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COMMUNITY AFFAIRS LEGISLATION COMMITTEE
(Senate-Wednesday, 19 May 2010)
PERRY, Ms Julia
CHAIR (Senator Moore)
GRIFFITHS, Ms Julie Ann Marie
COLEMAN, Ms Dinah
CAMPBELL, Ms Nicole Bernadette
COLEMAN, Mrs Marie Yvonne
COOK, Mrs Sandra
STEWART, Professor Andrew
CODINA, Mr Martin
BOND, Mr James Angus
DAVIS, Ms Catherine
DOVER, Mr Steven Robert
MacDONALD, Ms Terri
CARUANA, Ms Bernadine
RANGOTT, Ms Michelle Anne
WHALAN, Mrs Marion
GALBRAITH, Ms Amanda
RILEY, Ms Toni
SMITH, Dr Julie Patricia
WARBURTON, Mr Mark
LANDER, Mr Andrew
SANDISON, Mr Barry
SHELLEY, Ms Collette
SALVAGE, Mr Malcolm
ANDERSON, Ms Jody
COWAN, Mr Paul
- Mrs Coleman
Content WindowCOMMUNITY AFFAIRS LEGISLATION COMMITTEE - 19/05/2010 - Paid Parental Leave Bill 2010
CHAIR (Senator Moore) —Welcome. You all have information on parliamentary privilege and the protection of witnesses, and we have your submissions. I want to put on record the appreciation of the committee and the government for the work done by the National Foundation for Women through the consultative process, and also Ms Cook for the BPW for the work that your organisation has done. We appreciate the submissions that you have given us and also the long-term involvement that both your organisations have taken on this issue. I invite both organisations to make some opening statements. We will start with Ms Cook, because of the difficulty of telephone hookups. Ms Cook, would you like to make an opening statement?
Ms Cook —Yes, I would, and I will take this opportunity to thank you for inviting us to make a contribution to the inquiry. As an organisation whose diverse membership includes both employees and employers, particularly in the SME area, reactions to the exposure draft of the Paid Parental Leave Scheme Bill were diverse. However, BPW Australia has overall support for the immediate introduction of the proposed scheme.
In our original submission to the Productivity Commission back in 2008 we said that government funded PML requires all Australians, whether parents or not, to contribute a minimal amount to the first 14 to 26 weeks of the many of years of parenting, which we claim is a good start for children and is worthy of society’s support. Parents contribute enormously to providing the trained employees and the sustainable business owners that will pay the taxes and staff the facilities that all Australians will need as they age and retire.
Gender equity and the rights of working women are central to BPW Australia. We firmly believe that paid parental leave should be a basic right for working parents and should be viewed in the same way as annual leave, sick leave and other provisions. As the scheme matures in Australia, we would expect an extension of leave provisions to 26 weeks, given that research shows that longer paid maternity leave provides better health outcomes for both infant and parent.
My own recent experience while interviewing employees about gender pay equity confirmed that entrenched attitudes about women’s contribution to the work force—that they will only be there for a short time so they are not worthy of the same opportunity and investment—remain. We believe the inclusion of paid parental leave as part of standard employment conditions will facilitate cultural change to those attitudes.
Overseas research in countries such as Germany and New Zealand shows that women do return to work after paid parental leave. In New Zealand up to two-thirds of mothers go back to the same employer. Often they negotiate part-time work and more flexible working conditions. This is of particular importance to us as we remain concerned at the lack of quality part-time work in Australia, especially at senior and management levels. We have been impressed at the growing number of employers offering some form of paid parental leave, but many require an immediate return to full-time hours at the cessation of paid leave and this is often not the preferred choice. Evidence shows that when paid parental leave is combined with other practices such as flexible hours, part-time work, the provision of breastfeeding facilities and so on, women’s continued participation in the workforce is increased.
A change to work culture that embraces parenting as a part of the life cycle affects both employers, who have greater confidence that women will return, and employees, who do not have to feel guilty about having time off. The existing tension around paid parental leave must be recognised. We cannot stress enough how important it will be to have meaningful education opportunities for both employers and employees.
We know in Australia already that paid maternity leave improves female return-to-work rates, typically to the same employer, and up to 70 per cent return within 15 months. This is why we support the impost of having the employer as the paymaster. I spoke with one business owner yesterday who had minimal time off when she had her children because she had no alternative. She is highly supportive of paid parental leave despite the fact that it will have some administrative impact on her business. That is why we have emphasised the importance of the review and refinement of the scheme as it matures. We thank you for the opportunity to appear before this inquiry.
CHAIR —Thank you, Ms Cook. We will move to the National Foundation for Australian Women.
Mrs Coleman —As you know, we have been very supportive of the introduction of the paid parental leave scheme and we have provided you with a detailed submission. Yesterday, I emailed through to the committee an 85-page document, which Ms Perry had produced, rather than bringing it along today. It is a very useful background. Ms Perry, who has worked with us on this matter, has had extensive experience working in the Commonwealth on income support policy, including as director of parenting and family policy. As well, she has worked with the Organisation for Economic Cooperation and Development on a study of public policy and labour-force participation by sole and married mothers in OECD nations. That is the basis, indeed, of the document which I emailed to the committee yesterday. Ms Perry will make a brief statement. I should acknowledge my daughter, Dinah Coleman, who will also make a brief statement.
