7 December 2015
Speech - #2015015, 2015

In the role of: Minister for Small Business and Assistant Treasurer [21 September 2015 - 18 July 2016]

Keynote address to the Third Annual Women in Leadership Summit, Melbourne

“A great wind is blowing, and that either gives you imagination or a headache.” Thus spoke Catherine the Great, an 18th Century monarch, change agent, philosopher and conqueror. A visionary female leader in a very male dominated world.

In this quotation she made it clear that people respond differently to the often searing winds of change. Some will respond with imagination, seeing opportunities, whilst others sense only pain and trouble.

Well, the unceasing movement to gender equality is a scorcher of a breeze, so individuals and organisations are responding differently.

Today we see some organisations embracing diversity in their workforce as sources of future talent, whilst others are still bunkered down in an old school inflexible style. Today I will talk about what it means to operate on the side of imagination, how to support and grasp the opportunity in this change.

However, I will start with the observation that our nation has progressed significantly over recent generations. Until 1969 there was a legally mandated pay gap of 25 per cent under many employment awards. In some professions, including in the public service, women were expected to resign when they married. So, very thankfully we have made much progress in Australia since this time.

Yet, in spite of the advancements we have made, we would be premature if we were to claim victory at this point. The race is only part way run. I say this because the story of how far we have to go is in the numbers. As at November 2015, the national gender pay gap for a full-time base salary is 19.1 per cent. The average graduate salary for women is six per cent less than that for men. So, whilst there is no longer a mandated pay gap – there is in fact a gap in practice. Furthermore, women only represent 15.4 per cent of CEOs in spite of a workforce participation of 59 per cent. Yet even this participation rate is problematic given that it compares with a participation rate of 71 per cent for men. All of this leads to distortions in women’s superannuation savings – with men having an average super of $135,000, whilst it is around about $83,000 for women.

A particular area of interest to me is engaging women in the STEM fields of science, technology, engineering and maths. In fact, along with Amanda Rishworth, a Labor Member of Parliament, we co-founded the Friends of Women in Science, Maths and Engineering. It is a sad statistic to us that only eight per cent of 15 year old girls expect to have a career in science compared to 46 per cent of boys. In addition to this, men make up 92 per cent of engineering graduates and 75 per cent of IT graduates. Clearly the culture in schools that STEM subjects are predominately for men needs to change.

The Prime Minister will have more to say about this today with the release of the Government’s Innovation Package.

So it’s very clear that there is evidence that the job is far from finished. We need some of Catherine the Great’s imagination to chart a course for change.

Today, many employers are working to remove gender pay gaps within their organizations, and are prioritising gender equality in order to build more successful businesses. This has involved organisations changing culture; developing flexible work place practices, and implementing gender equality strategies. This has unleashed an extraordinary wave of talent for many enterprises that can now access the working population more fully. The willingness to experiment with different ways of working is paying dividends – it is an example of responding with imagination. With strategies such as these, we have seen the proportion of women managers rise to 36.5 per cent this year. For example, a young lady I am mentoring has recently joined a major bank. She works for a female sales manager, who works for a female General Manager, who works for a female Executive General Manager. Happily this is not as unusual as it once was.

Female representation in Parliament has also improved, with 31.4 per cent of Commonwealth Members and Senators being women, and five women in the Cabinet of which I am one. Those women are of different ages, professional backgrounds and experiences.

The Government has also been working towards a target of 40 per cent for women on Government boards, and I am proud to say that today women make up 39.3 per cent of Government boards and we are very keen to not only hit our target of 40 per cent but we are keen to exceed it.

But what do we do about the clear present pay gap? And what do we do about female participation in the workforce? I’d like to start with the challenge of workforce participation.

Women are often, but not always, the primary care givers for children. Lack of affordable child care often makes it difficult for women to keep working. What’s the evidence for this? Well, the Productivity Commission’s 2015 Inquiry into Childcare and Early Childhood Learning estimated that there may be up to 165,000 parents who would like to work, or work more, but are unable to do so because of the cost of or lack of access to affordable Childcare.

In order to address this, we need first to look at the Childcare system, but also the workplaces providing more flexible arrangements to working parents. It is actually in the best interest of workplaces to attract and keep their talented staff.

The 2015 - 2016 Budget started to take practical steps to address barriers to workforce participation by focusing on targeted, affordable, flexible and accessible childcare by investing $4.4 billion in the Jobs for Families childcare package. This is a significant investment in families and in Australia’s future. Without adequate childcare options, our goals of increased workforce participation as a nation are unattainable.

