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Thursday, 23 March 2017
Page: 2026

Senator KAKOSCHKE-MOORE (South Australia) (13:13): I rise to speak in support of the Family Assistance Legislation Amendment (Jobs for Families Child Care Package) Bill 2016. The bill seeks to amend various acts in relation to family assistance for child care. Key measures in this bill centre on the introduction of the streamlined childcare subsidy, replacing the childcare benefit and childcare rebate, and the introduction of the new supplementary payment, the additional childcare subsidy, which provides additional financial assistance for children at risk of abuse or neglect, families experiencing temporary financial hardship, families transitioning to work from income support, grandparent carers on income support, and low-income families in certain circumstances. The bill also sets out new approved provider service requirements due to come into effect next July. These requirements provide for an enhanced compliance network. As a result of these reforms, more than 815,000 families will receive a higher level of fee assistance than they are currently able to access. In short, millions of Australians will be better off because of these reforms.

Debating this bill is long overdue. It was hampered by the government's decision to package up the bill with welfare savings measures in the original Social Services Legislation Amendment (Omnibus Savings and Child Care Reform) Bill 2017. This has delayed providing families with much-needed relief for rising childcare costs. Thankfully, the government made the sensible decision to decouple the reforms from billions of dollars of deep cuts to payments received by families, young people, pensioners and working parents.

Data from the Department of Education and Training has revealed that the average hourly fee for all childcare services rose by almost eight per cent in the year to June. The average cost of long-day care services, which are used by 540,000 families, jumped to $8.90 per hour, up 6.3 per cent, in the year to June. These families are now paying $740 per child more a year, based on the national average of 21.8 hours per week for 48 weeks of the year. For many families the costs result in many parents, predominantly women, regretfully leaving the workforce. The department's long-term forecast predicts childcare costs hitting $233 a day in Sydney, $175 a day in Melbourne, $157 a day in Brisbane, $152 a day in Canberra and $138 a day in Adelaide. The measures contained in the bill will provide much-needed relief to working families that rely on child care.

Australia has one of the lowest levels of female participation in the developed world, which acts as a handbrake on workforce productivity and economic growth. The Grattan Institute estimates that, if Australia could increase our female workforce participation rate to that of Canada, our economy would be $25 billion better off. This bill represents a substantial investment by the government of approximately $40 billion in childcare support over the forward estimates, supporting working mothers and working families. Modelling by PricewaterhouseCoopers shows that the childcare package will deliver significant benefits to the economy by helping more women to participate in the workforce. These women will pay an estimated additional $850 million in tax, which will serve to benefit our economy.

There is no doubt that early childhood education and care are integral to the health and wellbeing of Australian children and play a vital role in their development and preparation for school and in enabling parents to work. The Nick Xenophon Team supports the delivery of a genuine, much-needed reform for a simpler, more affordable, more accessible and more flexible early education system.

In relation to the activity test, the bill provides for 12 hours of subsidised care for families on incomes of less than $65,000 a year, without the need for them to meet an activity test. If a parent studies, works or volunteers for just four hours a week—that is less than an hour a day—they are able to access additional hours of subsidised care. The Nick Xenophon Team is aware that there was a push by some to raise the subsidised care from 12 to 15 hours per week. However, in order to secure these additional hours, many families may have had to endure deeper cuts to their family support payments. We were not prepared to ask families to suffer those cuts. As a result, we have agreed to the government's proposal of 12 hours of subsidised care for low-income families without the need for those families to meet an activity test.

In relation to the consultation process in the development of the childcare package, I provide the following comments in a very constructive sense. There are important stakeholders such as SNAICC, the national non-government peak body in Australia involved in promotion of the rights, needs and aspirations of Aboriginal and Torres Strait Islander children and families. SNAICC was not invited to be part of the initial reference group during the consultation period on the design of this package. When I questioned the department of education during the Senate inquiry into this bill late last year about the number of Indigenous organisations involved in the consultation process, the department was unable to name a single organisation.

If they had consulted with Indigenous organisations in the childcare space, the government would have more properly understood the importance of early childhood education and care in Indigenous communities. It is imperative that the department reviews its consultation procedures to ensure that all appropriate stakeholder groups are comprehensively consulted with when reform packages are being developed. Consultation during the early stages would ensure that what is proposed meets the needs of the most vulnerable and the most marginalised.

During the Senate inquiry into the bill, I raised concerns about the bill's apparent silence on the future of budget based funding. Budget based funding was introduced with the intention to allow early childhood education and care to be conducted in regional and remote areas in which a market would not otherwise sustain them. Budget based funding is vital in supporting approximately 19,000 children, with nearly 80 per cent of budget based funding going to early childhood education and care in Indigenous communities.

In their submission to the committee regarding the effect of the cessation of BBF, SNAICC stated:

… engagement in early childhood education reduces risk of harm to a child, and subsequent involvement with statutory child protection authorities, as well as reductions in remedial services and criminal behaviour in the longer term. Holistic community based Indigenous services are a central preventative measure to strengthen families and prevent child abuse and neglect.

That is why the Nick Xenophon Team is pleased to hear that concerns about the impact that the cessation of budget based funding would have on Indigenous communities and the resulting effect on efforts to close the gap have been listened to. We have worked with the government to ensure that Indigenous children and children in rural and remote communities continue to have access to early childhood education and care, just as any other child in Australia does.

We understand the government has committed to protecting existing childcare funding for remote and Indigenous communities by maintaining the $61.8 million in funding for these services. We also understand that an additional $49 million for services in remote communities or highly disadvantaged communities to commence or expand their services has also been committed. This will ensure that budget based funding programs continue and support the most vulnerable children in our community. That announcement, along with the suite of measures in this bill, will make a significant difference to the lives of Australia's most precious resource: our children.