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Education and Employment Legislation Committee
28/10/2020
Estimates
EDUCATION, SKILLS AND EMPLOYMENT PORTFOLIO
Department of Education, Skills and Employment

Department of Education, Skills and Employment

[9:03]

CHAIR: I welcome the Minister representing the Minister for Education, Senator, the Hon. Simon Birmingham. I would also like to welcome representatives from the Department of Education, Skills and Employment. Senator Birmingham, do you wish to make an opening statement?

Senator Birmingham: Good morning. No, I do not.

CHAIR: Secretary, do you wish to make an opening statement?

Dr Bruniges : No, thank you.

CHAIR: I will hand over to Senator Keneally.

Senator KENEALLY: Thank you to the minister and the officials for appearing today. I would like to begin on the topic of childcare system funding and fees. I would like to clarify that in the 2020-21 budget for the Child Care Subsidy the budget papers estimated total spend this year of $8.97 billion. But if I'm reading this correctly, only $8 billion was spent in 2019-20. Why did the department predict that there will be a 12 per cent increase in spending in the subsidy in one year, particularly in the middle of a recession?

Dr Bruniges : Do you have a page reference that you're referring to in the budget papers so I can go to that?

Senator KENEALLY: In the 2020-21 budget, Child Care Subsidy, Program 1.2, from paper 1.4. I don't have the page number. I apologise.

Dr Bruniges : While officials are trying to find the reference—

Senator KENEALLY: Sorry? I apologise.

Senator Birmingham: While the official is trying to find the reference I will make the observation that the Child Care Subsidy is a demand-driven program. These are all estimates in that regard and trying to predict the demand elements. I think there has been, I understand, a very strong recovery in child care demand during the course of this year. I imagine those demand elements would be a key factor of why the increased investment is anticipated.

Senator KENEALLY: That is precisely the question I'm trying to ask. What's driving the assumptions that we are going to see a 12 per cent increase on spending in the subsidy in one year, particularly in the middle of a recession?

Senator Birmingham: I can tell you that the forecast is to spend approximately $9.4 billion on the child care package in the 2020-21 financial year. That's the figure that we forecast to spend.

Senator KENEALLY: Yes, but only $8 billion was spent on the subsidy in 2019-20. Sorry, you said $9.4 billion?

Senator Birmingham: There may be a difference between Child Care Subsidy and the package.

Senator KENEALLY: That is what I am trying to get to. I am asking about the subsidy.

Dr Baxter : You're referring to 2021 administered funding and you're asking specifically about the Child Care Subsidy line item?

Senator KENEALLY: Yes.

Dr Baxter : In 2021, the increase in Program 1.2, which is Child Care Subsidy, is primarily the result of a number of factors. A $165.9 million increase is due to higher price and demand observed in year-to-date actuals to December 2019, prior to COVID-19. As you know, it's an estimate that we make. It's a projection we make at the beginning of a financial year about what we think is going to be happening, based on where we've seen demand go. So, $165.9 million relates to that. The $66.6 million is an increase due to a reduction in Treasury's forecasts of wage growth. Where families' wages are lower than previously projected they're entitled to more CCS funding. As you know, the Child Care Subsidy system directs funding to the lowest income earners. A $5.6 million decrease due to the new arrangements for CCS. This is specifically a change in the method of reconciling income against CCS entitlements for those customers with changes in relationships. This is the part-year partner change we made to respond to some of the concerns from families in the sector. A $75 million net increase for some ons and offs related to how the COVID measures came on and went off. I can detail those if you would like me to?

Senator KENEALLY: Maybe we will do that on notice, in the interests of time.

Dr Baxter : They are the components that make up the change to the subsidy. I wasn't sure whether the figure you gave, the 12 per cent, also wrapped in the extra $900ish million for COVID funding. Would you like me to also detail that?

Senator KENEALLY: I am sorry?

Dr Baxter : I was not sure if the 12 per cent figure you use was also wrapping in the extra approximately $900 million for COVID related childcare funding in 2021?

Senator KENEALLY: No. That is very helpful. The factors that are underlie the assumption of the increase in the spending go to higher prices and increased demand, reduction in wage growth, changing the amount of subsidy that is paid out, a small amount in terms of the changes to CCS and another portion in terms of some ons and offs in relation to the COVID?

Dr Baxter : That's right. The first few factors that I mentioned—my understanding is they are a normal part of what we base our projections on from year to year. CCS being demand driven, responding to where demand is at, where prices are at, where we expect the distribution of wages across the economy to go, because that then effects the subsidy rate.

Senator KENEALLY: With the $165 million, which you said is made up of both an assumption about higher prices—

Dr Baxter : Higher price/demand. It is a higher price for the subsidy, which is driven by demand in the system—demand for more child care.

Senator KENEALLY: In the interests of time, is there anything you can table that would help us understand how you've come to those assumptions about higher prices/demand?

Dr Baxter : There's nothing that I can table. I can certainly take on notice to see if we have something that explains it. Effectively we have a child care model, as you know, which simulates a full year of child care data. That includes demand. It includes shifts you see up and down in demand from time to time.

Senator KENEALLY: Presumably it includes assumptions, say, from Treasury and others about employment?

Dr Baxter : Our model does not include that—

Senator KENEALLY: And wages.

Dr Baxter : I will have to come back to you about the elements that make up that specific demand, but I'm happy to take that on notice.

Senator KENEALLY: That would be really helpful. How much does the department expect centre based day care fees to increase in the 2021 financial year?

Dr Baxter : Can I clarify the question? How much does the department expect centre based day care fees to increase in the 2021 financial year?

Senator KENEALLY: Yes.

Dr Baxter : What we do know is that the average fee increase over the last 10 years has been 5.3 per cent. That's probably the strongest data point that I could give you. We don't have a particular expectation of fees. As you could imagine, it is a difficult year to be making assessments. At the moment we still have very substantial numbers of child care services whose fee increases are frozen. For much of this year there have either been no fees or the entire country had its fees frozen. At the moment, and through until the end of January 2021, all of Victoria—all of those services in Victoria which are accepting our support, which is most services—also have their fees frozen. It is a difficult year in which to estimate fee growth in centre based day care or in fact in any of the services, but we know the 10-year average is 5.3 per cent.

Senator KENEALLY: That is a fair enough answer in the sense of reflecting what's been happening this year. Presumably you must have some type of estimate that you work with in that modelling? I understand it's been provided previously on notice. Are you saying that you haven't got one this year?

Dr Baxter : I'm not saying we haven't got one. I'm not saying that the figures that I have just given you, which were based on December 2019 price and demand, that we don't have that. I don't have it here with me. I can tell you that from a policy perspective, if you're saying to me, what do we expect to happen to centre based day care fees? I would tell you that is a very difficult call given the environment we've had, which has been mostly fee free or fee increases frozen.

Senator KENEALLY: Given that you've just reflected that there have been services that have lost revenue, does the department have any expectation that services will try to recoup lost revenue by hiking up fees?

Dr Baxter : It's certainly not the feature of the discussions that we've been having with the sector. As you know, we have a reference group where we meet with representatives from all parts of the sector. We undertake intensive consultations on various issues from time to time. The focus of the sector at the moment is trying to return to full demand for all parts of the sector. We know that, when you look at the administrative data, the vast majority of the country is well in excess of 100 per cent of the demand that it was experiencing pre-COVID, and even this time last year. But there is a focus on making sure that all parts of the sector are able to experience that same rebound.

I think in that context we don't have a sense that they are looking to recoup. The idea that centres have lost revenue as a blanket statement is also perhaps not entirely accurate. We know that for some services, despite having lower demand, they have still had very significant revenue during this period. To give you an example, we know that at the moment in Victoria, although attendance at centres is very low, their charged hours are still at 93 per cent of pre-COVID revenue. On top of that, they're receiving a 25 per cent payment from the government. Their revenue is upwards of 100 to 120 per cent of pre-COVID revenue at the moment, even though attendances remain very low. It is a little bit blunt to say they've all experienced a revenue reduction. Many have experienced very strong financial support, despite the decreases in demand.

Senator KENEALLY: Do you have any reports of centres adjusting their fees, either up or down, given that some have had revenue losses and some have had re new increases?

Dr Baxter : I don't have specific examples with me of some having adjusted up or down. We know that for Victoria at the moment they are still frozen. We know it has only been in the last month that the rest of the country has had the transition payment conditions lifted. Right up until the end of September they were all required to keep fees frozen. Probably three or four weeks is not enough of a span of time for us to have been able to see any trends, unfortunately.

Senator Birmingham: Even though there have been many disruptions this year, the historic pattern is that centres usually set their fees once for the year ahead in terms of making a decision around what increase they'll apply, and that then applies over the course of that 12-month period. I'm sure there would be isolated instances, but it would probably be unusual if there were significant changes up or down by too many individual centres.

Dr Bruniges : As the year progresses, we'll work with the stakeholder groups to identify any pattern or change that we see that will be important for us to do that.

Dr Baxter : We do remain very focused on fees. I think we've mentioned here before that late last year we did write to 70 services, which were in the top 10 per cent of fee-charging services, to let them know that they were in that category and that we were after some extra information about why that might have been the case to try to understand fee drivers, and also to let them know that we were aware of this issue and this was an issue of concern. We also do publish the quarterly fee data as a way to support families with transparency of fees.

Senator KENEALLY: If we can go back to the 5.3 per cent increase, which you said is the historical average in fee increases. Is that a reasonable at least assumption for what we might see in the next 12 months?

Dr Baxter : As I've said, it is my strong sense that we just do not have a sense of what will happen in 2021. We already have a situation where, for half of the year, the majority of services have not been allowed to increase their fees. You would think on that basis the percentage for 2021 increase is likely to be much lower, given that half of the year has been out of scope, but I just don't think we know at this stage.

Senator KENEALLY: Back to your point about the letter that you'd sent out, I think you said, to 70 services?

Dr Baxter : To 70 centres.

Senator KENEALLY: Did any of them reply to the letter?

Dr Baxter : Yes, I think the majority replied. I might ask Dr Hart if he would like to come. He may have some more information. I think all or almost all of them replied. That's right.

Senator KENEALLY: How would you characterise the outcome of that exercise?

Dr Baxter : I think it has been a very important exercise in terms of ensuring that services know that we are aware who are in the top fee-paying areas, know that this is an issue of concern to the government and to families; know that we keep track of these issues; and that families have reported this concern to us. I understand we included in that information about the material that's publicly available to families to understand fee data, and it also allowed us to understand a bit about what services are saying are some of the drivers of cost increases. Dr Hart, do you have anything to add.

Senator KENEALLY: Did anyone actually say, 'We're going to lower our fees?'

Dr Hart : No, I don't think we got that level of feedback, but we did get an understanding about what was driving the fees. I think the approach that we took is similar in a sense to some of the approaches that we take to compliance, which is about understanding and education and also expectation. There was certainly a sense in the letter that the expectation is that fees would grow at a moderate rate. The key themes, if it's helpful, that came back were wages for staff and educators, insurance costs, and session lengths. Even though some session lengths might be shorter costs still needed to be covered. And also rental costs. Once upon a time a number of centre based day cares owned their centres. But they are renting and we got a sense that they were the primary drivers of the four to five per cent increase that we would see on an annual basis.

Senator KENEALLY: When the government launched its new system in 2018, if we cast our mind back, the minister at the time said the government will be 'naming and shaming centres that put up fees'. Has the department named and shamed any centres since July 2018?

Dr Baxter : I guess the thing about the piece of work we commenced with this correspondence to services in December 2019 is it has been very interrupted by the events of this year. We wrote to services in December 2019. I commenced in this role in February 2020 and I know even at that point I was engaged in workshops between Minister Tehan and the sector about the issue of fee increases. We did have another workshop planned to talk to the sector about fee increases and potential action that could be taken. At that point COVID intervened and fees became free. That piece of work, for the time being, was deferred but it is something that remains strongly on the agenda.

Senator KENEALLY: That's a fine answer; it's just not the answer to my question. I will try it again. Has the department named and shamed any centres since 2018? It's a yes or a no.

Dr Baxter : I guess if by 'name and shame' you mean do families have access to information about fees for various services, yes, they do. Our child care finder services allow families to identify where services are and what their fees are. They also have it through the quarterly fee data that we publish to ensure there's transparency about the breadth of fees. But that specific piece of work that was about working with the sector on fees and looking at the next action which would be taken, including any public naming of high fee charging services, was interrupted by the fact that fees became free and then fee increases were frozen.

Senator KENEALLY: But I think it was Minister Birmingham who said the government was prepared to name and shame those who 'do the wrong thing' and said, 'We will be monitoring the system closely. We'll make sure families get the benefits of these reforms. If there are providers who do the wrong thing, we will of course act to make sure they're identified and are held to account for doing so'. I understand about COVID, but COVID was 2020. This was in 2018. Again, I ask you: has the government actually named and shamed any centres who have put up their fees since 2018?

Senator O'Sullivan interjecting

Senator KENEALLY: A point of order. I do have the floor.

CHAIR: We are flexible. I will let Senator O'Sullivan just put that question to assist the understanding here and I will come back to you.

Senator KENEALLY: Does that mean that Labor senators will have the same opportunity when Liberal senators have the floor.

CHAIR: You will find that I tend to run a relaxed show here. As long as everyone gets along nicely, we can do that; otherwise I can bring in a bell and we can all have 10-minute slots.

Senator KENEALLY: You're far more considerate than Senator Stoker. I applaud you.

CHAIR: We will just let Senator O'Sullivan ask his question. We will come straight back to you, Senator Keneally.

Senator O'SULLIVAN: Just to supplement the question that Senator Keneally asked. The fee structure is transparent to parents right across Australia; is that not correct?

Dr Baxter : Services are required to make it clear what their fees are and also what components are included in that fee. In relation to the question about whether these services have been identified and been held to account, as you read out what the naming and shaming meant you mentioned identifying these services and holding them to account. Certainly the services have been identified. We have mentioned identifying those services that are in the top 10 per cent. They have been held to account in the sense that we have written to them, we have asked them to please explain why there is this fee-charging behaviour, and we have indicated to them that we are keeping an eye on what's going on.

Senator KENEALLY: Can you confirm that all services have their fees listed on the child care finder website?

Dr Baxter : No, I cannot confirm that.

Senator KENEALLY: So it's quite possible that there are services that don't have their fees listed on this website?

Dr Baxter : All services need to make their fee schedule transparent to families as part of their agreement with families.

Senator KENEALLY: But they're not necessarily on the child care finder website?

Dr Baxter : But they're not compelled to include all of their fee data on Child Care Finder. The majority do.

Senator KENEALLY: So the naming and shaming might be useful. Let's move on. I think we have established there haven't been any particularly named and shamed. What has the increases in centre based day care fees been over the past 12 months?

Dr Baxter : Childcare costs in general in the last 12 months for which we have data, which is to March 2020, rose by 4.4 per cent, which is lower than the 10-year annual fee increase of 5.3 per cent. Out-of-pocket costs in that period are still 3.2 per cent lower than they were prior to the introduction of the CCS in July 2018.

Senator KENEALLY: With the 4.4 per cent, how does this compare to CPI?

Dr Baxter : I'm sorry?

