Senator Natasha Stott Despoja
Portfolio: Workplace Relations
Related: Status of Women
| Dated: 16 May 2002
Location: Parliament House - Canberra
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Senator Natasha Stott Despoja speaks to the Workplace Relations Amendment (Paid Maternity Leave) Bill 2002: Second Reading |
Senator STOTT DESPOJA (South Australia—Leader of the Australian Democrats) (9.48 a.m.) —I move:
That this bill be now read a second time.
I seek leave to table the explanatory memorandum and to have the second reading speech incorporated in Hansard.
Leave granted.
The speech read as follows—
Today I introduce Australia's first legislation to establish a system of paid maternity leave. I do so in response to the Government's complete failure to respond to the growing support in Australia to catch up with our trading partners and provide a basic level of paid maternity leave for working women when they have a baby.
The budget's silence on this issue was disappointing. We can have no confidence that the Government is listening to the growing call to act on this issue—from employers, unions and the Government's own Sex Discrimination Commissioner.
It is time for a comprehensive and systemic approach to this issue. Some would say it is past time.
In 2001, The Australian Democrats announced a paid maternity leave proposal at the Australian election. We proposed a system of maternity leave for all working women, with contributions from employers, women and the government. Paid maternity leave has been long standing Democrat policy: we first formally balloted our members on this issue and adopted it as policy in October 1989—over 12 years ago. Since the time of last year's election I have held discussions with many individuals, representatives of business, unions, women's organisations and the broader community.
The Bill I introduce today reflects those discussions. I thank the many Australians who have taken the time to put their views to me on this issue.
The recognition of the need for paid maternity leave has gathered momentum. Last month the Sex Discrimination Commissioner issued an important discussion paper that set out options on maternity leave. A recent survey of Australians shows strong support for paid maternity leave.
Community attitudes now run well ahead of the legislature. It is therefore well past time for Parliamentary action. What a lost opportunity the 2002 budget has proved on the issue.
In his Budget speech on Tuesday night, the Treasurer spoke of supporting Australian families. Unfortunately his response, the Baby Bonus, is very poor support. It is regressive (offering a five fold greater benefit to higher earners who stay at home). It is biased against those who go back to work. It is delayed in its effects, and it is extraordinarily expensive ($1.235 billion over the next four years).
Australian households are under pressure. As more and more women enter paid work, the shape of the Australian family is changing. Unfortunately our policies lag behind this change. Australian Governments spend a lot on family supports, but we don't spend it well. Very basic supports like paid maternity leave are missing for many. A large number of third world countries are way ahead of us in recognising that later in pregnancy, at birth and after birth, mothers need time off paid work. It is shocking to many Australians to learn that we are one of only two countries in the OECD area that still do not recognise this fact, and provide a period of time off work for all new mothers.
It is time to move ahead.
The public debate on this issue, and on the provision of paid maternity leave, is sometimes confused. This confusion has slowed our progress on this issue, and made some over-cautious about moving forward. It is time to address a few `maternity myths'. While structuring a payment fairly poses some challenges, this Bill shows how these can be met. This Bill addresses some prevailing myths, it builds upon previous specific Democrat proposals and our recent consultations, it responds to the issues raised recently by the Sex Discrimination Commissioner's report, and it provides a legislative solution.
What the Bill does
The Bill amends the Workplace Relations Act 1996 to provide a system of paid maternity leave, building upon that Act's existing provisions for unpaid parental leave. The Bill sets out the purpose, entitlement, level and method for this system, and it creates a Government funded Maternity Payment which will ensure comprehensive provision of at least basic maternity pay for all eligible Australian working women.
The Bill provides paid maternity leave for 14 weeks at or around the birth or adoption of a child for most Australian working women who have a child, at the level of the minimum wage, or if they usually earn less than this, at their normal wage.
The Bill provides this Maternity Payment by means of Government funds (paid for by employers and employees through their normal taxes). This will be complemented by the contribution of employers (through `top up' and additional payments or periods of leave) and employees (through foregone earnings and the extra unpaid leave that many take).
