The government’s paid parental leave scheme is a basic payment to tide women over until they can return to work, the social services minister, Christian Porter, has said, arguing that parents should not also have access to employer-provided payments.
On Monday Porter told Radio National the scheme and the government’s proposed changes were “designed to try and ensure that as many mothers are participating in the workforce and are able to re-participate after the birth of a child, having provided for a fair amount of time to bond with the child after birth”.
Employer groups have previously raised concerns that cutting access to the government’s paid parental leave scheme would reduce workforce participation.
The federal government now provides parents 18 weeks’ PPL at the level of the minimum wage. Employees may access the scheme alongside their employer’s scheme.
The Coalition’s bill would prevent parents with generous employer schemes from accessing both, or limit government payments to a top-up of the employer’s scheme to the value of 18 weeks’ pay at the minimum wage.
First announced in the 2015 budget, the proposal marked a significant turnaround from Tony Abbott’s “gold-plated” scheme which promised 26 weeks’ pay at the parent’s normal pay rate.
The explanatory memorandum to the government’s bill says the purpose of PPL is to enhance the health and development of birth mothers and children and promote equality between men and women, as well as to promote workforce participation.
The bill has been slightly modified from the one introduced in 2015, with amendments to:
- Allow four weeks of backdated payments for parents who complete a claim more than four weeks after the birth of their child.
- Change the work test to take into account the circumstances of pregnant employees who are unable to continue because their job is hazardous.
- Allow parents to have a gap of up to 12 weeks between two working days and still meet the paid parental leave work test, up from eight weeks.
Porter suggested targeting the government PPL system more tightly would free up funds to give casual workers and women with dangerous jobs access to the scheme.
In submissions to a Senate committee inquiry on an earlier version of the bill in July 2015, Ai Group warned it was “concerned about the potential adverse effects on workforce participation of reducing or removing government parental leave payments to many parents”.
On Monday an Ai Group spokesman said the proposal had changed and it had not expressed a view on the new bill.
In its submissions, the Australian Chamber of Commerce and Industry said government-funded PPL was “an important part of the social safety net”.
“The role of PPL in driving increased participation outcomes after the birth of children is less pronounced than measures that seek to encourage women to return to the workplace” such as affordable childcare and tax concessions for it, ACCI said.
On Monday Pauline Hanson gave her support for the bill, saying government and businesses could not afford “double dipping”.
Hanson told Sunrise: “We need to pull the budget back. We cannot keep affording this.
“You said the words: double dipping, nobody wants double dipping. If you are getting a payment or looked after, that is fine. I do not believe in double dipping.”
Hanson said businesses and the government could “not afford it”.
Labor has criticised the bill, arguing it would decrease income support for 80,000 mothers by up to $12,000 each.
Labor’s family services spokeswoman, Jenny Macklin, told ABC radio that women on low pay would “either have to go back to work, so that they can pay their bills, or if they do decide to stay at home they will have less money”.
The opposition also suggested it was unfair on mothers who are already pregnant that the changes would apply from 1 January, because the scheme would be less generous than when they conceived their babies.
Senators David Leyonhjelm and Bob Day, who is soon to retire, support the bill. If Hanson’s four senators and Day or his replacement support it, the support of the Nick Xenophon Team will be sufficient to pass it.
NXT is negotiating with the government on the bill before its party room of four makes a decision.
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