Given that the point of having a parental leave scheme is not only to enhance productivity through female workforce attachment but also to provide benefits to women and children, we are sad to see that there is not any specific statement of objectives in the bill itself which would clarify that it is of benefit on a number of accounts. Indeed, that also makes it harder to analyse whether the program actually meets its objectives once it is operating. What is spoken of but not in legislation does not always get undertaken—ministers’ second reading speeches, valuable as they are, do not have any legal standing in terms of a statement of objectives.
The proposed 18 weeks duration, which we accept as rational at this time, is based on the Productivity Commission’s recommendations. Along with a number of other people, we would obviously support a longer duration, but we are prepared to accept that we have start somewhere. To that extent, we believe it is appropriate to adopt the recommendations of this bill. But we would prefer to see a period of at least 26 weeks in the next tranche of improvements to the legislation. Clearly, we believe that if we are moving towards 26 weeks over a period of a couple of years, it is really essential to see the superannuation guarantee payment brought into play as soon as possible.
We have noted the views of the Sex Discrimination Commissioner on the importance of involving fathers as well as mothers. We note that the government has indicated that it proposes to look at the partner-specific leave as a next priority. Given that both parents can share the proposed 18 weeks—or 26 weeks, if it is extended—we would again point out that fathers would not lose if we prioritised extending the introduction of partner-specific leave to 26 weeks. But we do see that there is going to be a considerable need to promote the availability of paid leave, as it stands, for fathers because the rate at which fathers choose to take leave to look after a new baby is perhaps not as high as we might think desirable.
Our broad position is that we see this bill as an essential starting point, but we would look to future development of a nationally coordinated approach towards paid parental leave at income replacement level which will incorporate and build on this proposed scheme. We see as very important the protection of low-income, casual and seasonal workers. We see it as important that, over time, the Commonwealth approach subsumes and makes consistent the present confused picture of private and public sector parental leave schemes, which exist now. While we have no doubt that the scheme as proposed in the bill will be of great benefit to many families—often low-income families in rural and regional Australia, working in small businesses and on family farms—we think that there are problems for seasonal workers in the way the bill is constructed at the moment. Ms Coleman will comment on that.
We think that it is very probable that once this scheme is enacted and there are programs in operation—and we note that the government has agreed that it will not require employers to begin making the payments until 1 June, which gives the opportunity for putting provisions in payroll systems—there will be lots of changes beginning to emerge in terms of employer provided schemes, as they stand.
We have noted with interest the submissions from Professor Stewart, and from Professor Baird from the University of Sydney. We think that what is going to happen in terms of privately negotiated parental leave is going to be hard to predict. We want to emphasise, therefore, that we think it is important in policy terms that the Commonwealth stay well across the issues of what is happening in privately provided schemes. We are very concerned that the more the national Paid Parental Leave scheme is identified as solely welfare transfer for low-income parents the stronger will be the demands that other welfare payments be paid at the same level notwithstanding that the eligibility for these payments is workforce attachment. This is why we believe it is essential that the government establish a policy and administrative regime which emphasises paid parental leave as a workforce related scheme and which maintains a close observation of and even a capacity to influence emerging trends in private and public sector schemes. We have proposed that there should be a post of parliamentary secretary for work-life balance and parental leave as part of the machinery of government to bring about effective future development of policy and to ensure the interconnectedness of policy development across the health, welfare and industrial relations portfolios.
Ms Coleman —Thank you for giving me the opportunity to appear before the committee today. I would like to say that it is important for policymakers to have a real understanding of the conditions for families in rural and regional Australia and especially for those who are seasonal workers. In my submission I have described work in shearing sheds in New South Wales. Often work is hard to find in rural Australia for women and for young people and not all small country towns have affordable child care and the hours the centres are open are not suited to people who have to travel away from home for work or long distances each day. The eligibility clauses proposed for no more than eight weeks break away from work might not be realistic for some seasonal workers in the shearing industry, for instance. There are real physical limits to how far families can travel away from the home base.
In my experience in country towns the lack of school holiday care especially for teenagers is a real problem for women who do find work. I have read the submissions from Professor Baird and Professor Stewart and I think that the points that they raise, in particular with the National Employment Standards and the request for leave—which is not necessarily a guarantee so you may be eligible for paid parental leave, but not necessarily able to get that leave—are very valid. Also I wondered where it did leave women in the shearing industry and other seasonal work with a job to go back to—would they still have a position to return to after being on paid parental leave? Thank you and I would be happy to answer any questions.
CHAIR —Thank you, Ms Coleman. Ms Perry, thank you very much, the document which gave the international perspective was very useful.
Ms Perry —I did want to say that you do not have to read most of it because it is summarised. If you want to look up a particular country it is there, but it is the summary that is the most important.
CHAIR —It is very important to have it on record.
Ms Perry —I congratulate the government for implementing the Productivity Commission’s recommendations and providing very substantial assistance to women to take time off to have a baby. As Marie says the policy I proposed was 28 weeks wage replacement paid through up to a one per cent levy on payroll with a government subvention. It would also provide paid paternity leave and a payment to the parents’ employer and a period before the birth. This policy was not recommended by the Productivity Commission. I note that there is a similar policy now proposed by the opposition although I do think that the payment specific for fathers, the payment to the employers and the period before the birth are critical and I would appreciate the opportunity to discuss that further.
