New Zealand's Paid Parental Leave system is Broken - TOP

As election bribe season kicks into full swing, both Labour and National are taking turns to give money to people that don’t really need it. Yesterday Labour announced their free tertiary package, which we have already critiqued here. Then National followed that up with an announcement about extending paid parental leave to 22 weeks, despite cynically vetoing Labour’s attempts to do the same. 

The fact is, like free tertiary education, paid parental leave is regressive middle class welfare. The poor get nothing, while the rich get the most benefit, exacerbating the rise in inequality in our society. Is this the kind of society we want, where only the rich can afford to stay home and spend time with their children?

Tribal voters will no doubt welcome and applaud their respective parties’ efforts.

But when will they realise that these sorts of policies essentially penalise the poor and reward the rich?

The truth here is that both establishment parties continue to cynically chase the middle voter, and don’t really want to do anything for those that really need help.

The Impact of Paid Parental Leave

Like most benefits, you only get Paid Parental Leave if you meet a bunch of conditions. You have to work at least 10 hours a week, and the higher your income, the more you get in Paid Parental Leave (PPL). Do we really need yet another policy to accentuate the growing gap between the haves and have-nots? For example, if you are not working, maybe because you have been home caring for your first child, you get nothing.

These two graphs below from Pennies from Heaven say it all. The one on the left shows that many women of child-bearing age are on low or no incomes. This illustrates the point that women are at the forefront of unpaid work in our society (e.g. caring). Where they are in formal employment, it is often in low paid, or part time roles. Compare this with the graph on the right which shows that relatively low numbers of highly paid women receive the bulk of PPL payments.

By extending PPL, Labour and National will only increase these inequalities. Is this the kind of society we want, where only the rich can afford to stay home and spend time with their children? Where the poor are forced to choose between spending precious time with their babies and being able to feed them?

TOP’s Solution

Bad news first: TOP would abolish Paid Parental Leave.

Now the good news: we would give ALL families with children under three $200 per week; no questions asked. This is far more generous than the existing or extended PPL proposed by either National or Labour. But the beauty is that all parents get the same, regardless of what they have been doing before they had a child. And by the way here’s how it’s funded (please note other parties never tell your where the money is coming from). It is from the rationalisation of NZ Superannuation wherein those who don’t need it only get $200 per week rather than their current payment.

The first 1,000 days of a child’s life are the most crucial for their development. The Opportunities Party wants to ensure that all parents are supported evenly during this crucial period. After all, every child matters, and every parent is worth the same.