Budget Emergencies and Baby Making

22 / 05 / 2014

The Abbott Government has delivered its maiden Budget, raining down blows on everyone from the young and unemployed, to students, the sick and pensioners.  Amy Gray challenges the rhetoric of the “budget emergency”, and questions the ideology driving the Prime Minister’s Paid Parental Leave scheme.

By Amy Gray

Now that Treasurer Joe Hockey’s budget has literally hit every Australian that isn’t white, male, old, rich and healthy, we are carrying budget cuts few believe the country should burden.

There’s good reason for this. Our recent economic history outperforms many developed nations. We are a low-taxed population; we have comparatively small debt and enjoy a triple-A rating from credit agencies around the world. Were the Australian economy a young family, it wouldn’t be in risk of losing their house and have to move back in with Mum and Dad.

However, such blessings are ignored by the Abbott Government ministers, who are wailing like budget banshees. Cries of “budget emergency” and “crisis” are klaxons to spring everyone into action selling off every public utility they can find or at least hunker down in the air raid shelter. We know it must be real to them because they paid for the Commission of Audit, a book of austerity suggestions so dastardly it should be renamed the Necronomicon and resulting budget some nefarious spell.

Central to this odious tome is Hockey’s declaration that “if you can work, we need you to work.” Everyone back into the workforce, you chattering fools! The retirement age will be lifted, prolonging not only the working life of seniors but also the age-related discrimination they face.

The youth – whom I’m reliably informed, are either enjoying the torpor and malnutrition of the NewStart allowance, fecklessly frittering away time and money while at Uni or protesting TV shows – also face huge discrimination as they are hectored to “earn or learn.” A deregulated tertiary education system that will increase costs (and their debt burden,) a welfare system either completely shut off to them, puts them on a 6-month holding pattern or forces them into indentured labour, along with whatever other Dickensian trope Hockey can use as a blunt weapon.

But how to get the nation’s laziest of workers – women, obviously – back into the workforce? If you’re Abbott and have a history of alienating them – you know, by punching walls near them, stroking their legs, referring to housewives ironing their husband’s shirts, disliking abortion/equality/women who squander the gift of virginity, etc – it can be a hard task to attract female voters and convince them to work, which the economy desperately needs. How do you get those mercurial broads to sling a vote your way?

So Abbott took the Gillard Government’s parental paid leave scheme, copied it and made some adjustments. He included superannuation, a crucial addition for women who normally have far lower super funds. He also simplified the payment system, moving it away from the workforce and through the welfare system instead. But, more importantly, he upended a big drum of imaginary cash and promised families (but really women) more money.

Abbott also included a provision that fathers could nominate themselves to stay at home and receive the Paid Parental Leave (PPL). At first glance this appears to be surprisingly enlightened. But there’s always a stinger and this one involves a Government actively reducing its costs by taking advantage of the gender pay gap. Any father who becomes the primary carer will not receive payment based on his salary, a scandalous notion that would bankrupt the nation in a nano-second. Instead, they are paid either their partner’s or minimum wage.  In short, paid like a woman.

Their policy document helpfully notes that “the reason why the Coalition’s paid parental leave scheme is pegged to the mother’s wage is to ensure there is not a perverse incentive to send a mother back to work early in order to access higher payments based on the father’s wage, recognising that male average weekly earnings are higher at present than female earnings.” So much for Abbott’s claim  that this is a fair addition if it leverages financial discrimination in order to cut costs and keep women at home.  This is less Swedish enlightenment, more like Stockholm Syndrome.

Abbott believes the PPL will boost and retain women’s participation in the workforce, which is aligned with Hockey’s cries that everyone needs to work. Unfortunately, this doesn’t pass muster when you look at the facts.

Greg Jericho has comprehensively explored this topic for the Guardian and noted the planned funding from a modest increase to company tax rates for organisations earning over $5m has actually plummeted from 2011-2012 forecasts of $81.5bn to 72.5bn. So, as the supposed source of the fully funded PPL, it will be interesting to see how Hockey will pay for such an expensive scheme during what we’re told is a “budget crisis”.

Further, Jericho notes that not only does the scheme favour the privileged who earn more money, but it will have negligible impact on boosting participation because most women at the higher echelons are already invested in returning to work and have workplace-arranged paid parental leave schemes in place. This has been backed by the Productivity Commission who deemed that Abbott’s scheme “would have few incremental labour supply benefits”. In short, it will cost a lot and not deliver much.

As have others, Jericho has presented evidence that the surefire way to boost female participation in the workforce is in quality, affordable childcare and quotes the IMF, which stated “if the price of childcare is reduced by 50 per cent, the labour supply of young mothers will rise on the order of 6.5 to 10 per cent.”

Instead of following such measures to ensure everyone that can work must work, we have a government that took an axe to proposed pay increases for childcare workers and told them to hand back any money they may have received. This is not the action of a government who wants women in the workforce as either a childcare worker (96%) or client. And that scheme cost $300mn, mere pocket change from Abbott’s $5.5bn PPL.

So, it must be asked, why is the Coalition persisting with this nonsense? It costs a lot, will barely make a dent in increased participation and takes women out of and not into the workforce.


Australia is in a perpetual panic about population growth, so much so, it has a history of financial incentives for new parents to encourage more births. While a robust immigration policy helps to increase numbers and slow the rate Australia’s aging population, many politicians believe increasing births will sustain Australia’s economy as an act of mutual growth.

So, this isn’t about getting women to stay in work. This isn’t about women existing as equal partners in society contributing their best. It’s about Abbott trying to keep women doing what he thinks women do best: make babies.