The Bill creates a Maternity Payment that is additional to existing paid maternity leave where it exists. The Payment is not intended to replace what already exists with a Government payment, but to complement and extend it.
The Bill provides paid leave for mothers in recognition of the physical demands of the later states of pregnancy, birth, recovery from birth and establishment, where possible, of breast feeding. In recognition of these physical facts affecting mothers, this payment is not intended to be transferable between a mother and her spouse except in exceptional circumstances. In this way, the maternity payment (an entitlement primarily of mothers at the time of birth) is different from parental leave, to which both parents have access.
Eligible employees are defined as those not employed by state, territory, or federal Governments (which generally provide, or should provide, paid leave at an equivalent or higher level) and those with continuous employment of at least 12 months in their current jobs (as already required in relation to eligibility for unpaid leave under the Act). Seasonal employees are excluded (as they are from existing unpaid maternity leave). Casual and part-time employees are included.
The payment is treated as normal wage and salary income for recipients, with existing tax, superannuation and other relevant laws to apply. This is to preserve the employment continuity of beneficiaries, to the benefit of both employees and employers.
The Bill does not require women to repay their maternity payments if they elect not to return to work after their paid leave. Most existing paid maternity leave arrangements do not require this. Many women are unsure of their plans when they have a baby. To require a repayment would impose an onerous burden.
The Bill responds to international conventions and recommendations in support of such leave and it does not discriminate between heterosexual and same sex couples. Their rights are the same.
A fair system of maternity leave
The bill provides a new Maternity Payment within an overall system of paid maternity leave which has three contributors. Firstly, government contributes through the 14 week Maternity Payment, and through payment by state, territory, and federal governments for maternity leave for employees under their control. Secondly, employers contribute through taxation (which funds the Maternity Payment), and the cost of current maternity leave payments where they exist, and the cost of enterprise `top ups' to the Government payment (ie to normal earnings). Thirdly, employees and their families contribute through taxation (which funds the Maternity Payment), and foregone earnings where the Maternity Payment is less than their usual wage, where they take unpaid leave, and where they trade off wage increases in exchange for `top ups' negotiated through enterprise agreements.
The cost to the Federal Government of the Maternity Payment
We estimate that the Maternity Payment will cost $352 million a year (net of tax receipts recovered, and net of the savings on the existing Maternity Allowance and Maternity Immunisation Allowance which will not be payable to those who receive the Maternity Payment). The Explanatory Memorandum sets out the basis of our calculation. This is considerably less than that allocated for the Baby Bonus.
Australia has a system of paid maternity leave—but only for some
Some suggest that Australia does not have paid maternity leave. This is not true. What we have, however, is a system that gives arbitrary access to paid maternity leave to some, leaving the majority of women who are low paid, or work in the private sector, or are employed in smaller businesses, without paid leave. Their employers, children and families pay the price. At present only around 38 per cent of all Australian working women have access to paid leave when they have a baby.
There are those who question the need for paid maternity leave, or question its priority amidst other options. The fact is that paid leave has already been introduced in workplaces covering around a third of Australian women, through the innovation of employers or unions or by means of bargaining at the workplace. What is more, 52 weeks unpaid leave is available to all. Given that so many Australians have thus given priority to paid and unpaid leave and a partial system already exists, the debate about its need is now passè.
The real question now is how to provide the benefit more equitably.
Australia's maternity and paternity leave and workplace arrangements have been slowly improving over recent decades, through the action of governments, unions, employers and the adaptions of families. It is time to build upon them in a fairer way, drawing on contributions from government, women, families and employers.
There is strong international precedent for paid maternity leave—not only in most of our trading partners and all of the OECD area with the exception of the United States, but also through long established international conventions which the Act already relies on in its establishment on unpaid parental leave.
The introduction of unpaid parental leave in the 1990s was an important step. It recognised that parental leave was an important employment-based right. Its provision was essential to equal employment opportunity for women at work and for parents in general, and that interruptions to employment around the birth or adoption of a child were to be expected and should be facilitated. Employees' rights around these events provide for fair treatment in the workplace, and they assist employers to keep skilled employees.
Employers, employees, parents and Government must all contribute.
