It’s hard to find an issue as badly misunderstood in Australia as paid parental leave.
Here, it is variously couched as an unnecessary extravagance, a “first world problem” (according to the Social Services minister Scott Morrison), a luxury, a ‘rort’.
It is very rarely explained as a public investment with rich – social and financial – rewards.
In 2009 Labor introduced Australia’s first paid parental leave scheme. It offered the primary carer of an infant up to 18 weeks’ of the minimum wage, that could be received in conjunction with any parental leave paid by the parent’s employer. It had twin objectives of enhancing child and maternal well-being and supporting parental work force participation.
It was designed to get as many new parents as possible close to 26 weeks of paid leave, the standard recommended by the World Health Organisation for optimum long term health benefits. It was a welcome safety net and split the cost between government and business.
For context, in 1970, 45 years ago, an average of 17 weeks of paid leave was available to mothers across OECD countries. By 1990 this had increased to 39 weeks, while by 2014 the OECD average stood at just over one year.
To reiterate, in 2015, Australia offers mothers 18 weeks paid at the minimum wage. And rather than progressing forward, we are regressing.
In one of the more whiplash-inducing policy twists of recent times, in just six months last year the coalition government moved from a position of increasing paid leave entitlements to 26 weeks at full replacement wage, to cutting the existing entitlements of up to 80,000 families, by up to $11,000.
Before we figure out how that happened, this question needs to be answered.
Why is it paid at all?
Paid parental leave is not merely a gesture of good will, a generous folly or a concoction of bleeding hearts or greedy mums. It is paid by governments around the world because economically and socially it makes sense.
The Productivity Commission Report on Paid Parental Leave in 2009 noted that there is compelling evidence of health and welfare benefits for mothers and babies from a period of postnatal absence from work for the primary caregiver of around six months.
Governments save money on health because of the proven long-term benefits of mothers being able to spend time with their new babies. And they stand to make money because it enables more women to continue participating in the workforce, thus increasing the pool of taxpayers from whom they earn revenue.
In Australia the latter is a legitimate economic priority: the inter-generational report handed down by Joe Hockey last year made it clear that because of our ageing population we need as many women working as possible.