Dr STONE (6:51 PM) —I rise to speak on the Family Assistance Legislation Amendment (Child Care Budget Measures) Bill 2010. The bill is so that the Labor government can amend A New Tax System (Family Assistance) Act 1999 by setting the annual childcare rebate limit at $7,500 for the four income years starting from 1 July 2010. Further indexation of this amount will not then occur until 1 July 2014. It was part of the 2004 election campaign commitment, when the Howard government gave a rock-solid guarantee of further extra assistance for families. The childcare tax rebate, as it was then called, was introduced by the Howard government in 2005 and backdated to 1 July 2004. We did this because we understood that being able to have affordable and accessible, and good quality, child care was an essential part of a family being able to manage its work and family commitments. Unfortunately, in seeing this reduction in childcare funding, we see a government that has no concern whatsoever for the affordability of child care, especially given the recent COAG national standards changes—and I will come to those in a minute.

The childcare tax rebate, as it was called then, was introduced by the Howard government in 2005 and backdated to 1 July 2004. We did this because we understood that being able to have affordable, accessible and good-quality child care was an essential part of a family being able to manage its work and family commitments. Unfortunately, in seeing this reduction in childcare funding, we see a government that has no concern whatsoever for the affordability of child care, especially given the recent COAG national standards changes—and I will come to those in a minute.

In their 2007 election platform Labor committed to increasing the childcare rebate to 50 per cent, lifting the maximum amount of rebate from $4,054 to $7,500 per child. They also said the payment was to be made quarterly, in arrears, and there was to be indexing. By 2010 this cap had reached an amount of $7,778 per child per year. The cuts that the amendments in this bill introduce will see some $278 per child per year having to be found by families in addition to what they are currently paying. This is a serious impost on a great many families.

Of course, the point about all of this is that women’s workforce participation rates in our country are extremely low. Ours is amongst the lowest in the OECD in terms of women aged between 25 and 44 years, the prime childbearing years, participating in the workforce. There are reasons for that. We do not do very well at all as a nation in offering flexible workplace arrangements, job sharing and working from home—but, in particular, we do not offer enough support for families, who are having to pay up to $100 and more per day for child care.

The Henry tax review highlighted the issues and problems associated with the workforce participation rates of our 25- to 44-year-old women. The government had asked Mr Henry to make coherent recommendations to ensure appropriate incentives for, among other things, increased workforce participation. So, when the Treasury department working paper was delivered in April 2010, it said:

On average, a gross price increase of one per cent in child care would be expected to reduce the hours worked by married women with young children by at least 0.7 per cent.

This finding from the Treasury department completely contradicted the 2009 Access Economics report, which suggested that in fact there was no relationship between the costs of child care and, if in fact there were to be increases in fees as a result of the COAG reforms, they would not impact on a mother’s decision to return to the workforce. Clearly, that was nonsense; and now we have the Treasury department working paper of April this year overturning that previous, erroneous Access Economics report.

For working families, anticipating that there will be up to a $22 per day increase in childcare fees as a result of the National Quality Standard for Early Childhood Education and Care changes, you can imagine the blow that this reduction in childcare support will deliver. For example, in a National Child Care Alliance Australia survey, in which 1,000 parents were surveyed, over 79 per cent of parents of children attending long-day care centres said that, if there were any higher fees at all, they could not afford to have their child continue at a childcare centre. And we know what the consequences are for families not being able to afford professional child care. Mothers have to quit their jobs or contract their working hours, or they turn to their parents, the grandparents—typically the grandmother, and ask her to take over the informal care. When that means the grandmother has to leave her paid employment to take up that childcare responsibility, so we have two victims of the Labor government policies—we have the mother herself, who is no longer able to be earning superannuation and salary in order to build her savings for her retirement, or to build her career; and we have the grandmother, also with a contracting capacity to earn for herself, to have an independent retirement. It is no surprise that over 73 per cent of people on the aged care pension are women, and that problem is increasing under Labor.

So we have to argue very strongly against this business of reducing the support for families who must buy their child care. Minister Ellis said at the time of the announcement of these reductions that it was not a real problem; it was only the rich families who would be affected—fewer than three per cent of families would be impacted. Those families, she implied, did not deserve any support anyway, because they were, in her words, ‘rich’. Well, I am afraid she got it very wrong on a number of counts. In particular, if you are a working family with a child having to attend a high-cost inner-city long-day childcare centre for four or five days a week, you will almost certainly be over the current rebate cap level. And, of course, any child in regional Australia who has to attend long-day care centres for more than three days a week incurs fees that also come out at or above the threshold. It is not a matter of being rich. It is not about this government penalising or punishing the rich by reducing the rebate cap. That is just a bit of an attempt to invoke some sort of ancient concept of class wars that I thought Australia got over long ago.

