Action Alert June 2010

This is an archived edition of Action Alert.

The Introduction of Paid Parental Leave

The introduction of a national paid parental leave scheme has been considered for some time, and on 12 May 2010, the Federal Government introduced the Paid Parental Leave Bill 2010 into parliament.  This Bill proposes to establish a paid parental leave scheme to enable eligible primary carers to receive, after tax, the equivalent of eighteen weeks paid leave at the rate of the national minimum wage as from 1 January 2011.  To be eligible to receive the payment, primary carers [most usually mothers, but note the non-gender-specific term] will need to have been in the paid workforce for ten out of the thirteen months prior to the birth of their child.  The 2011-2012 Federal Budget Estimates of the cost of this scheme indicate that the Government expects to have a gross expenditure on the scheme of $1,306,678,000 and to recover $220,000,000 in tax on the paid parental leave payments, leaving a nett outlay of $1,086,678,000.  Divided among an estimated 148,000 primary carers, this equates to $7,342 per primary carer.  That is a lot of money!  Is it a good proposal?

Unfortunately, paid parental leave is inherently discriminatory!  It penalises primary carers [usually women] who are ‘unwaged’ before the birth of their child.  Women who are already out of the workforce [because, for example, they have given up work to be stay-at-home mothers (which provides the best care for before-school-age-children, according to the best sociological research)] would not receive any paid parental leave on the birth of subsequent children.  The ‘unwaged’ primary carers would still receive the Baby Bonus – ‘waged’ primary carers would receive paid parental leave instead of the Baby Bonus, not as well as the Baby Bonus – but the 2011-2012 Federal Budget Estimates indicate that the Baby Bonus will be at the rate of $5,340 per child.  ‘Waged’ primary carers will therefore be about $2,000 per child better off than ‘unwaged’ ones.

So, under a paid parental leave scheme, there is a financial incentive for primary carers to return to the workforce as soon as possible after the birth of their child, so that they are in the paid workforce for the necessary length of time before the birth of their next child in order to be eligible for paid parental leave again.  This incentive increases the reliance on non-parental childcare arrangements, as those primary carers place their infants and toddlers into childcare centres so that they can re-enter the workforce.  Even apart from the weakening of the parent-child bond that this causes within the family, and even apart from the sociological research that indicates that children who have been placed in daycare from an early age later suffer greater emotional and behavioural problems at school, there is another cost.  Again the 2011-2012 Federal Budget Estimates indicate that the Government expects to spend $6,041 per child on childcare funding subsidies and accreditation procedures, while spending only $3,112 per child on Family Tax Benefit B [which is paid to parents who have lower income levels because they are usually stay-at-home carers of their children].  

On 8 March 2010, Tony Abbott, the Leader of the Opposition, announced the Coalition’s policy on this matter.  Rather than offering a viable alternative to the Government’s planned Bill, Mr Abbott proposed an even greater inequity!  While ‘unwaged’ primary carers would continue to receive the Baby Bonus, ‘waged’ primary carers would receive their full before-the-baby’s-birth salary for twenty-six weeks, up to a maximum of $75,000, funded by a new tax on ‘big business’ [who would then pass the costs on to their customers].  In effect, this would be an even more discriminatory arrangement, resulting in ‘waged’ carers receiving up to fifteen times more money than ‘unwaged’ stay-at-home carers! 

The former Federal Government introduced a Baby Bonus scheme in 2004, with one-off payments paid equally to all mothers at the birth of each child.  The Baby Bonus was the equivalent of ten weeks’ pay at the rate of the minimum wage, and, apart from financial assistance at a time of greatly increased expenses, the Baby Bonus provided an emotional and psychological boost.  The underlying message was: “Having a baby is a good thing!”  Unfortunately, some women had children to just get the lump-sum payment to spend on luxury items; the current Government has wisely re-configured the Baby Bonus into fortnightly payments over six months, making it more likely that the money is spent on the child.  

Someone has rightly said, “Let’s face it – all mums work, but not all mums are paid for what they do.”  The government benefits provided to help families with the costs of bearing and raising children should respect the freedom of carers to make their own decisions about work / stay-at-home balance.  Baby benefits should be the same for ‘waged’ and ‘unwaged’ mothers.  Early child benefits should be the same whether used for in-home care or institutional childcare.

Contact Kevin Rudd, Prime Minister [PO Box 6022, House of Representatives, Parliament House, Canberra, ACT, 2600, or phone (02) 62777700, or email at the website], and Tony Abbott, Leader of the Opposition [same postal address, or phone (02) 62774022, or email] to ask for a better scheme than PPL.

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Who will stand up for me against evildoers?
Who will take his stand for me against those who do wickedness?
Psalm 94:16

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This monthly release is prepared by Pastor Brian Robertson (P O Box 2367, Bundaberg, 4670) to inform Christian people about issues within our society.  “Action Alert” does not promote any one political party, but encourages its readers to be “salt and light” by speaking out on some of these matters.  The views expressed in “Action Alert” are those of the author and are not necessarily those of a local church or a denominational organisation.  To the extent permissible by law, no church or denomination accepts liability for anything contained in this publication and any use made of it.