Paid Parental Leave Changes to Affect Thousands

The federal government has reintroduced legislation that could see paid parental leave cut to tens of thousands of new mothers in a bid to end what what the government describes as double dipping.

The crackdown is aimed at stopping women from being able to claim payments from their employer as well as the government.

Working mothers who do not have access to an employer-paid scheme will be eligible for a full 18 weeks of taxpayer-funded leave.

A spokeswoman for the minister for social services, Christian Porter, said the paid parental leave (PPL) legislation had been reintroduced to deliver a “fairer” system.

“The government’s revised PPL policy is longstanding, having being announced in December 2015 in the 2015/16 MYEFO,” the spokeswoman said.

“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.

“The majority of parents (more than half or around 90,000 parents) remain unaffected by this change and only a small number of parents, 4 per cent, will no longer be able to access taxpayer funded PPL but these will be the highest income earners who already have generous corporate or public sector parental leave schemes of at least 18 weeks.”

The spokeswoman said the savings were being used to ensure that previously excluded parents like those in dangerous jobs who have to give up their work during their pregnancy can now access PPL, or those in casual occupations like casual teachers can now get access to PPL for the first time.

However the federal opposition says it won’t support the legislation which is likely to see new mothers out of pocket by more than $10,000.

“We understand that 40,000 to 50,000 of those mothers are already pregnant, expecting their babies and they will be up to $12,000 worse off as a result of this government’s cut to paid parental leave,” the shadow minister for social services, Jenny Macklin, said.

“What this will mean is a very, very difficult choice for working mothers. Either they will have to cut short their paid parental leave to go back to work because they have to pay their bills and that will of course mean they have to spend less time with their babies. Or they decide to stay at home and of course that means they will be thousands of dollars worse off.”

Macklin said the move was a direct attack on paid parental leave, a direct attack on those mothers who are trying to combine their work and family responsibilities and will leave thousands of new mothers worse off.

“This change will actually affect thousands and thousands of women who are working in low paid jobs, women who are working in retail, hospitality. Those companies that offer paid parental leave, some paid parental leave to the employers like McDonald’s, Woolworths, Myer, many of the women who work for those companies are not highly paid and yet they will lose money as a result of this change.”

She said when Labor originally designed the Paid Parental Leave Scheme it was to make sure that the government scheme fitted in with employer funded paid parental leave.

“That was the recommendation of the Productivity Commission, which we adopted and it has meant that around 700,000 families have benefited and of course that also has delivered very, very important time at home for mothers and fathers with their newborn babies,” she said.

“There is already a means test… So there are thousands of women on low and middle incomes who are going to be affected by this change.”

Crossbench senators have yet to announce how they will vote on the legislation.

Changes to paid parental leave were first introduced in late 2015 by the federal government but were withdrawn before the federal election due to a lack of support in the senate.