Senator FIFIELD (Victoria) (Deputy Manager of Opposition Business in the Senate) (1:52 PM) -I rise to speak on the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010. Let me make it clear at the outset that the coalition supports paid parental leave and the introduction of a scheme to deliver this leave for Australia mothers. As with so many other important reforms, Rudd Labor have rushed this scheme, and one can only hope that they do not bungle its implementation. Make no mistake, Mr Rudd’s scheme is second rate, it is less than optimal-but it is a step in the right direction. Introducing such important reform requires careful consideration, sound planning and a comprehensive understanding of the policy outcome that is best for the nation. In the shadows of a pending election this government are just rushing through a scheme that they hope will be popular and restore public confidence in their policy agenda. But Australians are not going to be terribly impressed by the government’s second rate paid parental leave scheme. The minister and her department are not sure of the detail of this scheme. No-one seems sure of how it will be implemented or regulated. Instead the chorus from Labor and from the minister is the old adage of ‘she’ll be right’. And we have heard that before. The government have many times asked Australians to have confidence in their ability to develop and implement policy. And all of this comes from the minister responsible for slashing $50 million from services designed to help families and deliver important relationship support services.
The coalition were deeply concerned, however, when only weeks ago officials from the Department of Families, Housing, Community Services and Indigenous Affairs who were providing the coalition with a briefing on paid parental leave were unable to answer simple questions about the practical implementation and operation of the scheme. One such question was: how will self-employed mothers be treated under the scheme? And, to top off this lack of detail, the regulations themselves will not be available for some time.
We should not forget that Labor has form on policy planning and implementation. Mr Acting Deputy President, I am sure that GroceryWatch, Fuelwatch, home insulation, Building the Education Revolution and the emerging debacle of the social housing program would all be familiar to you. While the government promises a lot, it not only does not deliver but bungles the process and this costs taxpayers real dollars. We on this side can only hope that we do not have to add paid parental leave to the list of this government’s policy failures. The Rudd governments paid parental leave scheme is, it has to be said, far from perfect. It does not provide to mothers working in the paid workforce of this country their full wage for the first six months, the time it is recommended they should spend on their newborn baby. Women should not have to choose between family and career; they should be able to choose both.
Given that parenting is such an important and critical part of early childhood development, the shortcomings of Labor’s scheme are extremely disappointing. Labor’s scheme is complex and, in true Labor style, where there is an upside, where there is a benefit, there is always a downside, there is always a detriment. Just like their assault on Australian miners, this scheme assaults yet another important part of Australia’s economic engine room: small business. This scheme throws a barrage of red tape at small business, which is something they can ill afford. It compels the hardworking small business operators across this country to become paymasters for Labor’s second-rate scheme. The government are not able to clearly and concisely advise how the implementation and management of the scheme would work. The small businesses of Australia are being asked yet again to trust the Rudd Labor government, a government that have demonstrated just how business savvy they really are by embarking on a project that will cost over $40 billion without a business plan. They are wasting billions of dollars because of incompetent oversight and planning in building the countless ‘Julia Gillard memorial halls’. If small business operators adopted the Rudd government’s modus operandi, they would go to the wall. Labor, however, unlike many businesses, have the nation’s credit card to rely on-and rely on it they do, to the tune of $100 million each and every day.
Sadly, there is further bad news for hardworking small business operators: they will be liable for state payroll tax for an employee on paid parental leave as well as for that employee’s replacement. Requiring the Family Assistance Office to administer the government’s scheme for the start-up phase delays but does not remove the needless costs and unwarranted obligations being forced on the small businesses that will be required to become the Rudd government’s PPL pay clerks. If it is good enough for the Family Assistance Office to administer the government’s flawed parental leave scheme for the first six months and it makes sense to invest taxpayer funds in that system and administration then why not keep it going beyond the initial period? By forcing employers to handle payments under the government’s scheme, Mr Rudd’s approach leaves small business to fund administrative expenses, payroll and office systems changes, reporting requirements and any increased liabilities for workers compensation, payroll tax and superannuation and to carry the risk of noncompliance or error.
The PRESIDENT -Order! It being 2 pm, we will proceed to question without notice.
(6:16 PM) -Just picking up where I left off before question time, allowing the government to drop small business right into paid parental leave obligations and duties simply sets up the machinery to fit up small business to pay the cost of fixing the shortcomings of Labor’s flawed scheme. While not impeding the introduction of the government’s scheme, the coalition will move substantive amendments to extend the role of the Family Assistance Office in administering the scheme indefinitely. I acknowledge here the ceaseless advocacy in this area by Mr Billson, the shadow minister for small business, and also the small business champion in this chamber, Senator Boswell. This measure will make ongoing use of the taxpayer investment in the establishment of the necessary payment and operating systems beyond the initial six months. The government is urged to embrace the coalition’s amendment to avoid the imposition of unnecessary and unjustified cost, regulatory burden and compliance risks to the small business community.
