Coalition PPL plan doubts

The coalition’s proposed parental leave scheme has come under attack from equal opportunity advocates, who argue investing in childcare would be a better way to boost participation.

Under the coalition’s plan, primary carers would receive 26 weeks’ leave at their actual wage, up to a maximum annual salary of $150,000, from July 2015.

In contrast, the Labor government’s existing parental leave scheme offers primary carers 18 weeks’ leave at the minimum wage.

Opposition leader Tony Abbott claims the coalition’s scheme will boost productivity by acting as an economic driver to encourage greater female participation in the workforce, describing the existing arrangements as inadequate.

The coalition has faced criticism for the high price attached to the plan, however, with the total cost of the scheme expected to reach $5.5 billion per year.

Industry groups including the Business Council of Australia and the Australian Mines and Metals Association have previously questioned the wisdom of the plan to fund its parental leave scheme through a 1.5 per cent levy on the nation’s 3,200 biggest companies.

Australian Women Chamber of Commerce and Industry chief executive Yolanda Vega said the funds would be better spent on affordable childcare, which she described as the core issue holding back women from participating in the workforce.

“I don’t think it’s a policy that’s been thought out,” Ms Vega told Business News.

“Realistically, I believe that $5.5 billion could be spent better off elsewhere on a more holistic way.”

Plans to boost productivity by encouraging greater female participation in the workforce could extend to subsidising nannies, with the coalition promising to examine the idea as part of a Productivity Commission inquiry into childcare reforms if elected.

Childcare Minister Kate Ellis has questioned whether subsidising in-home care, which she said would cost about $2 billion, would provide benefits to low-income workers.

Ms Ellis has also expressed concern that the nanny industry is not regulated, meaning the government would be funding private care without appropriate checks and balances.

The AWCCI points to the example of France, where in-home child care is heavily subsidised as part of a broad series of measures aimed at encouraging greater female participation, and care workers are required to register with local authorities and undergo comprehensive training.

“What we’ve proposed in our issues paper is that the childcare centres themselves manage the outworkers,” Ms Vega said.

“Just like you go to a temp agency to get a secretary for the day … the same model can be applied to childcare and managed by the childcare centres themselves, which have the capacity to ensure that the workers are qualified and legitimate.”

A number of large resources employers have introduced benefits to attract and retain female workers, with a Workplace Gender Equality Agency survey earlier this year revealing that the mining industry performed above average when it came to parental leave schemes.

Rio Tinto offers its employees 18 weeks’ leave at full pay in addition to the government-funded 18 weeks leave at the minimum wage.

BHP Billiton took pre-emptive action by introducing an 18-week parental leave scheme in mid-2009, a year and a half before the federal government’s leave scheme came into effect, while Woodside Energy, Fortescue Metals Group and Alcoa each offer 16 weeks’ leave.