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Tuesday, 23 November 2010
Ms LEY (4:43 PM) —I am pleased to speak on the Family Assistance Legislation Amendment (Child Care Budget Measures) Bill 2010. This bill is detrimental to Australian families and the coalition is opposed to this legislation. Decreasing the cap on the childcare rebate and removing indexation for the next four years will further increase the financial pressure on Australian families who are already struggling to meet the costs of child care.
Over the next few years the number of families affected by capping the rebate and freezing the indexation will increase from 20,700. This will be a progressive increase for families as more and more are affected over the duration of the indexation freeze. The Prime Minister, in her previous role as Minister for Employment and Workplace Relations, acknowledged that 20,700 families will be affected. Clearly, as inflation kicks in and fees rise that number will only go up. The cost of child care will also continue to rise further because of the national quality framework measures, which will increase overheads and running costs for childcare centres.
In their submission to the inquiry into the childcare budget measures legislation in June 2010, the Liquor, Hospitality and Miscellaneous Union stated: ‘It must be recognised that without alternative allocation of funding, the proportion of affected families will certainly increase over the subsequent years. We draw attention to the fact that childcare fees have risen by 34.9 per cent since June 2005, more than two and a half times the headline inflation rate over this period. With the capping of the childcare rebate and continuing fee inflation the cost of future fee increases will be increasingly met by parents at all income levels, exacerbating the cost of child care for many families.’
But the minister has her head firmly in the sandpit on this one and is deaf to the concerns of parents and even, remarkably, to the Liquor, Hospitality and Miscellaneous Union. I might just add that that union has changed its name I read today in the press, airbrushing the word ‘union’ completely out of its title and calling itself ‘United Voice’. Surveys, focus groups and marketing consultants indicated that, amongst other things, people could not spell ‘miscellaneous’. That is a bit of trivia, and I now return to the serious subject matter of the bill.
This capping of the rebate comes on top of the decision to implement the national quality framework agenda, which will further increase the cost of child care. The former CEO of GoodStart estimated that costs in New South Wales could increase by up to $20 a day. So where you have parents currently paying $105 a day for their 18-month-old to attend child care that cost will potentially increase to $125 a day. Cuts to the childcare rebate mean that this family will be even further out of pocket as they were already receiving the maximum rebate prior to the national quality framework price increases. That means that, if you are already receiving the maximum rebate of $7,500, any increases above that in your fees must be met by you, 100 per cent, with nothing to offset them. This bill aims to generate savings of $86 million over four years and the savings, according to the minister, will go towards the cost of implementing the government’s national quality framework agenda.
These cost increases, which really do concern members on this side, will come about as a result of higher staff to child ratios and the need for more highly qualified staff. This equates to higher labour costs for a given number of enrolments. These overheads will not be able to be absorbed by childcare providers, so of course they will be passed on to parents. Research undertaken by Childcare Alliance Australia showed that 74 per cent of parents surveyed would have difficulty meeting additional costs of $13 to $22 a day. This increase in costs may force many parents out of the workforce or they may need to cut their hours as child care becomes too expensive. The alternative is to seek additional forms of care for their child. The concern here is that parents will be forced to use backyard care, thus negating any form of quality regulation. There is considerable pressure on parents when it comes to finding appropriate child care. Every member of this parliament should have firsthand examples of that. We do know about unqualified child care or friends struggling to help out. And grandparents are always under pressure but perhaps feel unable to say no when they are asked whether they can take the children a couple of days or an extra day a week. There is a range of unsatisfactory arrangements.
The minister has been critical of the quality of child care in Australia in an attempt to justify her reform agenda. The argument on which she based the need for the capping of the childcare rebate is fundamentally flawed. She said that many childcare centres are failing to meet basic safety, hygiene, education and wellbeing standards. She said that audit and accreditation decisions made in association with NCAC had found that toileting and nappy-changing procedures were not done in accordance with advice from recognised health authorities and dangerous products, plants and objects were accessible to children. I am sure those things are true but they have nothing to do with this agenda. They are decisions and circumstances that would quite rightly be addressed by licensing bodies in each state.
