Throwing the PPL baby out with the bathwater

Instead of simply dumping its extravagant PPL scheme, the Coalition should consider it as part of a multi-pronged approach to reduce structural workplace inequality for women.

So the government’s ‘signature policy’ has become a non-core promise.

A policy that was designed to “give women a more realistic choice if they want to combine work with family” has been dumped because, well, it was unpopular with the party backroom.

While Tony Abbott’s paid parental leave scheme was initially overly generous and widely ridiculed for providing high-income earners with an overly generous payment, the fact remains no further attempt to restructure the scheme was made.

“I’m very proud to be leading a party and now a government which is going to give the women of Australia, the women in the workforce in this country, a fair dinkum paid parental leave scheme for the first time,” Abbott said shortly after the 2013 election.

In December, Abbott indicated changes would be made to ensure ‘better targeting’ and increased focus on childcare. Capping the payments and means-testing eligibility would have helped target the scheme towards families that need it most.

Instead, his political capital spent and suffering from chronic poor judgment calls, the Prime Minster abandoned the one policy that supported a goal that is hard to disagree with: reducing the financial penalty that women bear when they take a break from work to give birth.

Let’s be clear here. Women who have children and work less than full-time outside the home while the kids are young forego not only lost income, seniority and opportunities for advancement but lost superannuation as well.

Women’s superannuation balances flat-line between the ages of 38 and 42, and between 43 and 47. The average retirement payout for women is $112,000; for men it is $198,000. According to Australian Super, only 12 per cent of women think their super will be enough to retire on -- and they are probably right.

The Coalition’s paid parental leave scheme would have included superannuation and paid 26 weeks’ leave at the person’s usual wage, rather than the existing plan that pays 18 weeks at the minimum wage and no super.

Australia will remain one of only two OECD countries that fail to pay leave based on a replacement wage. The businesses that complained so bitterly about the added impost of the levy to fund the scheme will be happy with that status quo, although ironically the levy may not be scrapped along with the policy it was meant to fund.

The government has said it will focus on childcare as part of a ‘families package’ instead, without giving any details. It is hard to see that a lot needs to be done on this front. Parents already receive an extremely generous 50 per cent rebate on their child care costs -- up from a previous level of 30 per cent, far higher than in many other OECD countries.

Ridiculously, in this time of supposed budget need, it is not means-tested. Means-testing the childcare rebate and capping eligibility at the average household income would free up funding that could go towards a redesigned paid parental leave scheme -- one that includes six months of superannuation.

The idea of giving the rebate directly to childcare centres instead of families should be a non-starter as it would quickly disappear into general revenue and see rampant fee inflation continue.

The government’s problem was that it viewed the PPL scheme in isolation, rather than as part of a holistic approach to reduce workplace inequity for women from the time they have a baby through the early years of juggling childcare, and often remaining dominant carers through the child’s school life.

It is not just one policy that is needed, but an overhaul of many aspects of workplace culture. Where is the discussion of men’s roles as fathers who also work outside the home?

Parental leave, childcare, changing workplace culture to accept greater flexibility in working hours for both mothers and fathers: these should all form part of one continuous debate about enabling women who want to return to paid work to do so. Never mind some harebrained scheme to freeze employees’ eggs, which merely puts off the debate for a few more years.

And let’s not forget equal pay for equal work. Australian women now earn on average 18 per cent less than Australian men, the biggest pay gap since 1994.

It’s a question of equity, and removing one of the many financial burdens that women face in order to have a family.

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