Labour MP's paid parental leave bill passes first reading

UPDATE / July 26: A bill that would extend paid parental leave from 14 to 26 weeks passed its first reading in parliament last night.

As expected, the Maori Party and United Future MP Peter Dunne, who usually vote with National, supported the private member's bill, introduced by Labour MP sue Moroney.

Finance Minister Bill English says the government will use a special financial veto power to stop the bill becoming law.

There is provision for the government to veto bills which trigger more spending or taxation, even if parliament votes for those bills.

Mr English says the bill would cost $500 millon over three years.

Ms Moroney says she has Department of Labour advice estimating the cost at $285.6 million over the period.

A second Labour-backed private member's bill, for "Monday-ised" holidays, also passed yesterday.

Government to veto paid parental leave bill

April 10: Extending paid parental leave will not be a priority even when the government returns to surplus.

The issue of paid parental leave was thrown up again this week when Labour MP Sue Moroney's private members bill, extending paid parental leave to six months, was pulled out of the parliamentary ballot.

Unlike many other countries, New Zealand paid parental leave is funded out of general taxation rather than a levy on employers.

Acting Prime Minister Bill English told a media briefing this afternoon the government would use its veto to stop the bill becoming law, even if the bulk of Parliament voted for it, as the current numbers indicate.

The bill is backed by Maori Party and United Future MPs, who normally vote with the government.

There is provision for the government to veto bills which trigger more spending or taxation, even if Parliament votes for those bills.

"It's very important for parents and children to be getting support ... that's why we've maintained support like paid parental leave. It's a bit soon to be trying to expand entitlements when our big challenge has been to maintain them as they are, so we are likely to veto that bit," Mr English says.

"It's a bit surprising, not having heard much from the Labour Party all year, their first thing is to borrow half a billion dollars over four years for this proposition."

Parliament could "vote for all sorts of irresponsible things", but the government had to find the money to pay for them.

The extension of paid parental leave in the bill would cost an extra $150 million a year, he says.

Even if the government's books returned to surplus by the end of the 2015 financial year, as planned, there are other priorities, Mr English says.

These include building up the Earthquake Commission's natural disaster fund after the Canterbury earthquakes cleaned it out, and also restarting payments into the New Zealand Superannuation Fund.