Paid Parental Leave

In the 2015 Budget, the Abbott Government announced that it intends to restrict access to the government’s Paid Parental Leave (PPL) scheme from 1 July 2016. Mothers with an employer/workplace entitlement to paid parental leave will be no longer be guaranteed access to the 18 week PPL scheme. Nearly 50 per cent of all mothers will lose some or all of their government paid parental leave. Some families may be worse off by over $11,000.Write to your senators asking them to reject the Government proposal – see the much better proposal under the next item in this Blog.

If you are planning to have a baby, enter in your gross salary and the number of paid weeks leave your employer gives you to find out how you will be affected https://web.cpsu.org.au/ppl/ppl.aspx

Paid Parental Leave: Six Month Top Up proposal

OFFICAL COMMUNIQUE

The Australian Government has proposed changes to the Paid Parental Leave Scheme that will undermine Australian families’ ability to stay at home with their babies for the first six months of their lives.

The Australian Government’s current Paid Parental Leave Scheme provides two Australian-Government funded payments to eligible working families

Parental Leave Pay (PLP), 18 weeks at the National Minimum Wage (NMW) ($11,826 at 1 July 2015), with employers able to provide additional benefits e.g. fund extra weeks of paid leave

Dad and Partner Pay (DAPP), 2 weeks at the NMW with employers able to “top up” to normal earnings

The current proposal seeks to stop working parents who are primary carers from accessing the government entitlements if their employer pay exceeds the PLP payment. But employers will still be able to “top up” the DAPP.

An alternative proposal

The current scheme is based on the principle that the minimum entitlements provided by the Government would be complemented by employer schemes which lengthened the period of paid parental leave to achieve the optimal leave period recommended by the World Health Organisation of 26 weeks.

The current scheme has successfully met this objective, with the Paid Parental Leave Evaluation showing that the current “PLP had a clear effect of delaying mothers’ return to work up to about six months after the birth of their baby.” (Paid Parental Leave: Evaluation Report, p4)

The evaluation has also shown that the DAPP scheme has contributed to culture change among employees and employers, with “some fathers more willing to be assertive about taking leave following a birth, and some employers more inclined to see such leave as legitimate and a normal aspect of the leave taken by employees.” (Evaluation Report, p 13).

We do not want to risk the gains made by the PLP and DAPP Schemes and propose the following measures to strengthen the program:

26 weeks paid at the NMW as the, Australian Government Parental Leave Payment – to enable the primary care giver to access $17,079 in payments during the first six months of their child’s life

4 weeks paid at the NMW as the Australian Government Dad and Partner Payment DAPP – to accelerate the culture change around the role of fathers in raising children

Extension of the DAPP “top up” provisions to PLP – to enable both parents, not just Dads, to maintain workforce attachment with their employer during their parental leave

Superannuation for both payments – to contribute to retirement income, particularly among women

No restrictions on bargaining rights or employer voluntary additions adding to these payments – to enable employers to position themselves as Employers of Choice and attract and retain workers

This proposal was prepared in collaboration with YWCA Australia and the National Foundation of Australian Women.

Scenario 1: Bank Employee

Nora is pregnant and works full time as a customer service consultant at a bank, where she earns $50,000 ($962 a week).
Her employer has an 8 weeks paid parental leave scheme ($7,692 for the 8 weeks).
Her partner, Charlie, works at a child care centre. He earns $39,000 a year and does not have an employer scheme that pays for partner leave.

Current PPL situation

Nora is able to access the Government Parental Leave Payment of $11,539 (former NMW rate pre, July 2015 adjustment) over 18 weeks and her employer funded parental leave of $7,692 (8 weeks). This means Nora would be able to access 26 weeks leave, with an income of $19,231. This is 76% of her regular wages for that period ($25,000).
Charlie is able to claim 2 weeks of government partner leave at minimum wage for $1282 (former NMW rate pre, July 2015 adjustment) during that period.


Abbott Government Proposal

Under the new proposal, Nora would no longer be able to receive both the PLP and her employer’s payment. Instead, she would have access to 18 weeks of minimum wage – made up of her employer funded leave of ($7,692) and a $4134 top-up. This would bring the total amount of paid parental leave that she receives during the 18 week period to NMW $11,826 (calculated at adjusted NMW rage from 1 July 2015). This means that her parental leave drops to 66% of her regular earnings.
If Nora was to stretch out her total paid parental leave entitlements to the recommended 26 weeks, her weekly payment would be $444, which is 46% of her regular earnings.
Charlie would also be entitled to claim 2 weeks of government partner leave at minimum wage for $1314 during that period.

