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[Notice of upcoming address to the Australian Family Association] and [transcript]



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John Howard

NEWS RELEASE Member for Ben nelongShadow Minister for Industrial Relations & Manager of Opposition Business in the House

ATTENTION: NEWS EDITORS

The Hon John Howard MP, Member for Bennelong and Shadow Minister for Industrial Relations, will be addressing the Australian Family Association at the Dining Hall at Ormond College, corner of Royal Parade and College Crescent, Parkville at 7.30 pm.

An embargoed copy of the speech is attached.

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6/7/94

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Address by

THE HON. JOHN HOWARD, MP

SHADOW MINISTER FOR INDUSTRIAL RELATIONS

to

THE AUSTRALIAN FAMILY ASSOCIATION

on

Wednesday, 6 July 1994

at

7-30pm

at

Ormond College Melbourne University Parkville

It may have not been what

the Government's politically correct

advisers wanted, but the International Year of the Family has stirred a bigger than expected debate on family policy. So far, the news is not all bad either.

Many recent international years of whatever have been dismal failures. They have been nothing more than opportunities for fadists who control the decision-making echelons of the bureaucracy and academia to peddle some of their favourite theories.

Certainly the principles enunciated by the Government for the International Year of the Family were not promising. None of the seven included a simple reference to the cohesive influence of the family unit within our society. or was there any reference to the desirability of providing parents of dependent children with effective choice between one or other of them providing child care for those dependent children or paying for that child care - an issue which lies at the heart of the family debate in Australia in 1994.

More than most, family policy is an area in which the barricades must be held against the forces of minority fundamentalism.

There is no shortage of those in positions of influence in the bureaucracy, academia and the media who would have us believe that the day of the so-called traditional family is virtually over, that it represents in any event an emotional prison and that the most important thing to marvel about concerning the

family is its diversity.

This minority fundamentalism takes the form of implying that support for a traditional or majority practice is per se evidence of condemnation or intolerance towards those who are not part of that majority.

Nowhere is this more evident than in relation to family matters.

When, some four years ago, I released on behalf of the Federal Opposition the "Future Directions" document, it depicted on its front cover that dangerously subversive image of a mother and father and two children standing outside a picket fenced home.

Those who attacked the manifesto alleged that it portrayed a narrow stereotyped image of Australian family life, that it was intolerant towards homosexuals and sole parents and hankered after a 1950s perception of how families lived.

This extraordinary conclusion was reached apparently on the basis of the front cover of the document which, in any event, was utterly consonant with the way in which even in 1994 eighty percent of young children spend their family lives in

Australia.

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Let me illustrate with reference to some statistics which surprised me.

Some weeks ago, Peter McDonald, the Acting Director of the Australian Institute of Family Studies, addressed a weekend seminar organised by the Federal Parliamentary Liberal Party.

During his presentation, Dr McDonald made the point that no fewer than 87 percent of all first marriages - that is marriages where both parties were marrying for the first time - were intact at the moment.

Given the doomsdaying about marriage and the constant suggestion in wide sections of the media that marriage breakdown had become a chronic national disease, this particular figure surprised me but it is correct.

That does not mean that each marriage in the 87 percent will remain intact. But the high incidence of people who are involved in more than one broken marriage explains why 87

percent of intact first marriages is consistent with the other figure of one in three marriage breakdowns. The breakdowns are not all first marriages.

In assembling a sensible and effective family policy, it is necessary to go beyond matters of taxation and social security payments. Important though these are, the general

state of the economy will always have a profound impact on the economic and social position of the family. High interest rates and high unemployment in conditions of economic recession impose enormous strains on families in all sections of society.

There is little doubt that the most recent recession from which Australia is only now fitfully emerging was very destructive for many Australian families.

The most sobering statistics I have read in years tell us that using constant dollar comparisons the number of Australian households earning between $22,000 and $72,000 a year declined from 65 percent to only 40 percent between 1976 and 1992. In

the same period, the number of households under $22,000 doubled from 15 percent to 30 percent and those over $72,000 increased from 20 to 30 percent.

This variation traces a dismal pattern of a collapsing middle class. There can be little doubt that the deeply disturbing increase in the number of households under $22,000 is a direct consequence of family disintegration.

Family disintegration is a major contributor to poverty.

It is not drawing too long a bow to compare the approach of society to family relationships and its approach to health.