Senator KENEALLY: How does the 4.4 per cent compare to CPI?

Dr Baxter : I might defer to Dr Hart, who can probably find the relevant tables. Actually we will have a go at doing it together. We do have some of that data here, if you just give us a moment. So you're after a change in child care CPI versus a change in all CPI; is that what you're after?

Senator KENEALLY: Yes, please.

Dr Hart : The CPI from December 2018 to December 2019—and this is the CPI against which the hourly rate cap is indexed—was 1.8 per cent.

Senator KENEALLY: Thank you.

Dr Hart : You were asking about the centre based day care fees. They do fluctuate. For example, in 2019 in June the average was $10. It was $10.30 in September, but it actually dropped to $10.25 in December. There is variability. It is cyclic and it does go up and down.

Dr Baxter : It also varies greatly between locations. We know, for example, there are a very large number—in fact I think it is 86 per cent—of services which are charging below the hourly rate cap. We have many examples of those.

Senator KENEALLY: What percentage of centre based day care services are charging above the government's fee cap?

Dr Baxter : We have that here for you, if you just give us a moment. I will defer to Dr Hart.

Dr Hart : Nationally 13.9 per cent or above and 86.1 per cent are at or below the hourly rate cap.

Senator KENEALLY: Has the value of the Child Care Subsidy therefore diminished over the last two years? Fee increases seem to have risen faster than CPI adjustment to the CCS hourly fee cap rates?

Dr Baxter : No, that is not the case. The key indicator to look at is out-of-pocket costs. Fee increases obviously reflect an increase prior to the Child Care Subsidy. Out-of-pocket costs indicate the amounts parents have to pay separate from the Child Care Subsidy. Out-of-pocket costs have decreased 3.2 per cent from what they were prior to the introduction of the CCS in July 2018. In fact, we are still seeing a situation where out-of-pocket costs are well below what they were under the previous system.

Senator KENEALLY: Why do you think those out-of-pocket costs have decreased?

Dr Baxter : It is a number of factors relating to the design of the system. The system was very much geared towards lower and middle income earners and ensuring higher subsidies for those people. We do also have some ROGs data which shows that the out-of-pocket costs are lower again—at the lower ends of the income spectrum.

Senator KENEALLY: If the subsidy is linked to CPI, by definition the value eroded in the last year, did it not?

Dr Baxter : Actually over the last year childcare CPI reduced by about 95 per cent, because there have been no childcare fees over the last year.

Senator KENEALLY: And the year previous?

Dr Baxter : That's the data that Dr Hart has provided.

Senator KENEALLY: Can you provide that data, Dr Hart, for March 2019 to March 2020? I'm happy for you to take it on notice.

Dr Baxter : We might have to take that one on notice.

Senator KENEALLY: But just to get some information on the operation outside the COVID timeframe—a more normal timeframe.

Dr Hart : Sorry? The CPI change for child care from what period?

Senator KENEALLY: March 2019 to March 2020.

Dr Hart : 2.2 per cent.

Senator KENEALLY: It is very impressive that you have it right there. I might wrap up with that section there.

CHAIR: Senator Faruqi.

Senator FARUQI: I might start with some questions about the transition grant payments, which I understand were made to services between 13 July and 27 September this year. How were transition grant payments made to services between that period?

Dr Baxter : The question is, how were the—

Dr Bruniges : The transition payments were purely 13 July to 27 September.

Senator FARUQI: That is what they were for, right?

Dr Bruniges : That was paid for 25 per cent of the services' fee revenue.

Senator FARUQI: Was it paid weekly to services?

Dr Baxter : It was paid weekly in advance.

Senator FARUQI: Was that payment done through Services Australia?

Dr Baxter : I might just ask Ms Pearce to join us, just so I make sure I get all of the facts right. We had a number of different approaches. The mechanism for making the payments was to strike a grant agreement with services. You will recall that these payments were made from our CCCF, Community Child Care Fund, Special Circumstances Payment. In order to make payments under that mechanism we must have a funding agreement with organisations. In general the striking of a funding agreement is a fairly time intensive process, where there needs to be an offer, acceptance and a return and a number of steps in between. One of the really great innovations through the COVID process has been that we have developed and streamlined—Ms Pearce might like to talk in some more detail—a process of being able to get out and offer an acceptance to services much more quickly and electronically in a simple DocuSign process. That was the vehicle through which they were made. Then there was the process of how did the money actually hit the account, which I understand was through Services Australia but I'll hand to Ms Pearce to explain it to you.

Ms Pearce : The mechanism by which we made payment was we calculated the payments within our department. Then that goes as a file essentially over to Services Australia. Then they use the existing accounts and settings that they have through the childcare subsidy system to make the payments. That gave us a payment system that is the same as the childcare subsidy. That minimises risks around going into the wrong bank account and those types of things.

Senator FARUQI: You said the department made the calculations for the services?

Ms Pearce : Yes.

Senator FARUQI: Was that through a database? Was it a Microsoft Excel-type calculation that you did in the department?

Ms Pearce : I believe we've used a number of different mechanisms, but part of that is an Excel spreadsheet. But once we set these up they're fairly straightforward, because essentially you're taking 25 per cent of whatever the services reference period is. For most that's the two weeks ending 1 March. For a new service it's when we establish in their early operations. Yes, we use a number of aspects. We draw things out of other databases, do the calculation, put it into a file and pass it through.

Senator FARUQI: Were any calculations done manually for that or was it all using spreadsheets?

Ms Pearce : I would imagine that we've done some checking in terms of manual calculations from time to time. Occasionally a service might come back to us and say, 'Hang on. We don't understand how you've calculated,' or, 'We think you've got it wrong.' Then we will go back and we will redo those calculations.

Senator FARUQI: How many instances of that have there been over the last few months for that payment where services have come back to you and said, 'You've calculated it wrong'?

Ms Pearce : Quite a small number, but I don't have them with me.

Senator FARUQI: Could you take that on notice?

Dr Bruniges : Overall there were 6,000 providers covering 98 per cent of all services.

Senator FARUQI: Sure.

Dr Bruniges : As Dr Baxter has said, the pace at which that needed to be done was a critical point to ensure that that went in place. As to the work that we did around DocuSign to make sure that agreement was in place—it was a matter of days for us to dispatch and get those returned, which triggered that first payment. The first payment went out on 13 July. The total cost that we were dealing with of the transition payments that the government made available was $708 million.

Senator FARUQI: Yes, I do know that. What I'm concerned about is that obviously you had to do it quickly. What were the controls that were set in place to make sure that accurate payments were given to the services?

Dr Baxter : If I could add to the line you were going on around which payments would have been made manually and also some of those controls, and no doubt Ms Pearce will also have some finer detail to add here. On the issue of manual calculations, we were very conscious of the speed at which we were moving and the need to have controls in place. They weren't manual. They were still done through the system based on the fees data that we had and the revenue data that we had for services. But where—

Senator FARUQI: So, some manual calculations were done?

Dr Baxter : They weren't done by hand is what I'm saying.

Senator FARUQI: I didn't say by hand.

Dr Baxter : But they were done on a case-by-case basis, is probably a better way to say it. That would have been some of the situations that Ms Pearce has covered, but also where there were new services that arose after the period or where there were services that changed hands and were consolidated some of that needed to be done on a more case-by-case basis. Because we were very concerned to ensure that that was accurate we did rapid implementation and assurance process around all of these payments, including retaining external assurance to look over the payments that have been made. Ms Pearce can give some more detail here. We have done that in respect of the first range of payments, the relief payment package that was made. We are in the process of doing that for the transition payments to ensure that that has also been done accurately. We have also had external advisors that we retained come in to look at all of the payment processes to ensure that they were likely to reflect accurate processing and that there was sufficient checks and balances in place. That process gave us a very good report card, both through the initial process and then we did ask them to come back and look at the transition payments and whether any of the vulnerabilities that had been identified through the relief package had been sufficiently fixed, managed or had controls in place for those in the transition package. We also got very positive reports from that process as well.

Senator FARUQI: I think you and Ms Pearce said that the file that you did in the department was then provided to Services Australia to make the payments. What sort of information was provided in that file in terms of explanations of what these payments were? I understand quite a few payments are made by the department to those services.

Dr Baxter : Is your question about what information is provided to the service about what the payment was made up of?

Senator FARUQI: No, to Services Australia to make those payments.

Ms Pearce : I couldn't tell you line by line exactly what's there, but my understanding of that file is that, you know, it contains a unique identifier, that CRN, for the service. It's clearly a transition payment. Services Australia do it as a different run so there's no confusion between it and the childcare subsidy.

Senator FARUQI: So they are provided clearly with that information?

Ms Pearce : Yes.

Senator FARUQI: And childcare services would clearly have information on what amount was for what. I guess what I'm hearing is that some services may have ended up with amounts where they don't know how they were calculated, whether they were underpaid or overpaid. I don't want this to be another kind of robodebt-type situation. Is it made very clear to services? Is it a lump sum or is it made very clear that this is the transition payment, this amount is CCS, this amount is some other payment. Is that made clear to the services?

Ms Pearce : So services should know that—

Senator FARUQI: How would they know?

Ms Pearce : They know because we've got a contractual arrangement in place. They know the amounts that are involved. There may be occasions where they're getting a lump sum so they may not be able to tell easily that that's transition payment plus if you're in Victoria one of the additional payments.

Senator FARUQI: Yes, absolutely.

Ms Pearce : It should be reasonably easy to distinguish between one line and another what's childcare subsidy. Sometimes my understanding is that the software provided not by us but by third parties might be more difficult to follow. Certainly that's how most services account for that. But from our end it's kind of a clear input. If they've got software that muddles it all together, they may well not be able to, but that's not something within our control.

Dr Baxter : Could I add about the communications that accompanied all of the payments, because that was a really significant part of this as well. We had a very comprehensive communication shop running the whole time all of these payments were running. Wherever the agreement went out, which Ms Pearce has outlined, the funding agreement would state the amounts that would be paid and for which purpose. Each time—

Senator FARUQI: Would those be weekly amounts or would that be the overall amount that you would pay the service?

Dr Baxter : In the case of the transition payments, they were being paid the same amount each week. It would be, 'Here is the weekly amount of X number of weeks between this date and that date'. Then as we added components for people who were eligible for various pieces of that in Victoria, for example, that came with a separate funding agreement. That's one of the requirements. We would send out a separate funding agreement that said you are a service, for example, that is an outside of school hours care service, and so you were entitled to an additional 15 per cent. And, 'Here is what that looks like', and it's from this period to that period. It was in the funding agreement itself. Also, the detail of how that worked would then be included in the guidelines that would accompany it. Whenever we did one of those we accompanied it by a communication surge. We have an omnibus email that goes directly to the responsible person in the service. We can send a direct email saying that this is what's happening and what it means.

Senator FARUQI: When the payment is made or is this just with the agreement?

Dr Baxter : In the lead-up to it.

Senator FARUQI: I understand that. I'm just concerned about the payments being made. When the payments are made to services is it made clear what the payments are for?

Dr Baxter : Yes.

Senator FARUQI: Or is it just a sum of money that is deposited within the service? Is it made clear that, say, the $10,000 is the transition payment, and another $10,000 is the CCS top up? Is that made clear? That's what I'm getting at. Is that made clear to Services Australia as well in the file that's provided?

Dr Baxter : It is certainly made clear to Services Australia. We can take on notice to tell you what we understand lands as a tag in the person's account. I do know with the transition payments one of the things we did for clarity—and in fact with the relief package as well—is we separated out the normal payment run of, 'Here's your weekly relief payment. Here's your weekly transition payment'—from what we called internally the ad hoc run. That was, 'I need to get a bit of extra top up for this because I started a bit later or in the middle of a period. I didn't get my agreement back till later so I have a funny piece hanging off. ' So that people would get used to what is their weekly amount and also understand the ad hoc run we ran those at different times so they were received separately. We explained that to people in communication as well. We can take on notice to find out what we can about what's the tag that lands for them.

Senator FARUQI: That would be great.

Dr Baxter : But we did lots of this explanation in webinars, Q&A sessions—a whole range of things. People asked these questions and we worked through and explained it.

Senator FARUQI: Could you just take that on notice?

Dr Bruniges : If there's any particular case you have, we're more than happy to follow through on that, but we were absolutely determined to have that clear line of sight between us and Services Australia. As I said, the communications strategy that supported was very well received in terms of all of the webinars and the people participating. If there's any particular case—

Senator FARUQI: That's fine, but I would like on notice how it was deposited, how it was explained, what you provided to Services Australia and whether they had clear indications of what it was. As to the $708 million that was set aside for the transition payments, how much of that was spent between 13 July and 27 September?

Dr Baxter : Could you repeat the question?

Senator FARUQI: I understand that $708 million was set aside for the transition payments. I just want to know how much of that was spent between 13 July and 27 September?

Dr Baxter : You want to know how much of it was actually spent?

Senator FARUQI: Yes.

Ms Pearce : I don't have exact spend right up to the end. The reason for that is there is still a little bit of mopping up, particularly with our newer services. If they happen to come into being in the course, towards the end, we would be still making some lump sum payments to them. But as at 20 September, transition payments nationally were $736.69 million. That would include some of the additional transition payment that was being made with the extra five per cent in Victoria, which is why it's a little higher than that $708 million figure.

Senator O'SULLIVAN: We keep using the word 'unprecedented' with COVID. It certainly has been unprecedented times. For providers having to contend with everything that they've had to contend with, and with all the communications coming backwards and forwards from the department, if they'd required some clarity and some guidance, was there a hotline or something that they could call?

Dr Baxter : Yes, there certainly was. We not only had our general call helpline, which is available to services generally; we also had specific teams set up for those services who were going through the relief payment package, the exceptional circumstances, the transition payment. We had separate teams set up for small providers and also for the larger providers, because they obviously had a range of services that they were receiving payments, and it was more complex. In fact, we know that those services, those sorts of escalation services, for providers who might have had questions were very well used. We received good feedback that they were able to help services work through where they had questions or problems.

Senator O'SULLIVAN: I'm in Western Australia. Often hotlines are set up to close at 5.00 pm Eastern Standard Time, which cuts into our day over there. We get that a lot. What were the opening times for the hotline

Ms Pearce : Initially we actually did extend the times on our help desk during COVID—9 till 7. But I think as time went on we found that actually the usage pattern, including for people in Western Australia, was a bit earlier than that. We adjusted basically on the basis of what the needs of our sector were as far as when the help desk is available.

Dr Baxter : I think it was only very recently that we stopped with those extended hours. I'll just check the date. It was within the last month or so that we finished that. I can let you know that we did have a considerable amount of traffic to our CCS help desk. We had 14,869 inquiries over the April-May period. Just to give you a sense, that's an increase of about 87 per cent. We managed all of that and we managed that with very reasonable wait times as well. We found that we were able to inject extra resources to ensure that people's queries could get answered without having a substantially extra wait time.

Senator O'SULLIVAN: Yes, and just to give the department a bit of a bouquet, when we were at the height of the pandemic and there was confusion all around, I had a number of providers contact my office and was able to connect them with the department and get a good, efficient and prompt response. Thank you for all the work that you have been doing.

