Australia’s first ever paid parental leave (PPL) scheme was passed by Parliament yesterday. Australia was one of only two OECD countries (USA was the other) which did not have a comprehensive PPL scheme.
What the PPL covers:
The PPL will commence 1 January 2011 and will include 18 weeks paid leave at the federal minimum wage ($569.90 per week or about $15 per hour). This will be taxable. The PPL will be funded 100% by the federal government, with an estimated net cost of $731m over five years. Eligibility
- Expectant mums must earn no more than $150,000 per year to qualify and work at least 330 hours in 10 of the 13 months before their due date (around one day of paid work a week).
- Families electing to participate in the scheme will not receive the Baby Bonus (except in multiple birth cases) or Family Tax Benefit Part B during the 18 week PPL period.
- Families will have the option of signing the benefit over to stay-at-home dads if mothers want to return to work.
- About 148,000 Australians will be able to claim the benefit every year.
Points of Contention:
Burden on Small Business Businesses will need to act as paymaster for the PPL scheme, not the government. Many believe that administering the scheme will place yet another burden on small business and may even result in an additional potential discrimination against women. Where’s my Super? The PPL scheme does not include superannuation payments. Women are already disadvantaged greatly compared to men in this area because of their broken work patterns mainly due to having families. Businesses must pay super to all employees – why shouldn’t the government? It is time the government recognises the gap in retirement saving between men and women and not add to the problem.
Summary: The PPL scheme is certainly a great start to helping support working families. Is it enough to make a significant impact to working families in the long term? I don’t know yet but at least the government has taken the first step. HAVE YOUR SAY: Take part in a nation poll on this issue.