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In recent years, there has been an enormous - and in many ways highly successful - swing towards preventive health care. Australia is entitled to derive some satisfaction from the fact that in some areas of preventive health education we have been very successful. The emphasis on diet, the strenuous efforts made to discourage smoking and, more recently, other

forms of self-inflicted punishment such as the abuse of alcohol and drugs are examples.

The watchword in the health area is that prevention is much better than cure.

Yet, strangely enough, we seem unable as a nation to apply the same approach to our families.

The emphasis there is almost totally one of picking up the pieces after the fragmentation has occurred.

We devote pitifully few resources to marriage guidance. We fail to even address the issue of preparing young people for parental responsibilities through our education system. We fail as a nation to place any moral premium at all on the responsibilities involved in relationships. Increasingly an attitude of "anything goes" is applied to the assumption of

family responsibilities.

Is it any wonder, in the face of this hit and miss attitude, that there is mounting concern in our community at the increasing evidence of fractured families in our midst.

Quite properly, much of the debate in recent months has been around taxation and transfer payment issues.

In particular, it has focussed on what many of us regard as an absolutely fundamental proposition.

That is that Australian parents should have the right -measured in effective economic terms - to decide whether or not their young, dependent children should enjoy full time parental care or alternatively some other form of paid or

otherwise arranged child care.

Increasingly, this issue has come to the forefront of the family debate. No longer is it seen simply in terms of the rights of women.

Now it is seen as an issue of parental rights.

There are many women in our community who by any measure would regard themselves as deeply committed to the full realisation of their career potential yet who are alarmed at the absence of effective choice regarding child care when their children are young.

-s-

The need to more responsibilities is modern times.

effectively blend workplace and family one of the great unresolved conflicts of

detect in the Australian community a deep unease that the compromises so far worked out are far from satisfactory.

In less than a generation, we have swung from one assumed stereotype of Dad being the sole breadwinner and Mum always at home with the children to an uneasy mish-mash of realising that life will never return to what it was in the 1950s but equally that our institutional and other arrangements in the

1990s have not given parents the full choices they believe should be available.

Many of the most basic practices of modern life are still built on earlier stereotypes.

Let us take something as simple as school hours. They are still by and large the product of an era when young children were either met at the school gate by their mothers or arrived home to the welcome of their mothers before commencing play in the backyard or the street.

Perhaps the time has come when the school day should be revised? Is it so ridiculous that we consider a school day commencing at 9-00am and finishing at 5-00pm with the last two hours comprising homework and/or

lightly supervised sport?

Perhaps the right arrangement, where both parents work, is for the night time to be freer of homework.

There will be the predictable cry of outrage from some elements in the teacher unions. They should not be so peremptory. There is a golden opportunity here for the

employment of additional teachers. More generally industrial considerations would need to be addressed.

The simple point is that our present school hours are a product of a society which has very substantially changed and perhaps it is necessary that those hours change with it.

have said on many occasions, our present taxation system heavily discriminates against families with dependent children, most particularly those that rely on one income.

The choice of mother or father remaining at home while children are young is increasingly the preserve of the better off. This is a vicious and punitive denial of choice to hundreds of thousands of Australian parents and a serious

social injustice.

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No person in the past decade could have been a stronger proponent of what is called the rational approach to economic management than have I. For this I make absolutely no apology. No nation can survive, prosper and generate wealth

for its citizens without due regard to some fundamental laws of economics.

However, that having been said, nobody has more regularly advocated greater justice for Australian families with dependent children.

I have said before and repeat tonight that a nation whose taxation system is insensitive to its impact on families is a nation without a social vision.

It is the first order of importance that our taxation and/or payments system be changed to give real choice to the generality of Australian families regarding their child care arrangements.

The evidence which indicts our taxation system is well known to an audience such as this. For the past forty years, there has, with little interruption, seen a steady erosion of the position of all families and, most particularly, sole income households in our community.

The noise of militant feminism swept all before it for a considerable time until the past couple of years when a change in community attitudes has been quite discernable.

There is growing concern at the inequities of the present system. There is a strong realisation in the community that the present system penalises those who choose to care for their own children full time.

The crowning obscenity has, of course, been the most recent child care subsidy paid through Medicare offices. This is now the subject of an expensive government advertising campaign.

It is utterly indefensible that a household with two incomes totalling $400,000 can enjoy a child care subsidy of $61-50 a week, yet a single income household earning $35,000 a year with the same number of children to care for enjoys taxpayer

support of only $24-50 a week in relation to those children.

