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Parental leave ‘double dipping’ still on the table

Parents, have your proverbial crudités at the ready: paid parental leave (PPL) ‘double-dipping’ will probably remain.

Nick Xenophon’s party – which holds the balance of power on this issue – has declared it will stand by the current scheme, instead of backing the government’s plan to change it to a single payment. “We made a commitment prior to the last election to make sure the scheme was kept intact, that’s still our commitment,” Xenophon told Sky News on Monday.

Double dipping refers to the fact that parents can receive paid parental leave from both the government and, if they’re lucky, their employer, too. The government’s proposed amendment is to give parents $12,000 – equivalent to 18 weeks’ minimum-wage pay – only if they don’t receive this amount from their employer.

The minister for social services, Christian Porter, has said PPL is not gratuitous; it is designed to get women back to work, and savings from cutbacks to the scheme can be directed to those often excluded from it, like casual workers.

This approach may seem all carrot, no stick, but Lyn Craig, director of the Social Policy Research Centre at UNSW, thinks it’s probably the opposite. She explained that inadequate paid parental leave “may even depress workforce participation”, as parents may feel they must choose between caring for their baby and working. As for Porter’s perceived carrot – spending PPL savings, taken from the more fortunate, on the less fortunate – Craig isn’t impressed. “The idea that some people are getting an unconscionable advantage by wanting to be at home with their babies for six months to establish breastfeeding seems odd,she conjectured. “I don’t see why if [some women aren’t] covered, the scheme shouldn’t be extended to include them without having to take it off others.”

Craig also contended that Porter’s characterisation of PPL as a safety net for those who don’t receive employer contributions makes it seems like a welfare payment. In her opinion, it’s certainly not. On the contrary, she deemed parental leave “a social issue of great import to society” and asserted that government PPL was always meant to “top-up” employer payments.

Fuelling her vexation is Australia’s status as one of the least generous PPL providers, internationally. Data compiled by The Economist shows we, along with New Zealand, Switzerland, the UK and Ireland, are part of the bottom cluster in this regard. Only the US sits beneath us, and it is unique in that it offers no government PPL. Craig added that Australia’s scheme runs afoul of the six months of leave recommended by the World Health Organization.

Another of Porter’s arguments is his implication that mostly high-income earners will be encumbered by the amendment. He used the following example in an ABC interview:

“Currently, a parent earning $140,000 annually can receive a combined government and employer PPL amount of more than $44,000 – this is more than another parent working a minimum wage will earn in an entire year, and that is not fair.”

He further claimed a majority of PPL scheme users wouldn’t be affected.

Craig bit back. “What they’ll do is make it difficult for women and, despite the talk about it being at the high end, mainly middle- to low-income women might be affected by this,” she maintained. “Even with the top-up, there’s no one who’s raking it in.”

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