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Tuesday, 5 November 1996
Page: 6531

Mr HOLLIS(5.39 p.m.) —Labor put child care on the agenda, taking it from obscurity to an accepted part of affordable quality of life and equity for all. It is well documented that the preschool formative years have a significant and long-lasting effect on the school performance of the child. It cannot be disputed that the greater the enriching experiences a preschool child has and the greater the level of security and safety, the more chance that child has in fulfilling their opportunities in life. It was a clear recognition of this that directly linked operational subsidies to the community based child-care centres.

Children spend their formative years in many places not under the direct influence of government regulation, not least in their own home. But, where they spend time in organisations that are directly under the province of government, we have a responsibility to provide a high quality service. This also provides an important opportunity to raise the level of awareness amongst the broader community about high quality child care and raises the acceptable standards of the entire community.

To me this is one of the most important imperatives for continuing the operational funding to community based centres. In many areas these organisations are the flagships of quality by which parents can have a benchmark to judge the service they receive. Many parents are also in areas where private providers are few and far between because the economic base or the geographic spread of the population makes private centres less financially viable. It is a great shame that the current government, as part of its first budget, has also cut thousands of places that were planned for new growth.

The Child Care Legislation Amendment Bill 1996 abolishes the operational subsidy for community based long day care centres. I have seen many spurious arguments put forth to justify what is in reality a simple but punishing cost saving. This policy stems directly from the National Commission of Audit and its ideologically driven commitment to the fairytale of competitive neutrality in the child-care sector. The rhetoric of the report is chilling in its treatment of this service in its oversimplified and short-sighted consumer/provider terminology

Quoting directly from the report on this matter, we can see the complete lack of comprehension of quality issues expressed and the sheer leaps in logic that this report presents as some form of unchallengeable truth. On this issue, the report states:

Operational subsidies to publicly funded child-care centres result in distortion in the public and private sector supply markets for child care. Achievement of competitive neutrality between publicly funded and private sector suppliers is desirable and will also improve equity in relation to the fees faced by parents using suppliers in either sector.

I would personally like to see any of the government members spouting that garbage to a delegation of concerned parents—I have had many concerned parents coming to see me not just here but in my electorate office—and teachers from their local community based long day care centre. I am sure the reception would clearly dispel these myths.

Even more insidious, however, is the complete lack of discussion in this document about the way in which changes to funding processes will impact on the quality of the service. I would therefore now like to look a little more closely at the forced options being faced by the community based long day care centres in my own electorate of Throsby.

I have received direct representation on this issue by several members of the community based centres in my area, including the South Coast Workers Child Care Centre, the Western Suburbs Child Care Centre, the Wallaroo Child Care Centre, the Warilla Child Care Centre, which is run by the local council, and Illawarra Area Child Care Ltd, which is a not for profit, community based umbrella organisation which sponsors and assists the management of six children's services in the Illawarra, including four, 40 place long day care centres.

I also attended a public meeting on this issue at the Wollongong Town Hall on Thursday, 12 September. At all times it has been made quite clear to me that this proposal is putting before these organisations a decision where they are directly facing the choice between significantly increasing costs to parents or significantly decreasing the quality of the service.

The South Coast Workers Child Care Centre face a loss of $30,670 in 1997 and $61,341 per year after that. They have indicated that they will not be choosing to compromise quality and so will have to pass on the additional cost to parents. The same situation arises at many other centres. All centres are indicating that they cannot trade off quality for decreased service fees. They are extremely concerned that this will push many families who are just able to meet their current child-care costs out of the system and into unregulated and even backyard services. The impact on families is dramatic. One constituent wrote to me:

I am not a political person. I am a single parent defending my pre-schooler's right to quality, affordable child care. My child has been attending the Wallaroo Community based long day care centre full-time while I have been temporarily employed and training in an effort to become self-sufficient and no longer require Social Security payments. Under proposed budget cuts, Wallaroo will lose its operational subsidy and be forced to find other means to replace this money. I was recently informed that my fees may increase by twenty-five dollars per week or otherwise the level and quality of service will have to be drastically re-organised. This means reducing the number of qualified staff, purchasing less equipment for the children, possibly cancelling places for children under the age of 2 years and no longer providing hot meals. I am already struggling financially and can see no alternative other than to keep my son at home and give up any hopes of becoming independent.

This letter is typical of the issues parents and centres are struggling with in their concern that the cuts will be implemented.

These are everyday people. They may well not be political people, but they have seen an excellent service—run by the local community, delivering a needed and quality service to them and, most importantly to many of them, to their children—being beaten up by this government. These people can see no reason for this action other than cost cutting. If there is one area where people will not tolerate cost-cutting measures it is in the area of services provided to their children. These organisations are not protesting this decision because it eats away at their profit margin or weakens their investment potential. These are organisations run by dedicated members of communities who have put many years into building a service which their local community can be proud of and which ensures a benchmark standard of excellence. The people protesting these measures are adamant in their commitment to quality and will not trade it off for savings. They are insulted by the government sop of offering money to undertake efficiency reviews to make the organisations more financially effective.

Choice in child care for parents should not revolve simply around the purchasing power of the dollar. It is not good enough to say that if you want to spend more you can buy better quality when it comes to the critical years our children spend in preschool facilities. Real choice relies on an educated population who understand the balance of quality and price issues effectively enough to allow them to make informed choices with their money. Community based and government subsidised child-care services have provided the measuring stick for many parents in this field. At the end of the day they may choose not to use a community based centre but, as part of the real choice, they should have that option to consider. What happens in reality is that those centres hold excellent reputations in their local communities and are so in demand that many parents who would use them by choice are not able to get places in them.

It is an obvious statement to say that an under two-year-old child requires far more supervision than older children. This means a far higher staff to child ratio and therefore significantly increases the costs to the provider. It is no coincidence that this is an area with a huge unmet demand problem already. In my own electorate of Throsby, only 25 per cent of the current private centres provide any positions for under two-year-olds. Children with disabilities and children at risk particularly need the option of a quality fully resourced centre to provide for their needs. The families of these children are often already faced with significant out-of-pocket expenses to meet the child's needs and should not have to face personally providing extra funds to the child-care centre to resource a place for their child. The interaction provided is important for the growth of that child and ensures that other children are able to develop the compassion and understanding that we all should have for children in this situation. If this type of cost cutting forces those parents to take their children back into the home, then we have moved a long way backwards in our recognition of the dignity and rights of children.

Finally, I would like to comment on the other proposals which change the eligibility and administration of the child-care cash rebate. This scheme was put into place by the Labor government in July 1994. It was the first formal recognition that child care constitutes an essential expense incurred in earning an income. It provided some assistance to working families not benefiting from targeted child-care assistance and some further assistance to those in receipt of child-care assistance. Most significantly, the rebate was not income tested because it was already a direct recognition of the cost of child care as a legitimate work related expense. It was administered as a direct rebate rather than as a tax concession because this allocation is to be paid to families not in direct income-earning situations, such as those studying, training or, indeed, seeking work.

Means testing the child-care rebate is therefore a direct contradiction of the purpose of the rebate in the first place, and it is a clear broken promise by the current government. Over the last decade, we have developed a child-care system in Australia that is of world standard. Much of this achievement has been based on the funding of a system that has ensured quality and equity. To attack this now is short-sighted and self-defeating penny-pinching which can only negate results for all the interested parties. Not least of all, the children will be directly affected. I totally oppose what the government is proposing.