As Marie mentioned I had been involved in the Keating government’s policy on maternity allowance and that of the Howard government, which became the baby bonus later. Both these were intended as paid maternity leave for employed mothers and resulted in a government paid fixed rate payment to all mothers. Each time this is introduced it is heralded as ‘the first time ever’. Because of the complexities of meeting the wide variation in family circumstances and the political consideration of discriminating between women who had and had not been in the labour force before the birth these were paid as a simple lump sum payment. The current bill attempts to define eligibility to distinguish between working and not working before and after the birth and it becomes quite complex.
I wish to comment on a small number of issues in the bill. While it will fit the needs of most families it is those whose circumstances are slightly unusual where there could be quite serious, unintended consequences. In my view policy must be robust enough to cover such exceptions and the simpler the legislation can do this the better. My position is that we should trust families to do what meets the needs of the baby and not be too prescriptive. In looking at the length of this bill I am reminded that my last few years in the Public Service was heading a scheme to simplify the social security system. I think back to the baby bonus and, if you a woman in Australia, having a baby the attitude is, ‘Here is your money; you sort it out.’ It seems a little bit briefer than this current bill.
The proposal is to pay 18 weeks continuous at the minimum wage starting no earlier than the birth and allowing only 10 days work keeping-in-touch provisions during the period. The mother must have been engaged in work for a total period consecutively for 10 months of the previous 13 months prior to the expected birth with a break of no greater than eight weeks. That is the proposal. Out there are numerous families that have financial commitments, particularly housing costs, so tight as to require the mother’s usual income. Sometimes the mother is the primary or only earner; sometimes the secondary earner. Many are currently prevented from having children because they cannot afford to lose this income for the period and they have to choose between a house and a child. Others return to employment much earlier than is in the interests of themselves or the child. There are also families I have come across in my research where the father takes on a second job to compensate for the income lost. There was one where the father says that the only time he sees his baby awake is on Sunday afternoons. This is very difficult for family-functioning all around. It is difficult for a nursing mother to have a complete absence because the father is working himself to the bone to try and make up for the costs. I would also like to point out that 27 per cent of working women aged 20 to 34 and 25 per cent of mothers of dependent children are in casual employment and have no paid leave entitlements.
There are a few questions I have there. What happens to women who become pregnant while still on paid or unpaid maternity leave from the previous pregnancy? It is important to note that a relatively high percentage of pregnancies are unplanned. What happens to women who, because of their health or that of the foetus, or the conditions of their work or the workplace, have to leave substantially before the birth of the child? Very few women are in fact able to work to the day of the birth. If they are casuals who do not have sick leave entitlements there is no income coverage for that period. What do they do? In the 50 European and OECD countries I researched only one does not have a period of leave before the birth.
CHAIR —Switzerland, which is surprising.
Ms Perry —Yes, they are tough there—they do not like women. Fourteen have a workplace with benefits where pregnant women who do certain types of work that are dangerous or who are in dangerous workplaces are allowed time off or movement to other work and they are compensated for the income loss.
My next point is that, in relation to the post-birth period, with a lump sum entitlement as in the maternity allowance baby bonus, families can arrange their period of leave. They can arrange to spend it according to their circumstances. Some in tight financial circumstances are able to make ends meet by taking a shorter period off but financing that through the lump sum. Others kind of spin it out. There are a multitude of ways that people cope at present.
This is a larger sum of money but it precludes you working more than 10 days in that period. You cannot say, ‘If I can go back to work one or two days a week and my mother can look after the baby, we can pay the rent or the mortgage.’ You cannot do that. It is proscribed. This is the sort of example where there is a view of exactly what all women will do and yet there is just so much variation that I really do not think it is flexible enough. Loans are not available because expected income precludes the ability of families to borrow. In fact, I would support Bruce Chapman’s loans scheme in the absence of anything better because at least that might allow you to get some money to make it work, but I would prefer a proper scheme.
The leave would obviously be taken by the primary carer, the mother, in a continuous period, but there is a list of complex rules containing what leave might be taken by whom. There are so many permutations out there of roles that can be played by opposite sex or same sex partners, grandparents, other kin or friends. You find the most extraordinarily convoluted arrangements that people have. I really do not see why the arrangements cannot be left to families to work it out, provided it does not exceed the entitlement.
The period of work before the claim has to be consecutive days. You really cannot predict that you might suddenly find you have placenta praevia and have to lie down for eight weeks before the birth. You might have had reason to not be on leave, to be away from the workforce. Why does it have to be consecutive? We are saying that it has to be more than getting a job because you become pregnant only to get the leave. It may be for the convenience of employers. I do not see why Family Assistance Office cannot calculate it.
I have two more quick issues. The income test of $150,000 a year applies to the financial year ending before the claim. Clearly that is not going to be the income of the financial year in which you have taken a substantial period of paid leave. I have no objection to a means test in principle, but income testing people is quite administratively onerous. I do not think that the income test will save more money than it costs to administer on all the applicants to rule out such a short number. Also I have a problem with an income test that is for the previous year and before the change that causes the income loss.
One other group—this is rather similar to Dinah’s issue—is unpaid family workers, where the woman works full time on the farm or in the small business without pay. When she is absent somebody has to be employed to do her job. There is a real income loss there, because there is the loss of the value of her unpaid work, which is expressed in the cost of replacement. I would be happy to answer any questions.
CHAIR —I welcome the women from the Australian Local Government Women’s Association. We are very pleased to have you. Is there anything you would like to add about the capacity in which you appear today?
Ms Campbell —I am also a mum—of Francoise.