The freezing of the rebate indexation for four years will see thousands of families forced to pay 100 per cent of any increases in fees that occur. And we know that those increases in fees are in the pipeline because, as I said, we have the COAG National Standards Quality Assurance Program coming down the line. We do not object to improved quality in child care and early childhood services, of course. But we do object to the higher costs having to be met by families who cannot afford to pay. We also know that the new COAG quality standards agenda, which has been fully endorsed of course by this federal government, will also reduce the number of childcare places, particularly for smaller children, the nought- to three-year-olds. In Queensland, for example, they have calculated there could be a loss of up to 8,000 places in child care as a consequence of reducing the ratio of children to staff and requiring smaller groups to be supported in childcare centres.

So it is a bad news scenario for those working families who aim to balance their working lives and family commitments by accessing affordable, quality child care. The childcare rebate should also ideally have been made payable to parents weekly in arrears. This government made a commitment to change the way that the childcare rebate would be paid. That was an election commitment, but we have seen none of those changes. Given that the childcare rebate can be accessed when an account is rendered but not necessarily paid a number of families are finding themselves in very embarrassing situations, with the rebate in their pockets but the fees not paid—and that rebate having to be used for other essential household costs, including the mortgage and buying food. The whole business is getting more and more difficult all the time.

You might think this is the only thing that this government has done. Perhaps it was an oversight—perhaps the minister was not as influential as she should have been around the budget table—but in fact the reduction of this childcare rebate is just part of a long list of attacks upon working families and on their access to affordable, decent childcare services.

Let us go to a few more of the problems on the list. We know that the first of the 260 childcare centres that were to be built—that were promised in a campaign commitment by Labor—hugely blew out their budgets. They came in at almost double the initial expected costs. It was shades of the incompetence of the Building the Education Revolution program in handling tenders and in handling the building of public infrastructure. Because of the blow-outs in costs in the first couple of multipurpose childcare and early childhood education centres, this government has run away from their commitment at a million miles an hour. We will be lucky if we will see 38 centres built but the excuse used by the minister when she sadly told us about this outcome was that, ‘There is a surplus of childcare places around the country.’ Well, talk to some people in inner Sydney or in the electorate of Murray and tell them that although they have been waiting two years for a place in child care for their child or children this government believes there is a surplus of childcare places.

The truth is that in a few parts of Australia—in some outer suburban areas—due to the abolition of proper planning processes by this government, there has been an oversupply of childcare centres. But you cannot claim that there are no problems at all across Australia in obtaining a place and then cancel a commitment to build 260 new centres. That is just a nonsense and no-one is swallowing that line.

Then we had very recently the announcement of the loss of federal support for occasional care. Occasional care is another professional option for parents who perhaps want their socially isolated children to have some playgroup experience. This is particularly important for rural and remote areas. And occasional care is essential for families who suddenly have a medical appointment, for example, or some other family crisis, and they do not have a mother or mother-in-law or some other relative living within easy reach. They need that access to occasional child care. This federal government has chosen to walk away from funding support for that very important childcare option.

This government has decided to abolish the access to the start-up grants for family day care. Each grant was worth about $1,500. They were essential for women—they were almost universally women—to modify their homes so that they could offer professional child care. Often for these women it was a first step for them back into the work force or into a small business. These women often had to change or modify their homes, with different safety measures—different doorways perhaps or different locks on gates—and so on. So that $1,500 start-up grant was very important. It often made the difference between the woman being able to start the business or not being able to. That grant has been abolished.

We have also had the abolition of the rural and regional version of that long day care grant. That was worth substantially more but it has been abolished. We have been told that long day care centres with part-time child care in the more remote parts of Australia are under threat because Minister Ellis does not like the idea of part-time childcare centres being opened. She is only granting them six months of registration or accreditation at a time.

Mrs Bronwyn Bishop interjecting—

Dr STONE —She does not seem to understand, or perhaps she does not like children. I have to say that now small towns, across the wheat belt of Western Australia in particular, are not able to attract professional staff because they just have a six-month lifeline in terms of federal support.