Dr Baxter : I'll pass that on to the help desk.

Senator O'SULLIVAN: Yes, please. I think you mentioned before that the out-of-pocket costs compared with when the childcare subsidy began in 2018 is down 3.2 per cent; is that right?

Dr Baxter : That's correct.

Senator O'SULLIVAN: What does that work out to be? What would be the proportion of families that are now paying less than, say, $2 a day an hour?

Dr Baxter : Over 70 per cent of families pay less than $5 per hour for child care, and nearly a quarter, I think it's 24 per cent, pay less than $2 an hour for child care.

Senator O'SULLIVAN: What was the last figure?

Dr Baxter : So, 24 per cent pay less than $2 an hour for child care.

Senator O'SULLIVAN: How much money has been prevented from being fraudulently claimed because of the department's compliance work?

Dr Baxter : Over the last several years we have projected that we have prevented $3.1 billion in fraudulent payments going out—incorrect or fraudulent payments, I should say, going out of the department.

Senator O'SULLIVAN: How have you managed that? What's involved?

Dr Baxter : We've had a very substantial strategy which has involved a particular surge around integrity—a couple of budget measures that added to the existing work that the department does. The foundation of that surge in integrity work was very substantial work that is already under way in the department as part of our BAU. That involves very careful consideration of the suitability of operators before they come into the system. It involves a large amount of education work. It involves data sharing with our partners like the ATO under formal data sharing agreements. It involves significant site visits, including site visits with the state regulatory authorities and with local police, and it also involves criminal investigations. On top of that bedrock of things that we do as part of our normal business the government did introduce a couple of budget measures. In December 2017 there was an extra $62.3 million that went into an integrity surge. Then in December 2018 there was an extra $52.2 million. Some of that goes to us. It's also important to note that some of it does go to our partners that we work very closely with. We work, for example, very closely with the ACIC. We have given them in excess of a million dollars to support their efforts cooperatively with us. We work with directors of public prosecutions. We have given them in excess of $2 million to support the work that they give us. The AFP has received hundreds of thousands of dollars from us also. New South Wales police have received about half a million dollars. That has been very successful. Across the course of the period, as well as the dollar figure that I referenced, the $3.1 billion, we have also had a hundred people charged for fraud and related offences since 2014.

Senator LINES: Are you talking predominantly about family day care?

Dr Baxter : No. The broader saving has been across a range of areas. We have certainly seen a focus on family day care over the last few years, and the majority of those charged have been from family day care; that's correct.

Dr Hart : The $3.1 billion that Dr Baxter referred to is over a period of six years from January 2014 to March 2020. How we determine that figure has been largely through the cancellation and suspension of services, and funding that would have otherwise gone to them if they had continued to operate. That's how we actually determined that saving. But I think on top of that, cancellation and suspension is probably what you would call the high end in terms of response. We have done some other activities as well which are proving beneficial. We have recently written to a hundred services seeking information about how they've complied with transition payments. You would have seen also recently in the media a joint operation with New South Wales Police, Strike Force Mercury, around activities to defraud the Commonwealth for CCS and supplementary payment. There's a range of different activities that we do. The high end would be the cancellation and suspension, but there are also those lower level activities that involve communication and articulating responsibilities of services and providers.

Senator O'SULLIVAN: During the pandemic we eased the activity test for parents. Can you tell us a little bit about that and how it worked?

Dr Baxter : Yes, that is correct. The CCS activity test has been relaxed until 4 April 2020. This means that families who have had their hours of activity reduced as a result of COVID-19 can access up to 100 hours of subsidised child care per fortnight. We were particularly keen to ensure that the availability of child care was still there for families even if their hours were shifting around and as they were looking for work. That enables families to maintain or increase the level of child care that they use when they return to their previous activities or while they're looking for work. Parents can advise Centrelink that their activity has decreased via a very simple check box on myGov. One of the nice things about this measure is that we've had very good feedback from services and families that it's simple to administer. They're able to just go into their myGov account and check a box to identify that they have had this reduced hours or activity as a result of COVID-19. As at October, we have had approximately 12,500 families who have used the relaxation of the activity test. Actually I might just have an update on that number.

Dr Hart : We have a recent update that's just come through. Some 13,413 families have accessed that.

Senator O'SULLIVAN: Where's the demand for child care at now compared with the start of last year? Possibly exclude Victoria; it's a unique situation.

Dr Baxter : What we do know is that charged hours is the best indicator of where demand in the system is at. What charged hours includes is attendance and it also includes where services and families are still able to get subsidy because they're using an allowable absence. It's an indicator of revenue flow to families and to services. What we know is that, excluding Victoria, nationally we are at 107.2 per cent of charged hours. I should say that this is as at the week of 20 September. I do have later data than that, which I can share with you, but my data people get a little cross if I use it because it takes about a month for data to settle and for session reports to come in. I have looked at the trends for the weeks after that and it continues to be an increasing trend.

Senator O'SULLIVAN: Good.

Dr Baxter : But we use data from 20 September, because that's when we can see that the session reports coming in have stabilised. So, there are 107.2 per cent charged hours excluding Victoria. Even with Victoria included we have charged hours at 103.9 per cent of pre-COVID levels. I mentioned before the statistic for Victoria itself, which is 93.7 per cent of pre-COVID charged hours. This means that, even though attendances might still be low, particularly in Melbourne, services are still able to claim for hours because of the use of allowable absences. We do know that in regional Victoria there's been quite a strong recovery. The most recent data again that we have there is 110 per cent for regional Victoria of pre-COVID charged hours. On top of that, of course, Victorian services have the 25 per cent recovery payment, and that is a 40 per cent recovery payment if they're an outside of school hours care service.

Senator O'SULLIVAN: So, even with everything that we've gone through, the demand is really strong and in fact grown. That's amazing.

Dr Baxter : Certainly attendance remains low in Melbourne. But it's definitely picked up very strongly in regional Victoria. Those charged hours reflect the fact that the changes we have made during COVID have allowed those allowable absences to be used because families have just not been willing to bring children along to child care or because they've been prevented through some of the stay-at-home restrictions from doing that.

Dr Bruniges : That's been important for the whole viability of the sector. The way in which we have staged the different payments and the different policy decisions that government has made has ensured that the sector remains robust and viable in the main.

Senator KENEALLY: I have a follow-up to my previous line of questioning. I think Senator Lines will be back momentarily for some additional questions. I will go back to our discussion about CPI, the subsidy and fees. Fees went up 4.4 per cent March 2019 to March 2020. CPI went up 1.8 per cent. Therefore, the subsidy went up 1.8 per cent. Doesn't it follow that the value of the subsidy declined? It's just mathematics.

Dr Hart : The hourly rate cap went up by 1.8 per cent; that's correct. The fees increased on average by 4.4 per cent.

Senator KENEALLY: Therefore, the value of the subsidy declined?

Dr Hart : It's a lower increase to the subsidy than to the overall fees.

Senator Birmingham: Importantly, many families receiving 85 per cent subsidy payments—the vast majority of those cases, I suspect—are still receiving 85 per cent payment.

Senator KENEALLY: Given the fee increase and the increase in CPI, the value of the subsidy to those families has declined?

Senator Birmingham: For 86.1 per cent of services charging at or below the rate cap, families will continue to be receiving that 85 per cent subsidy payment on what they're paying.

Senator KENEALLY: Surely you would agree that, if the fees go up 4.4 per cent but the subsidy only goes up 1.8 per cent, we've got a bracket creep going on, don't we?

Senator Birmingham: No, because if you're still receiving 85 per cent of the fee payment you're still receiving an 85 per cent subsidy. The value of the subsidy there is not declining if you are still receiving an 85 per cent subsidy.

Senator KENEALLY: But your costs have gone up faster than your subsidy?

Dr Baxter : But you are receiving 85 per cent of whatever your cost is, provided it is not above the rate cap. Even if your costs go up, you're still receiving 85 per cent of that cost. The only time that that would be different is if your service is one of those that charges above the rate cap; some of your out-of-pockets will increase, but otherwise you are still receiving the same percentage of the fees provided the fees are not above the rate cap.

Dr Bruniges : One is a relative and one's an absolute.

Senator KENEALLY: Yes, I get that. I still think we have got bracket creep. We may agree to disagree on this point, but it does stand to reason—

Senator DAVEY: But even under Labor's policy—

Senator KENEALLY: Senator Davey, when you get promoted to be minister I will love asking you questions if that happens before the next election.

Dr Hart : We talked before about the percentage of services that charged at or below the hourly rate cap. I think that was 86 per cent. That figure has remained reasonably steady over the previous two years. The percentage still at or below the rate cap is the same. As the minister was indicating, there are 90 per cent of CCS families that are entitled to a childcare subsidy of between 50 per cent and 85 per cent, and that percentage has stayed around the same. While there has been a differential increase in CPI in terms of the hourly rate cap and fees, the net effect in terms of the affordability is still a very strong position for Australian families.

Senator KENEALLY: That wasn't particularly my question. We will put some questions on notice to see if we can break down some of those differential impacts for different groups.

Senator LINES: There has been a childcare system evaluation study. Could the department please advise how much funding has been allocated to the Australian Institute of Family Studies to complete the childcare package evaluation report?

Dr Bruniges : A total of $5.81 million, GST inclusive, has been committed to undertake that. It is registered on AusTender.

Senator LINES: Of that total, how much has been paid to the Australian Institute of Family Studies to date?

Dr Baxter : Some $4.67 million.

Senator LINES: I understand that the government released the first report in July of 2019?

Dr Baxter : Are you referring to the early monitoring report?

Senator LINES: I am going off the minister's media release at the time.

Dr Bruniges : It was August 2019, I think.

Senator LINES: I thought it was July 2019.

Dr Baxter : We have August here.

Senator LINES: The minister's media release at the time said:

This report is the first of a number of comprehensive evaluations of the introduction of the Child Care Subsidy, with further reports between now and 2021.

How many other reports have been completed?

Ms Pearce : I think one report that I can see here has been completed and provided to the department recently.

Senator LINES: Is that one in addition to the first one—so two?

Ms Pearce : It's actually a subcomponent. For some of the measures, like in home care, we have—

Senator LINES: Like what, sorry?

Ms Pearce : A subcomponent of the evaluation. We don't have a report for the full evaluation. There had been going to be a mid-point one but, for a range of reasons, that was running a little late and then we hit COVID, which meant that AIFs couldn't get into the field. We have decided now to concentrate on the final report.

Senator LINES: We had one report that was released in August, you're saying?

Dr Baxter : Yes, that's correct.

Senator LINES: I'm not understanding what a subcomponent is. What do you mean?

Dr Baxter : The thing about the evaluation is it is a whole-of-system evaluation. It is looking at not just the subsidy, which we have been discussing this morning, but all of the components that make up the childcare system—the childcare safety net, the Inclusion Support Program and the In Home Care program. There are a number of chunks that go to make up this overall evaluation. The one that Ms Pearce has referred to is the evaluation of the In Home Care program component. There is also an evaluation of the Inclusion Support Program that makes up one of the chunks. There is an evaluation of the safety net, which includes the ACCS, which is part of that as well.

What Ms Pearce has been referring to is that, essentially, AIFS lost close to a year of data about how the system was operating and normal parameters. Rather than looking at an interim report, a halfway report, we have instead asked them to focus on the full evaluation report, getting that completed so we can understand both for post COVID settings and for the system generally what it is that is happening. Ms Pearce has mentioned that we have a draft of the In-Home Care component of the report. We also have asked AIFS to do a number of snapshot reports on priority issues. But, again, they have been a little bit delayed because of COVID. They were due to be completed earlier. We now anticipate them being completed around the same time the first cut of the evaluation is completed, which is March 2021.

Senator LINES: I have a number of questions. So you're expecting a number of subcomponent reports around the topics that you just mentioned, such as inclusion support, safety net and so on?

Dr Baxter : That's correct.

Senator LINES: Secondly, you have asked AIFS to do a snapshot priority?

Dr Baxter : A series of priority snapshots so that we can get out to the sector, to the community, who we know are very interested in little snapshots on particular topics. I don't know if you have a list of the topics, Ms Pearce?

Senator LINES: No, that will do. I was just trying to clarify. Does that mean you've changed the terms of the original contract?

Dr Baxter : No. The terms of the original contract did refer to snapshots, but it had them being delivered in an iterative way. It's of course a normal part of any process where you're undergoing a significant piece of work like this that, where you have interruptions to the ability to collect data, as we have had during this year, there is some negotiation. AIFS has come to us and said the ability to harvest that data was compromised during this period and that they needed a bit longer for some of those snapshots. We have also said that what we really need is the results of this evaluation, because we are moving into post-COVID period, thinking about really trying to understand what the childcare system is looking like now.

Senator LINES: Given AIFS said it might take longer, does that increase the cost?

Dr Baxter : No, it is actually going to take shorter time. It had been planned to be delivered slowly.

Senator LINES: You just said they needed longer periods of time?

Dr Baxter : They need longer to gather the data. Originally the end date for the evaluation was later. I think it was originally late in 2021 and it is now being delivered in—

Senator LINES: Does it increase the cost?

Dr Baxter : No.

Senator LINES: When will we expect to see those reports publicly released?

Dr Baxter : As I have said, the priority snapshot reports are to be delivered to the department in March 2021. Decisions about publication of course remain a decision for government, but that's when we would expect to be receiving those.

Senator LINES: From a report that was first published in 2019 we have now got reports being published some time at the government's pleasure after March 2021?

Dr Baxter : This has always been a two year evaluation. As the secretary pointed out, it's a $6 million, two-year, whole-of-system evaluation. The early monitoring report was simply some sampling of what was basically the baseline. It was where data was at a very short time after the childcare subsidy package had been introduced. It's normal to say here's the baseline and here's what we know at this point. We have never wanted AIFS and the people who are supporting them to do a rushed job.

Senator LINES: I am really asking about publication dates. The minister said in the media release that we would have further reports between now and 2021. August, you are saying—

Dr Baxter : And we will, yes.

Senator LINES: But those won't necessarily be publicly released?

Dr Baxter : That will be a decision for government.

Senator LINES: Or they won't be publicly released?

Dr Baxter : No, I have not said that. I have said that—

Senator LINES: You said the final report would go to government in March of 2021?

Dr Baxter : I have said that we are expecting to see a draft of the final report in March 2021, that we are expecting to see the priority snapshots then, that is earlier than the original date that was in the contract and that decisions about publication—

Senator LINES: The minister said here that we will see further reports between that date of August 2019 and you're now saying March of 2021. But what you've just told me in evidence is that they won't be publicly released?

Dr Baxter : I have not said that. I have said—

Senator LINES: You said it was up to the government after March 2021?

Dr Baxter : There are these subcomponents—I have just mentioned one of them—the In Home Care evaluation, of which we have received a draft. The In Home Care evaluation is anticipated to be finalised in October or November. Decisions about its publication, decisions about any part of the evaluation's publication, will be a decision for government.

Senator LINES: Why don't you just set down on notice for us when you expect these subcomponents and when they will be delivered to government, to save time?

Dr Baxter : Certainly.

Senator LINES: Secondly, can you confirm to me that there will be a final report and evaluation of the system in 2021?

Dr Baxter : I can absolutely confirm that.

