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Everything You Need To Know About Tony Abbott’s Decision To Dump His Paid Parental Leave Scheme

Everything You Need To Know About Tony Abbott's Decision To Dump His Paid Parental Leave Scheme
Everything You Need To Know About Tony Abbott's Decision To Dump His Paid Parental Leave Scheme

Photo: Getty Images

Prime Minister Tony Abbott yesterday announced the decision to dump his $20 billion dollar paid parental leave scheme. The “signature” package, which was to include full salary plus super payments for new mothers for up to six months (capped at an annual income of $100,000), has now been downgraded to a smaller “families package”.

But what does this actually mean for new parents?

Firstly, you will still receive paid parental leave. The current system allows for up to 18 weeks of financial support paid by your employer or from the government. The payment rate is $641.05 a week – the minimum wage - for a maximum of 18 weeks. This is not changing.

Secondly, you will still get the childcare rebate if you are eligible. In fact, the Prime Minister is proposing a “families package” that hopes to restructure and streamline the childcare benefits scheme.

But the details of this are unclear, as the Prime Minister’s speech to the National Press Club revealed. The Prime Minister said that the policy would be refined in the lead-up to the next budget and that he would “consult widely” in the formation of a “better childcare policy”. This could mean that, in the future, childcare subsidies might increase.

The Prime Minister did concede that although his “signature” paid maternity leave policy has been shelved for the moment, it is not completely off the table. The Prime Minister hinted that he would like to revisit the policy in the future when the budget is in better shape.

But for now, paid parental leave has reverted back to the current 18 weeks scheme. That's more than the United States (which has no government mandated parental leave scheme), Switzerland, Germany and Japan, but far less than Norway and Denmark, where parents can take a year off work after having a children (and receive their full salary for the entirety of that year).

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