Paid parental leave reform welcome

AUSTRALIA'S journey towards a fair and flexible paid parental scheme has been long and laboured.

While many other wealthy nations embraced paid leave for new parents and realised the inherent social and economic benefits of such schemes long ago, Australia dragged the chain.

It wasn't until 1979 that unpaid job-protected parental leave even existed here, and even then this was made available only to mothers.

It took another 30 years, by which time calls for a scheme had become deafening, for the Commonwealth to get serious about catching up with our international contemporaries and considering a taxpayer-funded safety net for new parents.

In 2009, the Rudd government ordered the Productivity Commission to "identify the economic, productivity and social costs and benefits of providing paid maternity, paternity and parental leave". Its recommendations form the basis of the paid maternity scheme that Australia has today.

Currently, new mothers or a person deemed to be the primary carer through exceptional circumstances can access $719.35 a week for 18 weeks. This amount is linked to the national minimum wage. However, there are limits on the scheme that some argue are unfair and discriminatory.

Eligible recipients must have earned a taxable income of no more than $150,000 in the financial year before their baby's birth or adoption.

Given the scheme mostly replaced the generous baby bonus payments of the Howard government era, there is an argument that the scheme helps those with consistent employment at the expense of those without it.

There is also an argument that the means test only assesses the income of the primary carer.

Minister for Women Kelly O’Dwyer. Picture: AAP Image/Mick Tsikas
Minister for Women Kelly O’Dwyer. Picture: AAP Image/Mick Tsikas

The scheme also allows parents to split the 18-week period, however there can be no gap between the leave periods. There is also a so-called "Keeping in Touch" provision within the scheme, which allows the parent accessing the payment 10 paid work days with their employer.

Just one hour of work on a day counts towards the tally.

These provisions, in particular, fail to provide the flexibility many people require. For a start, self-employed people would struggle to legitimately receive the payment, given they alone usually know the intimacies of their operation and would find it impossible to hand them over for a full 18 weeks.

The same goes for people with particular skills or those whose employer may require their expertise for a particular period.

The inflexibility of the 18-week period is based on the false premise that it is easy for the primary carer, usually mothers, to take a hiatus from their role without causing any problems.

So it is welcome that Minister for Women Kelly O'Dwyer will today announce what she describes as a "game-changing" reform to allow the primary carer to have a break period from receiving the payment to return to work.

The fine print and how this would work in practise remains to be seen, but it is an acknowledgment by the Federal Government that improvements around flexibility are required.

The change, for example, would allow a self-employed mother to spend the first nine weeks with their newborn, return to work for a particularly important job vital for the growth of her business and then take the remaining nine weeks at a later stage.

It is necessary that there is a time limit for this to occur as it would undermine the reasons for the scheme if parents were simply banking this leave for a taxpayer-funded break down the track.

Equally, there must be strong provisions to prevent employers forcing parents back to work intermittently because they don't want to hire extra help.

However, this change will be welcomed by those weighing the costs and career implications of having children. Our paid parental leave scheme may not be the best in the world, but we have come a long way over the past decade. 

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