than men, and

(ii) that superannuation is paid on leave entitlements other than parental leave; and

(b) calls on the Government to address this inequity and apply the superannuation guarantee to paid parental leave entitlements".

Overall, this bill is a positive step towards fairer paid parental leave, but, as I said, it's a baby step. There are equitable measures which could be taken to align Australia's Paid Parental Leave scheme with world' s best practice now, rather than waiting for later. As one of the wealthiest nations on the planet, we should be able to give all working parents and their children the quality care and early childhood education that they need. The families of Australia deserve it.

In closing, I'll make this point: Why are we making women wait three more years for 26 weeks when, internationally, many other comparable nations already have 52 weeks? Why are we again making women wait for their slice of the pie when this government has $246 billion in revenue that it is choosing to give to the very wealthy in the form of those stage 3 tax cuts that former Prime Minister Morrison proposed. You can't cry poor and yet dish out $246 billion in tax cuts to the wealthy. If you axe those tax cuts, not only would you have more than enough money to address the housing crisis, the cost-of-living crisis and the climate crisis but you could afford to pay paid parental leave in the amount that women deserve and that parents deserve at a proper rate for a proper amount of time—not off in the never-never, but now.

10:27 am

Photo of Slade BrockmanSlade Brockman (WA, Liberal Party) Share this | | Hansard source

I too rise to speak on the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022 as a member of the Community Affairs Legislation Committee and a member of the coalition. The coalition will be supporting this bill. In fact, the bill reflects the coalition's policy when in government. Large parts of it are taken from the changes we proposed to the Paid Parental Leave scheme when we were last in government, and we acknowledge that Labor, in government, has adopted our policy in large part and is now implementing it.

I was lucky enough, when our third child came along, to be self-employed. That gave me the opportunity to take a few weeks out of the workforce at our own expense to spend time with our third child. That was an extraordinarily valuable time and something that I very much cherish. But I understand—and we on this side understand—that it's not always possible for new parents to take that time out due to their own financial circumstances. So we understand that these changes and the flexibility inherent in these changes are so important to families. That is why we proposed these measures when we were in government.

I would sound one note of caution. The one area where I think we still need to continue the conversation and where governments need to ensure that adequate supports and resourcing are put in place is assisting small business. Small business does still face a challenge, particularly small and medium-sized businesses with large staffing components. When they lose key staff members for a period of time in a tight labour market, replacements are not always available. So governments need to help and support those small businesses in dealing with those circumstances as well. It's a conversation that obviously needs to be had between business owners and their staff. I very much encourage those conversations to continue, because it is such a vitally important social measure that we take to ensure that new parents can spend time with their newly born babies.

The coalition does support these measures. We support the fact that these measures will see economic and social benefits that flow through society. In government, our Paid Parental Leave scheme gave families flexibility to choose how they access their payments and gave either parent the option, depending on individual household circumstances. When in government, the coalition made important amendments to strengthen Paid Parental Leave, including increasing flexibility and introducing special circumstances which allow a person to meet the work test if they've been impacted by family and domestic violence, natural disaster or a severe medical condition.

In March 2022, as part of the Women's Budget Statement, the coalition once again underlined its commitment to paid parental leave, by announcing the enhanced Paid Parental Leave system. Enhanced Paid Parental Leave would have seen an investment of $346 million over five years to expand Paid Parental Leave, giving working families full choice and control of how they use 20 weeks of taxpayer funded parental leave.

Through the course of the inquiry into this bill, as I said, there remained concerns, particularly among small family owned businesses, about the potential impact of cost changes in this area, particularly in light of tight labour markets. So I emphasise again that it's important that governments provide support to employers, particularly small and family businesses, ensuring that their obligations are made clear, that the administrative burden of these changes is minimal and to give the chance for these businesses to minimise the economic impact that may come in the future. Once again, we do support these changes and we do support paid parental leave.

10:32 am

Photo of Tim AyresTim Ayres (NSW, Australian Labor Party, Assistant Minister for Trade) Share this | | Hansard source

I want to make a short contribution on the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022, firstly to indicate that, while I think this legislation is an achievement of this government that is worth celebrating, and I trust that it will make its way through the Senate over the course of today, it is not just an achievement of this government; it is an achievement that really rests upon the shoulders of generations of people, particularly in the labour movement. In recent times in the labour movement, union leaders like Sally McManus and Michele O'Neil but also people like our own Linda White, who is now a Senate colleague, Jo-anne Schofield from United Workers Union, Julia Fox from the SDA and others have led this set of arguments. But I will not name all of the people who have been engaged in this. The point that I want to make is that their contribution rests upon the shoulders of, mostly, women in the labour movement who have been arguing the case for expanded paid parental leave for many generations.

I recall that, in the short happy period that I served on the executive of the ACTU in the late 1990s, women like Sharan Burrow and Jennie George—and, indeed, leaders like Greg Combet—were making the argument for this set of reforms.

It is also important to point out that leaders in Australian business have been making the case for these reforms as well. I point of course to Jennifer Westacott. She and many others have been making the case for this set of reforms. There are also dozens and dozens, if not hundreds, of business leaders in large businesses and small ones who not only have made the case for broader policy reform but have made changes in their organisations to set out better parental leave entitlements for women and men, for young parents, not only because they want to make their firms employers of choice in an increasingly competitive labour market but also because those business leaders have listened carefully to the debate from the academic community, to the international debate and to the trade union movement and have decided that leading the community debate is actually the right thing for them to do.

This is not the only community debate where the debate has been led by the trade union movement and by Australian business, and sections of this parliament have been left behind. In paid parental leave terms, the consensus across the economy and in the labour movement has certainly led this parliament to where it has got to. It has taken far too long for this set of reforms to come to the parliament.

I also want to make a few comments about the difference that this will make to young parents and to young people who are thinking about starting a family. They're thinking about their careers and their capacity as a couple—they need to work through the difficult choices—to support each other and their families and to make sure they have real career options in front of them. This set of reforms will ensure that workers and families are supported by the government when they make these decisions. So it will make a real difference in ordinary families' lives.

This reform is not just good for ordinary families; this reform is good for economic participation, productivity, economic growth and when we are dealing with some of the other significant challenges, particularly the different outcomes for women in the workplace and across their working lives. The gender pay gap is persistent. It has gone up and it has gone down, but it has persistently hovered around the midteens for well over a decade. Most of the movements that have occurred in the gender pay gap over the last decade have really been a reflection of changes that have happened in men's wages. I've seen members of the previous government come in here fist pumping when the gender wage gap went down by a few decimal points. The difference to women's wages has always been as a result of diminished growth for men's wages, not as a result of serious policy reform.

Some of the decisions that this government took through last year have had some impact. The decision to support minimum wage increases has had some impact. Future decisions that are targeted towards workers in the care sector will have some impact on the gender wage gap. This set of reforms will allow more Australian women to develop careers and ensure their careers and connection with work continue, and that is a very good thing indeed.

I'm delighted to have an opportunity to make a small contribution to this debate. I know there are some amendments that are going to be brought forward over the course of today's debate. I just say that, from the government's perspective, this is a very important step forward; it is a very important set of reforms. The government is, of course, constrained in terms of what it can do, given the tight fiscal environment and the challenges in front of the country, in terms of the legacy we have been left by the previous government. I know those amendments will be agitated and developed—that is a welcome debate—but the government is constrained in terms of what it can do. This is a momentous, historic set of reforms that builds upon generations of struggle and advocacy and work. I want to use this small contribution to thank those people who have done that work.

10:41 am

Photo of David PocockDavid Pocock (ACT, Independent) Share this | | Hansard source

I rise to speak on the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022. In doing so, I note the worthy and very welcome aims of this bill in assisting to close the gender pay gap and provide greater freedom to dads and partners taking time out to spend with their newborn children. It is important we get this right as there is a lot at stake, most importantly the wellbeing of the next generation. Research overwhelmingly shows the benefits of parents taking time out of work to spend time with their newborns. It's important for bonding but also for the mental health and wellbeing of parents. Throughout the committee process, I've also seen evidence of the wellbeing benefits for dads. These are the kinds of benefits we have the opportunity to promote through this bill.