CHAIR —Francoise should be on the record as well! Councillor Griffiths?
Ms Griffiths —I am from Blacktown City Council. I am also the manager for the private sector of the United Services Union.
CHAIR —We have your submission; thank you very much. Would either or both of you like to make a statement?
Ms Campbell —We will just make a brief statement. Firstly, apologies for our lateness; we were held up with prams at security.
CHAIR —Yes, it looks particularly dangerous; I can see that!
Ms Campbell —We are delighted to be able to participate in the inquiry and we are very pleased to provide a submission. The first thing we would like to say is that we commend the government for establishing a paid parental leave scheme. We have some issues that we will talk through. We also recognise and acknowledge the efforts of other political parties in recognising the importance of paid parental leave schemes. It has been a long journey, and it is great to see that there is tripartisan support for supporting parents and their young families.
ALGWA’s role, as you would have seen from our submission, is actually about supporting women in local government, whether they are employees of local government or elected councillors. Julie and I are both elected councillors. So we have a general role in furthering women’s understanding of how local government works and encouraging women to run for local council. As you know, we are appallingly represented at that level of government. One of the important aspects of ALGWA is to take action in relation to any subject or activity of particular interest to women affecting local governing bodies or local government legislation. That is the context in which we put our submission forward.
ALGWA as an organisation looked closely at the Productivity Commission’s report as it was being developed. We started a campaign in 2008 based on the time frames that came out of the draft report from the Productivity Commission. That was for 18 weeks paid maternity leave and two weeks paid paternity leave for all local government employees. The New South Wales local government employees’ award currently allows for nine weeks, and that has the capacity to be taken at half pay. It was effectively a doubling of the existing award entitlement. The New South Wales local government employees’ award is being renegotiated this year, in November.
ALGWA’s campaign has actually been reasonably successful. Local government in New South Wales is a very significant employer. We have some 70,000 employees in the local government sector, so New South Wales is a big player nationally but also across the state in terms of government employees. Councils are autonomous policy-setting bodies in their own right. Some of the councils that have adopted ALGWA’s campaign of 18 weeks at full wage replacement with super and the two weeks paid paternity leave are my council—Ryde Council—Gosford Council, Wyong Council, Ashfield, Leichhardt and the City of Sydney. Some of the other councils that are not quite at 18 weeks but certainly above the award are Blacktown Council—Julie’s council—which is at 14 weeks; Marrickville, also at 14 weeks; Orange, 14—this also includes the two weeks paid paternity leave; Penrith, the same; Port Stephens, 12 weeks; Wollongong, 12 weeks and Hawkesbury, 12 weeks.
We take the view that, like Francoise, from little things big things grow. We will be continuing our campaign across the local government sector in New South Wales. As I said, the Productivity Commission’s report was a great catalyst in focusing people’s attention on what could be done in local government land.
Within the local government sector there are always arguments about whether we can attract and retain quality staff and keep our staff working. Our submission has quite a local government focus, as I said. I certainly appreciate and endorse the comments made by the earlier speakers. There is such a diversity of roles for women. It is important for all of them to be considered.
We have proposed in our submission a number of amendments, many of which are common to a large number of the submissions that the committee has received. We obviously would like the period of paid maternity leave to be flexible enough so that it can be taken at half-pay for 36 weeks as opposed to just 18 weeks. Like many of the other respondents, we recognise 18 weeks is a terrific first step. We see that as the minimum benchmark and not the maximum. We would be looking for the government to grow this, particularly with the program review, to have 26 weeks, to have the capacity to have it at half-pay, to certainly recognise the important role of fathers and implement the two weeks paid paternity leave which was recommended by the Productivity Commission, and to have it at full wage replacement so that there is not the income loss.
The earlier comments are absolutely relevant in terms of the shortfall for some women. I live in Sydney, and buying a house there is extremely expensive. I am just a working girl; I am not a millionaire. It does require both parents to work full-time. It is very difficult to keep things ticking over. That is why the full wage replacement actually does allow you to plan for your families. Families, quite frankly, should not be something that you have to seriously squish in around managing your mortgage payments. That is not how life should be. It should be celebrating and welcoming future Australian contributors to our economy. We should not actually have to be in this awful situation where you really have to think, ‘Can I afford to have another child?’ It is not asking for anything extra; it is just asking to maintain the status quo of what you have.
One of the issues which we are concerned about is how the paid parental leave from the government will interface with existing industrial arrangements. This has become particularly pertinent for us in New South Wales with the renegotiation of the New South Wales local government employees award. We have actually had—and I have correspondence which I am happy to leave with the committee—some interesting discussions about how this might work. There is a lot of confusion out there. Some councils are quite concerned. There is a lot of almost aggressive language being thrown around with regard to double dipping or getting paid twice. So if there is an existing paid parental scheme, whatever it is, if anyone says, ‘Here’s another opportunity to access paid parental leave,’ it is like: ‘You can’t have that. You have this. We’ll get rid of our system because that’s there.’ It is almost hostile. That is really disappointing.
