Paid parental leave: Tony Abbott succumbs to pressure over scheme to get legislation through Senate

Updated

The Prime Minister has succumbed to pressure over his paid parental leave scheme, with more concessions to be made to the unpopular plan.

Tony Abbott's signature policy has faced opposition from all sides, including within his own party.

Mr Abbott flagged changes last week, in another compromise for a plan he has been unable to get through an often unpredictable Senate.

When it was first announced, women earning $150,000 a year would have received a payment of $75,000.

The maximum payment was later pared back to $50,000 - paid to women earning $100,000 a year - and may now be cut back even more.

Speaking in Sydney on Sunday morning, Mr Abbott refused to provide details about the changes to the policy he has taken to the last two elections.

Mr Abbott said he and his minsters would be looking at the Productivity Commission report on child care over the summer break.

"We will be better targeting our paid parental leave scheme so that we can not only deliver a paid parental leave scheme which helps families but more available and more affordable child care as well," he told reporters.

"We will still have parental leave based on a woman's real wage. It will still include super."

The idea to fund the payments through a 1.5 per cent levy on Australia's 3,000 largest businesses remains, but any savings made by paring back the scheme will be invested in child care instead.

Mr Abbott has indicated his preference is to direct that funding to support for in-home carers, which could include nannies, but has refused to give any further details.

"It will still particularly advantage a small business that will for the first time have access to a universal paid parental leave scheme but it will also support child care too," Mr Abbott said.

The current paid parental leave scheme, set up by the previous government, saw all women paid the minimum wage for 18 weeks, earning about $11,000.

Opposition Leader Bill Shorten labelled the Prime Minister's announcement today as "another broken promise".

The question to Joe Hockey is, 'how much will this paid parental leave scheme cost?' How much is Joe Hockey going to have in his mini-budget as the cost for Tony Abbott's paid parental leave scheme? Senior Labor frontbencher Jenny Macklin

"Tony Abbott has defended this paid parental leave scheme up hill and down dale. He's taken it to two elections. It is his signature policy... The fact that Tony Abbott has broken this promise, too, shows there is no promise he makes which is sacred to him," Mr Shorten said.

Senior Labor frontbencher Jenny Macklin called on Treasurer Joe Hockey to reveal how much the paid parental leave scheme would cost.

"The question to Joe Hockey is, 'how much will this paid parental leave scheme cost?' How much is Joe Hockey going to have in his mini-budget as the cost for Tony Abbott's paid parental leave scheme?"

Earlier, Mr Hockey had issued a warning about the rising cost of childcare subsidies saying the Federal Government had provided almost $5 billion in childcare assistance last financial year.

Mr Hockey said the impending mid-year economic and fiscal outlook (MYEFO) would reveal a "significant cost blowout" in the childcare subsidies system.

"You'll see in MYEFO that the current system in relation to childcare has had some very significant cost blowouts and what we recognise is that the system is not meeting all the needs of working families," he said.

"In particular it is it is not meeting the needs of flexibility of working families."

PPL 'indulgence' should be scrapped, Xenophon says

Meanwhile, Independent Senator Nick Xenophon said Mr Abbott should scrap the paid parental leave scheme altogether.

"Why do it as a half measure? Just get rid of it. It's an extravagance, it's an indulgence on the part of the Prime Minister," he said.

"This is going to cost billions of dollars, even in its modified form.

"That money could be better spent in having more affordable child care. That is the barbecue stopper out there because more and more parents are finding it tougher to keep their kids in child care."

The Opposition's Tony Burke said the backdown was unavoidable after the Government stood by the policy for four years.

"[The Government is] colliding with reality to discover that it's unfair, unaffordable, can't get through the Parliament and their own party room doesn't like it either," he said.

Jo Briskey from family lobby group The Parenthood said working parents wanted support for childcare.

"That's going to be of real interest to our members," she said.

"We've found over 80 per cent of parents who've been participating in some of our surveys have said that quality early education and care is more important to them than more funding for paid parental leave."

Topics: abbott-tony, government-and-politics, federal-government, federal-parliament, parenting, australia

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