Ministers launch full review of parental leave as current system ‘not working'

Yahoo

2 days ago

Ministers have launched a review of parental leave and pay as the current system is 'not working' for young families.
Business Secretary Jonathan Reynolds said the Government will investigate the whole system for supporting new parents to take time off work when they have a baby, including maternity leave, paternity leave and shared arrangements.
'We want this to work for millions of families who tell us at the minute that it is not working, so only about one in three new dads take paternity leave, mainly for financial reasons,' Mr Reynolds told the PA news agency.
Currently, new fathers can take two weeks' paid leave, at a rate of either £187.18, or 90% of average weekly earnings, whichever is lowest.
Maternity leave is paid at 90% of average weekly earnings for the first six weeks, and then whichever is lower of that 90% or £187.18 for the next 33 weeks.
Ministers hope to increase the take-up of shared parental leave, which allows a couple to share up to 50 weeks of leave and 37 weeks of pay between them.
They also hope to simplify the system for both parents and employers, with the Business Secretary pointing to 'eight different types of parental leave'.
Mr Reynolds insisted businesses would be 'absolutely integral' to the review, and would not face extra burdens as a result.
He added: 'They tell us the current system is quite confusing, that people don't know what they're entitled to, that businesses don't know what they should be offering.'
As ministers battle to boost sluggish growth, Mr Reynolds insisted bolstering parental leave would help the economy.
He told PA: 'Of course, business themselves, the growth argument is this: the more people we can keep in work, because they're able to spend some time with their children in those really important first few months and weeks, if we can do that, that's obviously going to strengthen the economy as well.'
Deputy Prime Minister Angela Rayner similarly described support for parents as 'vital for our economy'.
She added: 'Through our plan to make work pay, we're already improving the parental leave system with new day one rights. This ambitious review will leave no stone unturned as we deliver for working families.'
The review will gather opinions from parents, employers and experts across the UK and end with a series of proposals for reform.
Plans to boost support for young parents come after worries about the falling birthrate were expressed by Education Secretary Bridget Phillipson.
She told the Daily Telegraph falling birth rates were not only a concerning trend but one which 'tells a story, heartbreakingly, about the dashed dreams of many families'.
Official data from the Office for National Statistics shows fertility rates in England and Wales dropped to 1.44 children per woman in 2023, the lowest level since records began in 1938.
Ms Phillipson said people were scared off having children due to the high costs, and wanted 'more young people to have children, if they so choose'.