More broadly, for our economy, we know we need to do more to lift women's economic participation. The National Skills Commission estimated that 1.2 million additional workers will be needed across the economy by 2026. A large majority of these roles will be in traditionally feminised industries such as those in the care economy. We are feeling those impacts even now as we look at the shortages of registered nurses available to enter the aged-care system. Modernising our paid parental leave scheme is one lever we can pull to help close the participation gap and, by extension, the pay gap. Deloitte recently reported more flexible ideas around gender norms could lead to an additional $128 billion each year for Australia's economy and deliver 461,000 additional full-time employees into the economy. When we look across the world, there is ample research to show how tweaking PPL schemes can work to lift women's economic participation and close the gender pay gap. This bill presents a first step on that pathway.

There's plenty that's good about this bill. Firstly, the bill allows all paid parental leave days to be taken as flexible days. Allowing flexibility in how new parents manage care and work is a good thing for both parents and businesses. It means that parents and partners can manage a gradual return to work in a way that suits them and their needs. It respects that each parent in every family will have different circumstances, whether that's a grandparent able to help with care or a job with irregular hours. For businesses, a gradual return to work is also optimal. As the Australian Chamber of Commerce and Industry notes, forcing people to take 12 consecutive weeks off work has always been an unnecessary feature of the current scheme. In reality it's far easier for a business to manage a partial vacancy rather than a full vacancy, and it's likely these changes will help strengthen the contact between employers and employees while a person is using PPL.

I also welcome the positive changes for dads and partners. For too long women have shouldered the greatest burden of caring responsibilities for newborns. Currently 80 per cent of all paid parental leave is claimed by women. This is despite the host of evidence showing the benefits of fathers being able to take time to care for newborns in their first years of life, including improved wellbeing for both dads and children. These changes do the right thing, by giving dads and partners greater access to a shared PPL entitlement, which I hope will give them more incentive to take time out of work.

While there's plenty to be proud of in this bill, it really should be seen as a first step. There's so much more to do. Given the workforce shortages being felt in various industries, I feel this bill misses an opportunity to accelerate those changes needed to unlock greater workforce participation by women. The bill will not increase the overall PPL entitlement. It joins together the current 18-week scheme with the separate two-week dad and partner pay scheme into a single 20-week entitlement that can be used by both parents. While it is the government's stated ambition to reach 26 weeks leave by 2026, that is not included in this bill. As of right now, the 26-week entitlement remains just an ambition, and, even after we reach 26 weeks, Australia will still lag behind other OECD nations. The OECD average is 51 weeks, which is more than double what is offered in this bill. PPL is also not offered at a replacement wage; rather, it is offered at the minimum wage. So, at full-time equivalent pay, the OECD average for PPL is 36 weeks, while Australia currently offers just 8.6 weeks.

We know that more is required to increase the participation of dads and partners in PPL and to stimulate workforce participation by women. We know this because the international research in this area is well advanced. When we look across the world, we can clearly see the policy ingredients that are needed. A big ingredient is the 'use it or lose it' period. That is the period within the whole entitlement that is reserved for just one claimant to use. Under this bill, the 'use it or lose it' periods are set at two weeks for each claimant. This is basically what already happens under the current scheme, and so far there has been very little uptake of PPL by men.

Nordic countries that have implemented dedicated parental leave for fathers have seen significant increases in uptake by men. To give one example, when Iceland, in 2002, introduced 13 dedicated weeks for fathers, the proportion of fathers who took leave increased from less than one per cent to 80 per cent. I feel it is a shame that this bill does not contemplate longer 'use it or lose it' periods to greater effect, knowing from international experience that they have been making a huge impact. However, I'm aware that this is a question that the Women's Economic Equality Taskforce is currently considering, and it will form part of another bill on this subject later in the year.

A big concern that's been raised with me through consultations on this bill is around the continued administrative burden that PPL is putting on our small businesses, and these small businesses are increasingly being run by women, who are having to shoulder this burden. With this bill, we have an opportunity to change that by giving small business the option to either pay Commonwealth PPL directly or have Services Australia pay this, as they already do for 40 per cent of payments. I believe there's a really strong argument for medium and large businesses to administer the payment and to ensure that there is a connection between them and the employee taking the leave. However, for small, overworked businesses, we need to be doing all we can to reduce the amount of red tape and cost. Even small changes to a payroll can have a big impact on a small business. Small businesses need to liaise with the government, grapple with how to manage the flow of cash between Services Australia and their employee, and recalculate how much tax needs to be withheld.

It is a clear pain point, and it's something that has been raised with me by businesses in my community, the Australian Chamber of Commerce and Industry, the Canberra Business Chamber, the Australian hairdressing association and others. And it's not a new concern. It was something that was raised with the parliament when it was first contemplating PPL over a decade ago. It was then raised again in a review of the PPL scheme, which I quote here:

… employer and industry groups generally did not support the employer role, particularly in relation to small business. These stakeholders considered the employer role places an unnecessary administrative burden on business, and any benefits to employers in terms of employee retention were not commensurate with the administrative burden imposed.

This is feedback that has been reflected in my conversations with small businesses here in the ACT. Kate from The Healthy Eating Clinic told me her small business, employing 11 people, has seen payroll processing time blow out from half an hour to two hours. That lost time is precious, and it adds up. We hear a lot about the workforce shortages. In many small businesses, it's the owners of those businesses who have to step up and work extra hours to fill the gap.

This burden on small businesses will likely increase when, hopefully, we start paying super on Commonwealth PPL as well, and that means small business will be logging on to myGov, receiving money from the Commonwealth, withholding tax and sending it back to the ATO, processing super and then sending that on to the super fund—and doing this every pay cycle. None of these transactions involve any interaction between the business and the staff members other than a deposit of money and an emailed payslip, but the greater burden risks being a disincentive to employing women—the last thing we want to see with this legislation.

I have been frustrated to hear we shouldn't take action because it has always been a pain point. Clearly, just because something has always been broken doesn't mean it shouldn't be fixed. It's also frustrating to hear that we need to force small businesses to administer this payment as it will preserve their relationship with their employees. Small businesses are likely to be far closer to their employees than medium and large businesses. Often in small businesses your staff may also be family—if not technically, then in spirit. Some small businesses may want to administer the payment themselves, and that's fine. We should provide them with the option, recognising small businesses are as unique as the people that run them and require some flexibility. It is a small piece of red tape that we can start cutting today, and I hope the Senate will endorse my amendment.

I also want to join my colleagues across the chamber in urging the government to prioritise changes to extend super to paid parental leave. PPL is currently one of the only types of paid leave for which the superannuation guarantee does not apply. Paying super on PPL would significantly reduce the super gap between men and women. Currently, women retire with nearly 35 per cent less super than men, which is clearly unacceptable and something we need to address.

One last point I wanted to bring to the attention of the Senate is issues with how we are supporting foster and kinship carers. While this bill contemplates adoption, I want to note that adoptions are generally quite rare in comparison to the number of children in foster or kinship care. Foster and kinship carers are not entitled to PPL. It has been raised with me that the exclusion of foster and kinship carers from this type of leave actively discourages those carers from taking opportunities to welcome and settle often very vulnerable children into a new home environment, and we know how important those early years are for children. One of my constituents has seen the impact firsthand. She was able to take time away from work to spend with a child placed in her care, and she noted how it promoted steadiness in their relationship which endures today. She also experienced not being able to take time away with another child and experienced a placement breakdown as a result of this. She's raised this with me: 'To have those extra weeks to focus on the child, setting aside employment pressures, is invaluable to the child or young person to build bonds and attachments crucial to their development.'

While foster and kinship care is the domain of the states and territories, no payment is offered to help them take time out of their work. It seems to me that foster and kinship carers are falling between a gap in our federal, state and territory systems, and that more can and should be done to assist them in taking time out of work for the benefit of the child or the children they're looking after. I urge the government to consider this in more detail. I commend the bill to the Senate.

10:54 am

Photo of Jess WalshJess Walsh (Victoria, Australian Labor Party) Share this | | Hansard source

I also rise to speak on the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022, and I am really proud to do so, because paid parental leave is another strong and critical Labor legacy. We first implemented paid parental leave back in 2011, and today we are building on those strong foundations to modernise the scheme, to make it more flexible for two parents to provide care, and to consolidate the current entitlement—of 18 weeks parental leave plus two weeks partner leave—into a single 20-week scheme. It's a legacy that will improve the lives of Australian families.