No child should be attending a centre that does not follow proper health regulations and that has potentially dangerous items that children can reach. There is no need to cap the childcare rebate and introduce a quality framework because of those things. Those things will be addressed by the state bodies in their normal licensing, regulation, accreditation et cetera. Childcare providers tell me that they already do that to death. We really can have confidence in the safety and quality of our centres. The minister bases her decision about this legislation, which will cap the childcare rebate and increase the cost of child care to Australian families, around the argument that our childcare centres are somehow not up to scratch. It is disingenuous and it is insulting to the hard-working private and community providers of those childcare centres.
The minister fails to recognise many things, but one of them concerns the qualifications of childcare workers. While there are thousands of childcare workers who do not have a university or a TAFE qualification, many of these people have been in the industry for years. Many have raised their own children. They have on-the-job experience second to none. And, most importantly, they love their job and they love the children they look after. Nowhere does the minister acknowledge the fabulous job done by many of these childcare workers, instead she is adamant that only a qualification will do. I have firsthand experience with each of my children attending child care. Often children form an incredible bond with their carers. As a parent, my No. 1 priority was that my child was safe, happy and in a caring environment. I am sure that would be every parent’s priority. I can guarantee that just because someone does not have a qualification does not mean that they cannot impart some of life’s valuable lessons to our children.
All of the literature that we have seen over recent years concerning disadvantaged children and children at risk says that the key to developing resilience in the early learning years is in forming a bond with a person who cares. It does not say anything about qualifications or university degrees. Important though those things may be—and of course they have their place in the early-learning environment—we should be conscious that there are people who, at the moment, are being dismissed as not needed in the future because they do not have the qualification that the minister and this government insist on.
Particularly in rural and regional communities, many are already struggling to find child care for their children. But, despite all the rhetoric on increasing access, the government are actively working against this agenda. They are increasing the costs of child care and imposing a quality framework to which the childcare sector has not had sufficient opportunity to respond.
Lack of access and increasing costs will undoubtedly force many parents to either withdraw their children from child care or seek alternative, less attractive, care options. If parents have no choice but to work in order to meet the mortgage repayments—and those are going up—or pay off the car or other debts, they may resort to placing their child in care arrangements that are far from ideal.
The coalition believe there was a serious lack of consultation with the childcare sector on these proposed changes. We have concerns about the impact of these changes on the accessibility of child care. We have concerns about the feasibility of the framework, particularly surrounding the prerequisite qualifications for staff. All in all, the government has failed to put forward a consolidated, coordinated approach to child care. Certainly, improving the quality of child care is a very worthwhile aim, but it is just as critical that child care remains affordable and accessible. The actions taken by the Gillard government show just how out of touch with Australian families Labor has become. The government is ignoring the cost ramifications, instead intent on its own poorly consulted and poorly designed agenda.
Families are struggling at the moment. Many are experiencing real financial stress, with rising interest rates making the servicing of the mortgage an increasing struggle for many families. There are car repayments; there are credit card bills; there are gas and water bills to consider; there is the cost of electricity, which, particularly in my home state of New South Wales, is increasing all the time. The Labor government need to understand that people are doing it tough. Instead they are intent on increasing the cost of child care for Australian families. They just do not get it.
If we move for a moment from the social aspects of this policy to its economic aspects, we see there is a productivity agenda that should be addressed. We know that in this country women’s workforce participation rates are extremely low; the OECD has told us this. The Henry tax review looked at the question of underparticipation, if I could put it that way, in the workforce, and the minister’s other portfolio is employment participation, so she should be well aware of these facts and well aware that there are mothers, usually, who are waiting to return to the workforce, keen to do more time and anxious about losing their skills. The threshold question for those families is the cost of child care. Do members opposite understand that threshold concept?
