Paid parental leave: NSW Senator John Williams says Abbott's scheme is too costly

Updated

A Government senator says the economy is too weak to support Prime Minister Tony Abbott's $5.5 billion paid parental leave scheme.

It follows earlier reports on Thursday that the Commission of Audit has warned the policy is too expensive.

New South Wales Senator John Williams has told the ABC he wants to personally raise his concerns with the Prime Minister before stating publicly whether or not he will cross the floor.

The Australian Financial Review is reporting the Commission of Audit's first report, which the Government received nearly a fortnight ago, says the scheme is too costly and cannot be afforded with the budget in deficit.

The ABC has been unable to verify the report and a spokeswoman for Treasurer Joe Hockey says the Commission of Audit's "recommendations are confidential".

Senator Williams says he is concerned the economy is not currently strong enough to support the scheme.

"I've said all along, I don't have a problem with the paid parental leave scheme. That is our policy so long as the economy is strong, but I do have concerns about the strength of the Australian economy," he said.

"To me a strong economy in Australia [has] a four in front of unemployment – that's currently got a six in front of it and a four or close to four in front of economic growth - and we're currently growing at 2.5 per cent.

"So I do have concerns that the economy is not strong enough."

Asked if he would cross the floor, Senator Williams said he would not be making his position public until after he had the chance to talk personally to Mr Abbott about his policy.

"I'm going to have discussions with the Prime Minister prior to any decision I make and I think that's the right thing to do by the Prime Minister," he said.

Shadow Treasurer Chris Bowen seized on the report in the Australian Financial Review and urged the Prime Minister to dump his "excessive, gold-plated paid parental leave scheme".

Abbott defends his 'signature' policy

Mr Abbott told Parliament that he still "absolutely" stood by his policy.

"It's good for women, it's good for families and it's very good for our economy because if we can get the participation rate up, we will get our productivity up, we'll get our prosperity up, it'll be good for everyone," he said.

Mr Abbott says the time for his scheme, which would award new mothers six months at their full wage, capped at $75,000, had come.

"This is a policy which we took to the election and I have to say this is a policy that the Australian public well and truly understood when they voted in last year's election," he said.

Do you think the Government should change its parental leave policy? You had your say.

But Senator Williams said there would have to be amendments to Mr Abbott's scheme because the Government did not have the majority in the Senate.

The Greens are refusing to support the scheme unless the cap is lowered to $50,000.

"If the Greens stick to their guns then I can't see it getting through the Senate," he said.

"We'll have to wait and see what comes up in front of us."

Several Government sources, who did not want to be named, told the ABC the Prime Minister's policy was friendless within the Coalition and some argued even within the Cabinet.

One Liberal says the policy was the first concern raised at every business function they had attended since the Prime Minister announced his policy to his surprised party room in 2010.

Topics: parenting, federal-government, australia

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