28 July 2015

Address to the National Foundation for Australian Women, Annual Dinner

In Australia we often refer to the concept of a ‘fair go’. While it does mean different things to different people, I certainly believe that it means that we strive for equality of opportunity in our nation regardless of gender, race, class or creed. The freedoms and choices that Australia has provided to date have made us a stronger and more dynamic society.

Equality of opportunity in this nation has progressed significantly over the course of recent generations. That said, the journey remains far from complete. In the case of gender, women today are at the highest levels in many important fields including industry, business and finance, medicine and science, government and the public service. However, there are still serious issues to be addressed when it comes to women. Namely, the reality that in Australia today: some women are unsafe not just in their community but in their own homes; that women’s pay is lagging behind men’s; and that women are unrepresented at the top of some professions. There is real evidence to suggest that we are not finished in the work of ensuring a ‘fair go’ for women.

As a nation, we have a greater enthusiasm – and in many spheres a better track record – for equality than most. As a country we generally understand that equality of opportunity should be a matter of practice. So, today I will talk about the practice of making the ‘fair go’ real for women. In doing so I will tackle six key themes: security; family; tax; entrepreneurship; culture; and our international commitments.

Security

Let’s begin with the basics: the fundamental right to be free from violence and intimidation. The need for basic physical security. The Coalition Government’s vision for women is one whereby all women are safe from acts of physical and sexual violence. I would think that this is a vision for all thinking Australians. Regrettably, we have far from eliminated family violence in Australia, and women are more often than not the victims. According to the ABS personal safety survey of 2012, the equivalent of one Australian woman a week was killed by a partner between 2008 and 2010. Furthermore, 1 in 6 women, from the age of 15, has experienced physical or sexual violence from a partner. These figures are both shocking and abhorrent.

Unfortunately we are not alone in facing this challenge. The World Health Organisation stated in 2013 that the prevalence of violence against women constitutes a “global public health problem of epidemic proportions requiring urgent action.”

To address such a challenge everyone within our community must play their part. The appointment of Rosie Batty, an admired advocate against family violence, as 2015 Australian of the Year sends a strong and unambiguous message to our entire nation. We all must stand up and be counted on this issue. This includes government. The Government supports the UN Women’s HeforShe commitment whereby gender equality is seen not only a women’s issue but as a human right that demands each of our personal participation.

Yet we all know that words are meaningless without action. Government energy and spending is now being directed towards a safer Australia for women. There are major weaknesses in the legal framework to protect women. This is morally reprehensible.

As a result the Government has placed the issue of violence against women at the centre of this year’s Council of Australian Governments’ agenda (COAG) and we are working with COAG to institute practical steps starting with a national domestic violence order scheme.

In addition, more than $100 million will be spent on a range of initiatives to fight domestic violence under the auspices of the Second Action Plan (2013-2016) of a National Plan to Reduce Violence against Women and their Children. And finally, priority in homelessness services is being given to women and children experiencing domestic violence.

All of these policies are the expression of a society that understands it is not truly civilised if it accepts violence and discrimination – and this includes violence and discrimination against women.

Yet for real equality of choice, personal security is a necessary but not sufficient step. The Coalition Government seeks to enable women to achieve their own individual aspirations without feeling pressured or guilty. Real freedom can only exist where there is real choice. We want women to have the choice to work either to enhance their financial situation and/or to provide career satisfaction. Hence my second discussion theme: that of family arrangements.

Family

It is clear that our nation’s women remain underutilised in the paid workforce despite having so much to contribute in terms of skills, leadership and business savvy. It is a salient statistic that the labour force participation rate for women is 58.5 per cent, while for men it is 71.2 per cent.

Increasing female participation would not only improve economic security for women but would also provide considerable economic benefits for our nation.  By 2055, we will have just 2.7 working age Australians for every person over 65, meaning that fewer taxpayers will be working to provide the services and infrastructure our growing population needs.  If Australia can increase its female participation rates by 6 per cent, to match Canada, then the Australian economy would grow by $25 billion. According to Goldman Sach’s Economic Research Report entitled “Productivity – Much Ado about Nothing”, if we went a step further to raise women’s workforce participation to the same level of that of men’s, we could boost the economy by $195 billion a year.

The Australian Government took our view of equality of participation to the G20, so that under Australia’s Presidency, the G20 committed to reduce the gender gap in workforce participation by 25 per cent by 2025. In Australia, this would mean an extra 200,000 women in the paid workforce. This is not only an enormous boost in the labour force, but brings added diversity which is the wellspring of creativity. Importantly it is 200,000 additional choices for women.

I would like to acknowledge that not all work is necessarily paid work. Caring and working within the family and the broader community on an unpaid basis enriches individuals, our society and must be valued and respected. This is true for both men and women. However it is important to recognise that no legitimate interests are ultimately served by artificial barriers to choice.

Domestically, our 2015-2016 Budget started to take practical steps to address barriers to workforce participation by focusing on targeted, affordable, flexible and accessible childcare by investing $4.4 billion in the Jobs for Families childcare package. This is a significant investment in families and in Australia’s future because without adequate childcare options, our goals of increased workforce participation as a nation are unattainable.

The package has real practical features that help. It includes a $3.5 million investment in childcare assistance using a simplified system that is much more user friendly. It is much more intense in its support for lower income families. Furthermore it is structured to leave families better off, on average, by $33 per week. There are also investments in preschool education, childcare support for shift workers, and targeted support for families in distress.

