Additional Comments - Australian Greens

Additional Comments - Australian Greens

1.1Last year, the Government’s own Women’s Economic Equality Taskforce recommended expanding paid parental leave (PPL) to 52 weeks, to pay superannuation on PPL and to eventually pay PPL at replacement wage. Many inquiry participants endorsed the Women’s Economic Equality Taskforce’s recommendations, agreeing that these changes will unlock women’s workforce participation and help to close the gender pay gap.

1.2The Australian Greens welcome the Paid Parental Leave Amendment (More Support for Working Families) Bill 2023 (the Bill) as a baby step towards a fairer paid parental leave system.

1.3However, we agree with many of the inquiry participants that there are measures the Government could take right now to align Australia’s paid parental leave scheme with international standards and the advice of the Women’s Economic Equality Taskforce.

1.4Parents should have immediate access to a minimum of 26 weeks of paid leave to allow recovery from birth, maximising options to establish breastfeeding, and allowing parents to spend time with their infants. Parents should not have to wait until 2026 to get the 26 weeks.

1.5The only reason given by the government to delay full implementation of the increase to 26 weeks of PPL is financial. And yet, billions are wasted on other things every day. Women and parents should not be asked to wait when nuclear submarines and tax cuts for mostly wealthy men are not asked to wait.

1.6This Bill should be amended to achieve an immediate increase to 26 weeks paid parental leave. Importantly, where are the plans to create a pathway to 52 weeks of paid leave by 2030 to accord with international best practice? Many submitters including the ACTU have highlighted the international standard of 52 weeks and called for Australian families to receive the same, as soon as possible. The Greens support those calls.

1.7Australia has also fallen behind other countries in the rate of pay and how leave is allocated between parents. Australia's paid parental leave rate is one of the lowest in the OECD. For some people, full-time minimum wage is an increase on their previous earnings. But for many parents, the minimum wage is well below their normal wage. This forces difficult decisions about how long parents can afford to take leave.

1.8As many witnesses pointed out, continuing to pay parental leave at minimum wage is not an effective incentive to induce more fathers to take leave. The Greens support full wage replacement, including incentivising employers to top up the government scheme.

1.9We also know that periods of parental leave, and part time work on return from leave, have been a contributor to the superannuation pay gap. It has been a long standing policy of the Greens, unions and women’s economic security advocates to pay superannuation on parental leave. This was also formerly the policy of the Labor party.

1.10Many of the inquiry witnesses reiterated that parental leave is the only form of leave paid without superannuation and it is predominantly taken by women. Leaving superannuation off parental leave is an act of discrimination that directly undermines the purpose of parental leave, which is to encourage people to take leave to look after their children to give them the best start to life.

1.11The Greens welcome the measures in the Bill to increase the amount of parental leave that can be taken flexibly and by both parents together. In order to be effective, the flexibility in the PPL scheme must be complemented by further workplace reforms to support flexible work arrangements, and more affordable and accessible early childhood education and care.

1.12Finally, we support proposals to expand eligibility for PPL by relaxing the work test and residency requirements so that people are not unfairly excluded from leave. It is important that all families are supported to take leave, regardless of their circumstances.

1.13This Bill is a baby step to support parents in the crucial first few months of parenthood. But, there are measures this Government should take right now to align Australia’s paid parental leave scheme with best practice.

1.14We need longer parental leave now, paid at a higher level of income replacement, including super and designed to support a better share of parental care. The case for change could not be clearer.

Recommendation 1

1.15It is recommended that the Bill be amended to provide for:

Paid parental leave entitlements of 26 weeks from 1 July 2024;

Paid parental leave entitlements of 52 weeks by 1 July 2030; and

Superannuation to be paid on parental leave

Senator Janet RiceSenator Larissa Waters

Senator Barbara Pocock