ABC Radio National Breakfast with Fran Kelly
FRAN KELLY: So Minister you say this is about fairness. It’s going to make the scheme fairer. How is it fairer for, as Jenny Macklin said, workers – women working at McDonalds and Woolworths and low paid schemes to no longer have access to that scheme and the Government’s scheme?
MINISTER PORTER: Well I might just start by noting that that’s the same sort of language Jenny Macklin used in opposition to the schoolkids bonus, the Family Tax Benefit changes, to the pension asset test…
FRAN KELLY: Is it true though?
MINISTER PORTER: … changes in working periods and all of those ended up being supported by Labor, but I don’t think it is true, I think it’s deliberately inflammatory language.
The system that we’re trying to reform is that right now, without change, the present system can see a high income parent receive more money in combined PPL – paid parental leave – in 18 weeks than a low income parent can earn in an entire year. Now that is not a system that is fair, or should be supported.
FRAN KELLY: So let’s get a proportionality to this. How many women – because I put that example to Jenny Macklin earlier – how many women are in that situation, women on $140,000 per annum who can currently access up to $44,000 through the joint schemes?
MINISTER PORTER: That’s right at the top of the scheme. There’s about four per cent of people who, under the proposal that we are putting out, will no longer be able to access any of the paid parental leave that the taxpayer offers. Now that’s a small group at the top but that is happening at the moment and costing the taxpayer a very large amount of money. And it’s because of the fact that we can find savings in this system that we’re actually able to bring new people into the system, and that’s what this legislation does – so for the first time ever you’ll be able to have women, mums, in physical professions – building, jockeys, mining – they’ll be able to join this system for the first ever time because of the savings we’re making.
People in casual employment who’ve previously been excluded, like casual teachers, they’ll be able to join the scheme for the first ever time because of the savings that we’re making.
And yes, in the middle of the scheme there’ll be some limitation to the access to the taxpayer funded amount, but that is made in reference to your income and the generosity of your employer scheme…
FRAN KELLY: I’m just trying to decode what you’re saying there. You say ‘some limitation’ – basically the change is that if you currently have access say to many of the schemes have twelve weeks employer scheme. Currently you get that twelve weeks access, plus you get access to the 18 week minimum wage government scheme, so that’s 30 weeks…
MINISTER PORTER: That is irrespective of your income…
FRAN KELLY: Yes, that is irrespective but now under this change no one will be able to get more than 18 weeks paid parental leave will they?
MINISTER PORTER: Everyone gets, under this scheme, everyone gets a minimum 18 paid weeks at, at least, the minimum wage. No mother misses out on a minimum of 18 weeks at, at least the minimum wage.
But if you have an employer scheme, and let’s say that that’s a fairly generous scheme, and it’s a scheme that pays you at a good wage for 14 weeks, then we, the government, through the taxpayer, will provide the extra four weeks.
So we think that that is a fairer system because it saves money in the system, which can be reinvested to allow more people to join the system. And as I say, for the first time ever, because of changes to the work test in this legislation, a whole range of mums who were previously excluded can join in the system and have access to the 18 weeks paid parental leave from the taxpayer at minimum wage.
FRAN KELLY: Ok. Two questions that come to mind, I think a lot of people listening would go ‘why would a government think it’s a good idea though to reduce women’s paid parental leave scheme from 30 weeks, for quite a lot of women in this country at the moment, to 18 weeks?’
Why is it a good idea to have a paid parental leave scheme that funds women to stay home for a lot less time? Is that in the interests of the children?
MINISTER PORTER: Well Fran, the taxpayer funded paid parental leave scheme has always been 18 weeks, and it’s always had to be taken in a block of 18 weeks…
FRAN KELLY: Yes, but it was designed at the time, as I recall it, in terms of the productivity recommendations, to work in association with the employer scheme wasn’t it?
MINISTER PORTER: And it’s still meant to work in association with the employer scheme. You can negotiate with your employer how long you want to have off – but what we’re saying is that everyone should receive a minimum is 18 weeks at, at least the minimum wage. We shouldn’t have a system that allows a very high income mother to earn $44,000, in effect, in an 18 week period, which would take a low income mother an entire year to earn. I mean that is a system, surely, that can’t be argued as fair or sustainable in all the present circumstances.
FRAN KELLY: Well the problem was the Government did argue it as fair and sustainable with their six month scheme on much higher levels for some women for a long time, for many years, which makes it look as though this is just a money saving exercise.
MINISTER PORTER: Well there are sustainability’s into the budget that we’ve got to consider going forward. And the reality is money we can’t save now we are borrowing to fund, which means that a future generation of young Australians will have to pay that money back into the future.
But also, the savings that we can generate here are allowing us, as I say for the first time, to bring in a range of mothers who were previously excluded…
FRAN KELLY: Let me ask you about this, because this is a major social reform, it was heralded at the time, it was hard fought, that campaign you will remember, it was heralded at the time as a major social reform that Australia had been seen to be lagging behind. Now you’re saying, and I’m quoting you here, ‘those with substantial employer provided funds will make the scheme fairer and more equitable in its distribution of funds, and will not seek to undermine the objectives of the scheme’.
So can I ask you now, what in your view are the objectives of this scheme? Is it to save money, or is it to increase productivity and get women back to the workplace sooner? What is it?
MINISTER PORTER: It’s the latter. It’s always been the case that the scheme has been designed, and these changes are also designed, to try and ensure that as many mothers are participating in the workforce and are able to re-participate after the birth of a child, having provided for a fair amount of time to bond with the child after birth.
You know, I’m in a family that has been through that myself, of course that’s incredibly important…
FRAN KELLY: 18 weeks isn’t that long is it, to go back to work after four months?
MINISTER PORTER: But of course the funding for all schemes, whether it’s one type of welfare or another, has necessary limits around it. And to enable us to have a sustainable scheme that can have the best direction of funds to low income earners, and to bring in for the first time a whole range of women in dangerous professions, like construction or jockeys, for the first time ever to bring in a whole range of mums in casual professions, we have to find savings in the scheme. And we think the best way to find savings is to look at that top part of the scheme where there are people with very generous employer funded schemes who are also receiving a full $12,000 amount which leaves them with an 18 week amount far in excess of what some people earn in an entire year.
FRAN KELLY: Just finally, last week we spoke with Bruce Bonyhady, he is the outgoing Chair, we believe of that National Disability Insurance Scheme, he is widely regarded as the Grandfather of the NDIS. Why are you sacking him, and do you agree with him, it’s important that there is some experience on the Board with disability?
MINISTER PORTER: Well I’m not going to go into commenting on individual personalities on the Board, because we’re in the middle of that process, but when I first became the Minister for Social Services, the first thing I did was extend the terms of the present Board, half by six months and the other half by 12 months. And of course the system that the previous government, the Labor government, put in place was such that there were three year fixed terms. And had it not been for that extension everyone’s term would have ended at 30 June of this year.
The Board has to be designed to have a range of skills. In fact, what the Act says is, the range of skills have to be across insurance, finance, corporations and disability services. But let me assure you Fran, the Board, at the end of this year, will be as strong, stronger, than it has ever been with the best possible blend of skills to take the NDIS forward.
FRAN KELLY: Christian Porter, thank you very much for joining us.
MINISTER PORTER: Thank you.