This morning I attended a speech given by Joe Hockey. In the Q & A session a question came up about the Paid Parental Scheme. Now there are good, bad and cynical reasons for wanting a paid parental scheme. Hockey first rolled out the good reason – this will contribute to maintaining labour force participation amongst young women. Okay – maybe maybe not, but that is a plausible story. But that doesn’t justify how the PPL would be paid for.
The Liberals are proposing a levy on big business. A cynical explanation for that would be that big business tends to pay the overwhelming bulk of corporate income tax anyway, so why burden small business with a tax its not likely to pay? Hockey, however, has a bad reason for imposing higher taxes on big business.
His argument went as follows (Hockey didn’t use this terminology): Small business cannot compete for female labour on the same basis as does big business. Small business can’t afford to pay maternity leave and so what is a competitive attraction for women working for large business should become an entitlement for all women. So the Liberals would rather expand a welfare program than allow competitive forces to operate in the provision of paid maternity leave.
This argument was inconsistent with the rest of his speech where he argued that government should only do for individuals what they cannot do for themselves and no more. The audience understood that – there was no applause after Hockey finished his (very impassioned and heart-felt) explanation of the PPL scheme. Plenty of applause for everything else.