Senator LINES: Because we have put some questions on notice, we're happy to move on. I was going to go to the Productivity Commission, but I'm happy to—

CHAIR: I was going to see whether Senator Faruqi has any questions in this particular area. We have 15 minutes left to the break.

Senator FARUQI: Not in this particular area, but I have other questions.

CHAIR: I might give Labor the call, as long as it is still within Early Childhood and Child Care.

Senator LINES: I wanted to talk about the Productivity Commission and its analysis in 2015. I don't know if that is you, Dr Baxter?

Dr Baxter : Let's see where it goes and we will work out who we need to have at the table.

Senator Birmingham: It was important to some work that followed, but that is a few years ago now.

Senator LINES: Has the department briefed the Minister for Education on the studies of the childcare system completed by Grattan and KPMG this year?

Dr Baxter : Yes.

Senator LINES: You have done that? Has the department analysed the conclusions of those two reports and looked at the disincentives to work full time for secondary income earners that are built into the current system?

Dr Baxter : Yes, we have looked at and analysed those reports.

Senator LINES: You've looked at the particular disincentives that I just mentioned?

Dr Baxter : We have certainly looked at what those reports have concluded, including the recommendations they reached around those issues, yes.

Senator LINES: Is the department concerned about the fact that secondary income earners can lose money if they go back to full-time work?

Dr Baxter : I think one of the things we know from looking at the reports and from our analysis in this area generally is that each of the models bakes in different assumptions. It makes different assumptions about family types, about income sizes, about the types of care people use and the cost of that care. With some of the models that have analysed it we have had concerns; it's not clear what these models do around ACCS—additional childcare subsidy—which as you would be aware goes to about 27,000 families annually and about 39,000 children. We also know that they assume that finances are the sole driver of women's workforce choices. In fact, the ABS study of 2020 points to the fact that a range of other issues are predominant for women, including issues of workplace flexibility. You mentioned the PC recently. The PC found that families' preferences about care for very young children are a considerable driver of their choices about workforce participation, including participation in those extra days. It also assumes—

Senator LINES: Are you suggesting that the 39,000 children using the ACCS has a big impact on those models that Grattan and KPMG use?

Dr Baxter : I'm saying that they're not factored in. That is significant money. If you look at a model that is working on The Front project and Grattan, and they do different things—90 per cent and 95 per cent, and they each have suboptions—we know that many of the families who are using the additional childcare subsidy are receiving 120 per cent of subsidy. It really is quite a big difference for those families who are involved. We also know that none of the models factor in the recent changes to the taxation rates.

Senator LINES: Does the department have models that look to this issue, that secondary income earners can lose money if they go back to full-time work?

Dr Baxter : In general, the child care part of our department would not model workforce disincentive rates. Workforce disincentive rates do not just include childcare costs, they include the costs to families of extra tax—

Senator LINES: This one is focussed on childcare costs.

Dr Baxter : I am just explaining to you why we would not model, nor have—

Senator LINES: I think I can understand these other factors. I am simply asking about that. Are you telling me the department is not concerned about this issue that secondary income earners can lose money if they go back to work?

Dr Baxter : I'm certainly not saying that we're not concerned about it. I'm saying that I think that assumptions that women's workforce choices are solely related to a financial incentive are belied by the data that we see, both from the PC and also from the ABS this year. I am also saying as to assumptions that are made about what will happen to a woman on the third, fourth, fifth day that we have seen in some of the models that have been released this year, when we look at those and we analyse those we do note that there are some factors that seem to be missing. The additional childcare subsidy—

Senator LINES: Would you agree—

Senator Birmingham: Senator Lines, let's not interrupt Dr Baxter.

Senator LINES: No, but I really want my questions answered. Thanks, Minister. Would the department agree that many women face very high workforce disincentive rates of close to 100 per cent?

Dr Bruniges : What we do know is that, if we were to take just CCS alone as the sole decider, it would not explain why there was a seven per cent increase in women from families receiving CCS reporting more than 48 hours of activity per fortnight, from 56 per cent before the childcare package to 63 per cent in November 2019.

Senator LINES: I just really want a yes or no to the question.

Senator Birmingham: It's not a question that necessarily lends itself to a yes or no and you're not asking—

Senator LINES: I'm simply asking: are you concerned—

CHAIR: Let the minister answer the question, please.

Senator LINES: Are you concerned that there is a disincentive—close to 100 per cent? It is a yes or no question.

Senator Birmingham: There is a range of different factors that impact upon workforce incentives. There is a range of choice factors that apply there, and there is a range of other factors that have seen pre-COVID a record level of women's workforce participation achieved in Australia and strong growth there. You've heard the secretary just report about growth rates in terms of the number of hours accessed of childcare subsidy, which is, to some extent, particularly because of the activity test that we introduced, a measure of activity that is related there. Again, you've seen growth factors coming from families. There are, of course, other elements of incentive in a financial space, such as the government's income tax changes, that mean that as childcare subsidy, targeted as it is to provide the greatest financial support to the lowest income families, comes off, some elements of that tax relief will provide compensating support or additional incentive for people to work. To your question of where there is no childcare subsidy available for a family, that only relates to quite high income families. In those family circumstances there will again be different factors that they will take into account around return-to-work decisions.

Senator LINES: We have taken a very long time to simply get to a yes, no. Obviously you're not going to answer a yes or no?

Senator Birmingham: That's because it's not a yes, no question.

Senator LINES: The fact is that for many women picking up extra work creates a disincentive in terms of their childcare costs. In your AIFS report, 83 per cent of families said the new system didn't change their employment hours.

Dr Baxter : I would add to that that, while that was an early monitoring report, there is the matching data point that the secretary has identified from that same report which showed that women who have actually increased their hours of activity to 48 hours or more has increased by seven per cent since the new childcare system was introduced. So what I'm saying to you—

Senator LINES: So, seven per cent versus 83 per cent?

Dr Baxter : But it is a different measure.

Senator Birmingham: Nobody was anticipating that 100 per cent of families, just because we put in place a new, more generous childcare subsidy system, would suddenly decide that all parents were going to work more hours. This was a system designed to provide better choice and better targeted support. What we see is that a notable proportion of families have chosen to extend the number of hours they engage in the childcare system. We see that the out-of-pocket costs have reduced for families as an average. Costs have gone down for families in out-of-pocket terms. Families have chosen to access more hours of care under our system. And pre-COVID women's workforce participation had reached record levels. The system was working as intended in providing that choice for families and a decent proportion of families were exercising that choice, but certainly our government is never going to say our policy intent is to force families of young children to choose to have to work more hours. This is purely about the choice equation.

Senator LINES: Has the department undertaken any modelling on the impact of increasing the CCS and abolishing the annual cap in line with the recommendations in Grattan and KPMG?

Dr Baxter : We have done some calculations. Are you asking about calculations of the cost?

Senator LINES: Yes.

Dr Baxter : Yes, we have done some calculations in relation to cost. I think KPMG and Grattan were the two you mentioned?

Senator LINES: Yes. Are you able to share those with us?

Dr Baxter : Yes, I can tell you in approximate terms what those costs are. You asked about modelling. We have not rerun models, but we have calculated, using our childcare model, what the costs would be. The September KPMG and Front project work we estimate would cost around an extra $4.3 billion per year. I note—

Senator LINES: $4.3 million?

Dr Baxter : Billion. I note that KPMG themselves suggested that that would be an additional $5.4 billion. That is because they have assumed a really very high extra take-up of child care. We would take issue with an assumption of an increase that high. We have not seen that with any previous change to the system, but even if it was there we're not permitted to include those behaviour changes in our cost model that is endorsed by the Department of Finance. KPMG anticipate that at $5.4 billion. We thought $4.3 billion. The Grattan Institute estimated I think an extra $5 billion a year from theirs. We were not really able to get to a commensurate figure with that one, because there is so much in that that is assumed in terms of growth in the system. But again we are just not able to factor that kind of growth.

Senator LINES: You didn't have a figure for that one?

Dr Baxter : Based on current usage, which is not what this is based on, it looks like approximately $2 billion a year for the initial Grattan Institute proposal that they went to.

Dr Bruniges : Sometimes it is really hard to unpack some of those assumptions, on the publicly available point.

Senator LINES: Dr Baxter said that. The Productivity Commission report into the childcare sector, which I appreciate the minister has said is quite some time ago—February 2015—made a number of recommendations for reform. Did the PC recommend cutting off the subsidy at any particular level?

Dr Baxter : The PC recommended that the subsidy should be a means tested subsidy rate between 85 per cent for family incomes at or below $60,000, and 20 per cent for family incomes at above $250,000. It recommended going through to there, and it recommended a taper rate that is approximately the same as the taper rate now. The system that we have has mirrored the recommendations of the PC, the 85 per cent; the $60,000 has since been CPI grown—

Senator LINES: But they didn't recommend a cut-off? There are two different systems that you've just identified. The PC didn't recommend a cut-off to the subsidy at any particular level?

Dr Baxter : Are you talking about a rate cap?

Senator LINES: Yes. Did the PC study say at this particular income level the subsidy would be zero?

Dr Baxter : No, it recommended a subsidy between 85 per cent and 20 per cent.

Senator Birmingham: Zero subsidy ultimately was a function of Senate amendments. I can't recall offhand following the indexation what that threshold now sits at.

Senator LINES: Dr Baxter, you're not suggesting that what you subsequently designed was what the PC recommended? Or are you saying that?

Dr Baxter : Our understanding—and recognising I was not in the chair at the time—is that there was a system that largely mirrored the PC system. As the minister has said, subsequent changes as a result of the parliamentary process took place. Which indexation are you after, Minister?

Senator Birmingham: The top threshold, where it goes to zero.

Dr Baxter : That is now $353,680.

Senator Birmingham: In terms of that element of the Productivity Commission's report, the overwhelming majority of Australian families experience a system that is in keeping with the Productivity Commission's report of subsidy being provided between 20 per cent and 85 per cent of rate. Yes, it does go ultimately to zero, but only for families with an income of greater than $353,000, which I think is what Dr Baxter just said.

Dr Baxter : And approximately two per cent of families.

Senator Birmingham: So 98 per cent of Australian families are captured within that bandwidth of the Productivity Commission report.

Senator FARUQI: The last published National Workforce Census of early childhood was undertaken in 2016. Before then, as far as I know, the censuses were completed every three years, in 2013 and before that in 2010. Was a census completed in 2019?

Dr Baxter : Ms Pearce can talk you through the censuses that have been undertaken and when the next one is due, which I understand is in 2021.

Senator FARUQI: I just want to know if the 2019 one was completed.

Ms Pearce : No, Senator, it was deferred.

Senator FARUQI: What was the reason for that?

Ms Pearce : I can't recall what the decision-making was at the time. I know that this year we had planned to do it. I'm reaching back into my memory here. I think part of our challenge was we'd been through a big change in the sector. There was a lot going on. Adding quite a major census to that process—I think that at the time the decision was taken that it would be better to hold off.

Senator FARUQI: But surely it's more important when big changes are taking place that we do actually look at the situation of the workforce.

Ms Pearce : There's a lot of monitoring and a lot of work that goes on around workforce. Since I've been in this seat, which is almost three years, we've done a lot of work with the sector and with the Education Council around workforce. So it's not like nothing's been happening in that space. We're very aware of many of the things that are happening with the workforce and we regularly monitor using data from the ABS and other workforce data. So it's not like we're not looking at that, but we are really looking forward to running this census in 2021, because—

Senator FARUQI: So the report of that census will also be released in 2021?

Ms Pearce : I think, from talking to the team, we're hoping that we'll have it all together as a report by the end of that year. A census like this is pretty major and it does take a fair bit of work to run it. We're not just talking about a census that covers approved childcare subsidy services; we're talking about preschools and a whole range of other organisations. So it's quite a big operation to do it, to get the response rate that we really want. We've been very lucky this year that the response rates we've been getting to various surveys have been pretty good. And we're hoping pent-up demand for this one will mean that we'll get a really good result.

Senator FARUQI: When do you plan on running this? Next year?

Ms Pearce : Next year, that's right.

Senator FARUQI: Any time next year?

Ms Pearce : Let me just check if I've got the actual timing on that. It's not in my head but we're in the planning process of it right as we speak.

Dr Baxter : I have it here. It says that the census will commence in April 2021 and the preliminary results are expected to be available towards the end of the 2021 year.

Senator FARUQI: Great. Does the department have an estimate of how many early childhood teachers the sector might be short of by the end of 2021? I ask that question because there was a Queensland ABC report earlier this week which said that Australia's biggest childcare provider, Goodstart Early Learning, had 1,400 jobs open in the first week of October, 491 of which were in Queensland. So I just want to know if you've done any work on that.

Ms Pearce : I don't think I've got a number for the end of 2021. Certainly if you look at the ECEC website you will see they have a workforce report that was published in late 2019. In that report, they were projecting, I think, that by 2023 we would need an additional 9,000 early childhood teachers.

Senator FARUQI: But a lot has changed since 2019.

Ms Pearce : A lot has changed since 2019.

Senator FARUQI: So things could be very different. Are you going to look at that, and when?

Ms Pearce : We're constantly trying to get that data but it also relies on—as part of the workforce census, we'll be able to pick some of that up.

Senator FARUQI: That's not till the end of 2021 though, so you won't have any idea—

Ms Pearce : What we don't know right now is whether—I know COVID sounds like an excuse for everything but, in this case, what is that actually going to do to demand for child care and therefore the workforce? Is it going to run at the same rate that we were projecting, or is it not? Again, this sort of discussion is going on with the sector through our work in the Education Council context, trying to get a handle on that. The only way we really can pick that information up is if services provide it to us. And we have good relationships—

Senator FARUQI: The census would give you some of that information.

Ms Pearce : It will.

Senator FARUQI: And that's the problem, I think: that we won't have a census. Do you have a workforce plan to help the sector meet at least its regulatory requirements?

Ms Pearce : A workforce strategy?

Senator FARUQI: Yes.

Ms Pearce : Currently the Education Council has asked officials to progress a workforce strategy. A workforce strategy is not just something that a Commonwealth government can do. We have parts of the jigsaw but likewise employers, the sector, have a very important role to play. State governments also—many of them have their own workforce strategies.

Senator FARUQI: I do understand. But you have a role to play in terms of making sure that we have enough workforce so that the requirements are met. Otherwise centres will close.

Looking at the other side of the portfolio, on the skills side, what we have now is a jobs hub where we go through a process where a number of employers who might be short-falling in particular areas of need can come to us. We can look at where workforce demand is and where the vacancies are and act a bit like a broker and a facilitator through the jobs hub. That will also yield another source of data and evidence for us to have a look at how many people are coming in. It's not the full picture but it's another part of the puzzle, a very important kind of initiative in the employment side of the portfolio to help us understand where the greatest needs are quickly and to do that quick matching.

Senator FARUQI: Just to clarify, the department doesn't itself have a workforce strategy for early childhood educators?

