Abbott- Budget 2015-16 Child Care- Paid Parental Leave
Marie Coleman
Policy wonks like to talk about undertaking distributional analysis of any new policy proposalsspends 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.
Proposed Family Tax Benefit B cuts hit sole parents particularly hard- $7-10 per week, and a cut off
when the youngest child is 6 years old. The overall FTBB proposal actually is a disincentive to work.
By mid-day Monday the PM was offering to talk turkey on finding different savings- not least
because National Party Senators had begun to talk of publicly opposing the cuts. Labor has a
shopping bag of proposals falling on the wealthy and international tax avoiders.
The Treasurer scored the proverbial sandwich on Mother’s Day- announcing cuts to the
Government’s current Paid Parental Leave Scheme, which it inherited from Labor.
Again, proposal elements came out in dribs and drabs, with a lot of emphasis on alleged ‘double
dipping’. Never mind that the Productivity Commission designed scheme is intended as a universal
base complementing the multiplicity of different work-place entitlements offered by employers.
Some are as low as three weeks leave, others last for twelve months.
The government estimates that about 50% of (working) mothers, or 90,000 each year, will be
unaffected when the proposed new rules take effect because they have no employer-provided
entitlement.
Another 27%, about 45,000 each year, will have their employer provided leave entitlement topped
up to the current taxpayer-funded level of 18 weeks at the minimum wage, or about $11,500.
About 20%, or about 34,000 mothers, will receive only their employer entitlements because they are
the same, or more generous, than the publicly funded rate.
The Australian Chamber of Commerce and Industry, no fan of the original Abbott scheme, has
already said that employers will simply stop paying paid parental leave as such. They will roll their
dollar contributions up into related benefits, and the Commonwealth alone can pay for parental
leave.
Most employers manage the Commonwealth payment, and the proposed more complex calculations
may be a burden for smaller employers.
Tony Abbott has had frequent position changes on Paid Parental leave- but one remains constanthe has tried to sweep all Commonwealth and State employee parental leave schemes into his (now
abandoned) high cost scheme- planning was in hand through COAG. The Commonwealth alone has
over 40 such different enterprise agreements, at a minimum so would each State and Territory. Each
enterprise agreement has different levels of pay, and different durations.
Yet the bulk of women of child bearing age in the Commonwealth Public Service earn well under the
$90,000 per annum the Treasurer has been quoting as the cut off point for access to the (current)
Commonwealth universal Paid Parental Leave Scheme, which provides for 18 weeks leave at Adult
Minimum Wage. So too in State and Territory public employment.
Many enterprise agreements providing apparently generous maternity and related benefits have
been achieved through the employees trading off or foregoing other earning conditions to achieve
the enhanced benefits related to child bearing and family friendly work.
We can expect lower paid professionals such as teachers, nurses, and other emergency and health
workers to be very anxious indeed as to what the Abbott/Hockey/Corman attack on public sector
employees PPL means for them. Child Care improvements may be poor compensation.
The Nationals have noticed that the Government no longer seems to care about child care being for
child development as well as maternal workforce engagement, and that parental leave was designed
to help mothers have enough leave to bond with their babies, to improve maternal and child health.
Apparently mothering is no longer valued in itself. It has dropped from Government rhetoric.
Marie Coleman AO is Chair of the Social Policy Committee of the National Foundation for Australian
Women. She was a member of Implementation Steering Group for the (current) Paid Parental Leave
Scheme and of the group oversighting the legislative review.