Of course, there's more to come, because this is a first step in the Albanese government's plan to move to expand paid parental leave in Australia. We will bring forward more legislation, starting in July 2024, to phase in an additional six weeks, until we reach 26 weeks in 2026—a full six months of paid parental leave. This is the largest expansion of paid parental leave since we established the scheme more than 10 years ago.

These are the types of reforms that make me proud to be a Labor senator. These are reforms that we've laid the foundations for, that we protect, that we build on, that we sustain and that, over time, become entrenched and treasured parts of Australia's social and economic fabric. These are reforms that Labor governments get done—reforms like Medicare; reforms like the NDIS; reforms like quality, affordable education in the early years, and expanded access to TAFE and higher education. These are reforms that Labor governments deliver and that we deliver in a way that is sustainable in the long-term.

Paid parental leave is widely supported across the community, and this particular bill is supported by the ACTU and by the BCA and many other groups. And the bill is not controversial. In two-parent families, it provides each parent with two weeks of leave, and the rest can be shared as suits the family, up to 20 weeks. It can be taken by two parents at the same time. It can be taken in flexible blocks. And it can be taken across the first two years of a child's life. Importantly, single parents will be eligible for the full 20 weeks. In two-parent families, the bill resolves outdated assumptions which meant that, in some cases, women were unable to take the larger portion of parental leave because they were the higher earner in the family. Combining what is currently 18 weeks parental leave, mostly targeted at mums, with the two-week partner pay, mostly targeted at dads, just makes good sense.

It is now urgent that this bill passes the Senate this month. That is so that parents expecting to give birth or adopt on or after 1 July 2023 have the option of pre-claiming three months in advance so that they can receive their entitlements as soon as they are eligible. So it's urgent that we pass this reform.

Expanding paid parental leave is part of our vision for greater gender equality and for a stronger economy, and we know that those two things go hand in hand. We know that families, and women in particular, need support to balance their caring and work responsibilities, and we know that, when parents have the support they need to move in and out of the labour market as their children's needs change, it's good for everyone. It's good for families; it's good for parents; it's good for employers; it's good for productivity; it's good for the economy as a whole. And it's good for dads. This approach that we're bringing in in this bill gives dads and partners more options for sharing in the care, including by making sure that they can be on paid leave, if they're eligible for it through work, while they also receive their take-it-or-leave-it two weeks of the scheme.

It's important to note that the government's scheme is not designed to replace employer schemes. Indeed, we encourage employers to keep paving the way and providing greater paid parental leave for their employees. The government's scheme is a foundation for employers to build on, to make sure that they can attract and retain fantastic employees who become parents, and help maintain strong incomes over the life course.

We know that, when dads can take a greater caring role from the start, that can often lead to greater involvement in their children's lives in years to come. That, in turn, helps women to balance their own work and care as well, to keep up their own participation in the labour market and improve their own economic security. Paid parental leave is also, of course, fundamentally good for mums, allowing them to spend time in the crucial early days and weeks of their child's life, which we know is good for both maternal and child health.

To sum up, this is a bill that meets the needs of the modern Australian family and the modern Australian economy, and there is more to come from the Albanese Labor government. This is a smart, flexible approach to providing care and support for children after birth or adoption. It's an investment in gender equality and in productivity. It's another proud Labor legacy as we build up to six months paid parental leave. I am proud to support this bill.

11:00 am

Photo of Barbara PocockBarbara Pocock (SA, Australian Greens) Share this | | Hansard source

I rise to speak to the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022 and to add my support to the widespread support that exists in this chamber, including that of my Greens colleague Senator Waters. The Greens will be supporting this bill, because it represents a step—a modest step, but an important step—in the right direction. But much more needs to be done.

Twenty-one years ago, in 2001, I sat at the back of this chamber as a staffer, near the senator who introduced Australia's first private member's bill on paid parental leave, Senator Natasha Stott-Despoja. At that time Australian women were, alongside those in the US, the only women in the OECD not to get a paid rest when they had a baby, 100 years after the ILO said that they should. Anyone who has carried and fed a new baby, been sleep deprived for months and recovered knows how essential that rest is. If Australian men had babies we'd probably lead the world on paid parental leave, just as we led the world on the eight-hour day in 1856 and set a decent minimum wage at Federation. We were international leaders in creating a working man's paradise—a white working man's paradise, it's important to note—but that paradise did not extend to mothers. And we are not yet a working woman's paradise.

Sadly, it was not until 10 years after that first private member's bill that this parliament finally enacted paid parental leave, in 2010, with leave of 18 weeks at the minimum wage and an additional two weeks added later for partners on a 'use it or lose it' basis. Eleven years on, we've been overtaken by the rest of the OECD yet again, with the average period of paid parental leave now around 52 weeks in the OECD and close to full-replacement wages in many places. Australia now has one of the poorest paid parental leave schemes in the developed world, and we're now stuck at an inadequate 18 weeks paid leave with two weeks for partners at minimum wage, without superannuation—a pay cut for so many people at a crucial moment in a family's life.

While I welcome some parts of this bill, including strengthening the 'use it or lose it' provisions and the government's commitment to incrementally increase paid leave to 26 weeks by 2026, these provisions are too little and too slow to effectively support Australian parents. This is why the Greens are seeking to amend the bill to increase paid parental leave to 26 weeks, now. Australian parents should not be left waiting for the government to increase the entitlement by a miserly two weeks a year until it reaches 26 weeks in 2026, a rate that is still well below the OECD average and below best practice.

At the jobs summit and the select committee on work and care, an inquiry that I've had the privilege of chairing over the last eight months, and at the inquiry in relation to this bill, Australians and organisations from across the country—parents, women, unions and employers—were united in a call for paid parental leave and for a greater increase. Indeed, the ACTU, whom Senator Ayres has referenced in his comments, calls for a pathway to 52 weeks. I urge the government to support our amendment to increase paid parental leave to 26 weeks immediately and to create a pathway to 52 weeks paid leave to bring Australia in line with international standards.

Women in our labour movement—Sally McManus, Michele O'Neil, many leaders—stand alongside and on the shoulders of this parliament as they push to ask for more, to play catch-up on this important workplace provision. I also call on the government to support the Greens amendment to add superannuation to parental leave. Recent data shows that women retire with much less, nearly a third less, savings in their super than men, and we know that periods of paid parental leave and part-time work on return from leave have been a contributor to this gap. Yet last week Katy Gallagher told Australian women that they need to wait longer until the budget can comfortably accommodate paying women's superannuation on top of parental leave.

We have costings that tell us that we could do this tomorrow for the sum of $200 million. It's a small proportion of the budget, and it's something that will make a difference to many, many women in Australia. We don't have to wait. We can afford to do it now. It's time the government took action to reflect on its priorities and recognise that supporting women's economic equity is an overdue investment in the future of Australia. There's powerful evidence that improving paid parental leave in these ways will do many good things. It will increase women's participation in paid work. It will address skill shortages. It will increase GDP. It will improve children's development. It will improve relationships between couples and between kids and their parents. It has a very positive effect on men's health. It will help address gender inequality.

I want to finish with a story from the Select Committee on Work and Care inquiry. We heard from many individuals around Australia who look for a decent period of paid rest at the time of birth, with both parents looking for that kind of opportunity. We heard from Suvi, who lives in Sweden and has a 13-month-old daughter. Based on Sweden's parental leave policy, Suvi is planning to take a total of 16 months paid leave, and her partner is taking seven months paid leave. The first 390 days of that leave are generally paid at 80 per cent of a person's income, up to a cap.

Suvi said the best thing about this policy is that she won't be financially disadvantaged for caring for her child and can return to work part time. She has appreciated having that time after a very difficult birth; a start with her daughter; the chance to see her daughter grow and reflect on her life and work after a busy period through the pandemic; and to share that leave with her partner. She said that policies like this have created a family-friendly and caring-friendly culture in the workplace for both parents and at all levels of the workplace. This helps explain the much greater sharing of domestic work that we see over the life course in countries with good, lengthy periods of paid parental leave paid close to ordinary earnings and free child care, an arrangement which, together with paid parental leave, gives kids and their families a much better start, and is associated with a much narrower gender pay gap.

