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Monday, 2 June 2014
Page: 5050


Dr GILLESPIE (Lyne) (16:16): I rise to speak on the Paid Parental Leave Amendment Bill 2014, which is an administrative bill unrelated to the proposed policy referred to in the previous member's speech. This legislation removes the mandatory requirement of employers to administer the government funded paid parental leave. From 1 July, the Department of Human Services will pay eligible employees directly, unless an employer indicates they wish to opt in and the employee wishes for them to pay the paid parental leave.

This is a policy we took in the lead-up to the 2013 election to make a number of changes to the existing paid parental leave scheme in order to lift the cost burden on employers, particularly small businesses. These savings in compliance costs to Australian businesses are estimated to be up to $48 million annually.

This government made a commitment to the Australian people that we would cut red tape and continue to implement measures that alleviate the various burdens placed on our small business sector. If we are to grow and strengthen our economy, we have to reduce compliance costs—it is self-evident. Complex red tape costs businesses hours and money off their bottom line. If we want to let small businesses grow, the best thing we can do is reduce their costs.

There has been a significant impact on a number of small businesses in the electorate of Lyne that have been forced to close. In a regional area the vast majority of our employers are small to medium enterprises. We have a few government enterprises that employ hundreds of people, a couple of large health contractors that employ many people and a couple of businesses in the manufacturing industry that have upwards of 150 employees. The vast majority are all small-business men and women with small numbers of employees. The costs of compliance and red tape really affect their bottom line, and that is precisely what happened under the previous government. The current scheme that pays $662 a week for 40 days is foisted upon the employer to administer, and that is what this legislation is addressing, not the issues that the member for Fairfax was referring to.

If we achieve what the previous coalition government achieved—the encouragement of small business—we should get our economic activity in the small business space up and bring the unemployment rate down, which currently in my electorate is close to six per cent and in the youth unemployment space is double that. If you are a small business and your compliance costs are over $1,000, that could be employing new young employees. The suite of measures that make up our paid parental leave will help reduce compliance costs, particularly for these businesses. It will allow them a lot more flexibility. We spoke about taking over the role of paymaster in the 2013 and 2010 election, and this amendment is just keeping faith with that.

The Australian Chamber of Commerce and Industry support these measures. Their CEO, John Osborne, has highlighted the increased cost burden that was placed on small business. He said:

Small business people should not be forced to be the unpaid 'pay-clerks' for government schemes. This responsibility should be funded and administered by government.

He went on to say:

The Abbott Government is trying to do the right by small business in cutting red-tape and the Opposition should support this.

The Australian Chamber of Commerce and Industry surveyed their members and, of the 1,700 businesses that participated, 84½ per cent either agreed or strongly agreed that the government should not require employers to be the paymaster for the Paid Parental Leave Scheme. Similar support has come from other peak bodies, including the Australian Industry Group, the Pharmacy Guild of Australia and the Australian Mines and Metals Association, who came out quite strongly during the 2010 Productivity Commission inquiry into paid parental leave.

To put things in perspective in these surveys, the Australian chamber did a different survey of small, medium and large businesses, and 501 businesses responded to the survey. Seventy-one per cent of respondents recorded additional costs as a result of this scheme: 25 per cent said at least one to two hours per month; 24 per cent said from three to five hours per month; 22 per cent, 15 hours or more. And the costs as a result of that are up to: $250 for some employers; from $250 to $1,000 for 21 per cent of the employers; and for up to 20 per cent of employers with large schemes to administer and with many people of varying situations, over $1,000.

The introduction of the Paid Parental Leave Amendment Bill 2014 honours our commitment to the Australian people to simplify things and let the government administer a government scheme. It is smart, it is sensible and it is important legislation that will reduce compliance costs. If there are employers that still want to administer it, by agreement, they can. But most people do not want the hassle of yet another scheme or another compliance burden on their business. It is part of our commitment to reducing red tape and I commend this bill to the House.