Alternative proposal

Under the preferred paid parental leave proposal, Nora would be entitled to 26 weeks of minimum wage, government funded paid parental leave. This would total $17,079 for the 26 week period.

Her employer would be able to provide a top-up to Nora, at a cost of $7918, so that the family suffered no wage penalty during the six-month parental leave period.
Charlie would be entitled to 4 weeks minimum wage, government funded Dad and Partner Pay of $2628 over the 4 week period. His employer would also be supported by legislation to top-up to a wage-replacement level.
Both these government payments would include superannuation contributing to the families’ retirement income.

Think Tax Reform Discussion Paper

There are a number of policy reasons to encourage workforce participation by women. The key reasons can be identified as:

– Children in workless households are at greater risk of poverty;
– Underemployment affects the ability of women to save for their retirement; and
– Lower participation rates for women than men constitute a significant source of labour to maintain productivity in the Australian economy.

Read the full paper here – NFAW_Rethink

Please explain: The “rudest Budget imaginable” for women

ARTICLE – WOMEN’S AGENDA BY GEORGINA DENT

For the 30 years prior to 2014 each Federal government of the day has produced a Women’s Budget Statement in tandem with the Federal Budget. Not anymore. This practice was abolished by the current government in 2014.
“It used to be one the budget papers but then it vanished,” NFAW Marie Coleman explains.

Visit this link to read the full article – http://www.womensagenda.com.au/talking-about/editor-s-agenda/please-explain-the-rudest-budget-imaginable-for-women/201505295823#.VWzqTM-qpBd

Budget 2015-2016 – Gender Lens

It has been the practice since 1984 for Federal Governments to produce a Women’s Budget Statement as one element of the official Budget Papers. In 2014 this practice ceased. There has been no explanation from the Government. It is regrettable that the Government has made this decision. Read on – Budget 2014 NFAW gender lens (final)“>Budget 2014 NFAW gender lens (final)

It’s time to talk Paid Parental Leave, Tony

WOMEN’S AGENDA talking about Paid Parental Leave

visit – http://www.womensagenda.com.au/talking-about/top-stories/its-time-to-talk-paid-parental-leave-tony/201505225790

Maternal Access to 26 weeks part-Government-Funded Paid Parental Leave

Call-to-Protect-Paid-Parental-Leave-FinalWe, the undersigned organisations and individuals, make this statement of support for the current Paid Parental Leave scheme.

The Scheme enacted by the Parliament has the twin objectives of enhancing child and maternal well being and supporting parental work force participation. The universal Government scheme underpins whatever employees are able to obtain by negotiation with employers, with the aim of extending total paid leave as close as possible to a full 26 weeks recommended by the World Health Organisation.

We are dismayed by the proposal to remove access to the minimum leave entitlements provided by Government scheme for all employees entitled to additional employer-funded paid parental leave.

The proposal flies in the face of universal acknowledgement of the benefits of 26 weeks leave and of the findings of the evaluation of the Government scheme.

For the following reasons, we call on the Government to reverse its stated position and guarantee universal access to Government-funded paid parental leave:

The current scheme provides universal access to paid parental leave.

The current scheme is based on the Productivity Commission’s recommendation to establish universal access to paid parental leave for up to 18 weeks at the minimum wage for working parents with an additional two weeks leave reserved for partners who share in the primary care of the child. It was anticipated that at some point in the future, Government would extend the scheme to include minimum superannuation contributions.

The minimum entitlements provided by the Government were intended to be complemented by employer schemes which lengthened the period of paid parental leave to achieve the optimal leave period recommended by the World Health Organisation of 26 weeks.

The Productivity Commission estimated that the scheme would ensure more families have capacity to provide exclusive parental care for children for six to nine months and increase workforce participation on average by up to 6 months per woman over her lifetime.

Government funded paid parental leave was introduced as a universal scheme – to be available to all families in Australia. It must stay that way.

Paid parental leave has significant health benefits for both mother and child
There is compelling evidence of health and welfare benefits for mothers and babies from a period of postnatal absence from work for the primary caregiver of around six months.
Australian guidelines and the World Health Organisation recommend that infants are fed nothing but breast milk for their first six months of life and continue to be breastfed into their second year. Exclusive breastfeeding ensures that babies receive the full nutritional and development benefits as well as protection against infection and some chronic disease.