This is just the tip of the iceberg of benefits in countries like Sweden in terms of what they're paid parental leave policy delivers. At a work and care inquiry hearing, James Fleming, the Executive Director of the Australian Institute of Employment Rights, explained that Sweden's parental leave policy, along with affordable child care, has helped Sweden to achieve much higher rates of women's workforce participation and higher gender equality on many metrics than Australia. The institute calculated that, if Australian female labour force participation increased to match that of Sweden, overall labour force participation would increase by more than four percentage points, increasing GDP by at least six per cent, or as much as $100 million.

Suvi's story and the broader equity and economic advantages Sweden's work and care system delivers is possible for countries like Australia. Those supporting increased paid parental leave—and they are many—know we can afford it. We can afford to increase the length of leave, and we can pay superannuation on it. Rather than give a $9,000 tax cut to the very wealthy and each of the 227 politicians in this building through the stage 3 tax cuts, we can direct the $254 billion to the parents and the kids who need it most. We should set aside those tax cuts and instead improve paid parental leave and take other measures that will help Australian families deal with the cost-of-living crisis, including providing free, quality, accessible early childhood education and care.

At the Jobs and Skills Summit, and through evidence presented to the work and care inquiry and to this bill, Australians and organisations from around the country, and parents, women, unions and employers, were united in the call for a paid parental leave increase and improvements for Australian parents, especially mothers. No-one opposed it. It's time to act. We can afford it and, for the sake of our kids, parents, women, workplaces and economy, it's time we did it.

11:09 am

Photo of Catryna BilykCatryna Bilyk (Tasmania, Australian Labor Party) Share this | | Hansard source

I rise to speak on the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022, and I'm going to make only a short contribution on this bill, as I understand there is some urgency to this. If the bill is passed by the end of this sitting week, it will allow parents expecting to give birth on or after 1 July this year to claim three months in advance. You'll notice the government decided to include the words 'gender equality' in the title of the bill, because gender equality is at the heart of what this bill is about. As a nation we need to ask ourselves why there is a 13 per cent gender pay gap and why women retire with super balances on average 23 per cent lower than men. These gaps are closing but not fast enough, and to address this inequality we need to address a number of underlying causes.

One of these underlying causes is that women, more than men, make the sacrifice to put their careers on hold to care for children. We can see the stark figures in the Australian Bureau of Statistics head of household survey, which in May 2021 showed 38 per cent of women spent five hours or more on unpaid caring or supervision of children, compared to only 28 per cent of men. The same survey shows that, on just about any measure, women take on substantially more unpaid household work than men. Under the Paid Parental Leave scheme the notion of primary, secondary and tertiary claimants and the requirement that the primary claimant must be the birth parent meant the system was geared towards an expectation that women would bear most of the responsibility for spending time raising their children.

The flexibility this bill provides is for the benefit of both women and men. Many birth mothers would like more opportunity to advance their careers, while many dads and partners would like more opportunity to spend time caring for, playing with and forming bonds with their children. It's about providing the flexibility parents need to come up with the arrangements that work for their individual family circumstances, but this is also critical for children. From my experience as a parent but also as an early childhood educator observing other families I've seen how critical those early months of a child's life are to forming a lasting bond with their parents, regardless of gender.

As the Australian Chamber of Commerce and Industry said in their submission to the inquiry into this bill:

These changes should deliver significant benefits to the economy by boosting women's workforce participation, improving flexibility in the use of paid parental leave, enhancing gender equity outcomes, and ensuring businesses continue to have access to a diverse, experienced productive labour force.

Labor understands that. We understand that the right set of policies, getting the balance right between giving parents the time they need with children while maintaining their connection with work, is boosting labour productivity, promoting gender equality and also improving development outcomes for children. This is also what we sought to achieve with cheaper early childhood education and care for Australian families. It is not, as one senator in this place once described it, the hand of government reaching in and taking away the youth of our children.

I note the inquiry into this bill showed broad support for the provisions, including from representatives of employees and employers, such as the ACTU and ACCI. There were also a number of community groups backing the changes. In this bill we're extending the shared paid parental leave entitlement from 18 weeks to 20 weeks, and we will go further in accordance with our election commitments. This is just the first point. This is just the first step. The Women's Economic Equality Taskforce is currently examining the best model for the expansion to 26 weeks and will provide advice to the government later this year. This is the type of action Labor take to help improve the lives of working women and men, and we will continue to assist families wherever we can.

11:14 am

Photo of Mehreen FaruqiMehreen Faruqi (NSW, Australian Greens) Share this | | Hansard source

I rise to speak about the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022 and associate myself with the excellent observations made by my colleagues Senator Waters and Senator Barbara Pocock. This bill aims to improve the Paid Parental Leave scheme by making it more flexible, accessible and gender neutral.

Currently, Australia has one of the weakest parental leave schemes in the OECD, in terms of both rates of pay and the length of paid leave. With this bill, things will definitely improve, but we still won't meet international best practice. Increasing the availability of leave from 18 to 26 weeks is an important step forward in ensuring parents are adequately supported in the crucial first few months of parenthood. But why do people have to wait for another three years to get the 26-week entitlement? This should come much sooner, and we should be moving to 52 weeks of paid parental leave quickly, as well. As my colleague Senator Waters has said, there is no reason to delay the implementation of good policy.

This bill does introduce measures to increase flexibility in how and when paid parental leave can be taken, which will allow families to juggle their work and care responsibilities a little better. But, to be truly effective, the scheme should really be complemented by other reforms to support flexible work. That means universal and free early childhood education and care. High-quality early childhood education and care can give children the best start in life, and it is a critical component of lifelong learning. It will enable women to pursue career opportunities and ensure they aren't held back because this essential service is too expensive or is not available.

Time out of the workforce and taking on more unpaid labour has significantly contributed to the gender pay gap in superannuation as well. By failing to pay super on parental leave, the government is increasing the risk that certain parents, particularly women, will retire into poverty. Women of colour are even further impacted because they tend to have significantly lower rates of workforce participation and are generally overrepresented in low-paid and insecure work. The Greens also support full wage replacement. Paying parental leave at the minimum wage is insufficient and discourages men, who are often higher paid, from taking parental leave. My colleagues Senator Waters and Senator Barbara Pocock will be moving amendments to fix some of these shortcomings of the government's Paid Parental Leave scheme.

I will turn now to a cohort of people who often fall through the cracks: PhD students. A key shortcoming of this bill is that PhD students are not included in the Paid Parental Leave scheme. Despite often conducting research on a full-time basis, they cannot access the same parental leave entitlements as other working parents. I will be introducing amendments to fix this. Currently, PhD students do not qualify for the scheme, as their activity is counted as study through a scholarship or other award of financial aid and therefore fails the test in the current Paid Parental Leave Act. I can think of no good rationale for excluding PhD students. As a PhD student who, years ago, had a baby while doing research and as a former academic who is passionate about the importance and necessity of research and supporting researchers, this matter is very close to my heart.

PhD students are currently eligible for a stipend from their university through the government's Research Training Program. However, the stipend is a measly $29,863, well below the minimum wage. Universities have the option to top this amount up, but data on 189 universities shows that only 42 of them offer above the government's stipend, and none of them meet the minimum wage. In response to a written question on notice asked by Senator Waters during the Senate Community Affairs Legislation Committee's inquiry into the bill, the Department of Social Services advised:

The Paid Parental Leave scheme is intended to support working parents who have demonstrated an attachment to the workforce.

The department said:

Should a PhD student undertake paid work in addition to their studies, such as tutoring at a university, this could count towards the work test.

This is completely unreasonable. It is unfair to expect that every PhD student in Australia have the opportunity to get paid work and the time to commit to this work while they are studying full-time. That is atrocious.

