Coalition Paid Parental Leave Scheme Funding

Comments by Business Council of Australia Chief Executive Jennifer Westacott

Australia needs to support higher workforce participation to maintain our prosperity into the future in particular to offset the impacts of an ageing population.

Access to paid maternity leave, as well as reasonably priced, high-quality child care, is an important piece of the jigsaw.

Suggestions that the Coalition may renege on its promise to offset its proposed 1.5 per cent levy on larger businesses defies economic sense at a time when many businesses are struggling to stay competitive in a tough global economy.

Comments by the Opposition leader Tony Abbott that some businesses would be better off because they would not have to fund their own employer maternity leave schemes do not seem to stack up compared to the cost of what is in effect a 1.5 percentage point increase in the company tax rate.

Both political parties need to remember that it is only a growing economy that will ultimately pay for big-ticket policies, and taking action that loads up business costs and stunts investment and growth ultimately will be a dampener on the revenue available to pay for these services in future.

The government’s approach is broadly in line with the recommendations of the Productivity Commission inquiry into paid maternity leave and provides for an appropriate period of publicly funded paid maternity leave, which employers can add to if they wish.

The Coalition’s proposed approach goes beyond the recommendations of the Productivity Commission and imposes a levy on larger businesses, the very businesses which are already doing the heavy lifting on funding the most generous employer maternity leave arrangements.

For further information contact:
Scott Thompson, Director, Media and Public Affairs
Business Council of Australia
Telephone (03) 8664 2664 | Mobile 0403 241 128