Whilst women directly benefit from this policy, it is important to emphasise that it is targeted at families. We must move from a default setting where childcare and family are automatically considered female responsibilities. Overwhelmingly families do play a vital and positive role in providing security and care and as such are the foundation stones of our society. However every family is different, in its make-up and outlook. As a liberal, I fundamentally believe our system should not proscribe how we care for those we love but allow real choice, for women and also for men, based upon each families’ unique circumstances and values. We also need to look closely at our tax arrangements to see whether we are really encouraging choice in workforce participation. Which takes me to my third theme: tax.

Tax

With 58 per cent of university students being women, we are a smart country, with a generation of highly educated skilled women. However, after having children, families understandably focus on the marginal financial benefit of the second income earner returning to the workforce. Often, but I should stress not always, this second income earner is a woman. How much extra will families have in their pocket after tax and after childcare costs? All too often the marginal financial benefit is simply too low to justify the stress of juggling work and family commitments and loss of time with loved ones. So in reality, many women often forgo paid work because financial reward is insufficient or even non-existent. With it they also forgo choices regarding their career and an alternative means of social contribution.

It strikes me that our tax system (including Family Tax Benefits A and B) is partly to blame because it creates a situation where the second income earner is not rewarded for participation: but punished with greater stress without sufficient economic reward. The Productivity Commission’s 2015 Inquiry into Childcare and Early Childhood Learning presented some disturbing examples of how incredibly low the marginal benefits are for a second-income earner returning to the workforce. In the case of single parent families the disincentives are just as pervasive.

Take single mother, Nicola, and her two and three year old children. Nicola earns $31.54 per hour, and sends her children to long-day care at a cost of $88 per day each.

As she thinks about providing for her family, Nicola has to think about how working will impact her eligibility for Parenting Payment, Family Tax Benefit Part A, the Childcare Benefit and Childcare Rebate. And of course she has to think about the income tax system.

Scarily, the Commission’s analysis shows that she faces an effective marginal tax rate of 38.6 per cent in working a solitary day.  The effective marginal tax rate to work the second day rises to 66.5 per cent, and to 76.3 per cent for the third.  The killer, though, is that the effective marginal tax rate approaches 100 per cent for day four.  At that point, Nicola is financially better off to stay home rather than work.

This is hardly a fair go. This is actually our tax system making it harder for single parents to participate and in doing so secure their family’s financial security.

Disincentives like this completely distort the family work choices made by women and their families. The Government is working now through the Tax White Paper, to address the very real effects of the tax and transfer system.

For those women engaged in the workforce significant challenges remain. Sometimes it seems to me, in spite of the progress we have made, we have been premature in claiming victory for women’s rights. I say this because the story of how far we have to go is in the numbers. As at February 2015 the national gender pay gap is at a record high of 18.8 per cent. The average graduate salary for women in nearly 10 per cent less than for men. Furthermore, women only represent 17.3 per cent of CEOs in spite of a workforce participation of 58.5 per cent. We still have a way to go before the glass ceiling is truly broken.

Entrepreneurship

But how do we practically address the issues of equality of career choice, opportunity and pay? One way to think about this is to address the areas where opportunities are likely to arise. For example, we know that many opportunities for women arise in the sphere of small business, hence my fourth theme: entrepreneurship. One in three small business owners is female with women making up the fastest growing cohort of small business owners in Australia. It is relevant that the Government is making an investment of over $63 million towards new and existing Microfinance Initiatives which will help build the financial resilience of women and ensure the wellbeing of their families. Furthermore, the Jobs and Small Business package will provide tax relief and other incentives to encourage investment and grow small businesses. This will help the 480,000 women small business owners, as well as entrepreneurs and job seekers.

Business needs great employees to grow and flourish.  One way to attract these such people is through employee share schemes. You should not be taxed until you have earned income. Under the new arrangements from 1 July this year, the Government will defer the taxation point for employee share scheme options for all companies and offer an additional concession for shares and options for employees of eligible start-ups. This is a great way to incentivise the employees of a company while allowing the employer to invest more cash into growing the business.

Culture

Yet I know that even this is not enough. Many social and organisational attitudes still mitigate against female career progression. To support women in the workforce, we need to change community attitudes. Attitudes that create false barriers for women seeking out senior positions and I dare say, men seeking to play more active roles in family life. This brings me to my penultimate idea: creating a leadership culture.

The Government is fueling the leadership pipeline with strong, capable women by partnering with world-class organisations. This includes providing funds to the Australian Women Resource Alliance E-mentoring programme, the AICD Board Diversity Scholarship program and the Deadly Sista Girlz programme, which gives at-risk young indigenous woman and girl’s opportunities to become important ambassadors in their community. The Government will also encourage women as leaders by setting its own target for 40 per cent of positions on Government boards to be held by women. As people we subconsciously emulate observed behaviour. As such, we should never underestimate the power of role models. Those that forge new and lesser known paths and illuminate choices previously not considered. That is why the Government supports programs that foster women’s engagement and demonstrates, both to women and men, that range of choice that is possible.

International commitments

I’d now like to move on to my final theme: our international commitments.  The Coalition Government’s focus on women is not just domestic. To use the vernacular we can, indeed must, be able “to walk and chew gum”. While the issues some women face in Australia are, at their worst certainly dire – existential threat and struggle for the most basic of freedoms is the norm in much the world beyond our shores. It is well recognised that if you raise the status of, and power available to women, you raise families and their broader communities. 

As such Australia’s new aid policy has been reworked by the Foreign Minister, Julie Bishop, to require 80 per cent of our aid investments to address gender issues in their implementation. So, abroad, as well as at home, the Government prioritises the three objectives of: safety, economic empowerment and leadership for women.

In closing, our vision for women is our vision for all Australians – a life of safety, a life of opportunity and a life of choice. A life not proscribed by gender, government policy or community expectation but by individual preference and aspiration.