Firstly, let me admit that I don't fully understand that as I haven't had children yet.
However, we're planning on TTC in the Autumn. Fair enough, people earning less will (still) earn less but, (and I know this may sound unfair), they are used to it. If you have worked loads and then suddenly your salary goes down that much, how do you afford your mortgage and all those things?! We don't earn loads (but I do work full time) and to earn less than I do already, is scary. When I am able to go back to work, it won't financially be viable for me to because of paying for a nursery (DH is a teacher so although at the bottom end, earns enough that the government wouldn't pay out).
As for the pay being related to the amount of time taken off work, granted it's not a good idea, it makes people go back before they're ready. But unless there is a system in place to give the same amount of money until your children are legal adults, surely at some point it will be related to the amount of time you've taken off.
As for parental leave (and the stupid low income you get) it's not very good but at the risk of sounding sexist, why do men need more than a couple of weeks off? Surely the answer is to pay them a normal full time salary (make the companies pay not the government). Making it 'parental leave' surely just means the mother who is recovering and dealing with a new life will be put back and be viewed with less importance?
As I say, I haven't experienced any of this yet but we're in the process of buying a house (with a mortgage a third of our joint salaries) and it makes me feel sick every time I try to work out if we'll be able to afford it still when I'm not working. I don't know if it happens but, why not pay parents council tax for a year? I know LA's would get less money but surely, that would be more beneficial and more direct to cut parents costs?
Feel free to ignore me as (I've already stated), I'm in an ideal world on this not a real one!!