Paid Parental Leave Amendment (Flexibility Measures) Bill 2020
It's a pleasure to be able to speak on this really important issue today in the House, an issue that is very close to my heart and one of the reasons that drove me to make the decision to spend time away from my toddler and do this important work on the Paid Parental Leave Amendment (Flexibility Measures) Bill 2020. I thank the government for bringing the amendment to the House today. It is a good amendment and it's one that we're pleased to support. I would also like to recognise the contributions of the member for Jagajaga and the member for Perth last night in this debate, and the member for Canberra just now. It is really heartening to be part of a class of 2019—and I acknowledge the member for Stirling across the way—who are parents of young children. We are living the hustle, and we understand the hustle of parents across Australia: we navigate these jobs and have the flexibility required to do them whilst caring for our young children.
This is a bill essentially about levelling the playing field for women and for their working families. I think it's important to note in discussing the detail of the amendments that paid parental leave is just one element within a plan to level the playing field for women and their working families. It's an important one, but it is one of the prongs.
I wanted to use this opportunity today to highlight the thoughts of a constituent of mine named Felicity, who has written to me recently about paid parental leave and her experience within the current regime. She says: 'My experience has highlighted that women in the later stages of pregnancy are at a special disadvantage in that the policies around childcare and PPL are structured around a parent's ability to be able to obtain work should they wish to do so. It is unfortunately the reality that employers are not willing to provide employment to these women. I recognise that policy cannot anticipate all individual circumstances and that the issues I'm bringing to your attention would only affect a small subset of the population. However, that population is especially vulnerable and uniquely exposed to a high risk of mental health issues, which are made considerably worse with these kinds of worries and stress. In terms of suggesting how to resolve the issues, it would be simple enough to introduce an exception to both tests should a pregnant woman cease employment unexpectedly more than halfway through her pregnancy. The second proposal is attractive, as it provides some accountability to organisations ceasing women's employment at this especially vulnerable time.' I think it's a good suggestion. I thought it was worth mentioning in the House today, and I thank Felicity for taking the time to highlight to people like myself how the scheme actually lives and breathes with you as you are navigating it, as opposed to something that we academically consider as we bring it to the House for introduction or for amendment, as we're doing today.
Returning to the topic of how we level the playing field for women and how paid parental leave is an important prong of that, we need to do more than that. We need to lift their wages, because, like the member for Canberra before me spoke about, the gender pay gap can add up to hundreds of thousands of additional wages over a lifetime of work for women doing the same job as their male colleagues. In Australia, the gender pay gap is currently at 14 per cent. The average salary for a woman is $57,168. So 14 per cent of the average salary of Australian women over 45 years is $360,163. What that means in real life for women like Felicity is that as they consider what the impact will be over the course of their career at the moment, today, in real terms, it's $360,000 per child, considering the wage gap. So we need to protect women like Felicity and their right to organise.
We need to provide additional insurance to workers who need to take time off to care for a loved one, whether they are a newborn or an elder, in a way that doesn't financially punish them for doing something that helps us all. We do not value care enough in our society, and that is reflected by how we pay people who do the caring work in our economy. Childcare workers and aged-care workers are some of the most minimally paid people doing the most essential work in our society. We know that from birth to five years of age is the most critically important time for a child's physical and mental development across their lives, yet at the moment the people who work in our childcare sector are paid minimum wages and we can't get them to stay, when it would be in everybody's interests for them to do so.
I note also that currently the House awaits the findings of the royal commission into aged care, where we know that the same problem exists. People doing the work of caring and respecting our elders—at a time when they return to being incredibly vulnerable, like at the start of their lives—face extremely low wages and difficulty around their working conditions. This is all relevant; this all comes together. We need to use opportunities like we have today, even with amendments to help in respect of paid parental leave, to consider what we are doing for working women, particularly those who care for young people and for elders alongside the work that they do to contribute to our economy and the growth of our economy.
I would also note that we need to expand the rules of the road around flexibility, and that's one of the things we're doing today. Our amendment assists with flexibility for the existing scheme, and it's a good thing and I'm glad that we're doing it. But too many low wage earners have little or no say over when they work or how much they work. Too many operate in a situation where they get a text calling them into work the night before or at the last minute in the morning. That is difficult in itself, but it's particularly difficult when you have to arrange care for your child. It is also very hard to run a household budget and to pay childcare fees when you have wages that fluctuate so much as a result of uncertainty and volatility in your hours.
We also need to note that insecure work and casual work are on the rise, and both of these things make paid parental leave, in its existing scheme, more difficult for women and their families to navigate. At the moment, what I see today is a failed opportunity to address that problem.
