Parliament Updates

Zali Steggall MP speaks on Paid Parental Leave Amendment (More Support for Working Families) Bill

27 November 2023


 I rise to speak to the Paid Parental Leave Amendment (More Support for Working Families) Bill 2023. Paid parental leave is an issue I care very much about, and I've been pushing for this government and the previous government to do much more. It's an issue that affects many people around the country, including my constituents. I'm glad to see that some progress has finally been made in extending the Paid Parental Leave scheme.

The economics behind paid parental leave speak for themselves. Equity Economics has estimated that the cumulative impact of proposed changes to expand paid parental leave could increase GDP by 4.1 per cent, or some $166 billion, by 2050. If Australia could lift female participation to that of men, it would increase GDP by 8.7 per cent, or some $353 billion, by 2050. Further modelling by Equity Economics shows that if an average Australian woman had the same rate of workforce participation after having children as that of a woman in Sweden, for example, she would earn an additional $696,000 over her working life and retire with an extra $180,000 in superannuation. Those are pretty stark statistics.

Research by the Grattan Institute shows that shared paid parental leave boosts mothers' earnings and boosts our entire national GDP. Grattan modelling suggests that increasing the entitlement to 26 weeks shared between parents would cost the government some $600 million per year but add $900 million to GDP per year as well as boost mothers' lifetime earnings by $30,000. So not only does this make sense, but it is also very good for children. But it is important in this context because so many barriers have gotten in the way of gender equity and equal economic participation for men and women.

So expanding paid parental leave just makes sense, and that's exactly what this bill does. It expands parental leave, albeit in phases. It is very gradual, from 20 to 26 weeks by July 2026. My concern is that we will have another federal election before that. If this is not bipartisan and supported by the opposition, there will be the fear that they will repeal or wind back some of this progress, despite the fact that it is good economics, good for productivity, good for equality, good for women's economic security, good for Australian society and, of course, good for the families and new babies themselves.

At present, a working family can access up to 20 weeks of government funded paid parental leave. Shared care is encouraged. Two weeks are reserved for each parent, and they must use or lose those two weeks. This leaves 16 weeks for parents to share however they choose. By 1 July 2026, some 2½ years away, the scheme will be 26 weeks long, where four weeks are reserved for each parent on a 'use it or lose it' basis. That will leave 18 weeks that parents can choose to share however they wish. For instance, a couple may decide to share leave equally and take 13 weeks each. Meanwhile, single parents will have access to the full 26-week entitlement. Coupled parents will also be able to take up to four weeks of paid parental leave at the same time, whereas currently parents can only take up to two weeks together. It's important to note that being able to take up to four weeks enables parents to take parental leave together, and that has positive effects on maternal recovery. It's a clear step in the right direction, but it's clear that more can be done.

There is ongoing frustration with the pace of change. Whilst the government can be commended for finally acting on this, it is still very gradual, and the pace of change is very slow. In September 2022 I presented a petition to the House on behalf of my constituents, Peta and Shane Arthurson, to ask the House to immediately increase paid parental leave from 18 to 26 weeks. That was simply on the basis of the benefit to children of being able to be breastfed for the period of time that is actually recommended.

This bill now fulfils what the Arthursons' petition asked for but at a slow pace, rolling the extension out until 2026. No doubt the government will campaign on this at the next election as an election pledge to families, prior to this full instalment of parental leave being available, but it is a long way off and, I would argue, needed much sooner. So I support this bill, but there is more work to be done on the paid parental leave front and for achieving greater equality and economic security for Australian women. We need to get to gender equity.

The final report of the government's Women's Economic Equality Taskforce was released in late October. While this bill doesn't go as far as that report recommends, it is worth noting what more can be done and is recommended in that report. The final report recommended extending the Paid Parental Leave scheme by phasing the entitlement up to 52 weeks; legislating the payment of superannuation on all forms of paid parental leave; increasing investment in childhood education and abolishing the activity test, which requires both parents to be working to access childcare subsidies; boosting the availability of high-quality flexible work and strengthening the right of employees to flexible work and family-friendly working arrangements; encouraging employers to set gender equality targets and strengthen reporting obligations to include meaningful benchmarks; and introducing a tax offset for people with caring responsibilities who are re-entering the workforce, to curb the motherhood penalty facing women which means they earn less—and I should note that, invariably, it is women who take time out for caring for elderly parents as well, and that further impacts their superannuation.

These sorts of bold reforms recommended in the report are what we need not just for paid parental leave but for actual economic equality. When women succeed, Australia succeeds. We need to stop seeing such initiatives as costs and rather think of them as investments.

As I noted at the beginning of this speech, the untapped economic potential that we have that can be unleashed by lifting women's economic participation and making them more economically secure is what we should be focusing on. As stated by the current head of the Productivity Commission, 'If untapped women's workforce participation was a massive iron ore deposit, we would have governments falling over themselves to give subsidies to get it out of the ground.'

The government is yet to fully respond to the report on women's economic equality. I would hope that all reforms will be implemented, and I would encourage the government to lay out the pathway to do so. As the chair of the taskforce, Sam Mostyn, has said:

We have arrived at a moment of consequence where a genuine commitment to respecting women, and valuing and nurturing their economic contribution by removing systemic barriers, is vital.

This bill before us today takes a step in that direction, but it's only a step. More needs to be done. I urge the government to do more so that we can empower Australian women, make smart investments in our future and try to achieve genuine economic equality in the years ahead.