Dr Baxter : The department does not have one. But we do engage in regular discussions with our reference group about the issue of workforce. In fact the piece of work in the broader department about workforce that the secretary has just alluded to—I have been speaking with sector representatives about that piece of work. I've connected Mr Paul Mondo from the Australian Childcare Alliance and Ms Elizabeth Death from ELACCA, the Early Learning and Child Care Association, with Deputy Secretary Nathan Smyth, who runs that piece of work, so they can start to look at this, for want of a better word, matchmaking between where vacancies exist now and where some of those data points are. So they are getting together to look at how some of that—

Senator FARUQI: There has to be a long term planning—

Dr Baxter : This particular piece work the secretary has referred to and the connection that I've referred to is about quick, agile responses we have at the local level. We have vacancies here; where do you have available workers? How might we be able to join the dots between the two?

Across the country in terms of the Education Council, ministers from all states and territories have been commissioning the workforce strategy so that we can get a better holistic picture. You can imagine the variation even within a state can be quite high, let alone the variation in country. So that piece of work is underway. Clearly the census and other employment data should inform that so we get a better picture. And then on top of that we need to have a look—and I know some states and territories are already doing this in terms of skills and training courses available through either TAFE or private providers in the childcare area and making sure that everyone is aware of what's available in what state and territory to fill some of those gaps.

Dr Baxter : We do have some ABS labour force data that might help you in lieu of a census, Senator.

Senator FARUQI: You might provide that notice, if that's all right.

Dr Baxter : Sure. It does indicate that there's been an increase in educators employed across all sectors between February and August of this year.

Senator FARUQI: If you could just provide that on notice, that would be great. Moving on to another topic—

Senator Birmingham: Senator, just as a footnote on that issue, of course services will be eligible in terms of the JobMaker hiring credit and so on as well.

Senator FARUQI: That's a whole other kettle of fish.

Senator Birmingham: It is, but it's another financial support for centres in terms of their hiring decisions.

Senator FARUQI: As you'll know, many children had disrupted early learning, obviously, in 2020 and are not on track to achieve the 600 hours of early learning in the year before starting school. What analysis has the department done on how many children will meet or will not meet that benchmark of 600 hours of preschool in the year before they start school because of what happened in 2020?

Dr Baxter : We have done some work on this and we have looked at this closely with the sector, because they've been discussing this issue with us. I'd have to take on notice the data that we have on—

Senator FARUQI: Yes, sure.

Ms Pearce : Senator, in terms of our collection from preschool, we're probably going to get preliminary data from the ABS towards the end of the year. The kind of work that we've been doing is with the states and territories to try to get a handle on what we think it looks like, noting that states and territories are really the ones who are responsible, but also on the ground trying to deal with COVID and how that dosage, if you like, for children is maintained. So we have looked at enrolments, which is the main measure of the Universal Access National Partnership. But attendance is something that we've got to wait on because there was a census done back in August and we still haven't seen the results of that. So we've just been trying to make educated guesses from the data that we can see about what that might look like for four-year-olds. So it's not concrete or detailed at this stage. A lot of it's been in the conversation between us and the states and territories around what they are seeing, because we don't see their standalone preschools or their schools; we can only take a look at those children in centre-based day care. Largely across the country we think that's looking good. Victoria is a different question for obvious reasons.

Senator FARUQI: So you don't think that there will be many children who have lost out on hours? I guess it is the role of the federal government to ensure that they catch up and to make up any responses to make sure that they do catch up before they start school. I don't know if you've looked at approving additional days of childcare subsidy or removing the activity test or something so as to ensure that those children do meet those hours.

Senator Birmingham: This is a challenge, of course, across all aspects of education in 2020. Students in Victoria have missed a very extended period of education. In other states—

Senator FARUQI: Of course. But you know, Minister, these are very critical years. The years before school, as you know—there's enough data to suggest that they are absolutely critical.

Senator Birmingham: The first few years of school are also very critical. I suspect data may even show that they could arguably be even more critical.

Senator FARUQI: Sure. The government should be doing stuff for all of those.

Senator Birmingham: Indeed. However, in all of these instances, the running of preschool services and access, just like the running of school services and access, is done at a state and territory level. In terms of some of the financial support the Commonwealth has provided in a range of ways—we have explored that, obviously, this morning—that is there and continues by some measures to be there in other support for different services. But given particularly the disparities across some of the states, these are questions on which states are going to have to demonstrate how they are making sure that students affected in 2020, whether it's in preschool or school years, aren't disadvantaged in the long term. I'm sure the secretary and her counterparts have been holding discussions about that.

Senator LINES: We were talking about the PC report before the morning break. I want to go back to that. Dr Baxter, you said in earlier evidence that you believe that the current system largely mirrored the PC model.

Dr Baxter : Well, I mentioned the difference at the bottom tier, but yes.

Senator LINES: Sure but you did use the word 'mirror'. How do you make that claim when my understanding is that the PC didn't recommend the current subsidy cut-off points and did not recommend an annual cap?

Dr Baxter : Because I said 'largely mirrors' and I'm saying that it is a means-tested subsidy rate, that the top tier applies to families at 85 per cent who are at or below $60,000—and, as I said, that has since been indexed—and that it has a taper, which was proposed to be $2,923 per one per cent of income lost; ours is $3,000 of income per one per cent of subsidy. So other than a rounding, it also mirrors the taper. As I said then, through the legislative process, I understand, there were some negotiations that changed that at the edges. But those key features of the system—means tested, 85 per cent maximum subsidy and a taper that looks the way our taper looks have been mirrored in the system that we have.

Senator LINES: Who put the annual cap into the current system?

Dr Baxter : There was always an annual cap in the system. The previous system also had an annual cap. It had a less generous annual cap of around $7,000.

Senator LINES: Who put this one in? That wasn't a negotiated outcome, the annual cap?

Dr Baxter : I would have to take that on notice. I'm not sure how that one came into the system, if that was part of the negotiation process.

Senator LINES: Minister?

Senator Birmingham: The significant increase to the annual cap was part of the reform package put by the government.

Senator LINES: I mentioned before that 83 per cent of families reported to AIFS that the new system had done nothing for their hours of work, and then you mentioned seven per cent. Does the department think the cost of child care and the annual cap are major barriers to work?

Dr Baxter : The system is about incentivising work. It's about incentivising work for those who are the lowest paid and work the most hours. Our assessment of the data is that it has proved to do that, it has proved to incentivise work. We've seen the seven per cent increase in women who are receiving CCS undertaking 48 hours or more of activity. We also know that dollars alone do not drive an increase in workforce participation. If we look, for example, at countries which are often pointed to as having very high childcare spending rates, like Norway, which spends about five times as a proportion of GDP what Australia spends, it only manages to achieve about a 1.8 per cent increase in women's workforce participation. And Australia features very well against the OECD. We know that the OECD average for women's workforce participation is around 65 per cent. Australia's is around 73.9 per cent. So, no, we don't think that those figures indicate an issue with women's participation and increasing participation.

Senator KENEALLY: Dr Baxter—or someone else in the department might be able to help me with this—has the department been asked to commence any work on developing a six-month marketing campaign spruiking the benefits of early childcare education?

Dr Baxter : No. Not to my knowledge.

Senator KENEALLY: The government hasn't asked you to do that?

Dr Baxter : No. Not to my knowledge.

Senator KENEALLY: You've got no money set aside for any such marketing campaign or any idea that one might be under consideration by government?

Dr Baxter : No.

Senator KENEALLY: I've got a story here from The West Australian newspaper on 8 October headlined 'Handle with kid gloves'. It reported that the government is keen for a serious reform of the childcare sector, but only after doing a six-month awareness campaign in the lead-up to the next year's budget. I'm happy to table it.

Dr Baxter : I did see the article, Senator.

Senator Birmingham: I didn't.

Senator KENEALLY: Minister, are you aware if the government is preparing a six-month awareness campaign to 'sell the benefits of child care to taxpayers'.

Senator Birmingham: No, I'm not aware of any such thing. It may still be helpful for you to table the article.

Senator KENEALLY: I am happy to do that. The article—just before I table it, so I get this right—written by The West Australian political editor Lanai Scarr says:

But The West Australian has been told Scott Morrison has personally expressed a willingness for reform but knows the message needs to be first sold to taxpayers who don't have children …

Why would Scott Morrison 'personally express a willingness for reform', Minister?

Senator Birmingham: It doesn't sound like that was an attributed quote or a direct quote. I don't know—

Senator KENEALLY: So it's possible the Prime Minister doesn't have a personal willingness for reform?

Senator Birmingham: The Prime Minister helped drive the reforms that were implemented only a couple of years ago.

Senator KENEALLY: Right. So the reform work has been done, according to the government?

Senator Birmingham: The government did implement substantial reforms and those reforms have delivered a system where out-of-pocket costs have gone down, hours accessed have gone up and pre-COVID women's workforce participation went up.

Senator KENEALLY: I'm just trying to make sure I understand. The government's view is the reform work has been done?

Senator Birmingham: The government always monitors all of our policy settings to ensure their appropriateness for conditions, particularly in times like this. But the government certainly is of the view that there were very substantial reforms and additional investment was made into the childcare system, which were initiated partly when the Prime Minister was responsible for the childcare system and received the Productivity Commission report that Senator Lines was asking about earlier.

Senator KENEALLY: This is a fairly specific article. It is from the federal political editor of The West Australian. Presumably she's not just imagining these things. She's pretty clear that the government are about to embark on an:

… an unofficial six-month awareness campaign on the benefits of early learning before making serious reforms in next year's Budget.

Again, Minister, are you aware that the government is about to start an unofficial six-month marketing campaign on the benefits of early learning? And is the government about to embark on serious reforms in next year's budget?

Senator Birmingham: I have no knowledge of there being any such campaign. You've heard from officials that they don't either. I can't speak for Ms Scarr's sources, but having now been handed a copy of the article, I can only note that there are no quotations attributed to government ministers, government spokespeople or even government sources in the story.

Senator KENEALLY: It does sound odd—well, maybe it isn't odd—that this Prime Minister would think that a marketing campaign is the solution to getting more women back into work. So no money has been allocated; no marketing campaign seems to be planned?

Senator Birmingham: That's the answer we've given. We've given the answer a few times over.

Senator KENEALLY: I'm happy with those answers. I'd like to move on to—

Senator O'SULLIVAN: I raise a point of order, Chair. Senator Keneally ascribed a particular motive to the Prime Minister and it's not quoted here in the article as a direct quote, so I don't know how she can possibly ascribe those particular words to him.

Senator KENEALLY: I'm not sure that's a point of order but I take the senator's observations on board.

CHAIR: Thank you, everybody.

Senator KENEALLY: I will move on to a review of the childcare sector. I'm referring to an article in The Australian on 19 January 2020, which I'm also happy to table, where the education minister, Dan Tehan, did concede that private childcare providers are charging families more than the federal government's cap. We've heard evidence of that today anyway, and flagged that there would be a review in 2020 of the government's $10 billion subsidy to the sector. Has any work been done on Minister Tehan's 2020 review to date?

Dr Baxter : The review was flagged and the intention was to undertake the review in the second half of 2020. But the timing for that was that there would be two full years of administrative data available on which to undertake that review. Because of the intervention of COVID and the fact that we didn't have the childcare subsidy running in the first half of this year, we don't have those two continuous years of data on which to base that rate cap review. As you know, we had no fees and then we had fees frozen. So it's more appropriate to wait to have six months of data from the 2021 calendar year. So the rate cap review is still planned but it is planned to take place in the middle of 2021, to ensure we have two full years of administrative data.

Senator KENEALLY: So it is still planned to go ahead?

Dr Baxter : Yes.

Senator KENEALLY: Will the review be made public?

Dr Baxter : That will be a decision for the government.

Senator KENEALLY: I want to quickly turn to workforce, noting that Senator Faruqi has asked a number of questions on early education workforce strategies. Do you have any figures as to the extent last year of the childcare workforce that held a temporary visa?

Dr Baxter : I'll check what data I have with me, if we have anything on that. Otherwise I can check it on notice for you. No, I don't have it here. I can take that on notice. We may have some through our surveys that we undertook during the COVID period. We don't have it here in the ABS number data but we might have some through our COVID surveys.

Senator KENEALLY: Could I ask for that on notice?

Dr Baxter : Yes.

Senator KENEALLY: Thank you. All I seem to be able to source is the 2016 census.

Dr Baxter : That is the latest census.

Senator KENEALLY: But you might have some additional data from surveys?

Dr Baxter : Yes. It would be qualitative through our COVID surveys. We did do two surveys of the sector during that period. We'll see if there is anything on that. I can't recall but there may be.

Senator KENEALLY: The 2016 census said that seven per cent of all childcare workers were on a temporary visa. That meant about 9,900 were on a temporary visa of the 139,000 workforce. There were 2,053 on student visas; 1,091 were on Working Holiday Maker visas. How has the childcare workforce been impacted by the closure of the borders?

Dr Baxter : Interestingly, as I mentioned with Senator Faruqi's question, we don't have the workforce census data post 2016 but we do have ABS labour force data which is probably not a bad proxy for that window. It compares educators employed across all of the different childcare sectors, which is a little different from what we measure in the ECEC workforce survey. But it's probably the best proxy we've got. It suggests that in August of 2020 there were 199,600 educators employed across all sectors compared to 191,300 in February 2020. That suggests there has been an increase in the workforce. We have heard anecdotally that the closure of the borders caused some issues for some services trying to get staff and qualified staff. But we don't have a data point, I'm sorry.

Senator, can I clarify? Are we talking about domestic borders or international borders?

Senator KENEALLY: We're talking about international.

Dr Baxter : Sorry, I assumed you meant international.

Senator KENEALLY: I'm very interested because we've got seven per cent of all childcare workers on a temporary visa. If we take in permanent visas, so temporary and permanent, about 26 per cent of the childcare workforce are on a visa; they're not citizens. So I'm really quite interested in the extent to which border closures are impacting on labour force supply and particularly, then, what is being done to train and prepare Australian workers to be able to take up what will be vacancies. Particularly if the demand that you've projected for next year does eventuate, we're going to need more workers. And if the international borders remain closed before there is a vaccine in place, we need to know where those workers are coming from.

Dr Baxter : I'm happy to take it on notice.

We'll take it on notice and look at the pulse surveys that we've done to see if we can—

Senator KENEALLY: Thank you. On this very point about workforce, am I to take it from some of the data points you've just given me that the department is monitoring the supply and demand of the early educator workforce?

Dr Baxter : We certainly do monitor the data points. But also a very important pulse reading for us is those ongoing conversations that we have with the sector. Throughout the year, we have been meeting with the sector for most of the year weekly. It began with the work around bushfires earlier in the year and then through COVID, and we've only just recently dropped those back to fortnightly—with the range of sector peaks and also service representatives. We've not heard that this issue around visas has emerged as a particular issue. It was a—

Senator KENEALLY: I was asking more broadly, but that's interesting about the visas.

Dr Baxter : It was an issue, we know, that was raised when we were looking through COVID about the numbers of staff that were covered by JobKeeper. For example, when the government introduced an additional special circumstances payment for the sector, part of that was because small numbers—my recollection is around three per cent but I'll need to check that—were not covered because of visa issues. So the government introduced for services that could not get JobKeeper or for services that had 30 per cent or more of their staff not covered—so we knew about it in that context. It hasn't been raised more broadly as an issue around visas this year. That may be because we haven't seen the demand fully return yet in some parts. I think also—

Senator KENEALLY: That's right. That's where the vector is, isn't it: when the demand returns but the borders remain closed so we're not getting in those working holiday-makers and students?

