Announced: proposal to introduce taxpayer-funded parental leave

The Productivity Commission announced on September 29, 2008 a proposal to introduce a taxpayer-funded paid parental leave scheme that would:

• provide paid postnatal leave for a total of 18 weeks that can be shared by eligible parents, with an additional two weeks of paternity leave reserved for the father (or same sex partner)
• provide the adult minimum wage (currently $543.78) for each week of leave for most eligible employees, with benefits subject to normal taxation.

The proposal provides for businesses to act as 'paymasters' for the government-funded scheme, and also for businesses to fund capped superannuation contributions for employees for the period of leave taken.

All employees with a reasonable degree of attachment to the labour force would be eligible, including the self-employed, contractors and casual employees. A broad range of family types would be eligible, including conventional couples, single parents, adoptive parents and same sex couples, so long as they meet the employment test.

The Rudd Government will now consider a response to the proposal with a report due in February 2009.

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