Australia Budget 2022-23: Paid Parental leave to support new dads

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 Australia Budget 2022-23: Paid Parental leave to support new dads
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Highlights

  • The Paid Parental Leave (PPL) would see some major changes as per the latest budget announcement.
  • The Paid Parental Leave can be taken any time within two years of the birth or adoption of a child.
  • The introduced changes are likely to promote equality in the workplace, allowing more women to participate.

In its latest budget announcement, the Morrison government has made some crucial changes to the existing Paid Parental Leave. In a bid to make the paid parental leave scheme “fairer” for more Australian families, the government wants to introduce more flexibility to the system and expand the eligibility criteria.  

A combined 20 weeks of paid parental leave can be availed by new parents, both moms and dads, under the changes announced in the budget. The scheme has been designed to offer an easier path to young parents struggling to maintain a work-life balance. 

The Paid Parental Leave, which can be taken any time within two years of the birth or adoption of a child, has received a significant boost. The move is set to encourage a greater number of women to take up jobs and engage actively in the workforce while providing them financial security.  

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A great step up for new dads

The major reset to the structure for young parents is the integration of “Dad and Partner Pay” with Parental Leave Pay to create a single, shareable scheme that families can access as per their requirements. The 20 weeks’ combined leave can be split between parents in the two years following the child’s birth or adoption. Single parents would be offered an additional two weeks of paid leave, allowing them access to a total of 20 weeks of paid leave for the first time.

Throwing light on the importance of putting the preference of families first, Treasurer Josh Frydenberg stated that “Families, not government, are best placed to decide what works for them.” He also stated that 180,000 new parents access the Paid Parental Leave each year, and the changes would benefit them all.  

However, the most important takeaway from these changes is the big push given to leaves for new dads. Dads and partners can access the government’s scheme at the same time as any employer-funded leave, bringing them at par with mothers, who can currently avail the same.  

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Broadening the eligibility

Another area targeted by the government is expanding the eligibility criteria for new parents who can avail the leave benefits. Currently, mothers who earn up to AU$151,350 can access paid leave. However, even if her partner has no income or much lower income, any woman earning more is not entitled to the paid leave. 

Under the recently introduced changes, any household with an income of up to AU$350,000 a year between both partners can avail the paid leave scheme. As more women join the workforce and earn taxable incomes, the measure would provide them easier accessibility to juggle the responsibility of being a new parent with their jobs.  

 More women set to enter workforce

 

The PPL scheme is expected to cost the government AU$346 million and is likely to promote equality in the workforce. However, the Coalition has not yet introduced superannuation payments into the scheme. At the same time, childcare subsidy increases brought forward from July 1 to March 7, would provide an additional AU$2,200 per year to families.  

The announced changes, likely to be implemented from March 1, 2023, would improve cost of living pressures arising from global issues. With inflation becoming an increasingly pressing issue, households have faced harder circumstances. The budget aims to relieve some of the difficulties faced by young parents. 

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