PhD students are struggling. They are struggling to make ends meet amidst the cost-of-living crisis and rising rents. In January this year the Guardian reported that PhD students are barely scraping by, often relying on a partner to survive or being forced to eat instant noodles and work extra jobs during the night. We need to lift government support for PhD students. We must ensure that they are not put off pursuing higher education because of the high cost of living and the lack of entitlements. We need to increase the stipend, and here today we have the opportunity to actually include PhD students in the Paid Parental Leave scheme.

I urge my Senate colleagues to support the Greens amendments to expand the eligibility of the Paid Parental Leave scheme to PhD students. This amendment does so by including a new entitlement to paid parental leave for someone doing eligible postgraduate work. A person performs eligible postgraduate work if the person is enrolled in a course of study or research for a doctoral degree and performs study or research for the purposes of that course, whether the enrolment is within an institution or the study or research is performed within or outside Australia. These amendments expand the work test in the Paid Parental Leave Act to include eligible postgraduate work.

In November last year, the Minister for Social Services told parliament that this bill reflects the government's commitment to deliver better outcomes for families and advance women's economic participation. Minister Rishworth also said that Australians need a paid parental leave scheme that reflects the needs of modern families. If Labor is serious about achieving gender equity for all, and promoting the health and wellbeing of all parents and children in Australia, it must extend this scheme to postgraduate students. Anything less will be a pretty cruel oversight by the government.

Changes to improve paid parental leave and make it more equitable have been a long time coming. Women, women's organisations, women's rights activists, unions, families and economists have been pushing for this for ages. Discrimination against women at work in the form of diminished responsibilities and lower wages still continues. Improvements to paid parental leave as presented in this bill will, hopefully, help create more equitable workplaces and less disadvantage for women and improve the sharing of care between parents.

It is really time to move beyond incrementalism. That is quite apparent in this bill. It is time to make the changes that we need, in leaps and bounds. Women, parents and families do deserve more. They shouldn't have to wait years more for fairness and equity. We've waited far too long already.

11:22 am

Photo of Deborah O'NeillDeborah O'Neill (NSW, Australian Labor Party) Share this | | Hansard source

I rise today to speak to the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022. Once again, this is Labor delivering on its promise to the working families of Australia. We are delivering two weeks of paid family leave now, and we'll gradually increase it up to a total of six months of paid leave shared between two parents by 2026. This measure will have a demonstrable and beneficial effect on parents who want to spend more time with their children, and what could be wrong with that?

It also reminds me that, as a mother of three, I didn't get any paid parental leave at all for my first two children. I finally got some for the third. By that stage we thought that it was about time, but it was such a struggle. It's been a long time getting to this point.

I know how precious those first few months are with the remarkable gift of a child. Care responsibilities are critically important to the healthy life of a child and a family. I'm proud to be part of a government that acknowledges this and is making real changes. It's really important to think that in so many policy areas, when the Australian people elected the previous government for three terms, there was a huge policy vacuum in this space and a failure to respond to the realities for Australian people.

I don't think it's a surprise—having so many women sitting on this side of the chamber, and our colleagues over in the other place, and men who share parenting very, very significantly speaking up in our caucus about that shared parenting—that such a policy was able to be advanced as a commitment during the election by Labor. Now we're getting on with the job of delivering for Australians so they know that they can trust the government. We've said what we're going to do and we're getting on with doing it.

Labor created the Paid Parental Leave scheme, and we're expanding it. We're taking a staged and sensible approach to expanding the scheme. We have to do that sensibly because of the fiscal reality in which we find ourselves as a consequence of nine wasted years of debt growth by those opposite. Clearly, we're speaking at a time of global economic headwinds and budgetary pressures.

From 1 July 2023, the bill is going to deliver six really significant changes, combining the two existing schemes into a single 20-week scheme and reserving a portion of the scheme for each of the parents to support them both to take some time off work after the birth or adoption. It's going to be the case that some Australian men will be saying, 'How do I do this?' The response will simply be: 'You go to your work and you say that you're taking your leave because you've got childminding responsibilities.' That's going to be a radical departure for some men in particular professions. This is going to support and encourage that, and we know it's good for families and it's great for children.

This bill is going to make it easier for both parents to access the payment by removing the notion of primary and secondary carers. The reality for most working families is that you just muck in and get on with it. You don't say: 'I'm the primary carer today,' or 'I'm the secondary carer.' You're both the parents—you do the job—and this recognises that.

The bill expands access by introducing a $350,000 family income test under which people can qualify if they do not meet the $156,647 individual-income test. This is dealing with the reality of what's out there in the Australian population and not trying to pit one type of family against another. It's about getting Australia working and making sure that kids get cared for properly.

It increases flexibility for parents to choose how they take paid parental leave days and transition back to work, because it's very different from context to context, from family to family and from region to region. The sixth thing it will do is allow eligible fathers and partners to access the payment irrespective of whether the mother or birth parent meets the income test or residency requirements.

It's an extremely important bill and it's a very substantial reform. It's one that's been driven by the Albanese government's deep commitment to the maximisation of women's economic equality and the economic benefit for the Australian economy that's derived from proper and equitable social policy. Australians need a paid parental leave scheme that reflects our modern Australian families.

The expansion to 26 weeks by 2026 reflects the Albanese government's commitment to deliver better outcomes for families and to advance women's economic participation. In the lead-up to the election, the leader of the Labor Party—now the leader of the country, the Prime Minister—was out there stating this over and over. My colleagues sitting here beside me, men and women, were fighting for this reform and standing up for this reform, which was pooh-poohed by so many people. That's the problem. Other countries have been getting on with this job. We've got nine blank years—nine wasted years—to make up for now we've removed the previous government and established a Labor government. Our changes are not only going to help families better balance work and care but they're going to support the vital participation and productivity over the longer term, providing an immense return on investment for this policy and a huge boost to the Australian economy.

It's a policy that addresses the demands of modern life and the realities of modern families. It's a bill that's thorough and successful in achieving what it sets out to do, creating a paid parental leave scheme that truly works for families. And it centres equality and economic growth, not just the principle, and absolutely embeds this in practice. It's going to give more families across Australia access to government support. It's going to provide families with more flexibility and encourage parents to share the care with a view that supports what we know is just the fair and decent thing—and that's gender equality for all the men and women who are being born and all the men and women who are looking after them—together.

It gives me immense pride to speak in support of the bill, as part of a government which is delivering on its promises, and it will assist the lives of 180,000 Australian families every year. The bill is good for Australia's economy, it's good for our society and it's absolutely, totally intertwined with our success and our future. It delivers for parents. It benefits children. It's good policy by a Labor government that is inspired to do the best thing for Australian people. And for those reasons, I commend the bill to the house.

11:30 am

Photo of Marielle SmithMarielle Smith (SA, Australian Labor Party) Share this | | Hansard source

TH () (): I also rise today to speak on the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill, and I am so proud to stand here as part of a government that has brought this legislation before us. This is the first major change to paid parental leave since the scheme was introduced by a Labor government more than a decade ago. The first tranche of reforms were groundbreaking, and they made a difference to so many families' lives. But in the years since, the need for further reform has been clear because as Australian families have changed, as more and more families are seeking to share in the beauty and challenges of parenting more equally, this legislation has not kept up. It hasn't kept up with those cultural changes happening in Australian families.

The changes in this bill are about supporting families, but they're also about supporting gender equity. The changes are about valuing fathers as carers and in some families as primary carers. They're about recognising that men aren't always the breadwinners and that women aren't always doing the majority of the caring, that families make their own decisions about the care arrangements and the work arrangements that will best suit them and their children.

This bill modernises the Paid Parental Leave scheme to reflect how Australian families and their needs have changed since its establishment over a decade ago. It does so in a number of ways. The bill combines the two existing payments into a single scheme, it reserves a portion of the scheme for each parent to support them both to take time off after a birth or adoption and it removes the notion of primary and secondary carers, making it easier for both parents to access the payment. While modest, the 'use it or lose it' provisions encourage shared care, and I hope these provisions are something that we see expanded in further iterations of the scheme and as the Women's Economic Equality Taskforce continues its work.

The bill also expands access to the scheme for families where women are primary earners by introducing a $350,000 family income test. I know a number of families who have been locked out of taking full advantage of paid parental leave because of this issue, and I welcome the fact that the bill better reflects the circumstances of more families in our community.

