It’s baby time! -Should Parental Leave be increased in NZ?


The elections are looming and before the days of ‘Dirty Politics’, Cameron Slater and whether Judith Collin should stay or go were hot topics, there was some debate about some real election issues between the political parties in regards to paid parental leave entitlements.
This year National introduced extra $ in their 2014 budget to increase paid parental leave from 14 to 16 weeks in 2015 with a further increase to 18 weeks in 2016. As part of their ‘Best Start’ package, Labour are proposing paid parental leave being increased to 26 weeks with the Greens wanting an increase to 13 months paid parental leave.

Paid Parental Leave
There have been many debates about how long paid parental leave should be and different countries overseas have varying lengths and payments made for parental leave. New Zealand currently has the second lowest duration of paid parental leave amongst OECD countries so we are currently lagging behind the majority of the world. There are however still some countries including the US, Swaziland, Lesotho and Papua New Guinea who don’t yet provide paid parental leave of any type!
With the current 14 weeks paid parental leave we are on a similar level with China, India, Egypt and Algeria. Australia is more generous than NZ and provides 18 weeks paid parental leave with a higher weekly rate and an additional two weeks paid leave for the father/partner. On the high end of the scale, Denmark offers 52 weeks at full pay and Canada also has 52 weeks paid leave (not at full pay) shared by the parents.

baby time 1
With 26,000 parents (99% of these are women) on paid parental leave each year it is a substantial investment by taxpayers and when researching for this blog I found many discussion papers available regarding how to fund an increase to paid parental leave which was very interesting but is a discussion best left to the economists and politicians.

There are many proven benefits for extending paid parental leave as it has a direct financial benefit to households and a range of positive societal benefits including work-life balance, supporting child development and breast-feeding.
Longer paid parental leave also has some very positive labour market outcomes whereby it can maintain a women’s attachment to the labour force by choosing to come back to work and continue their career rather than leaving the labour force altogether. As women may be able to spend more time away from work on paid parental leave it also encourages employers to invest in training replacement employees who gain labour market experience and increased skills during this time however it can prove to be a financial burden to businesses in times of poor business performance.
A number of countries now also provide support for fathers/partners to receive a period paid parental leave in addition to the above which is not provided for in NZ.

What do you think, how long do you think paid parental leave should be in NZ?
Do you think there should be additional paid parental leave for fathers/partners?

baby time 2 - laila

by Nicky Dowling

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