Labor to Extend Paid Parental Leave in Budget 2024 Aimed at Encouraging Increased Birth Rates in Australia
The government is looking to provide superannuation guarantee on paid parental leave to support parents who want to have more children.
The Albanese government aims to promote larger families by investing in paid parental leave and early childhood education.
In a press conference on May 10, Mr. Chalmers emphasized the government’s commitment to creating opportunities for Australians to have bigger families.
“I was asked about birth rates in the budget. That has been on a trajectory of long‑term decline, as you know,” Mr. Chalmers stated.
“A healthy birth rate is good for Australia and we want to make it easier for people to make that choice if they want to.”
Recent data from the Australian Institute of Family Studies show that the age-specific fertility rate was 1.7 births per woman in 2021, which is below replacement levels.
While ruling out the return of the baby bonus, Mr. Chalmers and Finance Minister Katy Gallagher stated that the government is focused on expanding paid parental leave and providing superannuation guarantee on that scheme to encourage more Australians to consider having larger families.
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The government estimates that extending super to paid parental leave from July 2025 will cost $1.1 billion (US$726 million) over four years, and then $623.1 million ($411 million) annually thereafter.
“I know that people will make their own choices, and I don’t pretend for a moment that government should direct those choices,” added Mr. Chalmers.
“But we want to make it easier for people to have bigger families if they want to.”
Paid parental leave was first introduced in 2011, and the Albanese government plans to extend it to 26 weeks by 2026.
Workers Union, Educators Welcome Expanded Investments
The Australian Council of Trade Unions (ACTU) voiced its approval for funding superannuation for workers on paid parental leave, as well as wage increases for workers in aged care and early childhood education sectors.
“Alongside the superannuation announcement, this is a significant investment in industries traditionally undervalued and predominantly staffed by women,” stated ACTU President Michele O’Neil.
“The aged care and early learning sectors play a crucial role in supporting our oldest Australians with quality care and providing skilled educators and carers for our youngest.”
Community Early Learning Australia (CELA) also welcomed the announcement following extensive negotiations with the government and other stakeholders.
“This funding commitment represents a major step towards establishing a multi-employer agreement that appropriately values early educators and teachers,” said CELA CEO Michele Carnegie.
“This will have a significant impact on the long day care sector, and we anticipate finalizing the new multi-employer agreement to enable small and community providers to attract the qualified staff they require.”
Meanwhile, Shadow Treasurer Angus Taylor cautioned the Albanese government to be mindful of spending given the financial challenges faced by households and the need for responsible budgeting.
Mr. Taylor stressed the importance of adhering to budget balance rules set by Mr. Costello in the 1990s to ensure a stable fiscal framework.