Most importantly, the bill represents one part of a suite of broader policy reforms that our government has embarked upon that will support the development and wellbeing of our littlest Australians. We know that the first six months of life are absolutely critical to a child's development and future wellbeing. They're critical to a child's sense of attachment to their carers and they're critical to the growth of the child, as well. Enabling families to have the opportunity to spend more time with their babies in these crucial early months is a worthy reform, and I welcome the broader policy intent of our government to bring this scheme to six months of paid leave by 2026.

As so many of us in this chamber can appreciate, the first six months with a new baby are an absolutely amazing time, full of joy and delight as each little milestone is met. But—my God!—they can be a bloody tough challenge too, full of sleeplessness and stress on the family and on women who experience birth trauma or other physical challenges like mastitis, difficulties with pelvic floor damage and the impacts of recovering from caesarean wounds—so many things which can happen in a birth as you welcome a baby into the family. The mental health challenges which many families experience, both mums and dads, in these first six months can be really significant and at times really dangerous. A new baby changes family dynamics with other children. It can make more difficult your other caring responsibilities, including for elderly parents. It affects the family dynamic. So while it can be and is a time of miracles and wonder and joy and awe, it can also be really tough. It shouldn't be the case that the only families in our community who are given the time, space and security to deal with all of these things that happen in the first six months of a child's life are those who can afford to do so.

Bringing this scheme progressively to six months is a very, very significant reform. It's something that we can be proud of; it's something that I am proud of as a Labor senator to be part of another Labor reforming government. In fact, it's why we joined the Labor Party and why we stand for Labor. We want to be part of governments that do something to deliver for families and that keep reforming. That's what this bill does.

I want to acknowledge the work of the many, many activists in our community, the union movement, the formidable men and women of our union movement, who have been calling for these reforms for many, many decades before they've been introduced and continue to lead the fight to greater equality. I also want to acknowledge the businesses in our community who stood up early and came out and said, 'This makes good economic sense as well as good social sense.' To those businesses that are at the forefront of many of these changes, I acknowledge your work, too. As chair of the Community Affairs Legislation Committee, which looked into this legislation, I want to take a moment to thank everyone who contributed to our inquiry through submissions or through appearing before us and giving their evidence.

We were very happy to support this bill and to commend it to the Senate. I know there is more work to do in these reforms; there's much more work we can do to make life better for Australian families, for mums and dads and, critically, for their children. That's why I'm part of the Labor Party. That's why I'm proud to be part of a Labor government, because we will do that work from these benches. That's why we're here. I commend the bill to the Senate.

11:36 am

Photo of Tony SheldonTony Sheldon (NSW, Australian Labor Party) Share this | | Hansard source

I rise to speak in support of the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022. This bill expands and improves the paid parental leave scheme legislated by the Rudd and Gillard Labor governments in 2010.

This bill makes six key changes to the scheme. It combines the existing paid parental leave and the dads' and partners' pay schemes into a single 20-week scheme, which provides more flexibility for families to divide their leave as best suits them. It reserves a portion of the scheme for each parent, which ensures that fathers and partners take a fair share of leave and tackles the gendered stigma around parental leave. It makes it easier for both parents to access the payments by removing the notion of primary and secondary carers and ensures that both parents are treated as equal partners under the scheme. It expands access to the scheme by introducing a family income test, where families can be assessed if they exceed the individual income test. It increases flexibility for parents to choose how they take their leave days. It enables fathers and partners to access the payments regardless of whether the birth parent meets the income test or residency requirements. This bill delivers a fairer, stronger and more flexible paid parental leave scheme. It delivers a better paid parental leave scheme for 181,000 families around Australia.

Like every meaningful workplace right and entitlement in this country, this bill reflects countless hours of work and advocacy by workers and their representatives in the trade union movement. No workplace right in this country was ever handed down freely by the Liberal and National Parties. It has taken the blood, sweat and tears of Australian workers, their families, and unionists. Whether it's the 38-hour week, the weekend, the minimum wage, paid leave, superannuation, job security arrangements—which particularly supports women in the workforce—or turning around and making sure that pay equity is properly administered in equal pay for women in the workplace, with its aspects of workers' compensation and, of course, paid parental leave, these are all examples of changes and importance in workplaces around our country. It also goes to arrangements like penalty rates, particularly for those people in precarious, temporary, part-time or casual work, which is dominated by women in the workforce. In those areas, penalty rates were slashed and burned under the previous government.

These are areas that the Labor government has been pushing to make sure are rectified, and of course, if the Liberals get back into government, they'll undermine and attack them again. Just in the last few years, we've seen the Liberals attack penalty rates and superannuation; we saw the Liberals happily stand by while big companies like Amazon exploited workers and undermined basic workplace rights; we saw the Liberals abolish all minimum standards in the road transport industry; and we saw the Liberals intervene in court cases on behalf of labour hire companies to strip paid leave entitlements from casual workers.

Just a few months ago, we saw the Liberals in opposition oppose the Secure Jobs, Better Pay bill. What was in that bill? The Liberals opposed making gender equality an objective of the Fair Work Act; the Liberals opposed strengthening the right to request an extension of unpaid parental leave; the Liberals opposed strengthening the right to request flexible work arrangements; the Liberals opposed making it easier for workers in low-paid feminised industries to bargain for pay rises; and the Liberals opposed prohibiting sexual harassment in the Fair Work Act. These are all protections introduced by this government at the end of last year, and the Liberals and their mates in a few recalcitrant employer groups—employer unions—fought them tooth and nail.

Every time Liberals get in, workers go backwards, because the Liberals and the Nationals have always been the parties of bad businesses, not of the good businesses that have made many of these changes in conjunction with their workforce, who are often represented by unions. Every time a Labor government is elected we see the Australian middle class grow. Whether it's workers or good employers who want to do the right thing by their workers, Labor is the party for the middle class.

Let's take paid parental leave as a case in point. In 1973, it was the Whitlam government that first introduced maternity leave for public sector employees and banned discrimination against employees who became pregnant; in 1979, unions successfully argued for maternity leave in the maternity leave test case, which extended unpaid maternity leave to all permanent employees in the private sector; in 1985, unions won unpaid adoption leave; in 1990, the unions won the parental leave test case; and, in 1993, the Keating government enshrined unpaid parental leave as a workplace entitlement in legislation.

But during the long, dark years of the Howard government, while universal paid parental leave became common across the OECD, Australian workers went backwards. Rather than paid parental leave, we got Work Choices. During this time, many unions fought for paid parental leave to be added to enterprise agreements. But, while unions led the charge on parental leave, the Howard government was attacking the rights of workers to join unions and to be able to successfully argue for those changes across companies and across industry sectors. In doing so, Howard attacked the rights of workers to access paid parental leave schemes.

I remember that, while I was the New South Wales secretary of the Transport Workers Union, we were winning paid parental leave for truck drivers in agreements in the late 1990s and early 2000s, and we were publicly attacked by people like 2UE's John Laws for going soft. Well, thank goodness going soft is recognised as something we should all be doing as a community, not based on gender and, hopefully, not based on politics.

By the time the Rudd and Gillard governments legislated paid parental leave in 2010, Australia was one of only two OECD countries without a universal paid parental leave scheme. That is where the Howard government left Australian families: with one of the two most antifamily workplace relations systems in the developed world. Now, after another decade of Liberal government, another decade of Australian workers going backwards, this Labor government has inherited a parental leave scheme that has slid back to being the second-worst among comparable OECD and EU countries. Again, every time the Liberals and Nationals sneak in, they send workers and families backwards, and, every time a Labor government is elected, we repair the damage done to Australia's middle class.

Of course, this bill is just the first step in strengthening our Paid Parental Leave scheme. Later this year the Albanese government will introduce legislation to expand Paid Parental Leave from 20 weeks to 26 weeks—another big step forward for Australian families. We should aspire to continue to improve the scheme.

I note the submissions by the Australian Council of Trade Unions and the Shop, Distributive and Allied Employees Association calling for the scheme to gradually be extended to a full year of paid parental leave—52 weeks—with an increased rate of pay. They've also called for the scheme to be expanded to all workers, regardless of the length of service, including those who are on temporary or fixed-term contracts. Just as we've seen for a century, the trade union movement is always at the forefront of driving positive workplace reforms that benefit the entire community.