Child care, thanks to governments of both persuasions over the years, has decreased in cost. I can remember, as a young mother on the farm, facing the questions as to whether I could afford to put children in child care, whether I had to set up a playpen at the dairy or keep an eye on them while I was in the shearing shed—both very unsuitable options, I can tell you—or whether I would just delay returning to study and training. In the end I went to university when I was 30. But the only reason I did was that there was affordable child care on campus. It was safe and reasonable and my budget would allow it. So these really are threshold questions for families, the first thing they think of: is there child care available, is it close to where I live, can I afford it, is it safe et cetera?
What I am seeing from this government, who have lost their way, is that they are working actively against that agenda and then trying to say to the opposition that we have a problem with safe, hygienic, properly run childcare centres and somehow we do not want child care to be of a high standard. That is outrageous. It is a claim that they should not make. There is a productivity aspect to this agenda that we should not overlook. The key finding of an April 2010 treasury department working paper is:
… in contrast with previous Australian estimates, the cost of child care does have a statistically significant negative effect on the labour supply of … mothers. This finding supports policy that reduces the costs of child care to encourage maternal labour supply.
So the Treasury is telling us: reduce the cost of child care and you will encourage mums back into the workforce. I say again: parents who have already reached the new maximum childcare rebate of $7,500 a child will have to meet the entire increase in fees. If you are a low-income family you will be forced out of formal care because you will not be able to meet 100 per cent of the increase in fees. These families might not be affected by the initial reduction in the cap but they will be affected by the freeze on indexation. Because parents are already struggling financially, there will be a large number of children unable to access an early-learning program at the present time.
The worst thing that we could do with a policy like this would be to remove the options of maybe an extra one or two days a week for families who really do need child care because the children have early-learning difficulties, are at risk in some way or for whom child care has been recommended as a very important option at a time in their life when the family is not managing well.
Eighty-six million dollars is the amount the minister says this will save, and in her second reading speech she said that it would be put towards making the government’s quality agenda happen and supporting ‘the government’s quest to increase the quality of child care and early education in Australia’. That does not give me a lot of comfort. Apart from opposing this measure, I would like to see $86 million attributed to something more concrete than supporting ‘the government’s quest to increase the quality of child care’.
Perhaps that money will be paid to state governments. Perhaps it will be absorbed in the increasing bureaucracy surrounding this agenda, and that, I think, is the sad thing. We have a COAG process. We have a hundred million dollars allocated by the government just to support the marketing and administrative components of the COAG reforms. This has nothing to do with the reforms themselves, it is just the marketing and administration—the glossy ads, the TV campaign and more people working behind the scenes. But, as always, at the grassroots, at the cutting edge where the rubber hits the road the relationship between a carer and a child in a childcare environment that families can afford is left until last.
The government has been very tardy with its legislation. The first quarterly payment of the childcare rebate for 2010-11 was due to be made to families by Centrelink from 18 October 2010. That is because, the way it currently stands, it is paid quarterly in arrears, and that would be for the first quarter of a current financial year. The government had plenty of opportunity to introduce this bill to meet its own deadlines; however, it appears that the minister has stood by and watched as her legislation has disappeared from the agenda time after time. This in itself is a clear indication, I believe, that the minister has grave misgivings about her own legislation or that for some reason the government has some hesitation about bringing it in. Here it is, at the 11th hour, already not working to meet the needs of families in terms of the payment schedule.
Child care has been an absolute embarrassment for the Rudd-Gillard government. Their elaborate scheme to end the double drop-off was a promise they found easy to break. When it came to building 260 childcare centres, they suddenly found that real buildings are considerably more challenging than the Lego models that the government’s own hollowmen had been playing with. It is a desperate cash grab from a desperate government and it does show how out of touch they have become with ordinary Australians. Families are struggling to pay their bills and make ends meet. The coalition opposes this legislation and urges all members of the House to do likewise.