More to get cash for nappy duty

Self-employed women will be eligible for paid parental leave from July 1 next year, but they will have to pledge they will not work before they can receive the payments.

Associate Labour Minister Ruth Dyson hinted that the next change in the scheme might be another extension of the period of paid leave, which began at 12 weeks, went to 13 weeks and will be set at 14 from December.

At present only eligible employees receive a payment of up to $346.63 a week, but from July 1 next year, self-employed mothers who have worked at least 10 hours average a week in the six months before the birth or date of adoption will be eligible for the same weekly rates.

Payment will be equal to their average weekly income up to the employee's maximum.

If their business makes a loss or they earn less than the minimum wage for a minimum of 10 hours a week ($95), they will be eligible for a flat rate of $95 a week.

Although the announcement by Ruth Dyson is described as part of the 2005 Budget, it will not take effect until July 1 2006.

She said that if 2173 self-employed people were to take parental leave it would increase the cost of the scheme by some $8 million a year.

Ruth Dyson said there would be another review of the scheme this year as well.

An earlier review, published in 2003, raised the question of whether self-employed women should be compelled to stop work if it were extended to them.

Ruth Dyson yesterday made it clear that they would be expected to stop.

"As part of the application process they will say they won't be working for the period of paid parental leave. That is the same for employees."

Since the scheme began in July 2002, there have been a number of changes. First, it was extended from 12 to 13 weeks then the eligibility criteria were reduced from 12 months with an employer to six months.

The extension from 13 weeks to 14 weeks in December brings the scheme into line with New Zealand's obligations under International Labour Organisation conventions.

Ruth Dyson said that while the Government had not considered anything formally, "we know that other countries have longer paid parental leave".

"So we'll look at that but we haven't got any great priorities until we have done the evaluation."

There were still some new mothers who were not eligible because they had been with an employer for less than six months.

Paid parenting

* The paid parental leave scheme was a flagship policy of Labour's former coalition partner the Alliance.

* Since the scheme began in July 2002, 45,000 people have taken paid leave.

* Entitlement can be transferred to a partner or spouse but almost all the leave has been taken by women.