Whilst women directly benefit from this policy, it is important to emphasise that it is a targeted family policy. To achieve gender equality, we need to move away from a default setting where childcare and family are automatically considered female responsibilities. Overwhelmingly families do play a vital and positive role in providing security and care and as such are the foundations of our society. However, every family is different, in its make-up and outlook. I fundamentally believe our system should not prescribe how we care for those we love but allow real choice, for women and also for men, based upon each families’ unique circumstances and values. You don’t need to look too hard to find female executives who have husbands who willingly undertake the major duties of childcare. My own family arrangements are a case in point, my husband has taken parental leave to look after our baby daughter. With just a little imagination and a little flexibility in workplaces, different models are possible.

We also need to look closely at our tax arrangements to see whether we really are encouraging choice in workforce participation. With 58 per cent of university students being women, we are a smart country, with a generation of highly skilled and educated women. However, after having children, families understandably focus on the marginal financial benefit of the second income earner returning to the workforce. Often, but I should stress not always, this second income earner currently is a woman. How much extra will families have in their pocket after tax and after childcare costs? All too often, the marginal financial benefit after tax is simply too low for the second income earner to justify the stress of juggling work, family commitments and loss of time with loved ones.

With regards to the after tax impact of returning to work, the Productivity Commission makes some startling observations. One example it cites relates to a woman returning to work who faces an effective marginal tax rate of 66.5 per cent when she moves from one to two days of work a week. This rate rises to 76.3 per cent if she moves to working three days a week. So in reality, many women often forgo paid work because the financial reward is insufficient or even in some cases, non-existent. With it they also forgo choices regarding their career and an alternative means of social contribution.

The Government is working now through the Tax White Paper, to address the very real effects of the tax and transfer system. And we will have more to say on this in the new year.

Yet this still leaves us with the problem of women’s salaries. In this regard, I would like to see more workforces taking the example of companies which, after giving any male a pay rise, check to see whether they are leaving women behind. This can happen because evidence shows that women are less likely to demand an increase in their salary.

That women are more reluctant to make demands raises the issue of empowerment. What will help women feel that they can do what needs to be done, be the best they can be, and ask for what they deserve? When it comes to empowerment I think that we need two things: positive role modelling and mentoring; and also networking.

Let’s start with role modelling and mentoring. Positive role models create virtuous cycles whereby women see other women succeed, this encourages them to try, which in turn is seen by other women who they themselves try. As people we subconsciously emulate observed behavior. As such, we should never underestimate the power of role models. Female role models can actively mentor young women. This does not preclude, and should not preclude them from mentoring men, but a woman who has had a career and raised a family, has particularly relevant experience for another who wishes to undertake the same journey. It for is for this reason that I am involved with the women mentoring program in the Liberal Party. There are very many talented young women in the Liberal Party – many of whom work currently in my office.

Networking, and the support that should go with it, is already provided by a number of different organizations including Women’s Network Australia, Business Chicks and the Australian Businesswomen’s Network. Here, women can learn valuable and practical lessons. They can also find future mentors. However, for all the value of female mentors it is also important for women to realise that men can provide valuable mentoring and support. I personally have had just as much support from men who see talent before gender, as I have by having fabulous women mentors as well.

Now many may, at this point, be assuming that my comments largely relate to those working in large businesses or institutions. Yet opportunity most certainly exists in the world of small business. In fact, one in three small business owners is female, with women making up the fastest growing cohort of small business owners in Australia. This is the type of entrepreneurship and leadership that we, as a nation, should be encouraging.

I have been fortunate enough to engage with many successful small business women throughout my career. Take Janine Allis for example, the founder of Boost Juice. Janine, as a new mum, wanted healthy snacks for her children and so she started experimenting with the idea for Boost Juice at her kitchen table. Fast-forward 15 years and today her Juice Empire has achieved $2 billion in global sales and spans 17 countries and more than 350 stores.

Another such woman is Emma Welsh, a Higgins local, who started another juice empire, the Emma and Tom’s fruit juice business with her friend Tom Griffiths. Both Emma and Tom had business backgrounds, but had never taken on the challenge of building a business from scratch. Although they initially experienced a number of setbacks with slim margins in the highly competitive fruit juice industry, today Emma and Tom’s has developed a national brand, and sells their juices in over 2500 cafes and restaurants in Australia. These women are role models, they support networking events, and they do mentor others.

In conclusion, we need to keep pushing the boundaries – women have come a long way but we are only part way through the journey. Whilst the Government can help on issues such as childcare and tax, there are many steps we women can take to empower ourselves, and to help empower others. To once again quote Catherine the Great “I have no way to defend my borders, but to extend them.” So, the only way to sustain and protect the rights that are now recognised as ours, is to keep pushing the boundaries until women have all the options available to men. This way we all, men and women, have more choices, and our children, both girls and boys all live in a richer world.