I also think we should note that, after a lifetime of work, retirement with dignity should be guaranteed to every Australian, particularly to women and to the working mothers who have got us all here. But we know that women over 55 are currently the largest cohort of recipients of the Newstart allowance. We also know that women over 55 are the largest growing group of people experiencing homelessness in Australia. You can draw a line between women who take time out of the workforce or had to leave the workforce in previous decades to care for children and have now come to the point in their lives where they are retiring and women who are in need of the pension and are experiencing homelessness or are reliant on Newstart. We need to address things like paid parental leave—which could make that situation easier, with the resulting impact on superannuation—now, in opportunities like we have with today's amendment, rather than not address them, and we need to consider the problem as a whole.
I would note that, on average, women have 47 per cent less superannuation than men when they retire. That is largely because, when people take leave to care for their children, they do not get paid super. Very few sectors and workplaces pay women superannuation when they are on parental leave. It is far more frequent and common to do so in Europe and in Scandinavian countries. I note again that, whenever we discuss issues around working women, we ultimately turn to Scandinavia to see what the best practice policies are, what we could be doing and how far we have to go to get there.
It has been shown that women who spend time outside the paid workforce have a tendency to hold multiple roles and live on a system of payments throughout their lives, not just wages—whether that be, for example, the paid parental leave payment or the baby bonus, as it was in a previous decade. In this context, having a $450 threshold, not providing superannuation to women of all ages and not accumulating super in periods outside the workforce all bundles together to mean that women suffer an economic penalty from undertaking vital caring roles. That's a penalty that isn't shared equally across the average family, no matter how well intentioned you are and how hard you try.
This is something I talked to Gai about. Gai is a widow who came to parliament in the previous sitting fortnight to talk about this issue with parliamentarians. Gai has just retired, but she still needs to work 10 hours per week to supplement her pension and her super. She has to work to get by, but she's thankful that she owns her own home. Gai is someone who took time out of the workforce to care for her children, who was not paid during that time and who now suffers an economic penalty in her later years. In particular, Gai is concerned about women who are renting, rather than owning their home like her. Her super was hurt by the freeze a few years back. She thinks she lost approximately $4,000, not including compounding interest in rates. She talks about the discussions she has with other Australian women over 55—people who are asking us in this place to do better. They say that in their retirement they can't afford to go on holidays. They feel socially isolated because they can't afford to go out with their friends or take their grandchildren on excursions because, to survive, they need every cent for their existing expenses.
You can draw a line from how we treat paid parental leave and new mothers to how we support them re-entering the workforce, which increases productivity and helps our economy to grow, right through to what those women face three or four decades later when they do not have accumulated salary and superannuation equivalent to that of their male counterparts, and what that means when they are no longer in the same relationship they were in and were perhaps reliant upon when they first had children.
Ultimately, we are falling behind on paid parental leave, which I'll narrow my remarks to today, but it's something we need to do more about. This is a failed opportunity. This is an amendment to make our Paid Parental Leave scheme better. It a good amendment, but it should have been one of 28 amendments. The scheme is now 10 years old. We're still working on the same information and data from 10 years ago, but the world has moved on since then.
Last night, in this debate, the member for Perth spoke about the international comparison and how we have one of the least generous paid parental leave policies in the OECD. Current rates of Australia's paid parental leave entitlement cover only an average of 42 per cent of the previous earnings of participants; it amounts to about 7.6 weeks of full-time pay. In Norway, parents can access 35 weeks of paid parental leave at the full amount. Estonia offers mothers 85 weeks of paid leave, Hungary offers 72 weeks and Bulgaria offers 65 weeks. Finland, with a 34-year-old female prime minister, recently announced that their paid parental leave will be extended to nearly seven months, in line with paid maternity leave. That is paid parental leave in line with maternity and paternity leave. They have listened to UNICEF, who asks: how can we make sure that our kids get the best start in life and how can we give each parent the chance to bond with their children to form relationships that will last a lifetime? We should also value the work that people do when they give up financial reward to care for our little children and to care for our elders. It's really important. We're falling behind.
I would also like to note the member for Jagajaga's comments about this, and her important work over the years, from 10 years ago and right up to today, to try to make this the best scheme we could possibly afford. But it should also be the best scheme that we deserve.
I conclude my remarks by reiterating that this is a failed opportunity to help level the playing field for Australian women and for the families that they work for. We need to lift their wages. We need to fix the gender pay gap. We need to protect women's right to organise. We need to insure and support our workers who take time off to care for loved ones. We need to support them financially while they support the cohesion of our community and the strength and the productivity of our economy. We need to enforce the labour laws that we've already fought so hard to achieve. We need to expand flexibility for all workers, not just those lucky enough to work in best practice workplaces. We need to tackle insecure work; we need to address that. We need to push back against casualisation of our workforce. We need to make laws that allow all workers to retire with dignity. Days like today are a missed opportunity to get to work on these imperatives. Days like today remind me that to change the country, to get us the country that we all want, we're going to have to change the government. I thank the House.