Dr Baxter : Yes.

Senator KENEALLY: My question was, more broadly: are you monitoring the supply and demand of that workforce as a whole?

Dr Baxter : Yes.

Senator KENEALLY: So you're doing that. Is there anything you can point us to? Is there anything you can table to give us an indication of what that's showing?

Dr Baxter : I think we'll look on notice at what we have. I don't have in front of me—

Ms Pearce : But also, coming back to my earlier evidence, this is a partnership game to try to bring together these sorts of data points. When I've been thinking and looking over what we're seeing, the problems that we are seeing are ones that we already had—the projected 9,000 early childhood teachers. A lot of that is coming through our work with stakeholders. We're almost constantly meeting weekly at the moment to go through workshops to try to identify what's happening, what the issues are. And there's a very wide range of issues here. It's not just one issue; it's not just about the visas or something.

Senator KENEALLY: Sure. And, again, my question about monitoring wasn't just about the visas. It was a broader one. And I do apologise—we are so short on time. I understand that you're doing the monitoring and I really appreciate that Dr Baxter is taking on notice the questions that I've asked. The last early education workforce strategy did expire in 2016. Why has that been allowed to expire?

Dr Baxter : It wasn't allowed to expire, Senator. It was a workforce strategy that ran to 2016, so that was the end of it. It wasn't as though it was terminated early or anything like that. And there has been this body of work since towards the development of the new workforce strategy, the draft of which is due to be considered by Education Council in March 2021 with a final in June of 2021. So we do know that the officials working group has been doing a lot of work on this. But they haven't, either, just been waiting for the framework to develop; they have also been looking at a number of initiatives in different states and territories and also in the Commonwealth around some of this matchmaking that I mentioned before of workforce.

Senator KENEALLY: Can you remind me, if you said it earlier, what period of time the next strategy will cover if it comes in in 2021?

Ms Pearce : We were thinking about a 10-year horizon. You want these things to be long term and enduring. But, that said, that's up for agreement by Education Council.

Senator KENEALLY: Forgive me—it seems like it's taken five years since the expiry of the last strategy to get a new one in place. If you knew the last one was expiring in 2016, why wasn't there one ready to go earlier than the five-year hiatus?

Ms Pearce : These are questions for all education ministers. It's done under the—

Senator KENEALLY: I'm asking the one that's here.

Dr Bruniges : The latest piece of work goes to the issues of recruitment, retention, sustainability and quality. Those are the areas that the ministers have asked us to focus on. I take your point. In the interim you've got the gap there. There have been things that have been done, as Ms Pearce has said, in each state and territory. We worked on a whole range of regulatory activities with states and territories and our colleagues. And there have been in the childcare workforce area in a number of states and territories a number of initiatives that have incentivised people to do a cert IV in childcare, a diploma in childcare. But no, there has not been a national strategy between those periods of time.

Senator KENEALLY: Between 2016 and 2021?

Ms Pearce : States and territories probably worked very hard on individual strategies in each state and territory. At a national level, that work is underway.

Dr Baxter : The strategy that's in development now was commissioned a couple of years ago. So it's about to be finalised but there have been some interruptions, obviously, to some of that work this year. But it has been underway for a couple of years.

Senator KENEALLY: But, again, COVID only started this year; 2016 was four years ago. And given that it was an expiry date, I feel like you should have known it was coming. I don't mean you personally; I mean you the department collectively.

Dr Bruniges : One thing I can say is that at the end of last year all ministers worked on and released the Mparntwe new declaration on education, of which a subsection is early childhood. We worked on that. Every 10 years, ministers get together; they have that. The work that went forward in the Mparntwe declaration around child care is part of something that occupies that space, because it was to be the 10-year declaration of all ministers in the country.

Senator KENEALLY: The next one comes in in 2021 and you're thinking about a 10-year time frame. It's taken five years to develop this one. Are you going to start working on the next one in five years time? How are we going to avoid having these five-year hiatuses between strategies?

Dr Baxter : I think an important part of the strategy going forward is about how we can make this thing a living document that we can continuously refresh.

Senator KENEALLY: The whole death-and-resurrection cycle is not good, is it?

Dr Baxter : There's a report I could draw your attention to that ACECQA, which is the project lead on this project released on 13 October, which does go to some of the work that's been undertaken to date. That will be able to demonstrate that this is not the beginning of a process; it's very much about reflecting work underway. But I take your point that it's important we ensure the next one allows for that process of ongoing reinvigoration.

Senator KENEALLY: So at this stage 2021 is what we're looking at?

Dr Baxter : Yes.

Senator Birmingham: Subject to the consensus of the Education Council.

Senator FARUQI: Has the experience of providing free child care for a short period of time this year and the disruption of the pandemic led to any rethink within the department of the value of universal and free early childhood education?

Dr Baxter : Senator, you would know that the department has very significant efforts that go towards the Universal Access National Partnership. A significant part of the work that I do and that Ms Pearce engages in is about that universal access before school under the UANP. The government did commit $453 million for an extension of that partnership this year, the extension for 2021. We have continued to work to ensure that even during COVID the gains that have been able to be achieved for that universal access have been able to be held on to during this time. While we have worked to ensure that in some areas, like Victoria, who may have had problems getting some children along to preschool, we're still able to hold on to those gains that we can through that process. So there's a very substantial part of the work that we've done there.

We are also seeing very promising attendance at child care from those who might not be in that year before school. And we've seen state and territory governments investing in three-year preschool. So we are seeing, even in the context that we've had this year, a real commitment to an expansion of universal access to care before school. We've already charted, I think, today some of the gains that we've seen in children attending early childhood education and care more generally and in having the vast majority of the costs for that care covered. We've heard data here about 90 per cent of parents having a subsidy between 50 and 85 per cent—

Senator FARUQI: I did ask about universal and free. A very specific question: has the department looked at childcare subsidy of 100 per cent for all families?

Dr Baxter : When you say 'have we looked at it', what do you mean?

Senator FARUQI: Done any analysis, costs—

Dr Baxter : We have calculated the cost of providing free child care. That is in the public domain. That was a media—

Senator FARUQI: For the future as well?

Dr Baxter : I don't think the amounts going forward into the future were in the public domain. I'd have to check the exact number but it was around six or seven billion dollars extra annually. We did look at that when the issue was raised in the return to the transition payment package.

Senator FARUQI: I'd like to read out to you a line from a piece published this month from Jessica Irvine, who's the senior economics writer with The Sydney Morning Herald. It doesn't often see eye to eye with the Greens, but this is what she wrote:

I believe the time has come for Australia's federal government to move towards universal childcare—by which I mean government-funded free childcare for any family that wants it.

Sounds radical? Well, it's exactly what we do for children aged over five today.

Maybe, Minister, you could give me your response to that. Do you agree with that? What's your view on universal and free childcare?

Senator Birmingham: It's not the government's policy. The government's policy is to target financial support for childcare services to families working the longest hours to ensure that they can access the greatest hours of support and to families earning the least to ensure that they get the greatest degree of financial assistance. Of course we recognise the importance of early childhood education in the preschool space through the universal access agreement and cooperative work we do with the states and territories to ensure that all young children have access in their preschool years to crucial early childhood education. We recognise that these are choices that families make. Our policies are designed in terms of early childhood years outside of the preschool environment to empower families to make those choices. The reforms we've made in recent years have driven down out-of-pocket costs for families, have increased participation, and clearly have helped families to feel freer to make those choices that suit their circumstances.

Senator FARUQI: But you don't consider early childhood education to be as important as school education?

Senator Birmingham: I think I addressed that. I don't seek to draw comparatives in that sense. The work of early childhood educators—

Senator FARUQI: We have universal free public education in schools. So what I'm asking you is: if you place the same the emphasis, why won't it be universal and free?

Senator Birmingham: I could turn that question back to you and say: aside from preschool, do you believe that attendance at child care should be compulsory? We believe that attendance at school should be compulsory.

Senator FARUQI: Those are two quite different things.

Senator Birmingham: They're not. You're seeking to put early childhood education and school education on the same plane there in terms of importance to child development. If I were to take that assumption at face value, then ipso facto every child should have to attend early childhood education, just as every child has to attend school education.

Senator FARUQI: It's a human right, Minister. I also think that university and TAFE should be free but there shouldn't be a compulsion.

Senator Birmingham: The Greens think that money grows on trees too.

[11:30]

CHAIR: This is a very good point at which to thank the Early Childhood and Child Care Division for coming in. That section we are we finished with. We now move on to the next division from the Department of Education, Skills and Employment: the schools part.

Senator KENEALLY: Thank you for being here today. Can I begin with the take-up of the funding offer. You recall, of course, the government's announcement of $3 billion in COVID relief for schools that reopened. Are you familiar with the announcement I'm talking about?

Ms Gordon : Yes, Senator.

Senator KENEALLY: Was the department consulted about this decision before it was announced?

Ms Gordon : I think there are a number of different elements of COVID funding measures. One was the bring-forward of funding. There were different elements of that. We did work with the minister in developing options for that. Is that what you're asking—whether we were aware of the announcement before it was made?

Senator KENEALLY: Were you aware of it, were you consulted, did you provide advice—yes, that is what I am asking.

Ms Gordon : Yes, Senator, we provided advice throughout that period on the financial vulnerability of schools and some of the concerns that have been raised by the non-government sector, and also on options for support for the sector.

Senator KENEALLY: Did one of those options include the bring-forward of funding to schools that opened up?

Ms Gordon : Given that one of the issues that was raised with us was cash-flow issues for non-government schools, for fee payments and the like, one of the options that we had proposed was the bring-forward of funding—bringing forward of that later payment in the year. So, yes, we had proposed that as one of the options.

Senator KENEALLY: All right, thank you. How many schools were eligible for the payment if they complied with the conditions?

Ms Gordon : I might ask my colleague Mr Sawade to respond to that one.

Mr Sawade : Senator, 837 non-government schools met the eligibility criteria to bring any part of their July payment forward.

Senator KENEALLY: Thank you. The July Economic and Fiscal Update showed that just over $1 billion was brought forward from this fiscal year. That seems considerably less. In fact, it's about a third of the $3 billion announced. Is that correct?

Mr Sawade : That's correct.

Senator KENEALLY: It seems that many schools didn't go for the opportunity to take up that funding offer.

Mr Sawade : Senator, roughly 2,000—2,408—non-government schools responded back to the department. Of those, 837 indicated that they would meet the eligibility criteria.

Senator KENEALLY: So, wait a minute, my earlier question was how many schools were eligible for the payment if they complied with the conditions. You said 837.

Mr Sawade : Sorry, yes, that's right—837 of those schools met the eligibility criteria to bring any part of their July payment forward.

Senator KENEALLY: No; my question was how many schools would have been eligible to apply for the payment assuming they met the conditions.

Ms Gordon : All non-government schools were—

Senator KENEALLY: Which was how many?

Ms Gordon : offered the opportunity.

Mr Sawade : So how many non-government schools, Senator—it was 2,857 non-government schools.

Senator KENEALLY: It's 2,857 non-government schools, and then 837 were eligible for the payment? First of all, that's not even half. It's nowhere near half of the non-government schools. Of those 837, how many actually got a payment?

Mr Sawade : Just to be clear, Senator, the 837 reflects the number of non-government schools that responded to say that they would be eligible. Of those, 696 requested that they actually had a payment brought forward.

Senator KENEALLY: So 696 requested the payment be brought forward. Does that mean they all got money?

Mr Sawade : Of the 696 schools, Senator, 693 had a payment that would have been made in July. So the arrangement was that we were bringing forward a payment—or a part of a payment—that would have been made in July. So 693 were therefore entitled to a payment in July and subsequently had funding brought forward.

Senator KENEALLY: How many schools received the full payment for achieving 50 per cent of their students back in class?

Mr Sawade : I'm sorry, Senator—so I've got—we ran it in two separate processes. I've got the figures that responded for the first up to 12.5 per cent, so the first part of the July payment, which is notionally 25 per cent of the annual entitlement. We ran a second process for the up to 12.5 per cent. I haven't got the figures for how many actually got both of those payments. I can give you the figures for each one broken down. For the first payments, 827 schools were eligible for a payment that was made in May, and 678 schools requested the payment and were made. Then 819 schools were eligible for the second 12.5 per cent, which was made in June, and 677 of those requested a payment.

Senator KENEALLY: Did any systems or states reject the offer outright?

Mr Sawade : Senator, no state or system rejected the offer. There were non-government school systems that chose not to take advantage of the offer.

Senator KENEALLY: Could you repeat that answer? You said nobody rejected it, but there were non-government school systems that—

Mr Sawade : There were non-government school systems who indicated that they would be eligible for funding but did not request to have their funding brought forward.

Senator KENEALLY: I think we're playing a semantic game here. Didn't the entire Victorian Catholic school sector say, 'No thanks'?

Ms Gordon : They opted not to request the funding—that's right.

Senator KENEALLY: So if we take a system like the Victorian Catholic system that rejected the offer, or declined to take it up on the basis of health advice, doesn't that mean they just simply weren't able to access financial relief? Isn't that the case?

Ms Gordon : Senator, this was a timing issue. With the schools that opted for the earlier funds it wasn't a case of additional funding being provided; it was just a cash-flow question. So the Victorian Catholic system didn't indicate it was in need of cash-flow relief at the time.

Senator KENEALLY: Was that their advice to you? Did they say: 'We're not taking this up because we don't need cash-flow relief,' or did they say: 'We're not taking this up because we're not going to open up based on health advice'?

Ms Gordon : I'd need to take on notice exactly the communication they provided at the time.

Senator KENEALLY: Really?

Ms Gordon : But certainly they—at the time there was not an approach to request cash-flow support because they weren't taking up the offer.

Senator KENEALLY: Because maybe they couldn't open up as a result of health advice. Come on—isn't it the case that this was a bribe to schools to open up, and schools that decided to act in accordance with health advice were unable to access this cash-flow relief?

Senator Birmingham: Senator Keneally, this was an opportunity for schools to access a bring-forward of funding in circumstances—

Senator KENEALLY: Only if they opened up.

Senator Birmingham: In circumstances, indeed, where schools were open, and with costs and overheads of being open in a COVID-safe way, at that time. So—

Senator KENEALLY: Do class overheads stop without students?

Senator Birmingham: Senator Keneally, I haven't said much today. It was, in the context of opening in a COVID-safe environment, the additional costs that, potentially, schools might incur, and providing them with some of the certainty of funding through those advance payments. Schools that were, for a variety of reasons, not opening up obviously did not have those pressures at that point in time.

Ms Gordon : Senator, I might add as well that Catholic systems—seven of the eight Catholic systems across Australia chose not to take up the offer. So it wasn't just the Victorian Catholic system that didn't opt in. Every state and territory Catholic Education Commission, with the exception of South Australia, chose not to seek the bring-forward of funding.

Mr Sawade : Sorry, Senator; South Australian and Northern Territory Catholics also took up the offer.

Ms Gordon : My apologies.

