Unjustified concerns

The issues of maternity and paternity leave are popping up again on the public agenda. It appears the government is considering the possibility of changing the current legal provisions. Maternity leave might be extended by two weeks, unpaid; and paternity leave might rise to five days. There is a discussion brewing about these possible changes. Namely, some people are asking if that rise in maternity leave is affordable (a perennial and essentially legitimate question); if this is an appropriate moment to do it, given the current economic circumstances; and how much small and medium companies will be strained by such a decision.
The first question has an easy answer, I suppose. The costs of such a decision seem minor by any standard. Even if the two additional weeks were to be fully compensated, regardless of who would bear the cost – companies or the government – the figures involved are small. Let us assume that measure was in force in 2014. Further, let us assume, quite unrealistically, that all women that bore children last year were working, and all would take the unpaid two weeks leave. The cost of their replacement, taking as a reference the median wages at the end of that year, would reach about 50 million patacas, give or take. That amount is hardly more than 0.01 per cent of last year’s GDP, and less than 0.04 per cent of the tax revenue generated by gambling.
With more realistic assumptions than those taken above, if the government decided to take the responsibility for these costs, less than one hour of tax revenue from gambling would possibly be enough. Even leaving the ethical questions and social benefits aside, it does not seem a high price to pay, if only to depart company from the only other country in the world with equally ungenerous regulations on this matter, Sudan. There is nothing in this comment against the Sudanese, who have had more than their fair share of suffering for many years. But can we keep a straight face about the issue, when we share the tail of the international ranking in maternity leave with a country that has been ravaged by war and all kinds of social disasters? We cannot afford to be more generous than a country that exhibits an income per capita that is less than 2 per cent of ours?
On the other hand, it can be argued that the economy has seen better days. That is a fact. But even at the current level of economic activity and income we are well above any other time in the history of the city, except the last four years or so. The current predicaments seem a weak obstacle that cannot stand on its own.
The small and medium companies issue is both more complicated and delicate. Of course, they are the most sensitive to increasing costs or staff changes. Their plight deserves more attention. We will come back to it next week.