The minister has suggested that such part-time centres would be at greater risk of closing. She has made sure, absolutely sure, that these centres will close. The point about these small centres in places like Corrigin, Darkin and so on, is that they are in very small communities. But the women in those places still often need to have a salaried job beyond the farm to supplement their husbands’ income. And they do not have, just because they are rural women, any great access to a mother, a mother-in-law or some other neighbour who will take on their children out of charity or because of a sense of family responsibility. These families need professional, accessible, affordable child care in the same way that suburban and metropolitan families do. But they are small communities so they cannot have, and do not want, seven-day-a-week or five-day-a-week, eight-hour-a-day child care. They only want a part-time service. That is what they want; that is what they need; and that is what we, when we were in government, supported. This government does not understand. They are simply saying, ‘You’ll have to live with six months accreditation, and if you are not happy then you know what to do about it.’

We even had new centres that were hoping to start up, particularly in the wheat belt of Western Australia. They are now saying that they cannot afford to start up if they will not have ongoing accreditation as part-time centres. This is just shameful. I am so saddened to think of those communities having a contraction of essential services because this government either does not care or does not understand. It is a very sad circumstance.

We also have a problem with our children with special needs. As we all know, special needs children often need more attention, and at the moment we only have a subsidy set at $15.74 an hour. Most childcare centres have a cost of at least $25 per hour to support the special skills and experience required of the employee who will look after those special needs children. So how are these centres going to continue to offer the special inclusion support for special needs children when there is that huge differential between what is offered, $15.74 per hour, and, on average, the cost of $25 per hour? Those same families are also going to find their rebate slashed. This is the sort of problem we are facing with this government, which is absolutely out of touch and not caring about the future.

We have to say that child care is not a luxury. It is not an option for a mum who wants to play some tennis instead or go to the bingo halls. Perhaps that is what the minister thinks it is all about. Well, it is not about that at all. It is about women who have a need, because of their own career development or because of the financial pressures of their own households, to access professional and affordable child care. Such women should not be forced to ask their mothers, the grandparents, to sacrifice their earning capacity to fill the need that this government has now created. It is not fair to the grandparent—the grandmother, typically—nor to the family.

We just have to look at Labor’s Paid Parental Leave Scheme to see how little they actually think of working families in Australia. We have waited so long for a paid parental leave scheme in Australia. We now only have the USA without a mandated universal scheme for its families. You would think that having beaten their chests and said that they are all for working families and women, this government would produce a paid parental leave scheme equal to world best—at least. No, what they have put on the table is a disgrace. We have already said that women often have a fractured working life because of parental responsibilities, particularly those women in the key child-bearing age group between 20 and 34. They drop in and out of the workforce. They go into part-time work and then back into full-time work while they juggle their family responsibilities. One of the problems that that produces is a fractured superannuation history and a fractured time in which they can accumulate savings or even something like long-service leave.

What has this government done in relation to superannuation for women taking paid parental leave? They have ignored the issue altogether. They have said ‘We will think about it in a couple of years, maybe.’ I suppose that is code for: ‘We are sending the country broke with our debt and deficit. We are busy chasing our biggest growth generator in the country, the mining industry, offshore.’ But, sadly, the sector that is to take the brunt of that miscalculation and shambolic government is the working women of Australia. They are not to have superannuation during their paid parental leave.

We know too that six months is an optimal time for a woman who has just given birth to establish exclusive breastfeeding if she wants to and can. Six months is the optimal time of bonding with that newborn and six months off work is also the optimal time for that woman to recover from that pregnancy. Labor itself acknowledged that during the time of the Productivity Commission’s report. So what did this government put on the table for paid parental leave? What time frame? A miserable 18 weeks. Not even five months. Just a bit over four months—how disgraceful. But they said: ‘That’s all right. We are just making that short-term offer because women can go and access private paid parental leave schemes or the schemes in the public service to top-up our miserable offering.’

Women who currently have access to paid parental leave, and many women in the Australian economy do have access to paid parental leave, are the higher paid women with over $1,200 salary a week, women in the public service, women in the defence forces and women in the finance and banking sector. You ask the woman serving in a shop, in the retail sector, in hospitality and tourism and the seasonal worker; you ask my fruit-picking women or women working in dairies as milkers; you ask the casual woman and the self-employed woman if they have access to an alternative paid parental leave scheme to top-up Labor’s miserable cheapskate offering. I am sorry. They do not have that alternative. So Labor’s scheme simply perpetuates the haves and have-nots amongst women in our society right now. What a mean thing to do. I have to say that I am, quite frankly, disgusted by it. I am disgusted that the trade union movement is not up there screaming about this problem, marching outside Parliament House, demanding a better deal.

