PRESS RELEASE 22 January 1999

Paid family leave is affordable

New calculations published today by the Low Pay Unit, using figures obtained by Harriet Harman MP and Chris Pond MP, show that the government can easily afford to provide paid family leave, at least for low paid workers.

The right for employees to take time off work to look after their children- due to come into force this December- will only be a reality for low income families if they can do it without loss of earnings.

• If the government were to replace the wages of everyone claiming Family Credit for three months leave per child, spread over their first 8 years, it would cost just £117 million per year. This figure represents only 0.04 per cent of total government spending, and is much lower than some recent estimates.

• If half of women and a tenth of men who are eligible claim the full amount- as the DTI assumed in its own assessment in 1997- the cost would be only £28 million per year.

Bharti Patel, Director of the Low Pay Unit said

"This small amount of money could go a long way towards helping people achieve a better balance between work and family life, as well as making sure that low paid workers are still better off in a job than on benefits, even when they take time off to look after their children"

This paid leave could easily be administered through the new Working Families Tax Credit, as the necessary information and systems would already be in place. There are a number of families who don't currently get Family Credit who will qualify for WFTC and paid family leave should be extended to them, but the extra cost of this would still be small.

For further information call:
Bharti Patel, Director - 0171 713 7616 or 07887 643 750 (mobile)
Nick Burkitt, Researcher - 0171 713 7616

Note for editors: The EU Parental Leave Directive, to be implemented by December 1999, gives the right to three months' leave for men and women when they have a baby or adopt, available until the child is 8 years old. A full briefing on parental leave is available from the Low Pay Unit.