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Monday, 31 May 2010
Page: 4528


Ms RISHWORTH (12:25 PM) —I rise today to support these very important bills, the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010. This is Australia’s first national Paid Parental Leave scheme. It is integral to providing the necessary support that parents expect and deserve. It is increasingly difficult for parents to balance work and family commitments. This is echoed time and time again in my electorate. Complex modern life does make it difficult to balance work and family commitments. Paid parental leave is one of those things that will go a long way to alleviating some of the financial pressures that families are facing.

The introduction of paid parental leave in this country has been a long time coming. We know that for many years Australia was one of the few nations in the OECD that did not have a paid parental leave scheme. So I am very proud to be part of a government that has acted so that parents can receive the benefit of paid parental leave from 1 January 2011. This is in stark contrast to the previous government, who actively opposed paid parental leave for the 11 years they were in office. Indeed, if we believe some of the reports about the coalition party room coming out in the media, there are still people in the party room who oppose paid parental leave.

Paid parental leave is a good thing for employers, a good thing for employees and a good thing for children. The introduction of the Paid Parental Leave scheme will assist employers to retain experienced staff without a significant cost burden on business, especially small business. For employees it provides job security and ongoing connection with their employer but also flexibility at that critical time when a baby is born. Most importantly, the scheme ensures that parents get the opportunity to stay at home with their children in those vital early months just after the birth of a child. As evidence continues to show, this is a critical time for a primary caregiver to be at home with their child. The scheme is designed to be flexible, being available to either mothers or fathers, and allows for the primary caregiver to transfer unused parental leave pay to their partner, ensuring that there is flexibility to meet differing family arrangements. While I recognise that there will be many more women choosing to take paid parental leave, this flexibility does allow individual families more options. It allows them to really look at what works best for their family.

The government’s paid parental leave initiative is fair for employees and fair for families, so these bills are very significant. Many parents in my electorate have not previously been lucky enough to work for companies that have offered paid parental leave as part of their employment contract. This has often been the case for casual workers, who have experienced financial stress when having a baby because of the cessation of the second income. Many mothers have told me that they have had to return to work earlier than they would have liked because of financial pressures on their family.

The Paid Parental Leave scheme before the House today is the government’s response to the Productivity Commission’s report into paid parental leave, entitled Paid parental leave: support for parents with newborn children. The Productivity Commission reported that there were compelling reasons for a paid parental leave scheme, including the improved wellbeing of families and, in particular, child and maternal health. It found that such a scheme encourages women to maintain their lifetime attachment to the workforce, improves gender equality and ensures that there is an emphasis placed on the balance between work and family life.

The government has accepted the recommendations of the Productivity Commission to balance the interests of both employers and employees and develop a scheme that is affordable and responsible and does not put all the burden onto employers. That is why the government accepted the Productivity Commission’s recommendations that a paid parental leave scheme be a government funded scheme that pays parents for a maximum of a continuous 18 weeks at the federal minimum wage, currently around $543. To be eligible for paid parental leave a person must be the primary carer of a newborn child or adopted child and must have been in paid work. Paid work is defined as being engaged in work continuously at least 10 out of 13 months prior to the birth or adoption of a child. That person has to have worked at least 330 hours in the last 10-month period. This means that parents may be regarded as working continuously if they have worked part time or casually, if they have had multiple employers or have recently changed jobs. This government initiative provides a realistic test and accommodates real-life situations, which include a mobile workforce. The scheme will mean that people who are primary caregivers who earn less than $150,000 in a financial year will be eligible for the Paid Parental Leave scheme. Importantly, as I have already mentioned, the parental leave is transferable. The paid leave period can be taken at any time in the first year after the birth or adoption.

The government’s Paid Parental Leave scheme is due to start on 1 January 2011. This is really important to a lot of people in my electorate, as I am sure it is around the whole country. It means that couples who fall pregnant now will know that they will be able to get access to government paid parental leave at the time of the birth of their child. From 1 October 2010 parental leave may be started to be applied through the Family Assistance Office, which will ensure that parents will be able to put the wheels in motion.