Breastfeeding is the biological and social norm for infants. Having a child and taking time out for family reasons is viewed by the community as part of the usual course of work and life for parents in the paid workforce. Paid parental leave helps ensure that working mothers have the capacity to meet their child’s needs during the first few months of life whilst remaining in employment.

A reduction in the period of paid parental leave means parents who must return to work once the paid period expires will have to find care for their young infant. We note Budget proposals for expansion of child care beyond 2017. Even so, places for babies in childcare centres are limited and difficult to access. Care for infants is very expensive to provide. Early exposure of infants to group care increases the risk of infectious disease. Where child care is not available these mothers may drop out of the workforce. A reduced period of paid parental leave combined with a lack of supply of childcare for babies may lead to a reduction in women’s workforce participation. Good policy design will support a smooth transition between paid parental leave and childcare. This policy extends the gap between the conclusion of paid parental leave and childcare.

Click here for a full copy Call-to-Protect-Paid-Parental-Leave-Final

Abbott- Budget 2015-16 Child Care- Paid Parental Leave

Marie Coleman

Policy wonks like to talk about undertaking distributional analysis of any new policy proposals- spends or saves- before going out into public discussion.

With families’ policies it is essential to see who are the winners, who are the losers, and whether all the various pieces fit together.
So the Mother’s Day pitch for benefits to low and middle income families need to be looked at carefully.

The moving feast over the last 48 hours has been discussion around how good the child care package is, and whether the Government can get the Opposition and cross benches to accept the bitter off-setting savings. Low income families are asked to accept a loss of benefits of $9.4 billion over the next four years to pay for the package. Read more

A graph click here from the Workplace Gender Equality Agency gives a snapshot of the paid parental leave systems of some of the industries reporting to the Agency in 2014. Obviously it does not cover agencies not required to report. Note that some 48.1% of reporting agencies provide some PPL, but there is considerable difference between the various industries. Visit www.wgea.gov.au

Childcare

We will not support more penalties for low income women

The National Foundation for Australian Women (NFAW) has been at the forefront of women’s groups arguing the pre-eminent importance of affordable accessible child care, both to assist women move out of poverty through workforce participation, and for its benefits for child development.

We campaigned in favour of referral to the Productivity Commission, and gave evidence to the Commission. We welcomed the Commission’s final report. We welcome the Government’s objective of making quality child care more accessible and affordable.

But we cannot support further penalties being imposed on low income women in order to finance an expansion of child care.

Minister Morrison, together with the Prime Minister and Minister for Finance have made it quite explicit that expanded funding for child care is contingent on the Senate enacting changes to Family Tax Benefit which were proposed in last year’s Budget.

Analysis by Professor Peter Whiteford and Daniel Nethery of the ANU Crawford School of Public Policy showed that these proposals would have meant that an unemployed lone parent with one 8 year old child would lose $60 per week, about 12% of their disposable income.

Lone parents who are working and earning around two-thirds of the average wage would lose by 5.7 to 7.1% of their disposable income, between $60 and $75 per week. A single income couple with two school age children and earning average earnings would lose nearly $90 per week or around 6% of their disposable income.

We agree with the Minister that there is scope for reform of FTBB. We would support a reformation which removes workforce disincentives without further penalising the poor. We cannot support the robbing of poor women to enable other low income and middle income women to reduce their child care costs.

For further information contact:
Marie Coleman AO PSM 0414483067,
Chair, Social Policy Committee, National Foundation for Australian Women

Viv Hardy 0411 208 951
CallidusPR

Download a copy here – Childcare May 2015 Media release (1)

Health policy options in the wake of health pricing ideas

The Commonwealth Government focus so far on the use of a ‘price signal’ to make savings in health expenditure entirely misses the nature of the problem with current and future health costs in Australia – and the obvious options for improvement.

Without an aggressive focus on reducing the risks of preventable illness and improving the management of chronic diseases, government fears of the increasing health costs of the growing and ageing population will become a certainty.

Read more here – health policy options in the wake of health pricing ideas (f)-1 Feb 2015

Rosemary Calder is a member of the NFAW Social Policy Committee and this document has been published online by Fairfax newspapers.