The best paid parental leave systems are ones where government and business are working in partnership to ensure that their employees are supported at this very important time. It should not be either/or—either business funds it or government funds it and there is no happy marriage. There is opportunity for business and government to work together. In that regard, one of the points we make in our submission is that we need to make sure that those employers that have existing paid parental leave schemes continue those arrangements and are encouraged to continue those arrangements. The Productivity Commission talked about businesses with an existing paid parental leave scheme as doing it as a point of differentiation, and they absolutely did. They saw the value of investing in their workforce and retaining their employees. There is no doubt at all in my mind that this scheme, whilst very welcome, will certainly mute, to a degree, that point of differentiation to an extent that a business might actually say, ‘I’ll scrap it now.’ That would be a shame. We would like to encourage the government to consider further opportunities arising through the review of Australian taxation and how business might actually be supported. If they are already doing good things and supporting their workforce then what more can we do to actually help them? I think there is scope for that.
The concern we have with regard to the dropping out of participation is significant in terms of local government, and that is something we are certainly happy to take further questions on. I have correspondence which I will leave with you. The question is: how does this scheme interface with arrangements which are under state jurisdiction control rather than under the Fair Work Act? And also, in terms of the public communication campaign for employers and the public more generally, we really need to be clear about what this scheme is. It is not a pseudo award entitlement. It is a paid parental leave scheme that is government funded and will be administered by employers. That is separate to the negotiation of employee entitlements. There is obviously a workplace issue—it is work related—but it is separate to industrial award negotiations. I think there has been a muddying of the waters, and that could potentially be to the detriment of people working in, for example, local government. Somebody working in local government right here and now could be entitled to access the baby bonus or part B of the family tax benefit and might choose to opt out of the government’s paid parental leave system for their own reasons—whatever those reasons are. If somehow, at the expiry of an industrial agreement—like, for example, the New South Wales local government employees award—there is this idea that you can embed the government scheme as part of the industrial—
CHAIR —Excuse me, Ms Campbell. We are just going to check whether anyone has any objection to being filmed.
Ms Campbell —No, that is fine.
CHAIR —I think one of the reasons we are being filmed is baby Francoise, but that is cool.
Ms Campbell —She is very pretty.
CHAIR —We are happy with that, but I just wanted to make sure that you have no objection.
Ms Campbell —The importance for us in terms of local government employees is that it is very clear. Then we can give advice back to our members and continue our campaign at councils and say: ‘Look, this is not double dipping. This is not somebody being sneaky and somehow manipulating the system to get paid twice. This is actually an existing employee entitlement in local government land, and here is a government scheme as well that augments that. That is terrific and wonderful, because we want to support our working parents. Let us continue to work together.’ But I think there is a danger that a negative vibe is occurring, and we really need to address it. I think that public education campaign will be critical. We certainly think existing employers should be encouraged to continue their arrangements. It will be a very important aspect of the programmed review. It would be a great shame if we saw a real drop-off in employers that have already recognised the importance of such schemes.
CHAIR —Thank you. Ms Griffiths, do you have anything to add?
Ms Griffiths —Thank you. I will make mine short and sweet. As you can tell, I have caught the flu. I concur with all the parties that are here today. I come from a very local level. In 2001, I was campaigning for paid maternity leave for the local government state award—which we got up. It was the best day that we ever had. We have many women out there in local government who were struggling to be able to take maternity leave and then return to work. There were difficulties around the types of work that they had to perform and whether they could take the time off.
I will give you an example of a particular director in the council. This director and her husband were having their first child and decided that the husband would have the time off to care for the baby while the director worked. The husband had an accident, a serious accident. They had two mortgages and they had two cars. What ended up happening was that they were so disadvantaged that the director had to come back to work within three months because her husband was severely injured. So the income replacement is absolutely significant for women of today.
Also, there is the difficulty, which Councillor Campbell expressed, regarding local government. At the moment, because the federal government has announced the paid maternity leave scheme, a lot of local government bodies seem to feel that they can opt out of their current industrial arrangements. We have written to the Deputy Prime Minister about this; it is a really big concern. We were of the understanding that one would balance the other and that the current payment through the local government awards or the industrial instruments would be maintained whether they were in the private sector or local government. We felt that that would work towards the ILO convention’s paid maternity leave scheme as well, and I am concerned about it.
I am also concerned about superannuation. I asked Minister Macklin about that. I asked whether an element has been put into the whole project regarding employers paying super. The advice I received was that they did not have to pay super as part of the government’s maternity leave scheme. I would ask that you take that into consideration, hopefully as a recommendation. Even though it is a minimum wage, we are so far behind the eight ball now regarding retirement age and having an income when we retire—and we are already being told that we are going to be disadvantaged by the time we retire and living on the poverty line—that any little bit that we can get—and I will take a big bit—I would really appreciate. I will stop talking now because I will lose my voice. I thank you for the opportunity here today and I am looking forward to any recommendations that may come out of the committee.
CHAIR —Thank you, Councillor Griffiths.
Senator HANSON-YOUNG —It is encouraging that everybody at the table here today has said that we need to be looking towards extending the program whether that be the length of time up to the 26 weeks, or looking at whether the minimum wage is really the appropriate benchmark, or replacement income. I think that is a message on this issue that needs to be given directly to the government. As for the superannuation issue, I agree with you. It is totally ludicrous that it not be included in this scheme and, just to let you know, I will be moving amendments in relation to that.
Concerning the relationship between this legislation and the existing paid parental leave schemes that some businesses and companies have taken on board—and I put this to the various business groups who appeared last week—I am concerned that there is nothing in this bill at the moment that is an encouragement for those employers to continue. It is pretty concerning if already, even in local government, those negotiations are up for grabs at the moment. Really they should not be. Perhaps, Ms Perry or Marie Coleman, you could give us some indications about what we could see in the legislation to be a disincentive for existing businesses to dump these schemes. At the end of the day they are going to be looking at their bottom line, aren’t they, and I think we need to be realistic about that. How do we stop them from doing it?