The scheme the government has announced does not put undue burden upon business and imposes minimal new costs. The government will fund employers to pay eligible long-term employees as part of the scheme who have been employed for over 12 months. The Family Assistance Office will ensure that funds are made available to employers in advance of the provision required of them to pay paid parental leave, which will ensure that paid parental leave payments will be made available in the usual payroll cycle. This initiative provides long-term benefits for business, keeping that parent who has had time off work connected with their employer, connected with their career, and promoting their return to work after the paid parental leave has concluded. This is very important for employers. A lot of employers talk about the cost burden when a person might leave the workforce, the training costs associated with skilling them up. There are a lot of very good employees out there and employers want to have provisions that ensure that they can hold on to these employees.

In terms of practicality, it is not in the hands of the employers to decide who is eligible. For my electorate this means whether you are a small business in Morphett Vale, Moana or Willunga you do not have to bear the brunt of assessing who is and who is not eligible. Eligibility will be conducted by application to the Family Assistance Office. In real terms, this means that businesses will not have to dedicate time and funds to assessing eligibility of employees. The government will expect that employers will pass on payments to their employees and the bill contains integrity provisions such as compliance rules and the right to review for employees. This will ensure that parental leave is paid to eligible parents when they require it, ensuring for working parents certainty and security of 18 weeks pay. Employers will not have to change their employees’ usual pay cycle, set up any special bank accounts or report back to the Family Assistance Office. There will be no additional rigmarole for employers. They will only be required to pay the parental leave through the normal means and also deduct tax for it.

For employees this bill goes a long way to alleviating the financial burden so often experienced by mothers and primary caregivers immediately after the birth of a new child. Talking with many of my friends and many of my constituents, that time immediately after the birth of a new child is a very stressful time. It is emotionally stressful and also very financially stressful, but at the same time incredibly rewarding and a wonderful experience. By providing financial support this bill will take a little bit of the pressure off parents and allow them to spend time at home with their newborn baby. Importantly, workers who often miss out on many entitlements afforded to permanent staff will receive paid parental leave. Workers who may be casual, contract or self-employed will be eligible.

The bill offers real financial support for many parents who have not received paid parental leave in the past. The 2008 ABS data shows that less than a quarter of women on very low wages, less than $400 a week, have access to employer paid parental leave schemes. So it has been those medium- to low-paid workers who have missed out on paid parental leave, and this bill for the first time will give these women access to paid parental leave. Importantly, however, for those who are already receiving paid parental leave, the government has made it clear that the government funded Paid Parental Leave scheme is not a replacement for parental leave provisions currently in any industrial agreement. For those new parents already eligible for employer funded schemes, the government paid parental leave initiative can be taken in addition to existing schemes. Parents can take paid parental leave before or after or at the same time as other legal entitlements. This is very important. Employers cannot withdraw any existing entitlements for the life of the industrial agreement, and modifications if companies choose to do so, including perhaps modifying it to be a top-up payment for the 18 weeks, will need to occur at the time of bargaining any new agreement.

This new scheme is characterised by flexibility and allows parents to make their own choices. Parents may nominate when they wish to receive their pay. The start date can be on or after the date of birth or, in the case of an adopted child, the placement date. All pay must be received within the first 12 months after the relevant date. As previously mentioned, the government’s paid parental leave initiative gives parents the option to share their parental leave benefits. This means a mum will be able to stay home with her new baby but will have the choice to return to work when it suits her, knowing that her partner may be able to take paid time from work for the remainder of the 18 weeks. Parents electing to receive paid parental leave will not receive the baby bonus except in the case of multiple births.

Parents who fall outside of these provisions, outside of the paid work test, will still be able to access assistance from the government. Those that do not receive paid parental leave will continue to be able to access the baby bonus, if they fit the eligibility criteria, and family assistance under the current rules. Alternatively, parents who meet the eligibility criteria for paid parental leave can also choose whether or not they will elect to receive the paid parental leave or whether they will receive the baby bonus and family assistance in lieu of paid parental leave.

