Lib Dems pledge to transform parental leave with £2.4 billion investment including doubling of statutory maternity pay

8 Jun 2024

EMBARGO: 22:30 Thursday 6th June

The Liberal Democrat manifesto will include a plan to transform parental leave, including doubling Statutory Maternity Pay to £350 a month
Proposals also include increasing paternity pay and creating an extra use-it-or-lose-it “dad month”, to encourage more fathers to take parental leave
Ed Davey says Lib Dem proposals would give parents “the choice and flexibility they need”

Liberal Democrat Leader Ed Davey has announced his party’s manifesto will include an ambitious plan to transform parental leave, including doubling Statutory Maternity Pay to £350 a week and introducing a use-it-or-lose-it “dad month” of paid leave for new fathers.

The party’s bold plans for reform also include making paid parental leave day-one-rights at work, rather than the current 26 week period which means those in new jobs don't qualify, and extending them to self-employed parents.

As well as raising Statutory Maternity Pay, the Liberal Democrats would increase paternity pay to 90% of earnings and create a new use-it-or-lose-it “dad month,” encouraging more fathers to take parental leave. The party argues this would increase choice for families and help more new fathers take time off work to spend time with their child in those crucial first weeks and months, in turn helping Mums to stay in their chosen careers.

Currently, low rates of statutory maternity and paternity pay are not high enough to give parents a real choice, while the UK’s two weeks of statutory paternity leave lags far behind most advanced economies. Around a quarter of fathers are not eligible for paternity pay, either because they are self-employed or because they have not been with their employer continuously for six months.

The party argues that encouraging more fathers to take parental leave is good for families and critical to closing the gender pay gap. On average, women face a 'pay penalty' of 45% lower earnings in the six years after giving birth to their first child.

The Liberal Democrats have said that their £2.4 billion investment in parental leave would be paid for by a plan to clamp down on tax avoidance and evasion, recovering more of the £36 billion that is going uncollected every year under the Conservatives.

Liberal Democrat Leader Ed Davey said:

“Millions of parents are being denied the choice to spend more time at home during that all-important first year with their child, because the UK still lags behind other countries on shared parental leave.

“Many mothers and fathers are being forced back to work early because they simply can’t afford to take more time off.

“The Liberal Democrats’ proposals would give new parents the choice and flexibility they need, backed up by a package of proper support. We would boost statutory pay for new parents, alongside a new ‘dad month’ to help more fathers take time off work to be with their new baby during that first year, giving mums a better career boost.”

ENDS

Notes to Editors:

Liberal Democrats would give parents genuine flexibility and choice in the crucial early months by:

Raising Statutory Maternity and Shared Parental Pay from the current rate of £184.03 to £350 a week.
Increasing pay for paternity leave to 90% of earnings.
Introducing an extra ‘use-it-or-lose-it’ month of parental leave for fathers and partners, paid at 90% of earnings.
Making all parental pay and leave day-one rights, and extending them to self-employed parents.
This package of reforms will cost £2.4bn a year by 2028-29

The funding increase will be paid for by a crackdown on tax avoidance and evasion. Under the Conservatives, the amount of taxes going uncollected for reasons including avoidance, evasion and criminal activity has reached £35.8bn a year [HMRC].

The Liberal Democrats’ plan to tackle tax avoidance and evasion would raise a net £7.2 billion a year by 2028-29, facilitated by a £1 billion a year investment into HMRC.

Around a quarter of fathers are not eligible for paternity pay, either because they are self-employed or because they have not been with their employer continuously for six months (O’Brien et al, 2017).

On average,women face a 'pay penalty' of 45% lower earnings in the six years after giving birth to their first child. (UCL)