What does it take to get Julia Gillard and Tony Abbott to agree? Try stay-at-home mothers. In response to the Productivity Commission’s draft recommendations on a national maternity leave scheme, Gillard has promised that the Government wants to “support new mums, whether they are in or out of the paid workforce”.
Tony Abbott was out of the blocks early on Tuesday, decrying the PC’s recommendations as “discriminatory”.
Whether the Government has the fiscal capacity to take on a $500m pa scheme of the type recommended by the hardheads at the PC isn’t clear given our economic circumstances, but that’s another matter.
It seems that the meaning of “discriminatory” — and from the rugged individualists of the Coalition, yet — has now been extended to the notion that if one sector gets anything, then everyone else should get it as well. And the issue is rendered even less clear when we’re talking about “mums and bubs”. It’s not so long since Brendan Nelson almost broke down in tears declaring that every mother loves her baby and any means-testing of the baby bonus was a direct insult to motherhood.
So let’s be blunt. Stay-at-home mothers don’t deserve a single cent of maternity leave support beyond what is available through existing welfare arrangements — and even those should be means-tested.
The biggest benefit of a national maternity leave scheme would be to encourage more women into the workforce. The PC estimated that the scheme would result in an average increase in lifetime female employment of around six months. It doesn’t sound much, but across the entire workforce that will provide a useful boost to Australia’s workforce.
Regardless of any temporary effects of a recession, we’re running out of workers. We’re already importing them as historically high rates via our immigration program. There’s still not enough, both in high-skill industries and even low-skill industries like horticulture. Every time you can’t get a tradesman, or have to wait weeks for a medical appointment, or wait ages for a government department to process an application, it’s because people can’t get enough staff. And it’s not just inconvenience — while we might all like the higher wages that come from a tight labour market, across the economy that’s an ongoing spur to inflation and higher interest rates.
A recession will fix that temporarily, but the long-term direction is against us. We’re not making people as fast as we used to anymore, and we’re about to hit a workforce wall with the retirement of the baby boomers.
Increasing the participation rate for women is one of the keys to fixing this. We’ve done an okay job in the last few decades but women’s participation rate is still well shy of men’s, by more than 10%.
It should be a lot closer, both because men are playing a greater role in their kids’ early development, and because women are going into the workforce.
Any attempt to also reward stay-at-home mothers as part of maternity leave scheme will directly undermine the benefits of such a scheme by increasing the incentive for women to remain out of the workforce. We’re still stuck with a welfare system that, thanks to John Howard’s 1950s view of the world, treats stay-at-home mothers as deserving of special treatment. Further increasing the financial rewards for stay-at-home mothers will exacerbate that misdirection of taxpayer funding, particularly in an environment where we’re going to have to start picking and choosing what we want governments to fund.
Thanks to the likes of Abbott and Howard, however, we’re unable to have a serious debate about maximising our participation rate without it being infected with cloying nonsense about the virtues of stay-at-home motherhood. The Government will find it politically difficult to adopt the PC recommendations, assuming they remain unchanged in its final report. But any parallel assistance for mothers who refuse to join the workforce will defeat the key benefit of a maternity leave scheme. This isn’t about motherhood, this is about the economy.