I have been contacted by many people in my electorate, both mothers and fathers, who are in great support of a national paid parental leave scheme. In particular, Kerry, of Huntfield Heights, told me specifically that this bill will provide her and her family with the financial security she needs to take time off work and to spend more time at home when her child is born.

In this debate we have talked a lot about the benefits to parents, but there are also significant benefits to children. Paid parental leave represents not only our commitment to working parents but also our focus on the welfare of children. Evidence suggests that early parent-child interactions are incredibly important for babies’ social, emotional and cognitive development. Evidence also suggests that ensuring mothers have the capacity to breastfeed is incredibly important to the healthy development of the child. Paid parental leave provides parents with the option of staying at home with their newborn and giving them the best start to life without the financial pressure of returning to work. As I said before, many parents have told me that because of that financial pressure they have felt the need to return to work earlier than they would have liked and earlier than they thought was best for their child.

The benefits of the scheme have been supported by many people. The benefits for children have been supported by the New South Wales Commissioner for Children and Young People, Gillian Calvert, who said when the scheme was announced:

Research shows the continuous interaction between babies and parents in the baby’s first twelve months of life shapes the brain wiring—affecting how a child regulates their emotions, communicates, solves problems, thinks logically and reacts to the world.

I am sure everyone in this chamber will agree that those types of skills and developmental milestones are incredibly important and do set a child up for a good, healthy life.

The bill before us today is an historic one. Australians have been waiting for paid parental leave for too long. It took the election of the Rudd government to introduce such a scheme. The previous government demonstrated regularly that it had no interest in this issue. For over 11 years, the previous government refused to even consider a paid parental leave scheme. However, I would go so far as to say that the previous government was not only not interested in a paid parental leave but actively opposed to it. This was made especially clear—and this has been regularly quoted but I think it is really important to put it on the record again—by the now Leader of the Opposition when, as a minister in the previous government, he said:

Voluntary paid maternity leave: yes; compulsory paid maternity leave: over this Government’s dead body, frankly. It just won’t happen.

That was the attitude of the previous government to paid parental leave—it was never going to happen. That quote does make it clear that neither the previous government nor the current Leader of the Opposition intended ever to support paid parental leave being available to working parents in Australia.

Obviously we have seen a change of heart by the opposition leader in—I would suggest—perhaps a desperate bid to try and appeal to women. He has announced a paid parental leave scheme that, on the face of it, sounds quite generous. However, the opposition have yet to reveal most of the details of their scheme. Importantly, what a lot of parents want to know is: when will it start? There has been no start date for the opposition leader’s scheme. It was mooted when it was first announced that it was perhaps starting in 2013—maybe. That would mean that parents would have to wait at least an extra two years for an opposition paid parental scheme than for the government scheme—that is, indeed, if it gets introduced at all. Parents have communicated with me that they are making decisions now about having children and about their financial circumstances. They do not want to wait until 2013 to know whether or not the coalition, if it were to get elected, would do another policy backflip on the issue of paid parental leave. We have seen that Australian families do need certainty. Families are having babies now and they need to know what assistance will be provided to them.

In addition, the coalition’s announcement of the 1.7 per cent levy to pay for their parental leave scheme—if it indeed does come to fruition—will be, as is often quoted, ‘a big new tax on everything’. It will hit consumers at the checkout, it will hit consumers when they buy services and it will hit consumers across the board. This is in light of, a few months before, the Leader of the Opposition promising he would not introduce any new taxes. And the Leader of the Opposition had previously said there would not be an introduction of a paid parental scheme and that the introduction of a paid parental scheme would happen ‘over his dead body’. So I think the people of my electorate would be justified in wondering why the Leader of the Opposition does continually backflip or backtrack on what he says. The Australian people have a right to question which statement made by the Leader of the Opposition is indeed the gospel truth. That is a valid question for the Australian people to ask.

In comparison, our policy has a start date; our policy has a real and practical system of implementation; our policy does not slug medium and large businesses and put the burden onto them; our policy will not hurt the consumer. Our scheme is fair, balanced and economically responsible. (Time expired)