There has been considerable alarm in some areas of business about the potential costs of paid leave, especially to employers who employ many women, and small businesses.
Not all businesses share this alarm. Some see providing paid leave as a means of becoming `employers of choice'. However, most of these are large businesses. The structure of the system in this Bill does not undermine this strategy. The additional provision of a basic Maternity Payment, alongside existing employer provisions, will ensure that these employers retain their competitive advantage: they will remain ahead of the pack.
However, this Bill does not adopt an employer-funded scheme of paid leave, recognising the burden it would place on small business.
There are two overwhelmingly persuasive reasons for rejecting this course and instead going for a system where Government, employers, employees share the costs. Firstly, the cost should be shared on simple equity grounds. All who benefit should contribute. Employers alone should not pay. On the other hand employees alone should not pay, since their employers and the whole society benefit from women's labour and reproduction.
Secondly, a system that leaves all provision at the level of the individual employer will result in an unfair burden on feminised workplaces and industries. This in turn will result in discriminatory behaviour by employers, some of whom will chose not to employ women of childbearing age. The unlawful fact of such behaviour may not prevent it. While a levy on all employers is also an option—and would share the cost fairly between all employers—it adds a layer of administrative complexity, and does not fairly share the burden more broadly with employees and government.
It is fair that all who benefit should contribute by means of general revenue, topped up by employer contributions and foregone earnings by employees. The Maternity Payment, paid for from general taxation revenue, provides a minimal basic benefit for all eligible working women. While all employees and employers contribute to this Government payment through taxation, the Bill anticipates their further contribution by means of enterprise level negotiated additional `top up' payments or periods of leave.
Overall, however, individual Australian women and men who choose to have babies will continue to bear the majority of costs of having children, beyond the minimal contributions of the Maternity Payment and the `top up' agreements of employers and employees. The costs of rearing children are many, many times greater than these small relative sums: in 1999 they were estimated at over $200,000 in the first 16 years of a child's life, and over $300,000 in the first 25 years. The Government paid Maternity Payment represents in the vicinity of 2 per cent of this estimated cost.
The decision to have a child, and its financial effects, remain primarily located at the individual parent level. There are those who believe that all the costs of parenting should be privately borne in recognition of the private nature of reproduction. However, given the role of working mothers in the labour market, this view is no longer sustainable, especially given the small relative size of the public contributions that are envisioned. Further, it has been reasonably argued that children are a public good from which we all benefit. This argument is a strong basis on which to make a small public contribution to paid maternity leave.
The Maternity Payment is Primarily for Mothers
Australia provides unpaid parental leave to both parents, and the Act allows parents to sort out how to share the leave.
However, under the proposed Bill specific recognition of maternity is made, and the proposed Maternity Payment is designed as a payment to the mother. It is not generally transferable between parents except in exceptional circumstances (like the death of the mother). Other arrangements apply for adoption, where parents can choose which of them takes the paid leave.
The Bill is structured this way for two reasons. Firstly, and most significantly, carrying a baby in the later weeks of pregnancy, giving birth, recovering from birth and early mothering to establish breast feeding where possible, are physical acts that affect the body and being of the mother. This payment distinguishes this physical phase of maternity from general parenting, which will remain to be shared between parents, as they see fit, for the remaining 38 weeks of unpaid leave.
Secondly, if men could claim the payment for maternity leave, given their, on average, higher earnings, it might make economic—if not practical—sense for the father to receive the paid leave. In many cases, where women work part-time, male parents would receive a higher level of payment than their female spouses. Limiting the payment primarily to mothers means that any incentive to seek higher economic benefit by nominating fathers for it, rather than fund a work break for the biological mother, will be curtailed.
Of course the active participation of men in parenting is extremely important, and deserves the strongest possible practical support by governments and employers. Some countries with advanced systems of work/family support provide paid parenting leave for parents (usually in addition to paid maternity leave) and leave it to them to decide how to share it. In the longer term, it is to be hoped that Australia moves in this direction and improves the conditions of general parental leave. But at this point in the evolution of Australia's work/family system, the fairer provision of a Bill to the many women who at present receive no such payment is the pressing priority.
What about those at home, unemployed, or self-employed?
