Improving Paternity Leave Provisions ‘Could Boost The Economy By £2.6bn’
Secretary of State for Scotland Ian Murray will become the first cabinet minister to take full paternity leave (Alamy)
3 min read
Exclusive: Expanding the statutory level of paternity leave for fathers could deliver £2.6bn of long-term growth to the UK economy, according to new research.
The Joseph Rowntree Foundation (JRF), a charity that aims to solve poverty in the UK, has conducted research by comparing the paternity leave policies of other countries. The UK currently has the worst paternity leave offer in Europe, with anyone whose partner is having a baby being entitled to a maximum of two weeks' paid leave.
The research, seen exclusively by PoliticsHome, showed that the long-term impact of increasing statutory paternity leave to six weeks at 90 per cent of pay could boost the UK economy per year by £2.6bn in the near term. The economic benefits of such changes in comparable countries appeared to show up after two to three years, according to the JRF.
In the JRF’s model, this increase in paternity pay for eligible fathers would be funded by the government – with the JRF estimating HMRC would incur a direct cost of £1.1bn per year with a net cost of £220m per year.
Labour MP Luke Charters will bring up these findings during Prime Minister’s Questions on Wednesday, arguing that they show it is a “win-win” for the government and for families.
Before PMQs, chancellor Rachel Reeves will deliver a speech in which she is widely expected to set out her plans to boost the economy, with the aim of delivering the government’s core growth mission.
Charters told PoliticsHome: “As a Labour MP, I was proud our party ran on two clear mandates in the election: one of change, and another on growth.
“By making some positive changes around paternity leave, I am convinced we can deliver on both of those things. This is about ensuring dads across the UK can play a meaningful part in their children’s lives while delivering an extra £2.6bn annually of economic growth.”
Multiple other MPs have recently spoken out about the need to improve the UK’s paternity provisions.
Secretary of State for Scotland Ian Murray will become the first cabinet minister to take full paternity leave, as he and his wife are expecting their second child next month.
Jon Pearce, a Labour MP who took more than the minimum paternity leave, told PoliticsHome it was still "not enough" and called for “massive reform”, while fellow Labour MP Josh Simons said that Parliament was a “long way” from leading by example on paternity rights and that it was “absolutely ripe for modernisation”.
However, the government is currently facing a difficult fiscal situation due to high government debt, low growth, and increased spending pressures – so the prospect of improved paternity provisions costing more than £1bn might raise eyebrows in the Treasury.
George Gabriel, co-founder of campaign group The Dad Shift, said the evidence has “always been clear” that decent paternity leave is “good for dads, for mums, and for babies too”.
“What this new research makes clear is that properly supporting families can drive growth too,” he said.
“We hope the Prime Minister welcomes Luke’s example and invitation to get serious, set a timetable for a review and then get on and deliver a better deal for working families.”
Abby Jitendra, principal policy adviser at the JRF, said: “Government has an opportunity to invest in families and the economy through proper paternity leave.
“Robust modelling shows that more generous, government funded paternity pay policies change fathers’ involvement in the care of their children which means mums are freer to work. Families benefit and the economy benefits.
“The UK doesn’t need to be last in class any longer – government needs to act now.”
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