Just as we have seen for a century, the advocacy and campaigning of the union movement is often so successful that even the Liberals are shamed into supporting positive workplace reforms such as we're seeing today. That's why it's so, so hard to destroy unions and to stop workers and their representatives and working families from coming together to have a representation and a voice at work. Unions make workplaces and Australian society fairer. They make our middle class stronger. For the Liberals and Nationals, the party of the employers—the employers who want to rip people off—unions are something that they will never support. But I tell you what: good companies do support them, good employers do, and good politicians make a difference. We'll continue to drag the Liberals and Nationals kicking and screaming into the 21st century. Part of the way of doing this reform and bringing them into the 21st century is making sure there are programs that are actually of benefit, because this is also a productivity opportunity and is of assistance to employers.

Regarding the mandatory nature of these benefits, the employer's role can help parents to stay connected to their workplace while on leave, leading to the benefits of business, including increased retention and reduced training and recruitment costs. Crucially, the employer role also supports women's workforce participation. We know that time out of the workforce due to caring responsibility is a key driver of the differences between men's and women's economic outcomes. Keeping women connected to their employer while they are on parental leave is intended to encourage women to return to the workforce and have that productivity boost and opportunity across our community while also reducing employee turnover and, in turn, reduce the lifetime earnings gap between men and women.

Of course, part of that program is also to support employers of all sizes. Services Australia will ensure that information available to employers is updated to reflect the changes in this bill. This includes a Services Australia website for all employers, which provides information on what employers need to know about the paid parental leave scheme and detailed information about how to register and manage their role. Other resources available include the Paid Parental Leave scheme Employer Toolkit, a handbook maintained by Services Australia since the scheme's introduction. And of course Services Australia also provides a dedicated phone service for employers who require assistance in registering their business online or to ask for help about their obligation under the scheme. Services Australia staff who operate this phone line will receive training about the changes in this bill. This is a change for all Australians—a change that will boost productivity, participation and fairness in our workplace and provide an opportunity for employers to further advance a good workplace.

11:48 am

Photo of Helen PolleyHelen Polley (Tasmania, Australian Labor Party) Share this | | Hansard source

I rise to speak on the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022. Again, it gives me great pleasure to speak on a bill that is delivering on the Albanese Labor government's election commitments and a bill that advances women and gender equality in this country. This bill will make life better for over 180,000 families. It will ease the cost-of-living pressure that are being felt by all Australians, because it's a bill that serves families first—and, again, it's a Labor government that introduces these social changes.

Businesses, unions, experts and economists all understand that one of the best ways to boost productivity and participation is to provide more choice and more support for families and more opportunity for women. We on this side of the chamber understand the value of women so much better than those on the opposite benches. The Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022 will support women's workforce participation, while helping more dads and partners take time off work to be with their children. I know the benefits firsthand. My husband and I had to reverse roles—not by choice—and I understand the true benefits of the bonds that dads can have with their children. It sets them in good stead for a fantastic life experience.

We said during last year's budget that we would deliver a better cost of living, more affordable housing, cheaper child care and medicines, expand paid parental leave and get wages moving again. These changes take effect from July 2023 and will deliver a single Paid Parental Leave scheme with flexible 20-week entitlements for working parents. I'm delighted about what this will mean for parents in my home state of Tasmania. It will mean greater flexibility and efficiency for parents. It's child friendly and empowers women and girls to be the best versions of themselves. Around 180,000 Australian families take up this benefit each year, and they will now be able to share the entitlement in a way that is best for their families' circumstances.

The changes will enable either parent to claim parental leave, pay first and access the entitlements in multiple blocks as small as one day, with periods of work in between. A new family income test of $350,000 per annum will also see nearly 3,000 parents become eligible for the expansion of paid parental leave. Pending passage through this place, the changes come into effect for parents whose children are born or adopted from 1 July 2023. Parents can pre-claim up to three months before the expected date of birth or adoption so there is no delay in receiving payments. Pre-claims under the improved system will open from the end of this month.

This legislation is an important first stage of our major reform of the Paid Parental Leave scheme and lays the foundation for expansion to 26 weeks by 2026. Not only will the government's reform help families better balance work and care but also will support participation and productivity over the longer term, providing a dividend for the Australian economy and communities across Australia. In other words, it means that women can step out of the role of parent—they're still going to be parents but having that full responsibility—by going back into the workforce to enable them to continue developing the important skills that will help them build a stronger economic outcome for themselves through their working lives.

Crucially, the bill will give more families access to the government payment, provide parents greater flexibility in how they take their leave and encourage them to share that care responsibility. It's great for families right across this country. The bill delivers six key changes: combines the two existing payments into a single 20-week scheme; reserves two weeks of the scheme for each parent, to support them in taking time off work after the birth or adoption of their child; simplifies the claims process by removing the categories of primary and secondary carers, so it's easy for parents to access the payment; expands access by introducing a $350,000 family income test under which people, including single parents, may qualify if they do not meet the $156,647 individual income test; increases flexibility for parents to choose how they take their paid parental leave days and transition back to work; and sixth, allows eligible fathers and partners to access the payment, irrespective of whether the mother or the birth parent meets the income test of residency responsibility. It is fundamental that this bill passes the parliament by the end of March so that parents expecting to give birth or adopt on or after 1 July next year have the option of pre-claiming, to receive their government entitlement as soon as they are eligible.

Labor will introduce further legislation to progressively increase the Paid Parental Leave scheme from July 2024 until it reaches 26 weeks—a full six months—in 2026. This is the largest expansion since Labor established the scheme back in 2011. It's something that parents of my generation never had access to. This will be such a good fundamental change for families, for parents and for their children. I echo the words of the Minister for Social Services, Amanda Rishworth:

We know what happens when both parents are not supported to take time off paid work to care for their babies—usually Mum works much less, or leaves the workforce altogether to take on caring responsibilities, while Dad remains in full-time work …

This pattern persists for years after the child's birth and is a key driver of gender gaps in workforce participation and earnings.

I urge everyone in this place to support this bill. This bill will support women. It will help remove that issue that many women face when they become mothers, having to choose between being the parent who is the full-time carer or giving up their opportunity in the workforce. The reality of having both parents being able to share in that caring role is so important. It provides relief around the cost of living. It also strengthens the bond between the parents and provides women the opportunity to return to the workforce, if they want to, earlier than they otherwise may have done so.

As I said earlier, the bond that is developed between parents in those first very important months and years cannot be underestimated in setting the foundations for the relationship that children have with both parents. Frankly, if I was being honest in this chamber, I'd say the fact that my husband became the carer and the homemaker meant that our children actually much preferred my husband to cook. In fact, they still do—and I'm being blatantly honest about this. Those relationships are terribly important.

The other benefit is what it does for women being able to establish and maintain their skills and their place within the workforce. We know that there are too many women of my generation, and beyond, who don't have enough superannuation to be able to retire. This will help solve that issue. It's not the only thing that we need to do, because we still need to increase superannuation for all Australians, but I see such great benefits for the families in my home state of Tasmania: the relationships are going to be stronger, the bonds are going to be better, productivity and the economy are going to be stronger, and skills in our workplaces will continue to grow because women won't feel that they have to step away from paid employment.

Once again, it's a Labor government that steps up to introduce legislation to ensure that both parents get the support to develop the bonds and to share those caring responsibilities. We've have had almost a decade of inaction on behalf of the former Liberal government. And it's sad that you have to wait until there's a Labor government to ensure that these social changes are introduced. So, I urge those on the crossbench and those on the opposite side, in opposition, to actually vote for this important legislation. I commend this bill.

11:59 am

Photo of Don FarrellDon Farrell (SA, Australian Labor Party, Minister for Trade and Tourism) Share this | | Hansard source

I start my contribution to the debate on the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill by seeking to submit a correction to the explanatory memorandum.

Leave granted.

I thank all of those who have contributed to this important debate on this bill, including Senator Polley, who gave a very personal account of the importance of this legislation to her family. Improving paid parental leave is critical, nation building reform. The Albanese government knows this, and we know that paid parental leave is vital for the health and the wellbeing of parents and their children. We know that investing in paid parental leave benefits our economy. And we know that, done right, paid parental leave can advance gender equality.