Senator KENEALLY: Are you aware that Jim Lassiter, the head of Overnewton Anglican Community College, said he felt he was being forced to decide between the financial health of the school and the safety of staff and students? Surely you've heard that feedback from the private schools, from the Catholic and the Anglican school systems?

Senator Birmingham: As Ms Gordon has indicated, this was a bring-forward of funding opportunity for schools who were meeting the criteria and conditions, including opening. As I've indicated, that reflected some of the concerns or pressures that those schools opening may have faced at that point in time.

Senator KENEALLY: What proportion of independent and Catholic schools accepted the offer?

Ms Gordon : Across Australia, seven per cent of the Catholic system and 49 per cent of the independent sector.

Senator KENEALLY: Sorry, 70 per cent of the—

Ms Gordon : Seven—seven per cent.

Senator KENEALLY: Seven per cent?

Ms Gordon : Seven per cent of the Catholic Education Commission—of the schools—and then 49 per cent of independent schools.

Senator KENEALLY: What proportion of schools in Victoria accepted the offer?

Ms Gordon : It was 20 per cent of independent schools. Then, as you mentioned earlier, the Catholic system didn't—

Senator KENEALLY: None in the Catholic system.

Senator Birmingham: The individual schools in the Catholic system don't get the choice, Senator.

Senator KENEALLY: I'm quite aware of how the Catholic system works, Minister. Could you provide on notice a list of schools that took up the offer?

Ms Gordon : Yes, I think we've actually provided that on notice previously, but, yes, we can take that on notice.

Senator KENEALLY: Thank you. Has a COVID-19 case been detected at any independent school that took up the government's offer?

Ms Gordon : I would need to take that one on notice. We don't have a list of schools in which COVID cases have occurred, so we would need to seek that advice.

Senator KENEALLY: Who would have that list of schools?

Dr Bruniges : Maybe, at the state and territory level, Senator, state ministers and ministers for education, as I know you're aware. It may be that state and territory departments have that, or it may be individual AISs have it and—

Senator KENEALLY: What about the National COVID-19 Commission or the AHPPC? Somebody must have it at a national level.

Senator Birmingham: I'm certain that state health officials would all have it.

Senator KENEALLY: Right.

Senator Birmingham: And whether those names of individual schools have been shared as part of any of the Commonwealth processes via our AHPPC is, rightly, a question through Health, but I'm sure we can see if there is the information easily available.

Senator KENEALLY: I had a number of questions about the breakdown of data about schools where COVID has been detected. But you're saying that you don't hold that type of data?

Ms Gordon : That's correct.

Dr Bruniges : No, we don't.

Senator KENEALLY: Interesting.

Ms Gordon : Senator, on the question that you asked us to take on notice about the list of schools, we actually provided that information on a previous question on notice that was provided in July, which has a list of all the schools that took up the option to bring forward their July payment.

Senator KENEALLY: Great, thank you. Minister, do you consider this program a success? Only seven per cent of Catholic schools and only 49 per cent of independent schools took it up. I mean, it seems that schools really didn't like the idea that they were being bribed to open up early against medical advice.

Senator Birmingham: Senator, I don't accept the characterisation put in your question. I'd remind you of the fairly consistent AHPPC advice in relation to schools and schools being open. But, in terms of whether or not the program was a success, it was an opt-in program and a choice for schools to make. As you've heard, some more than 900 or almost 1,000 chose to do so. I'm sure those nearly 1,000 schools do consider it was a success or benefit, given the choice they made.

Senator KENEALLY: It was not quite 'nearly 1,000'. Just out of curiosity, there had been three billion offered. Only one billion has been spent. What's going to happen to the money that was left over?

Senator Birmingham: It was a bring-forward, Senator, as Ms Gordon has explained.

Senator KENEALLY: So that money will still go to the schools; it'll just be on its usual timetable?

Ms Gordon : Yes, those payments have already been made.

Senator KENEALLY: Are there any arrangements in place for those schools who continue to face financial pressure throughout the next year and beyond? Is there going to be another bring-forward offer? Or has the government asked you to develop any other plans?

Ms Gordon : The bring-forward was just a cash-flow measure for this year. There is also the Choice and Affordability Fund, which provides some flexibility for the non-government representative bodies to assist schools that are in financial difficulty, not just COVID related but for other unforeseen circumstances. So that fund is available to draw on. If there are schools that are in need, they can approach their non-government representative bodies and seek assistance.

Dr Bruniges : Remember, too, that the payment timings are different for non-government schools and for government schools. One is, I think, three months. Am I right, Ms Gordon?

Ms Gordon : Three payments for government and—

Dr Bruniges : Three payments for government, and non-government are on a monthly basis.

Senator KENEALLY: I just want to go back to this idea about cash flow. The school is going to have ongoing costs in many respects, whether or not the students are turning up. They're going to have to pay their electricity. They're going to have to pay rates. They're going to have to pay their staff. I'm just trying to understand why, if there was a cash-flow problem, there was a condition that students had to be in school. If it was a cash-flow issue, why not just address the cash-flow issue?

Ms Gordon : Senator, it was a decision of government to have a condition placed on the bring-forward of those funds.

Senator KENEALLY: Minister, why was that condition placed on the payments? If it was a cash-flow issue, why not just address the cash-flow issue?

Senator Birmingham: Senator, as I was explaining before, there were concerns at the time around what uncertainty may exist for schools in terms of their operating, particularly their operating protocols and practices in a COVID-safe environment. The bring-forward provided some scope to deal with that degree of uncertainty that may be there for those schools who (a) were opening, and (b) felt that they needed it.

Senator KENEALLY: What kind of uncertainty are you talking about?

Senator Birmingham: Senator, there was plenty of uncertainty months ago as to precisely the nature of requirements for COVID-safe operations and how they would be sustained. I think there's—

Senator KENEALLY: But how does that relate to solving the cash-flow issue? I'm just trying to understand the connection. Why try to tempt schools to bring students back into the classroom?

Senator Birmingham: As schools were responding to health advice around how they could remain open and operate in the COVID-safe way, they were having to look at different practices around cleaning practices, around hygiene practices and around social-distancing practices that schools needed to implement during that time.

Senator KENEALLY: I'm sorry, that still doesn't answer the question. I don't understand, if there was a cash flow issue, how that addresses the uncertainty. Why would a government want to tempt schools with a bribe to get their students back into a classroom in a time of massive uncertainty? I just don't understand the connection here. It's never been clear.

Senator Birmingham: Senator Keneally, let's just work through—

Senator KENEALLY: Wasn't it just a political aim?

CHAIR: Senator Keneally, can you please let the minister answer the question.

Senator Birmingham: Let's work through a few of your assertions there. The government at all times has urged schools to follow AHPPC advice. AHPPC advice has been fairly clear and consistent around the safety of schools being open. But, of course, schools also have had to work through those issues that I referenced before in terms of changing practices to apply social distancing and to deal with hygiene, cleanliness and other matters relevant to limiting and minimising any of the risks of spread of COVID-19. Implementing any of those policies and practices came with potential costs for schools, and the opportunity to bring forward funding was a way that schools who were opening could deal with some of those potential costs and the uncertainty at the time that may have been associated with those potential costs.

Senator KENEALLY: I think we'll have to leave it there, Minister. I'll move on to my next question. I think we're going to agree to disagree, perhaps.

Senator Birmingham: Well, I'm happy, Senator Keneally, that my two children got to go to school this year. There were many parents elsewhere that wished their children had the same opportunity.

Senator KENEALLY: Does the department foresee any increases in private school fees as a result of the financial pressures they've faced this year?

Ms Gordon : Senator, we have had no indication from the non-government sector that there would be an increase in fees as a result of the COVID pandemic.

Senator KENEALLY: Do you have a mechanism by which you monitor that or seek to get a sense in forecasting what might happen in the next financial year?

Ms Gordon : Non-government schools report their private income on My School, so it's transparent to be able to see what the income—

Senator KENEALLY: I'm asking if you, the department, do any type of forecasting or consultation with them in order to do forecasting.

Ms Gordon : We don't specifically look at forecasting fees, no.

Senator KENEALLY: Thank you.

Senator O'SULLIVAN: Was there ever any AHPPC advice that schools should close?

Dr Bruniges : Not that I'm aware of, Senator.

Senator O'SULLIVAN: No advice?

Dr Bruniges : Ms Gordon may be aware, but I'm not aware of any.

Ms Gordon : Most of the decisions about school closures and health advice was local advice. The AHPPC provided guidance about health guidelines for school operation. That was consistent—that it was, in the absence of a local issue or a local incident, a low-risk environment.

Dr Bruniges : What we have seen, Senator, just following on from Ms Gordon, is that where there has been a case identified in a particular school, the state jurisdiction or so forth have shut the school for a day or two. But, as Ms Gordon said, that is a local decision. I can't recall any AHPPC advice stating that schools should close. In fact, it was the counter.

Senator O'SULLIVAN: Right. So it's usually the case, isn't it, that schools would have to implement a COVID-safe plan. Was there support there for schools to be able to do that? I think there was that additional funding for hygiene measures. Is that right?

Ms Gordon : Some additional funding was provided—it was referred to as hygiene payments for hygiene products and other incidental expenses that a school might face in the context of COVID.

Senator O'SULLIVAN: Do you know how many non-government schools took that support?

Mr Sawade : Yes, there were 2,765 non-government schools that received a payment as part of the hygiene assistance.

Senator O'SULLIVAN: Thank you. Was there any work that the department did on the impact of the school closures at all?

Ms Gordon : There were a number of pieces of research that were commissioned to look at what—

Senator O'SULLIVAN: Research, did you say?

Ms Gordon : Some research, yes, that was commissioned to better understand the likely impacts of home-based learning. The research is available on our website. It broadly identifies that there are a number of vulnerable and disadvantaged groups that are likely to be further disadvantaged as a result of having to learn from home.

Senator O'SULLIVAN: And that's on your website?

Ms Gordon : Yes. There are five or six reports.

Dr Bruniges : There are five reports, each done by different academics and institutions. As Ms Gordon has outlined, it really looked at the evidence that was available domestically and, I think in some cases, internationally about the learning. And I think Senator Faruqi has raised before the school closures and what that would mean in learning-outcome gain. My recollection is telling me that, for disadvantaged students, it was a far more significant impact on learning gain. But, again, we published and made those available on our website for everyone to have a look at. There is international research, too, I might say. The OECD is undertaking a range of international research on what that means and whether you can quantify and describe that in places. I think Dr Baxter mentioned Norway, particularly looking at the consequences of impact of having a closed system. Europe is very different to the domestic situation here in Australia at the moment. So, I think from a number of OECD countries, there's a collection of data to look closely at if they can quantify and describe from a learning outcome point what that impact is.

Senator O'SULLIVAN: My own little O'Sullivan family household research showed that my nine-year-old didn't do very well, but my older child did. So it sort of depends on the situation, doesn't it?

Dr Bruniges : Yes. I think you look at it and think, 'Are there different stages and levels of schooling?', and there could well be. I know from some of my OECD colleagues that the psychological safety impacts are somewhat higher sometimes on the earlier years—there's differential impact. So it's not going to be a universal impact across all.

Senator FARUQI: I just want to go back to an earlier question that I asked in Early Learning, because that's relevant to schools as well. We spoke a little bit about the disruption that COVID-19 has caused for children, obviously, in early learning as well as in schools. As I said, we've heard from a lot of people that they feel that children starting school in 2021 won't get anywhere near the 600 hours of early childhood education in the year before school. Obviously, this is also going to place strain on schools when they enter schools—on schoolteachers and on students. There's a report that has come out—I think it's come out today—called Educational opportunity in Australia 2020: who succeeds and who misses out by Victoria University and the Mitchell Institute. They talk about this as well. Basically, the report reveals that those students who were already disadvantaged before the pandemic now face a double disadvantage. So I guess my question is for the minister. Minister, given all of this, why isn't there any new funding in the budget to support public schools that will require additional supports because there will be additional needs arising from the pandemic? Why is there an arbitrary 20 per cent cap?

Senator Birmingham: There are a couple of things there. The funding methodology is responsive to areas of need in different ways. As those evolve then so, too, will funding evolve in that regard. I think in terms of school systems and how they adjust in different parts of Australia to the different amount of schooling that was disrupted this year, they are things that those school systems across states and territories and in the non-government sector are going to need to work through on their own methods. Obviously, many worked through different forms of remote delivery and there will be, I'm sure, ongoing assessment to see what the impact of that was in terms of the extent to which it did actually disrupt a child's development versus proved to be a successful process of development.

Senator FARUQI: Minister, is there any new money for public schools in this year's budget?

Senator Birmingham: Public school funding continues to grow each year. Ms Gordon can probably speak to the figures.

Senator FARUQI: Is there any new money to support the impacts or disruption that the pandemic has caused? We all have agreed again and again that these are unprecedented times, yet the federal government is not providing any money to support the impacts that schools and students will face on that.

Ms Gordon : There are a number of initiatives in the budget that support schooling and some of the impacts of COVID. You might be aware—

Senator FARUQI: Could you tell me then, Ms Gordon, how much money is there in this year's budget to basically overcome the impacts that I'm just talking about? How much new money is there in this year's budget for public schools?

Ms Gordon : For public schools there's—I'd need to find the number—

Senator FARUQI: Over and above what's done every year.

Ms Gordon : There are a number of initiatives that are not specifically for public schools but generally to support the school sector.

Senator FARUQI: If you could provide those on notice that would be great, because my time is limited.

Ms Gordon : Sure.

Senator FARUQI: Thank you. I might move on to another line of questioning, which is about Respect Matters. In last year's budget, there was $2.8 million over three years for Respect Matters. I think the budget allocated $1.5 million in 2019 and around 0.5 million in each of the following two years. Only 0.36 million was spent on the program in 2019, even though 1.5 million was allocated. The shortfall has not been carried forward. So that effectively cuts the program by half. My question is why.

Senator Birmingham: Senator, I think we can reassure you that the full funding for the program over the full period of time, in fact, will be made available and is budgeted for and that the profile of that will be reflected appropriately in the portfolio additional estimates statements.

Senator FARUQI: So it was a mistake and it wasn't in the budget because—so that money—there will be the 1.1 million carried forward?

Ms Gordon : The full amount has been—so there was a movement of funds last year and then there will be another movement of funds into that program.

Senator FARUQI: Why wasn't that reflected in the budget papers?

Ms Gordon : It was a timing issue, but the funding is now in the—

Senator FARUQI: I don't understand 'timing issue'. What do you mean by 'timing issue'?

Ms Gordon : So there are two separate—they were related, but two separate decisions. A decision was made late in the financial year when it was—because of a number of delays in the program, the funding hadn't been expended. Because the budget had been delayed, there were a number of other projects that had—their funding was coming to an end that year and needed extending. So a decision was made to move the funding to those projects that couldn't be funded because the budget had been delayed. That funding has now been returned into the budget through a movement of funds in this financial year. So the full amount of funding will be available.

Senator FARUQI: So a decision was made to move funding that was allocated to Respect Matters to some other programs. Who made that decision?

Ms Gordon : The minister made the decision.

Senator Birmingham: On the basis—

Senator FARUQI: Minister Tehan?

