7 February 2022
I rise to speak on the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Bill 2022. I support the amendments that the government is proposing in this bill in its first stage of reforms. These changes are long overdue, with so many families have been struggling under the current system. The changes will have a positive impact on the lives of some 180,000 Australian families, many of whom are juggling work and family life. It will take some of the pressure off their household budgets. These changes will give more families access to the payments and greater flexibility on how they take the payments. They will encourage sharing of the caring load, which supports gender equality and increases the number of fathers taking on carer roles with newborns.
I must say that this is still not an ambitious bill. There are a lot of things in this bill that are not vastly growing the Paid Parental Leave scheme in this country. We are still miles behind our OECD counterparts. This bill is getting rid of discrimination and improving flexibility, which I welcome, but I do want to be measured in speaking about what we are achieving here.
I welcome the introduction of the $350,000 family income test. Single parents can can also access it, but they don't meet the individual income test of $156,647. Previously, for those who maybe aren't familiar with the scheme, the test was calculated solely on the birth mother's income and strongly discriminated against professional women, because as soon as a woman earned above that cap of $152,000 the family was not entitled to paid parental leave. But you had the converse situation where a man could be on any income above that—on any income, essentially to $1 million—and if the birth mother was below that cap that family was entitled to paid parental leave. The discrimination against women in professional occupations was quite extreme and ridiculous. I raised it in a motion under the previous government in 2021 and raised it again in 2022, so I absolutely welcome the fact that the government is getting rid of that provision that discriminates against professional women. There are many families in Warringah and elsewhere around the country who are missing out under the current scheme because the payment was pegged to the mother's income in that way.
According to the ATO, between 2010 and 2020 the number of Australian women with taxable incomes over $150,000 more than doubled, with almost 250,000 women now earning over $150,000. The proposed higher family income threshold will mean more families can access paid parental leave, especially where the birth mother is a professional and the higher income earner. This is really only bringing this scheme into the current day and age, where both men and women birth parents work and pursue professional occupations. The current scheme is grossly outdated and desperately needed to be fixed. It effectively assumed that a woman would not be the primary breadwinner in the family. It beggars belief that it has taken this long for such a measure to be amended, but I commend the government for addressing it so quickly in this term of government.
Not only will more families be eligible for the payments, but basing the income test on the joint household income will encourage fathers into caring roles. It will also get rid of the disparity where you had the situation of the very high income earning father of, say, a million dollars; those families will no longer be able to access the payment, which I think is appropriate. Having more fathers in caring roles will improve the long-term bond with children and increase their participation in unpaid work at home.
The proposed amendments also include increasing flexibility for families. Parents can now decide how and when they take their paid parental leave days, allowing parents to take payments in multiple blocks as small as a day at a time for the first two years of their child's life. Importantly, the requirement to not return to work in order to be eligible will be removed. This will help facilitate mothers transitioning back to work. It can also be taken in conjunction with any employer leave entitlements. Under this amendment, parents will also be able to take two weeks of their leave at the same time so that they can spend time together bonding with and raising their child.
The proposal to simplify the claiming process is also welcomed. It will now be made gender neutral, by removing distinctions between primary and secondary carers. Currently, if a family wants to share parental leave, the birth mother must claim first and then transfer it to another parent. This new, simpler claiming process allows eligible fathers and partners to qualify if the mother or birth parent does not meet the income test or residency requirements. This change will benefit about 2,000 Australian families a year.
This is finally bringing paid parental leave in Australia into the modern day and age, but we can do more. The government's proposal to combine the existing payments into a single 20-week scheme is more a reconfiguration rather than an extension of the scheme. This is not extending paid parental leave. We are still stuck on 20 weeks. We know the proposal combines the 18 weeks of paid parental leave that traditionally the birth mothers took with the two weeks of dad or partner leave to form a single 20-week payment that can now be shared between both parents.
The full rollout of the scheme to increase to 26 weeks of paid leave is promised by 2026—essentially another election cycle away. That is too long for families to wait. That's three more years. I remind the House that, at 26 weeks, Australia will be lagging well behind developed countries, with the average in OECD countries being 55 weeks of paid parental leave. Just think about that—55 weeks and 26 weeks. That is a monumental difference.
Last year the Grattan Institute released research showing that shared paid parental leave not only boosts mothers' earnings but it can boost our entire GDP. Increasing the entitlement to 26 weeks, shared between parents, would have a net positive impact on the economy. We would benefit by $300 million. It would cost some $600 million per year but would return $900 million per year. So why are we waiting three years to do it? I just don't understand. It's the patriarchal nature of this place. Changes to break down gender inequities and pay inequities take so long. You have to develop the political will, the political courage, to change the status quo. We need to increase paid parental leave sooner if we want to have a chance of increasing female workforce participation and decreasing the gender pay gap.
We know two major issues are facing the Australian economy: increasing savings for superannuation and moving women from part-time to full-time work. The government has maintained the two weeks reserved on a 'use it or lose it' basis to encourage both parents to share the leave. The Women's Economic Equality Taskforce see a further increase in the 'use it or lose it' provision as a key to ensuring more women stay connected to the workforce, rather than being expected to take all the leave to care for the newborn. The Parenthood organisation, who have done phenomenal advocacy work in this space, say that a goal of four to six weeks of 'use it or lose it' is essential to achieving a behavioural change in men whereby they do more of the parenting in early months.
I encourage the government to also consider the inclusion of a bonus provision. A 2021 Grattan Institute report recommends an additional two weeks of bonus leave which could be used by either parent if both parents take at least six weeks leave. When these 'use it or lose it' provisions and incentive schemes have been introduced overseas, there have been significant increases in men's uptake of parental leave. Australian Bureau of Statistics figures show that only one in 20 fathers take primary parental leave and 95 per cent of all primary carers leave is taken by the mother. These figures highlight the importance of the 'use it or lose it' and bonus provisions.
A Warringah constituent's petition to me, with 8,000 signatures, which I've presented to this place, has not been addressed in these amendments. The petition calls for Australia to align with the World Health Organization guidelines and the National Breastfeeding Strategy goal of children having the opportunity to be exclusively breastfed for the first six months, which means you need to increase paid parental leave to 26 weeks at the minimum. These are the basic things that need to happen.
So I welcome the government's amendments to paid parental leave. They will give families more access and greater flexibility, they will help to eliminate gender inequality in some small way, they will get more fathers into carers' roles and they will facilitate women's participation in the workforce in a small way. But the timing of the full rollout to 26 weeks of paid parental leave should be brought forward. There is no justifiable reason to wait three more years. We can't make families wait that much longer.
As we look to the future, we have to encourage the government to be planning to bring further improvements to this bill. We need to consider these two important incentives to achieve equitable sharing of leave: extending the use-it-or-lose-it provision to at least four weeks and including a bonus provision. I haven't even begun to touch on the problem of the inequity of access from community to community and the costs involved. And then, of course, there are the skills shortages. We know there are not enough carers in the child care sector. For paid parental leave to work, children need to be able to go into care so that women can go back to the workforce. There are so many issues in these areas. It is so gendered, and the patriarchal nature of this place has meant that for too long it has gone unaddressed. But I do hope in this term of parliament we have sufficient loud voices from women in this place and men who know and care about how important this issue is to finally make some changes.
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