This Bill creates a system of paid maternity leave that is relevant to women in paid work. It is an employment-based measure, not a welfare measure, and it reflects the relevant ILO recommendations that national policies enable employees to exercise their right to work, `to the extent possible, without conflict between their employment and family responsibilities' (ILO Recommendation (No, 165) Concerning Equal Opportunities and Equal Treatment for Men and Women Workers; Workers with family Responsibilities).
However, there are strong equity arguments for assistance for all women, not just those in a paid job, when they have a baby.
About 72 percent of women in the 20-45 age range are in paid work, so most will receive assistance under this Bill. However, mothers at home, mothers looking for work, and self-employed mothers also deserve some support. Basic notions of equity, recognition of the contribution and situation of new mothers, and the community benefit that arises from well-nurtured babies and healthy families, demands support for women whether they are inside or outside paid work when they have a baby.
To this end, we propose consideration of a complementary measure beyond this bill for these women, funded out of a restructured Baby Bonus and other Allowances. As things stand, these women will continue to receive the flat rate Maternity Allowance ($798.72 at present) and the Maternity Immunisation Allowance ($208), which women who receive the Maternity Payment will be ineligible for under this Bill. Many will also be eligible for the `Baby Bonus'. If we reallocated the Baby Bonus funds ($510 million in 2005/06) to the Maternity Payment (costing around $354 million), there would remain a sizeable sum to put towards an up front payment for women at home when they have a child. Of course such a payment would need to be equitably structured in relation to womens' incomes, and other allowances (including the Maternity Payment and Maternity Allowances).
The Australian Democrats support an appropriate benefit for such women. The `Baby Bonus' is one flawed means of assisting such women. However, its bias against women who return to work, and in favour of higher income earners, its application mostly to only first children, and its stretched-out timeline of payment, make it poor policy. It should be restructured.
The Maternity Payment: how much, when, how
The Bill sets the basic, government funded Maternity Payment at the Federal Minimum wage for 14 weeks, with adjustment in line with that rate. 63.7 per cent of Australian working women actually earn less than this, and so (unless their employer tops up their government payment), will receive less than their normal pay on maternity leave. For the 36.3 per cent whose normal pay is less than the minimum wage, they will receive a Maternity Payment at the level of their normal wage.
The Bill follows the relevant ILO convention in providing 14 weeks Maternity Payment.
The mechanism to trigger the payment `piggy backs' on existing administrative arrangements for unpaid leave in the Workplace Relations Act 1996. In short, the Maternity Payment simply provides a payment in the first 14 weeks of the 52 weeks unpaid leave already provided under this Act, and minimises new administrative requirements in terms of notifying the employer, supplying medical certificates and so on.
Under this Bill, when employers are advised by their employees of pregnancy, they advise the administering department, which makes an advance payment to the employer. The employer then pays the employee the maternity payment for the 14 week period of paid maternity leave.
In effect, the employer is recouping from government the cost of the Maternity Payment. Regulations would assist employers to be paid in advance. This system has been adopted to minimally disrupt existing systems, to ensure that the period of paid leave is counted as continuous employment, and to ensure continuity of employee benefits like superannuation. This is highly desirable in light of women's lower average superannuation benefits. It is important to maintain the nexus between the benefit and employment.
The Bill has provisions for recovery of inappropriate or wrong payments. It creates an offence for misleading the department. The payment system has the virtue of encouraging the employer to notify the employee of their entitlement and ensure its payment and recovery from Government.
In conclusion, I am proud to bring to the parliament this country's first law to establish a national system of paid maternity leave. We are a little late in our history to be considering it, but better late than never. The Bill shows that the technical problems can all be solved and the Explanatory Memorandum replies to many of the myths about paid leave—some of which are peddled to feed alarmism and resistance to this long overdue reform by misleading business and the community about the cost and implications of a fair system.
Action on this issue simply requires a commitment to get things right for Australia's working women and their families. We do not need more deferral strategies—more costings, options and talk. It is time to act. I commend the Bill to the parliament.
Senator STOTT DESPOJA —I seek leave to continue my remarks later.
Leave granted; debate adjourned.
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