We heard these messages loud and clear at our successful Jobs and Skills Summit in September, where gender equality and economic reform went hand in hand. Businesses, unions, experts and economists all understand that one of the best ways to boost productivity and participation is to provide more choice and more support for families and more opportunity for women.

That's why paid parental leave reform was a centrepiece of our first budget, with an additional half-a-billion-dollar investment in the scheme. Paid parental leave is a proud Labor legacy, and the Albanese government is building and expanding on that legacy. The number of government and non-government members who have spoken to these reforms over the course of this debate shows how important this issue is to many Australians. We've wasted no time delivering on our budget commitment. The changes in this bill modernise paid parental leave so that it's the right time and right for the future.

We know dads and partners want more time at home with their baby. My oldest daughter is expecting our third grandchild in the next week or so, so I can fully understand that dads and their partners do want to spend more time with, particularly, a new baby. We know parents want flexibility in how they choose to take leave and transition back to work. We know the current eligibility rules are unfair to families where the mother is a higher income earner. Our bill fixes those problems. It gives more families access to the payment, provides parents more flexibility in how they take leave and encourages them to share care to support gender equality.

From 1 July 2023, this bill will improve paid parental leave by combining the two existing payments into a single 20-week scheme, reserving two weeks of leave for each parent to support them both to take time off work, making it easier for both parents to access the payments by removing the notion of primary and secondary carers, expanding access to around 3,000 more families each year by introducing a new $350,000 family income test, expanding access to around 1,500 more dads and partners each year through a new simpler claiming process and, finally, increasing flexibility for parents to choose how they take government paid leave and transition back to work. It's critical that this bill passes both chambers by 9 March to ensure that parents expecting to give birth or adopt on or after 1 July 2023 have the option of preclaiming their entitlements three months in advance.

This bill implements the first part of the government's budget measures. We will separately bring forward legislation to progressively increase the scheme from July 2024 until it reaches 26 weeks in July 2026—a full six months of leave. This is the largest expansion of paid parental leave since Labor established it in 2011. Our half-a-billion-dollar investment reflects our government's commitment to improving the lives of working families, supporting better outcomes for children and advancing women's economic equality.

I'd like to take this opportunity to thank the Senate Community Affairs Legislation Committee for its work conducting the inquiry into the bill and preparing such a comprehensive support. Special thanks go to Senator Marielle Smith, from South Australia, for her significant contribution as chair of that committee. The inquiry heard from a diverse range of voices, including employer bodies, unions, family advocates and general equality experts. I would also like to thank the many organisations and individuals who took the time to prepare submissions on the bill and the witnesses who appeared before the committee to provide their evidence.

As many of the submissions and witnesses noted, the bill is a crucial step towards a parental leave system that empowers the full and equal participation of women. We were pleased to see that the submissions overwhelmingly supported the measures contained within the bill. We were also pleased to see the committee's finding that the reforms proposed by the bill will deliver better outcomes for parents, children, employers and the economy and that the bill will achieve its overarching objective of creating a more accessible, flexible and gender-neutral paid parental leave scheme for Australian families.

The Australian Human Rights Commission and the Australian Chamber of Commerce and Industry, amongst others, welcomed the move towards gender neutrality, removing the presumption that women are always primary caregivers. The National Foundation for Australian Women also endorsed the changes, stating that they send 'an appropriate signal about the direct importance of the role of fathers and partners in the lives of newborns'. Other submissions welcomed the expanded eligibility, especially through the family income test, which will ensure families with equivalent incomes are treated the same regardless of which parent is the higher earner. The Diversity Council, Ai Group and the Australian Institute of Family Studies welcomed this change as well as the changes that enable eligible fathers and partners to claim parental leave pay even when the birth mother isn't eligible.

I also want to highlight the support for the increased flexibility introduced by this bill. The Australian Chamber of Commerce and Industry, in particular, noted that these provisions will support parents to manage work and care, support gradual returns to work and help parents maintain an ongoing connection to the workplace.

I note that there were additional comments from coalition senators. I acknowledge the points they raised about ensuring businesses are supported to understand the changes to the scheme, and I'd like to assure senators that Services Australia will make sure information and support are available to those employers.

In the committee's report, the Greens made additional comments, welcoming the changes and making further recommendations—that the bill be amended to include superannuation on paid parental leave, that the scheme be expanded to 26 weeks from 1 July 2023, and that the Women's Economic Equality Taskforce be asked to investigate rates of payment. In response to these additional comments, I want to make it clear that the Albanese government is firmly committed to increasing the scheme to 26 weeks by 2026. The government committed half a billion dollars in the October budget, and we will legislate it by July 2024. This is the largest investment in the scheme since Labor established it in 2011. Our approach to expansion allows us to make important structural reform in a difficult fiscal situation. We are responsible economic managers; we need to address the inflationary pressures in the economy, and that requires us to be very prudent about any expenditure.

We're also committed to getting the settings right to maximise women's economic equality. The government has asked the Women's Economic Equality Taskforce for advice on the optimal model for a 26-week scheme. The task force, made up of independent experts and chaired by Sam Mostyn AO, is currently considering the right mix of 'use it or lose it' weeks and flexible weeks. Following consideration of the task force advice, the government will bring forward legislation to expand the scheme to 26 weeks by 2026.

Regarding payment of superannuation on paid parental leave, the Treasurer, the Prime Minister, the Minister for Finance, and the Minister For Social Services have been very clear: when we can afford it, we would like to do it. Our first priority has been improving how PPL is structured and expanding the number of weeks. That's our priority, but we will continue to work on issues around pay inequality. The key driver of the gender gap in superannuation is gender pay gaps in working life, and the Albanese Labor government is investing in a range of policies that support women's workforce participation and earning potential.

Regarding the rate of pay, the Productivity Commission recommended it be based on the national minimum wage rather than the proportion of previous earnings. This approach balances the need to provide support to parents with the cost of the scheme to taxpayers. Payment at national minimum wage also means that every family welcoming a new child receives the same financial support. The government does not have plans to change that.

It is worth noting that the changes in this bill mean from 1 July this year eligible parents will be able to claim government paid leave at the same time as any employer paid leave. This will make it easier for families to maintain their income while caring for their newborn. Under the current scheme, this option is already available to mums but not to dads.

During the inquiry, we also heard some concerns from the Greens about the current work test rules, including for people with short or inconsistent work histories and full-time students. While there are no changes to the work test as part of this bill, the current rules are designed to be flexible and are accessible to casual workers, temporary workers, and workers on short-term or fixed-term contracts.

We've heard some questions from senators about the potential for administrative burden on small business. I'd like to assure senators that, in designing the changes, the government carefully considered impacts on business. This legislation does not change the employer role in any way. Evidence provided to the committee's inquiry demonstrated that the more flexible scheme will actually benefit employers and employees without any additional administrative burdens on businesses.

Existing legislation requires employers to administer government funded parental leave pay to eligible long-term employees. Services Australia provides the payment to employers in advance of them passing it on to their employee in accordance with the employer's normal pay cycle. This employer role helps parents stay connected to their workplace while on leave, leading to benefits for business including increased retention and reduced training and recruitment costs. Crucially it also supports women's workforce participation, and we know that time out of the workforce due to caring responsibilities is a key driver of the gap between men and women's economic outcomes. I remind senators that, to reduce administrative burden, employers are not required to administer the payments when employees take the government paid leave days in continuous blocks of less than eight weeks.

I'm pleased that our changes have been warmly welcomed by business. In their submission to the committee's inquiry the Australian Chamber of Commerce and Industry said they strongly support these changes:

These changes should deliver significant benefits to the economy by boosting women's workforce participation, improving flexibility in the use of paid parental leave, enhancing gender equity outcomes, and ensuring businesses continue to have access to a diverse, experienced productive labour force.

Again I thank all senators for their engagement on this important issue, and I commend the bill to the Senate.

Photo of Andrew McLachlanAndrew McLachlan (SA, Deputy-President) Share this | | Hansard source

The question before the Senate is that the second reading amendment standing in the names of Senator Waters and Senator Pocock be agreed to.