Budget 2014: Hockey says details of paid parental leave scheme will depend on states

Federal Treasurer Joe Hockey has said the government is still determining the “exact numbers” of its paid parental leave scheme with the state and territory governments.

The government reinforced its commitment to the scheme in its 2014-15 budget on Tuesday night, despite the policy barely rating a mention in the budget papers.

However, according to the mid-year economic and fiscal outlook issued in late 2013, provision for the policy has been made in the contingency reserve, a pile of government cash reserved for decisions made by the government but not yet announced, or decisions that were made too late to be included in individual portfolio estimates.

Responding to questions about the lack of detail about the policy in the budget papers, Hockey told the National Press Club yesterday the government is still finalising negotiations with the states and territories, which currently administer their own parental leave schemes.

He did confirm, however, the income threshold for the policy has been scaled back, from $150,000 to $100,000, as indicated in the budget overview document released on Tuesday.

“There weren’t too many journalists criticising us for breaking that promise,” he said, in reference to accusations the government has broken multiple election promises in its first budget.

Diversity strategy and compliance consultant Prue Gilbert told SmartCompany the state and territory governments currently top up the federal government’s paid parental leave scheme by providing around 14 weeks of replacement pay for workers in government sectors.

This is in addition to the 18 weeks of parental leave currently provided by the Commonwealth.

While Gilbert says there is little detail available about how the new scheme will work, she said she imagines the negotiations with the states rest on the Commonwealth “wanting the states to abolish their own schemes and give those funds to the Commonwealth, which would take over responsibility for parental leave”.

Gilbert says it’s fair to say the government is “playing down the focus” on the policy, which has attracted criticism from opposition parties and from within the Coalition’s own ranks.

She says it’s important to place the spending on the policy in perspective, within a budget that is “investing the most money in industries that are not female-friendly, such as construction”.

“The scheme does actually support mothers and increase workforce participation,” said Gilbert. “It’s also in the best interests of the child”.

The paid parental leave scheme will not be the only sticking point in the government’s future dealings with the states, with media reports today revealing a number of premiers are “furious” at the government’s plans to rip $80 billion out of hospital and education funding.

Fairfax reports Queensland Premier Campbell Newman has accused Prime Minister Tony Abbott of trying to force the states into lifting the rate of GST to make up the slack in the budget, while newly installed NSW Premier Mike Baird has labelled the funding cuts “a kick in the guts to the people of NSW”.