Ms Perry —There are different reasons why they do it at the moment. One reason is that it is much easier for large companies, because it is not very expensive to provide paid maternity leave. But it is a shock when you are a very small employer with two employees and you are going to have to pay one of them for nothing. But with the likes of AMP or Westpac, they can factor in 1½ per cent of their income to be used for maternity leave because two per cent of their people are going to take maternity leave in a year. So for large business it is much easier to budget and plan for.
They do it, too, for a point of differentiation. When there are only a few employers providing paid maternity leave they are doing it to out compete other people, so I am not quite sure about the retention aspects of a universal system. I just do not really see the logic in how a universal scheme is going to do that when it is basically a competitive thing.
But I have also come across a number of small businesses who pay paid maternity leave because they just think they cannot not do it—they value their staff and are acting on a moral basis by doing it. Given the state of them at the moment, if the government said, ‘For anyone who has a paid maternity leave scheme, the government is now going to force you to continue you that,’ that would be the end of any kind of altruistic measures, particularly with respect to the latter group of people who are doing it because—
Senator HANSON-YOUNG —How do we encourage and provide incentive for that partnership? If a woman is being paid only the minimum wage under the government scheme, yet currently in the enterprise bargaining agreement that they have got she would be paid replacement for 14 weeks, how do we ensure that that is actually the top-up as opposed to it simply going back to getting only the minimum for the 18 weeks—which is obviously not going to be better?
Ms Perry —I think that actually saying so would be a very good idea. I do find a problem where the government does not seem to talk to us. Having been inside the government, it is a different perspective to be outside it. The government did not counteract the claims that global warming was rubbish. The government does not understand its power, its influence, in making statements. This is why a statement of intent and a statement of objectives should be in here that clearly says that this is an adjunct to existing schemes—something where, in your negotiations, you could say, ‘The government says it is only carrying half the burden and it is expecting you to carry the other half.’ Legislation which tries to control every aspect of someone’s life is not necessary but what is necessary is promotion of a culture. I would love to see that lesson be taken up by the government—just talk to us and show that kind of leadership.
Senator HANSON-YOUNG —So you are saying that the intent of this—being that the government is providing a base level for a universal scheme which is not meant to be at replacement or the cost of existing schemes—is not effectively represented or even communicated in this?
Ms Perry —In many acts there is a statement of objectives about what the act is intended to do, and you can come up and say, for example, that clause 380 is a problem in terms of your objectives. But with this you cannot do that. There is no reason, for example, to have 295 consecutive days except for a 68-day break. I do not know what that is meant to achieve, so I do not know how to argue against it—it is just there. So I think that having a statement that says something along the lines that this act is intended to supplement provider-based and it is intended that employers have a role to play clarifies issues.
Senator HANSON-YOUNG —It would be nice to see an explanation or a commitment to further extending the program as well. That is what I would like to see.
Ms Perry —As you know, Senator, I would prefer a scheme where there was a mandatory payroll based levy on employers. I think it is the employer’s role to pay. I am very concerned about creating disincentives to employ women by putting a risk on young women of workforce age when you are going to take them on. Small employers have said to me, ‘If they bring in paid maternity leave, I am never employing another woman’—and I say, ‘You don’t understand my scheme.’ There is already discrimination against women, so I really do not like the idea of an employer top-up on an individual basis as the ultimate goal. But, why we have it, I would not want to discourage it.
Mrs Coleman —I would add that in this business of trying to talk to society about what we are trying to achieve, that is another reason for us arguing that there should be at the minimum a parliamentary secretary who is pretty much devoted to the promotion of the government’s objectives. I think that is really quite important. It is very hard for an extremely busy minister, with a vast portfolio, to give enough attention to getting this thing bedded down.
CHAIR —Anyone from the local government association on Senator Hanson-Young’s question?
Ms Campbell —I just wanted to reiterate the point that in local government we have had paid maternity leave provisions since 2001. That is when the nine weeks came in. I think a little bit of the confusion that has been created is feigned confusion. I think it is opportunistic actually. At our conference in 2009, the local government association actually put forward a motion, which thankfully was not passed. It was not debated. It was decided to let the executive kick this around and nothing has come out of it yet. I will read you the motion because it goes to the heart of how the scheme could potentially be used to erode existing arrangements. This was the motion from the executive: ‘That the Local Government Association supports an increase in the future award’s paid maternity leave provisions to 18 weeks on full pay or 36 weeks on half pay where such increase in the award entitlement does not apply in addition to the benefits provided by the federal government’s paid maternity leave scheme.’ That means you have got a very large employer in New South Wales that has been involved in implementing a paid maternity leave scheme for some nine and a half years now making it very clear that their agenda is to get out of this. I think that is really disappointing. That has been an alarming position taken by the executive of the Local Government Association.
Senator HANSON-YOUNG —Especially in the absence of a government scheme that is offering everything that it needs to offer. It is not long enough. It does not give replacement income. I take Ms Perry’s comments about that. In the absence of a scheme that is really delivering what parents need, we cannot be seen to be putting forward a scheme with a communication strategy from the government that does not make it very clear to existing employers who have schemes that they can get out. This scheme does not deliver enough for them to do that. There are women who are going to be worse off.
Ms Campbell —Very much so, particularly in local government.