Then we have the problem that it is only to be paid at the minimum wage—this is Labor’s Paid Parental Leave Scheme. If you are on more than the minimum wage your mortgage is going to reflect that, as are your other household expenses. So, quite simply, using the calculator—very deliberately supplied by the Labor government on its website—the woman over the minimum wage will do the calculations and realise, sadly, that she is not able to take that parental leave. Financially, she will be better off staying on the baby bonus. This is the baby bonus that we introduced as a coalition. What a sad, sad day. I have to say that this government stands condemned for that miserable performance. They have also made it so difficult for small businesses and other businesses to manage the pay process for their employees on paid parental leave that I am somewhat fearful that some of our small businesses will say: ‘I have to manage her pay, and we are still not sure what the payroll implications of that are and we are still not quite sure what it means for workers compensation and other add-on costs that employing people generates in this country.’ Those small businesses, when they are faced with two equally talented people applying for a job with them, may then choose the older woman, which will be fine—or the man—but not the woman of childbearing age. What a terrible indictment of this government and what a sad impact of their Paid Parental Leave Scheme, which is so miserable, so inadequate, that that could be the consequence.

Of course Labor has realised that they have stuffed this up and that they have a shambolic piece of legislation in the form of the Paid Parental Leave scheme. They somehow have not managed in their two years to liaise sufficiently with the states in relation to the payroll tax implications. As a government they are so concerned about the impacts of the extra red tape and cost burdens of their scheme on small business that they are giving businesses six months off while the Family Assistance Office does the job for them. The Family Assistance Office will continue on, and handle the payroll issues for casual women employees and women who are self-employed. So why could you not have the Labor government engage the Family Assistance Office to manage the payrolls for women on the Paid Parental Leave scheme right throughout the economy? What a ridiculous way to have gone.

The coalition has a superb scheme on the table—it will be world’s best practice, but we will have to wait until we are in government to implement it. It will deliver superannuation and it will deliver, in addition to six months leave, two weeks for the non-primary carer, who will typically be the father, so he too can engage in those precious first months of the baby’s life. It will also include replacement of the primary carer’s wage or the minimum wage, whichever is greater, capped at $150,000. Most importantly, to ensure there is no further discrimination against child-bearing age women, the Family Assistance Office will take care of payments under the Paid Parental Leave scheme. We will completely leave that extra burden and red tape and administration cost off the business sector. Many parents and potential parents have said to me just how disappointed they are with the Labor scheme, and I know that they are simply marking time until we are in government and can fix it all.

This brings me back to this particular bill, which is part of the horrific series of difficulties that Labor is visiting on working families, particularly women with children and childcare needs. It is going to reduce the childcare rebate by some $270 a year—this is the cap—despite the fact that we all know childcare fees are going to substantially increase under the new quality standards regime. If parents are looking forward to the time when their children go off to school and think that will be a relief in terms of childcare needs, we all know childcare needs continue on in terms of holiday care program needs or after- or before-school care. There is no surprise if I tell you that Labor has just defunded the active community school care programs, which engage 150,000 children across Australia in more than 300 schools. Just when you thought it might have been a relief for you, when the children move from up-to-four-year-old child care into preschool and then into the school system where there might be a better prospect for them that they could afford, no, Labor has made sure that that is also going to be a time of extraordinary ongoing difficulty for families who must have that care.

It seems that families, particularly families with younger children, are bearing the brunt of this government’s failure to manage our economy, its failure to understand that you must get value for money when you throw billions of dollars into something like a frenetic building program aimed at schools in particular and when you throw billions of dollars at something like the Home Insulation Program, which has endangered lives, and has in fact led to four deaths, and put honest workers out of jobs. It is a tragedy to think that one part of our community which is hurting most as a consequence of all of that are our families with young children, particularly as they reach out to try and juggle their working lives with their family responsibilities. We want our families to feel secure in where they take their children in their younger years. We want them to access an affordable childcare service but, sadly, this government is making sure there is nothing but chaos and heartbreak. I certainly feel that this childcare budget measure is ill-conceived. It only saves $83 million over four years, and when you think about it that is not very much when you are inflicting so much damage and so much distress on so many families.