Paid Parental Leave Scheme,5AA Adelaide
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MIKE SMITHSON: Well as I said many people say it’s overdue, long overdue, legislation has finally been passed for eighteen weeks’ paid parental leave for mums and dads, it takes effect from January next year. Now that’s great news of course if you just discovered you’re about to have your first or your next child. It will only apply to employed mums and dads so you’ve got to have a job and it will pay the equivalent of a minimum wage of about 570 bucks a week for eighteen weeks. Sounds pretty good. However your income can’t exceed $150,000. Now, that’s not a problem for most people. Federal Families Minister, Jenny Macklin, has been kind enough to join us on the line. Morning Minister.
JENNY MACKLIN: Good morning Mike.
MIKE SMITHSON: Now we say it’s long overdue. How significant will these changes be?
JENNY MACKLIN: It is certainly long overdue. I think families have been waiting decades for Australia to catch up with the rest of the developed world so it will be very, very important, especially for many families, mums or dads, who have not had access to employer funded paid parental leave. So if you think of the casual and part- time workers, seasonal workers, contractors, so there are many thousands of families who now will get financial support to spend eighteen weeks at home with their newborn baby. I think we all know just how critical those early months are.
MIKE SMITHSON: Are there any cancers? For instance, do you pay tax on that $570?
JENNY MACKLIN: Yes, you do pay tax. It is taxable, so it will also be paid just like a wage. So it will be paid according to your normal pay cycle.
MIKE SMITHSON: So how does someone, let’s just say for instance, a mum and dad out there, they’ve just received the good news, they’re expecting a child. Do they have to do a mountain of paperwork or is that done for them?
JENNY MACKLIN: No. One of the good things is we’re making sure that people can do some of their paperwork before the new baby comes along. I know this has been one of the frustrations for families. So in this case we’ll make sure that people can start getting their paperwork done from the beginning of October if their baby is due early in January. The scheme will start on 1 January but families will be able to get their paperwork done a couple of months in advance and they’ll be able to do that both for Family Tax Benefit and for paid parental leave.
MIKE SMITHSON: So Minister is there some flexibility here that someone for instance who has a baby around about now? Do they qualify in some form?
JENNY MACKLIN: No.
MIKE SMITHSON: Or what’s the starting date and what’s the crunch time where this starts to benefit families?
JENNY MACKLIN: The start date is 1 January. It’s always hard when you’ve got a new scheme starting. You have to have a start date and I know it’s hard because people have waited so long but it will be from 1 January. We’ve got a lot of work now to do with the Family Assistance Office to get it all up and running so that’s when it will begin.
MIKE SMITHSON: So let’s just get this clear. The baby that is the catalyst for you getting the parental leave, the paid parental leave, the baby has to be born after January, on or after 1 January?
JENNY MACKLIN: On or after. That’s correct.
MIKE SMITHSON: What about for those families, how do you explain to families that might have the baby on 31 December?
JENNY MACKLIN: Well that’s always the difficulty isn’t it with any program that starts. There has to be a start date. So if it was the 31 December you’d ask me about the day before, so that’s just the way it works. And I think you’d understand that what ever system we’re running, there’s always a start date.
MIKE SMITHSON: But that’s going to be very disappointing.
JENNY MACKLIN: It’s going to be hard.
MIKE SMITHSON: It could be quite traumatic for people in fact?
JENNY MACKLIN: Well my birthday is 29th December. I understand these issues, so I know what you’re getting at, but I think people will also understand we have to have a start date. It is 1st January. We’ve had parents wait decades for paid parental leave, it’s finally going to happen.
MIKE SMITHSON: Now the Opposition had put forward amendments that have been more generous than your own, but obviously the amendments didn’t get up. Are we short changing mums and dads out there? Some might say, well we would have preferred to see the amendments and had a better deal than we’re getting now?
JENNY MACKLIN: Well, I’ve just seen the Leader of the National Party commenting this morning that he has concerns about the size of the payments that Tony Abbott is talking about, so it does seem that the Opposition is proving that they’re actually split on the details of the policy. You’d be aware that Mr Abbott has said in the past that paid parental leave would be introduced over his dead body, so I’m not sure what the Opposition is going to do now. They have said that they’re going to introduce a new tax on some companies to pay for their paid parental leave, but they seem to be divided on these issues.
MIKE SMITHSON: So how do you pay for it?
JENNY MACKLIN: We’re paying for this as part of the Budget. It was budgeted for in last year’s Federal Budget so it is fully costed and funded in the Budget.
MIKE SMITHSON: Jenny Macklin, if someone doesn’t have a job today but they might have a job in September, is there a qualifying period for how long you’ve actually been fully employed?
JENNY MACKLIN: Yes.
MIKE SMITHSON: To get this allowance?
JENNY MACKLIN: Yes, there is. There is a work test. It’s 330 hours in the ten months’ period before your baby’s born. So that’s around a day a week.
MIKE SMITHSON: So that’s all you have to work?
JENNY MACKLIN: Yes, that’s right.
MIKE SMITHSON: So that’s not full-time employment though is it?
JENNY MACKLIN: No, no it’s not full-time employment, that’s the point I was saying before. This is really very much aimed at those people who’ve never had access to paid parental leave, especially part-time and casual workers. They too, of course, need to have time off with their babies and we’ve wanted to make sure there was a generous work test.
MIKE SMITHSON: And it’s the mums and dads, do you expect a big take up rate with dads as well as mums, that the mums want to go back to work, but the dads want to stay home?
JENNY MACKLIN: We are saying to families that this is a choice for you. If parents want to share the leave they can. So if mum wants to take the first period off to recover from the birth and breastfeed for a while, she can do that. And then she can hand over the remainder of the leave to dad if he’d also like some time home with the baby. So we really want to say to parents, this is a choice for you.
MIKE SMITHSON: Now I know I’m sounding technical here, but if you’re passing the baton from mum to dad, does that double the paper work? What I’m trying to ask is, you would want a very simple system for a young family…..
JENNY MACKLIN: Sure.
MIKE SMITHSON: Who is just coming into this, is a little bit blinded by the science and the technology and the red tape or paperwork or bureaucracy…
JENNY MACKLIN: Yep.
MIKE SMITHSON: Do you have, does it become more complicated if you want to share the load?
JENNY MACKLIN: No, the Family Assistance Office will help families work through all that. Of course, it’s a new scheme that’s why we need the next six months to get all the systems in place. That’s the work that the Family Assistance Office will do and we’ll try and make sure it’s as simple as possible for families. We know that they want to concentrate on caring for their babies and we want that too.
MIKE SMITHSON: Okay, just before we let you go, do you expect with the incentives that are on offer, and look I’m all for it, I think it is a great move. But do you expect a bit of a population spike in 2011?
JENNY MACKLIN: I’m never one to get involved in these discussions Mike. I think having a baby is a very, very personal thing that families themselves decide.
MIKE SMITHSON: It’s a pretty good incentive though?
JENNY MACKLIN: I think families will make those decisions but what I’m pleased about is that finally there is going to be support for families, financial support for families when they do decide that they want to have a baby. It is a very, very special time for families and I’ve spoken to so many mums and dads who are forced back to work very quickly after their baby’s born because there’s no paid parental leave. It’s very, very hard for those families and so I do hope this will make it much easier for them and better for their babies.
MIKE SMITHSON: Okay, Jenny Macklin, thanks for joining us this morning.
JENNY MACKLIN: Thank you Mike.