CHAIR —Ms Cook, do you have any comment on Senator Hanson-Young’s question?
Ms Cook —I would just like to confirm everybody’s comments about the need for clarification. I actually agree that there is a degree of feigned confusion. I think there is already a degree of hostility around the whole concept of paid parental leave, so any campaign that we need to get out has to be extremely clear with really clear objectives to counteract the very negative opinion of most employers out there who offer paid parental leave in the SME sector.
Senator ADAMS —Thank you all for your submissions. They are very interesting and I think you have shown the practical aspects of the difficulties within the schemes that are actually out there, what is going to happen and where we go in the future. You have done that very well. Ms Coleman, having been a farmer for many years and dealt with a number of contractors and the intermittent employing of people, would you like to elaborate a little on how women will be able to be eligible if the work has to go on consecutively? With the shearing contractors we have wet sheep and, as far as the horticulture area goes, you cannot pick fruit when it is raining. There are all these issue and because it is physical work the women will not be working right up to term. I know I worked as a midwife until I was four weeks from having my first child, but it got to the stage where I was going to be the next patient. That was in a different area, but I could not have worked like that on the farm, in the sheep yards or doing anything heavy. Would you like to talk about the difficulty for those people?
Ms Coleman —Yes, I think there is a real difficulty with the eight-week section, because as you say working in sheds is very hard, physical labour, even working as a cook involves very long hours. You frequently work 10- to 12-hour days and are on your feet all day. It is not necessarily easy to stay to full term when you are pregnant. As you say, there have not been wet sheep so much of late, but hopefully there will be wet sheep again and that could involve quite extended periods of time. Also, the shearing industry has an off season, as in other seasonal work, and we might have sit-down time, as it is called in the industry, and you have to look for other work. I was fortunate enough to get other work in droving—I used to take the children droving—and I had farm work to attend to at those times. But it is a real factor and hard to maintain continuous employment.
Senator ADAMS —The other point, which I think you raised, is that the wife probably works on the farm doing unpaid work and once she has a baby someone else has to be employed, so that is another complication. The other point is about acting as a paymaster. I have had a number of small businesses say, ‘This is a government problem; the money should be paid from the Family Assistance Office.’ Would you all like to comment on that, because small business is taxed enough without trying to deal with this issue.
Ms Perry —The reason I support the idea of a parliamentary secretary for this issue is that it is a business issue, an industrial relations issue and a health issue. At the moment it is in the social security portfolio, which underscores the fact that it is a social security payment. It is seen as welfare and, as welfare, it has a lot of problems because it is not based on income need. I think it is necessary to do whatever is possible to take it away from the idea that it is a welfare thing. It is paid by government on a means-tested basis. It is socialist; it is welfare. With regard to the kinds of lengths there are to get the payment through the employer, I know why that has been done but I think it is an incredibly complex system to achieve that kind of semiotic end. In complex cases, particularly, where I would like to see a grandmother stepping in—all the various complex things or where people were not going to take it in one lump—I would like to see an option for payments by the Family Assistance Office. If families and babies are going to be significantly constrained because of the problems for employers, I see no reason why there should not be an alternative where that will occur.
Ms Campbell —We do not see an issue, and it has not been raised within local government as a barrier to local government administering it; that is not the issue. As I said, the alarming thing is that they want to get out of administering what they are currently already committed to. But, in terms of the machinery to set it up and do it, that is not considered an issue in local government.
CHAIR —I will come back to you. BPW, you have members who are employers as well. I am wondering whether you have an answer to this question.
Ms Cook —Yes, I do. I certainly do not think that they like the idea but, surprisingly enough, we have not had a really hostile reception to it. I think that ultimately they can see the benefit of it and, as much as they never like to do one more thing, they will in fact take it on board. People throw their hands up and say, ‘We’ll never employ another woman,’ but we heard that when leave without pay was introduced for women. I think they will not like it but generally they will put up with it if they have to. That is what I hear from the members who have contributed.
CHAIR —Thank you, Ms Cook. Councillor Griffiths, you wanted to say something.
Ms Griffiths —Thank you. From a payroll perspective, local government have the ability to generate the payment based on their systems. Some of the smaller businesses might not have such a facility to administer it. Whether or not they would be able to do it would have to be taken into consideration. The only thing that really concerns me about a lump sum payment is: will it actually go to the child or to the family or will it be dispersed in another way, which would be to the detriment of the family? I would ask that, whoever is going to administer it, it be paid on a weekly or a fortnightly basis not as a lump sum, because it will be used for a mower or a whipper-snipper or something else and not the child.
CHAIR —There has been a lot of evidence in previous times around that issue.
Senator FURNER —I have been asking this question consistently and it is in regard to the 10 keeping in touch days. Do any of you foresee any issues associated with returning to work during the leave period for those keeping in touch days in any shape or form?
Ms Perry —I do not think they should be prescribed. They should be left to the employer and the employee. I think very few women would want to go back to work in the first 18 weeks if they could avoid it, but I would like to see it able to be broken. If you have something which you have to finish and only you can do it and you can take that time back or if you want to work a little of that time because you have to to make ends meet, I do not want that prescribed. I think it should be left to people to do what they need to do within the entitlement.
Senator FURNER —Do you have an issue with it being consensual; that both parties consent to performing those 10 days?
Ms Perry —It should be consensual by both parties. They are going to be able to work it out a lot easier than the Family Assistance Office is.
