Saturday, July 26, 2008

What Labour has done for Britain - Maternity and Paternity Leave

This is the first in an occasional series to examine just what the Labour government has changed in the last eleven years.

When Labour came to power in 1997, women who were expecting babies got just 14 weeks paid maternity leave, at £52 per week. The Labour government increased this to 26 weeks from 6th April 2003, and from 1st October 2006 this was increased to 39 weeks (6 weeks at 90% of your pay, and 33 weeks at a flat rate of £117.18 per week). The intention is that this is increased to 52 weeks by 2010.

Unsurprisingly, the fertility rate, which had reached a low of 1.63 in 2001, started to climb as the new rules came into effect, and reached 1.84 by 2006. This was a relief to the government. These new babies are future tax payers, future consumers, future entrepreneurs and future contributors to society. If Bangladesh indicates the problems you get when your fertility rate is too high, Japan indicates the problems you get when your fertility rate is too low. The ideal is a fertility rate at or near replacement rate, so that the population holds steady over times and no single generation is overburdened with responsibilities to the old or young, compared with other generations.

Our maternity leave policies compare well to those in other mature economies. Americans get no paid maternity leave at all. In France, you get 16 weeks leave at 100% of your earnings, rising to 26 weeks at 100% earnings for the third child - so they get less leave, but higher pay. In Germany it's 14 weeks at 100% pay, and 12-14 months at 67% pay not exceeding €1800 per month. Spain provides 16 weeks at 100% pay. Sweden's maternity pay is an extravagant 16 months at 80% pay for the first 390 days and a flat rate for the final 90 days.

The female labour participation rate has increased from 62.5% in 1996 to 65.5% in 2007.

Paternity leave of two weeks paid, was introduced in April 2003. From April 2003, parents of children under six or disabled children under 18 have the right to request flexible working.

David Cameron, who claims he is in favour of supporting families, voted against extending maternity leave and pay, voted against introducing paternity leave and voted against introducing flexible working.

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