Labor’s second-rate scheme does not sufficiently recognise that parents have different patterns of family responsibilities and paid work. It fails to recognise the current economic circumstances Australian families are facing, from increasing interest rates to the housing affordability crisis to increased costs of living and the proposal of another great big new tax on everything. More and more families are now requiring two incomes just to make ends meet. In Australia today parental leave is available to parents through both private enterprise and the Public Service. Conditions such as the length of the scheme vary from very short periods to 18 weeks, yet few schemes provide the ideal leave period of six months. Mums working casual jobs who do not have accrued leave will lose out under the government’s scheme. Labor’s 18-week scheme was recommended by the Productivity Commission as a result of an expectation that an employer would effectively provide a top-up to the leave to reach 26 weeks, thus delivering the internationally recognised standard of six months. But of course casual workers will not have accrued leave and therefore it is unlikely that they would get the top-up.
The coalition has put forward its proposed scheme, which is in stark contrast to the Labor second-rate scheme. The coalition’s scheme is a wage replacement scheme that would provide primary carers, predominantly mothers, with 26 weeks paid parental leave at full replacement pay up to a maximum salary of $150,000 per annum or the federal minimum wage, whichever is greater. The coalition scheme would be available to all employees including full-time, part-time and casual workers, contractors and the self-employed who meet the eligibility test. It would include superannuation contributions at the mandatory rate of nine per cent and it would facilitate an easier transition in and out of the workforce for Australian women during their childbearing years. It would signal to the community that taking time out of the workforce to care for children is a normal part of the work-life cycle for parents. The coalition scheme would promote an increased female workforce participation, leading to productivity gains as it would create a financial incentive for women to be engaged in paid work prior to childbirth and to return to the workforce after their period of leave. The coalition scheme would provide paid parental leave for a period of 26 weeks to afford all mothers the opportunity to breastfeed their infant for the minimum six-month period recommended by the World Health Organisation. Labor’s scheme does not. The coalition scheme would provide women with a replacement wage to a cap or minimum wage, whichever is greater, to adequately support working families when they are at their most financially vulnerable. Again, Labor’s scheme does not.
The scheme Labor is proposing also fails to ensure that all Australian families, regardless of whether a mother is at home or in the paid workforce, are afforded the flexibility to choose what is right for their specific individual family circumstances.. Labor’s scheme is far from perfect but ultimately on balance having a second-rate scheme is better than not having a scheme at all. The coalition has a second reading amendment that further details our concerns with this legislation and our alternative approach. I move the second reading amendment circulated in my name:
At the end of the motion, add “but the Senate:
(1)(a) affirms its commitment to supporting all Australian families and supports policies which give choice and flexibility to parents to enable them to choose what is right for their individual circumstances, whether they are at home or in the paid workforce;
(b) recognises that parents have different patterns of family responsibilities and paid work over their life cycle;
(c) recognises that due to rising costs of living and a housing affordability crisis, the majority of families require two incomes to make ends meet;
(d) notes that Australia remains only one of two OECD countries that does not provide a paid parental leave scheme and that introducing a paid parental scheme is critical to the needs of working families and our national productivity more broadly;
(e) rejects the Government’s representation of a paid parental leave scheme as a social security measure and instead affirms that it is a valid workplace entitlement that must come with a superannuation component to arrest the gross inadequacy of female retirement incomes;
(f) notes the Government’s proposed paid parental leave scheme is inadequate in its current form and should be amended to better reflect the requirements of Australian working mothers, and families more generally;
(g) supports the ability of casual, part time and fulltime women to access paid parental leave provided that they have met the qualifying criteria; and
(h) recognises that a paid parental leave scheme is only one part of government’s important role in supporting families as they raise the next generation of Australians; and
(2) acknowledges that the bill does not:
(a) provide paid parental leave for a period of 26 weeks to afford all mothers the opportunity to breastfeed their infant for the minimum six month period recommended by the World Health Organisation; or
(b) provide women with a replacement wage, to a cap or minimum wage (whichever is greater), and so does not adequately support working families when they are at their most financially vulnerable; and
(3) acknowledges that the bill places a totally unnecessary impost on Australian businesses by requiring employers to act as paymasters for eligible employees; and
(4) calls on the Government to make such amendments to the bill as would rectify these flaws.