Ms Campbell —We have not had feedback from our members or from the Local Government Association that that is an area of the bill that is of particular concern.
Ms Cook —We have had feedback from several who support the idea that it is consensual. The general idea that we want from this bill is to give women every opportunity to stay connected to the workforce, and that is the reason that they like it because it gives them the ability to keep their hand in and not be treated like a leper when they return to work after having had no contact at all.
CHAIR —Senator Fisher, one question.
Senator FISHER —I am not sure which of you reflected that you felt there was concern, particularly in the business community, about paid parental leave—one of you did. How do policymakers prevent legislation like this from compounding that employer concern, if I can put it that way, and ensuring that the result is as intended, whatever that may be? Some of you have already given evidence about the lack of comprehensive objectives set out in the legislation. How do you prevent a legislative scheme, as reflected in this bill, from effectively compounding that employer concern? More particularly, how do you prevent it compounding that employer concern if you try and legislate to stop employers from letting this scheme replace whatever else they may be providing at this stage?
Mrs Coleman —What we are dealing with here quite often is a decent strategy of communication with employers, quite frankly. There is always confusion and alarm when anything new is introduced. That is just human nature. We have heard the words ‘some feigned confusion’. I think one has to have decent communication strategies in place and real genuine provisions for making sure that you are in contact—if you are government you are trying to run the thing—and listening to the actual experiences of business as much as you are listening to the feigned confusion, because the two things are not quite the same.
I am very much aware, for example, that when the superannuation guarantee program was introduced it was widely advertised that this would lead to the collapse of small business and probably of Western civilisation. In fact, what it has done is lead to the establishment of a very large and very profitable industry with significant investment funds which greatly enhance the working of the Australian community. I think we have got to work on the basis that there has got to be a lot of cooperative work going into this.
Attitudes to maternity leave and parental leave are always mixed in the community. I have something here from an opinion poll we commissioned 12 months ago, which I think is still consistent with a lot of current attitudes. There are age groups which are very supportive. There are gender groups which are very supportive. There are others which are not. There is natural apprehension among employers about something new coming in. I think we have to have a good, solid working program to help people bed things down in their payroll systems and the like, and we have to really listen so that if there are problems identified we can do something about them.
CHAIR —Local government, do you have an answer to the senator’s question?
Ms Campbell —I absolutely endorse the comments made by Mrs Coleman because the communication strategy is key to taking business on the journey and the dialogue. Also, for those businesses that have already got their existing paid parental leave provisions, it is important to explain what this scheme is and how it might interface with what they already have. I think there is also scope within government to consider some incentives for those businesses that have schemes and support them in continuing and growing those schemes. As I said, it is a welcomed start to a longer conversation with business and employees.
Ms Griffiths —In regards to the communication strategy I think we have to really sell to the employers, even to small businesses, that this is a good scheme. There are great opportunities here for retaining staff and a lot of people today say that they struggle to retain people. I think that if we can implement a great strategy where we raise retention as a positive and not a negative—because there is a lot of negativity around it—and stay positive about what the benefits will be to a small business, a large business or whatever, there are plenty of large businesses that can reiterate what the benefits have been for them.
The only other issue was the difference in income. In local government there will be a significant difference between what women currently earn in their job, even as a childcare worker, and what the minimum rate would be. There are quite significant differences. In small business there may not be such a big gap. There is a lot to consider and I think that we really need to move around how we can support each other, support business and really move away from money. I am tired of hearing about money. We are talking about children’s lives, we are talking about families and if we can support them I think we should do that.
CHAIR —Ms Cook?
Ms Cook —I would certainly endorse and stress the idea of communication, and I do believe that we need to take that research and those businesses here that show that retention rates after parental leave are very high. We also need to embrace the employees and see if we can promote a dialogue between the businesses who are fearful and employees, and get them to realise that it is a journey for everybody through their work and not payment to a woman for having a baby. If their communication can address that I think it will go a long way for small business in changing their attitude.
CHAIR —Thank you, Ms Cook. Senator Fisher?
Senator FISHER —You have spoken about communication. Does this communication from the government do the job? Given that it has been written before the bill has been passed, does it risk exacerbating the negativity, for example, that you have just spoken about, Ms Griffiths? Is it too early to put this information out, given that the bill is not settled and given the sorts of questions about the bill that your organisations have identified as being left unanswered?
CHAIR —Councillor Griffiths, would you like to answer that?
Ms Griffiths —Thank you. My answer is pretty simple. Remember, we have been going on this journey for a long time. Many reports have given exactly the same information. I would say that the information you would find in a book would go part way to addressing some of those issues. I think that you will always find that we are on an evolution: things are going to change all the time. As soon as you print a book there is already an amendment to go in it. The documents you held up are documents that—
Senator FISHER —So I gather you have not actually seen them. I should have asked whether you have had an opportunity to see them.
CHAIR —They have not been distributed, Senator.
Ms Griffiths —No, but what I am trying—
Senator FISHER —They have been distributed to us.
CHAIR —You are not in the business world, Senator. Councillor Griffiths, have you anything to add, because we are rapidly running out of time.
Ms Griffiths —I will finish up there, thank you, Chair.
CHAIR —Thank you so much. Thank you, all, very much: to Ms Cook for the extra stress of being on the phone—I know that is difficult; to the Local Government Association for your ongoing work; to Francoise for being so well behaved; and to the National Foundation for Australian Women, again, for the work that you have done on this issue for so long.