All the arguments in the world about costs incurred in earning assessable income cannot justify such gross inequity. To those who defend the alleged equity of such an arrangement, it ought to be said that the costs, ie., child care costs,

incurred in earning the second household income can never equal the cost involved in providing full time parental care for children at home. That cost is the total renunciation of a second income.

-7--

Yet for some strange reason this point is never conceded by those who advance the rather arid economic comparison between child care costs in a two income household and the normal business expenses involved in running, say, a professional practice.

To provoke deep debate on this issue, I raised, at the beginning of this year, the issue of income splitting.

I advocated income splitting as one method of removing the inequity against single income households.

At no stage did I commit myself to income splitting as being the only way of achieving this goal. My purpose was to get the debate going and to help focus public attention on the

unfairness of the present system.

I remain of the view that there are a lot of virtues in using the taxation system to remove current inequities.

To start with, taxation relief does not carry the connotation of dependency and welfare. There is the additional advantage that income splitting promotes the concept of partnership in marriage.

There is also the hard-headed economic consideration of what the experts call "churning". Alan Tapper - an author who would be well known to this audience - has estimated that as much as thirty to forty cents in every taxation dollar

returned as welfare is swallowed up in the churning process.

Also, there is the related consideration that income splitting is, and has for a long time been, available to people in business and the professions. Indeed, present taxation arrangements most heavily discriminate against wage and salary earners.

The availability of income splitting for non PAYE taxpayers and its denial to PAYE taxpayers is the most effective answer of all to those that claim that even pure unlimited income splitting would be a bonanza for the rich.

The truth is that, in many cases, the very rich already take advantage of income splitting. Its full introduction would, therefore, confer a far greater relative advantage on low and middle income earners than the great bulk of high income earners.

Despite this, I have always acknowledged that some cap or taper would be required if a system of income splitting were introduced. I have also advocated that it should be only available to couples with dependent children.

-B-

However, income splitting is not an end in itself. It is but one of a number of ways available to remedy the inequities of the present system.

I know there is strong support amongst many in this audience for the provision of a homemaker's allowance. Obviously, this is another method of remedying inequities.

Within a short time, the dependent spouse rebate will be cashed out for those who have dependent children and the value of that rebate (only fractionally increased) will take the form of a direct payment to the principal carer which, in most cases, will be the mother.

Some people will argue, with some justification, that a new system of direct payments to mothers having been introduced it would be counter-productive, indeed unpopular, to revert to a taxation method of helping sole income families. This is a

strong argument for building on the new home child care payment as a method of redressing current injustices against single income households.

There are numerous other methods, including the so-called French system of income splitting which draws support from some groups in our community.

There is also the possibility of introducing an additional threshold for sole income households which would begin to taper out beyond a certain level of income to ensure that it

was heavily targetted in favour of those who need assistance most.

I have said before and I repeat it tonight: my goal is to repair the imbalance. I am less concerned about methodology employed than I am about securing a commitment across the political spectrum to a taxation/payments system in Australia that effectively gives to the generality of Australian

families a choice about the arrangements they make for the care of their dependent children.

I welcome the introduction of the parenting allowanced announced in the Government's White Paper on Employment.

Although brought in under the guise of an unemployment relief measure, it does recognise an important principle - although for a very limited number of Australian families. It will be of help to this group and I quite unreservedly compliment the

Government on the initiative.

I also take the opportunity of complimenting the Government on the introduction of what used to be called the family assistance supplement which provided additional help for very low income families.

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It should be noted in passing that the original concept of this supplement was, in fact, contained in the last budget of the Fraser Government in 1982 and had been the brainchild of Senator Chaney, the Minister for Social Security in that Government.

I am no wild-eyed idealist about these things. However I believe there is considerable latent support in the community for effective freedom of choice for all Australian families.

The greatest problem faced is that the commanding heights of the media, the public service and academia have been captured by the politically correct in these matters.

Call a public meeting on the issue, talk to your friends at a • parents and citizens gathering or amongst your business

associates and plenty of common sense emerges.

By contrast, when one tries a debate on the issue with a Keating Government Minister, for example Senator Crowley, or the Chairman of the Council for the International Year of the Family, Professor Cass, one is met with some well-rehearsed

lines.

I have some regard for Professor Cass' qualifications yet I found it excruciatingly difficult to get an admission from her during a recent radio debate that in some way the principle should be acknowledged that families had a right to an economically effective choice about the form of child care most appropriate for them.

It is a very basic principle, but the acknowledgment was not forthcoming. One can only conclude that such a principle is not on that lady's agenda.