Senator Birmingham: I'm sure it would have been Minister Tehan, I imagine.

Senator FARUQI: Which minister made that decision?

Senator Birmingham: I'm sorry, Senator, but just to be clear, as Ms Gordon had explained before, those decisions are made on the basis of anticipated underspends in the year for which that money had been profiled. So the money under the Respect Matters program or programs were not going to be expended. The minister authorised their expenditure on other programs. But the government has ensured that the total money for the Respect Matters program remains available—the full $2.8 dollars million overall. It's just available over different financial years than had previously been the case.

Senator FARUQI: So how much will be available in 2021?

Ms Gordon : In 2021, it will be the $600,000 that had been originally allocated plus the 1.137 that had been moved into this year.

Senator FARUQI: Could you tell me which minister made that decision?

Ms Gordon : This is all under Minister Tehan's areas of responsibility.

Senator FARUQI: Why was there only—when there was 1.5 million allocated in 2019, do you know why only 0.36 million was spent? What were the programs that lost out?

Ms Gordon : Nothing has lost out. The issue was that there were a number of delays in the earlier work that had been done. So this builds on the $5 million for national Respectful Relationships education program. That was under the Women's Safety Package in 2015. So this builds on that work. There was a delay in the finalisation and publication of those resources, so that had a flow-on effect to the expenditure of that money.

Senator FARUQI: And how are you going to make sure that the 1.1 million and the 0.5 million will be spent in 2020? What assurances have you put in place that that money will be spent?

Ms Gordon : We're currently working on the program and how that's going to be expended over the next two years.

Senator FARUQI: How much was spent in 2020?

Ms Gordon : In 2019-20—the financial year?

Senator FARUQI: No, this year.

Ms Gordon : Just for the first six months or—

Senator FARUQI: Yes, sure.

Ms Gordon : I don't have that information, but over the 2019-20 financial year we had—this is of the 2.8. We had 363,000—sorry, 463,000 in total that's been expended this financial year—sorry, the 2019-20 financial year.

Senator FARUQI: So schools have the money at the moment to roll out these programs?

Ms Gordon : This money is not going to schools. It's going to the development of resources for supporting teachers and students.

Senator FARUQI: So that is happening at the moment?

Ms Gordon : Yes, there's active work underway.

Senator FARUQI: It hasn't stopped?

Ms Gordon : Work has not stopped, no.

Senator FARUQI: I just want to go to some money that was allocated in this budget—I think about 39.8 million—for Aboriginal boys' education through the Clontarf Foundation. I just would like to know if there was any similar allocation of money to improve education for Aboriginal girls.

Senator Birmingham: Senator, I think there's around $55 million allocated through the NIAA in programs that support Indigenous girls.

Senator FARUQI: Sorry, how many million?

Senator Birmingham: About 55 million, I'm advised. That's obviously funding administered by Indigenous Affairs rather than this portfolio. We have a challenge there that I don't have full briefings on those programs. I'm just checking what I do have.

Ms Gordon : Perhaps I could add to that. The NIAA actually run the Indigenous Advancement Strategy for children and schools. Funding to support the Clontarf Foundation is part of that. So this particular initiative extends that function and will continue to be administered for the next four years by NIAA. The NIAA does—generally, the funding under the Indigenous Advancement Strategy is for activities which are designed to benefit any agenda. But, as the minister pointed out, as part of the overall package there's around—NIAA has advised us that 57 million will be provided for targeted girls' activities and then about 54 million for targeted boys' activities. That's in addition to around 200 million under the Indigenous Youth Education Package, which provides scholarships, boarding and residential academic and mentoring support for both boys and girls.

Senator FARUQI: As far as I understand, then, that's 55 and 54 for boys and girls through NIAA. Is there an additional 39.8 for Aboriginal boys' education through the Clontarf Foundation?

Ms Gordon : That Indigenous Advancement Strategy includes the Clontarf Foundation program as well.

Senator FARUQI: The 54 includes the Clontarf Foundation?

Ms Gordon : I'd need to take that on notice because I'm not sure of the time frame. Obviously that new money is going forward. So I don't know whether these figures are for—

Senator FARUQI: If you could provide those figures, that would be—

Ms Gordon : Absolutely. But there were a number of programs—some which target boys and some which target girls.

Senator FARUQI: I just want to make sure that there is money provided. It's great that Aboriginal—that there is money for Aboriginal boys, but there should be at least equivalent, if not more, because we know what the gender inequalities are. I just want—

Senator Birmingham: Senator Faruqi I think it's—that's one of those factors of how things are presented sometimes in the budget papers. New measures, of course, are singled out. Continuing measures, if you like, are not singled out in Budget Paper No. 2 in the same way. So what you've got here is clearly a pipeline, which was pre-existing, of measures for Indigenous girls and what would seem to be a degree of additional support for Indigenous boys. But, based on the figures Ms Gordon has given, that appears to achieve relative parity in terms of the amount of spend or close to. But there may well be then timing factors in terms of when some of those supported girls' programs come to an end. In the next few years, it may well be that you would see measures for Indigenous girls, but not boys, in those budgets as another three-year or four-year commitment is made to a program.

Senator FARUQI: Clarity would be good, because I understand that groups like the Stars Foundation provide really good support for Aboriginal girls. Was there anything in the budget for the Stars Foundation for Aboriginal girls' education?

Ms Gordon : Not in our portfolio.

Senator FARUQI: Was there anything last year?

Dr Bruniges : We might have to check NIAA, Senator.

Senator FARUQI: If you could check that.

Dr Bruniges : Yes, we'll take that on notice and check with NIAA.

Senator FARUQI: Thank you.

Senator KENEALLY: Can I just pick up for a moment on some of Senator Faruqi's questions regarding the Respect Matters funding. First of all, the initial announcement by Minister Tehan in March 2019 was for 2.8 million?

Ms Angus : That's correct.

Senator KENEALLY: Thank you. And then the 2019 portfolio budget statement showed 2.5 million?

Ms Angus : Yes, that's also correct. That's as a result of—that's the administered funds as opposed to departmental—300,000 of that was departmental funding.

Senator KENEALLY: Right. And then the 2020 portfolio budget statement for those same years shows funding at 1.36 million? It's on page 42.

Ms Gordon : That would be the issue that we were talking about—timing. The funding has been subsequently put back and the full amount will be visible in the PAES—the portfolio additional estimates.

Senator KENEALLY: When did you make that decision to bring the funding back? I think you said, Minister, it would be in the upcoming MYEFO.

Senator Birmingham: Portfolio additional estimates statements.

Senator KENEALLY: When did you make the decision that you would bring the funding back?

Senator Birmingham: The decision will be reflected in those, I should say.

Ms Gordon : I'd need to take it on notice about the exact timing.

Senator KENEALLY: Thank you. I'm not sure if you quite got to this point with Senator Faruqi's attempts to ask you—very good attempts to ask you about this. Why was there a delay in the program?

Ms Gordon : This is where this—the new money builds on the existing program of expenditure under the Women's Safety Package. That was in 2015. So there are a number of different elements of that that have been delivered, including quite a significant package of resources. There's been additional resources—

Senator KENEALLY: Resources to schools?

Ms Gordon : Resources for schools, yes—educational resources for teachers and classroom resources. So those resources—the contract has been complete for the development of those resources. There's some additional work around tailoring some of those for particular cohorts like Indigenous students and some work around where those resources will be hosted—what platforms and which websites. That work is still underway.

Senator KENEALLY: The announcement was made in March 2019. That's more than a year ago. We have an ongoing challenge in relation to domestic violence. I'm just wondering why it's taken so long to have some of those platforms and things designed. Is there any particular reason?

Ms Gordon : I think there's a number of things that have factored into it. We've been doing additional due diligence on the resources and the development of the website. The impact of COVID has also led to some delays in some work, including this program.

Senator KENEALLY: Right. What states is the Respect Matters program operational in?

Ms Angus : It will be established as a resource that any teacher can access via an online platform, so it won't—so most states and territories already have Respectful Relationships programs in place in their individual jurisdictions.

Senator KENEALLY: You said it will be established. So currently there is nothing established under the Respect Matters program?

Ms Gordon : The Respect Matters program is the development of the resources that I was just talking about. Those resources will be made available. There are already some existing—

Senator KENEALLY: It's just unclear. Is it an online—because it's been a little unclear, I think, as to what it will be actually doing. Is it an online resource for teachers to use?

Ms Angus : Teachers and parents.

Senator KENEALLY: Okay. Are there any schools that have yet been able to access these resources?

Ms Gordon : These were additional resources. There's already the Student Wellbeing Hub—

Senator KENEALLY: I just mean Respect Matters resources.

Ms Gordon : These resources will be added to an existing body of work.

Senator KENEALLY: When do you expect that to happen?

Ms Gordon : We don't have a time frame at this point.

Senator KENEALLY: Right. Are you aware of a white ribbon survey whose results were published on the weekend—that 42 per cent of men between the ages of 18 and 34 don't believe hitting, punching or restraining another person to be a type of domestic violence? Have you seen that report?

Dr Bruniges : I did, Senator.

Senator KENEALLY: You did. We've got a school in Sydney where the year 12 muck-up day for this all-boys school listed challenges including having sex with an 80 kilogram plus woman or having intercourse with, and I won't use the language, a chick which is a three out of a 10 grading or lower. We do have a challenge here. I'm just wondering, given these attitudes, is there a sense of urgency within the department to get this Respect Matters program out and available to school communities?

Ms Gordon : Senator, there's certainly an issue. The Australian government has been working with states and territories over a number of years on these issues, not just through the Respect Matters program—also the Student Wellbeing Hub has some resources as well and is supporting a broader effort across states and territories to look at respect, respectful relationships, how that's incorporated into the Australian curriculum and how we can support efforts in this area.

Senator KENEALLY: This is meant to be a three-year anti-violence education campaign. It's not yet started. When it starts, is it going to run for three years? Is that the plan?

Ms Gordon : We'd anticipate that the resources would continue unless they're improved upon and updated, but they wouldn't be removed from the website in three years time.

Senator KENEALLY: I guess I'm just quoting the minister's media release. He said it was a three-year anti-violence education campaign. So my question is: it was announced in 2019. Is there going to be some kind of supporting campaign around the Respect Matters materials when they are finally produced and is it going to go for three years?

Dr Bruniges : Senator, I think it would be fair to say that some of the teacher professional learning online modules and the importance of having accredited teacher professional learning is going to be incredibly important. So that will run. And there's the capacity to update those modules online. That's going to be in place. So, in that place, those modules might run longer than three years. The materials—I know from a state and territory perspective there's a range of state and territory projects underway. In the New South Wales example that you quoted, I'm sure the authorities in New South Wales are paying diligence and attention, as my counterpart, Mark Scott, is responsible to that school and would be undertaking a range of work.

Senator KENEALLY: All right. Let's move on. I just quickly want to ask another—

Senator FARUQI: Can I ask a question on this very quickly before you move on. I just want to clarify that not a single school in Australia has seen any of the resources that are being developed through this program where $2.8 million was allocated.

Ms Gordon : I can't rule out whether a single school has, because we've been undertaking consultation in the development of them. So there'll be a number of teachers that have been involved in that process.

Senator FARUQI: But none of them have been put online for any of the schools to benefit from?

Ms Gordon : The new resources have not been made publicly available. It does—

Senator FARUQI: I'm sorry, but I just find it mind boggling. We have an epidemic of violence against women in this country—40 women have already been violently killed this year. Senator Keneally read out some statistics of that survey. Does the government consider this a serious issue, because it doesn't look like it to me at all.

Senator Birmingham: Yes, Senator.

Senator FARUQI: Please give us a timeline of when this is going to be put up and make it an urgent priority. Women are dying.

Senator Birmingham: Senator, the government does consider it to be a very serious issue. That's why—

Senator FARUQI: Well, how?

CHAIR: Can we let the minister finish his answer.

Senator Birmingham: That's why additional investments have been made. As Ms Gordon reflected before, Commonwealth and national resources such as the Student Wellbeing Hub have had developed previously resources to aid schools in the delivery of teaching principles and practices in relation to tackling these difficult issues. Those resources are actively used by school communities. This program is about trying to build better, newer resources for schools to be able to use, recognising, indeed, that outcomes to date are not satisfactory. Clearly, that's why additional investment has been made and additional attempts are being made. It is equally important that the money is spent in a way that we try, through that collaboration with those of expertise, to actually get resources that will work and be impactful, not just—I want it done as quickly as possible. The government wants it done as quickly as possible. As soon as there was any identification of a question about the resourcing around this program, the government made sure that was fixed, because we are committed to it. But we also have to make sure that they are resources that ultimately address the problems. Tragically, efforts to date by governments of all persuasions, state and federal, culturally—these are not factors that any one single government is ever going to have a silver bullet to fix. As I know you appreciate, and Senator Keneally and others, these are broad cultural issues and it takes concerted efforts. And, of course, this part of Respect Matters is only—or the Respect Matters program administered by this department is only one part of the overall action plan in relation to reducing violence against women.

Senator FARUQI: Thank you, Minister. It all helps. But with all due respect, this program doesn't even have a timeline yet.

Senator CHISHOLM: In my exhaustive study of the 2020 budget—and I had the yellow highlighter out—I stopped on pages 81-82—the 2020 budget measure student support package. There was 25 million over five years from 2020-21 to establish a fund to enable the government to respond flexibly and quickly to emerging priorities and educational challenges presented by COVID-19. The budget included 25 million over five years. Could you please break down how the funding is distributed across the forward estimates?

Ms Gordon : I'd need to take that—I'm fairly certain it is five million each year for the five years.

Senator CHISHOLM: And what is the fund going to be used for?

Ms Gordon : There'll be grant—funding guidelines for that program that will be developed and made publicly available. But they're still in development.

Senator CHISHOLM: Okay.

Senator KENEALLY: So they're non-existent?

Ms Gordon : That's correct.

Senator CHISHOLM: Has any of the money been spent?

Ms Gordon : No.

Senator CHISHOLM: So the guidelines will be made publicly available?

Ms Gordon : Yes, that's current—that's standard practice.

Senator CHISHOLM: And will any of the money be spent before those guidelines are in place?

Ms Gordon : The guidelines will need to be in place and agreed before any money is expended from that program.

Senator CHISHOLM: Are you able to give us any insight into what sorts of things that money will be used for?

Ms Gordon : That's still subject to decision and development. It's really to provide the flexibility to—for emerging issues. One of the things over the last period has been that there wasn't the flexibility within the budget to necessarily respond to the pandemic as it arose.

Senator CHISHOLM: So what, for instance?

Ms Angus : I think we would be looking to have a fairly flexible range of funding that would be available to direct towards looking at how to maximise students' opportunities post the pandemic. There's a number of—there is research coming out, some of which has been referred to this morning, about the sorts of things that might be happening to students.

Senator CHISHOLM: Like what? I'm sorry—surely you can give me some specific examples.

Dr Bruniges : I can give you an example. One of the issues we know is starting to be well documented is student mental health, engagement and attitudes to learning and what that impact might be. There's probably an initial line of sight and the government invested in a range of measures—actually bushfires, around mental health. We can't quantify and describe exactly the consequence of impact on young students, senior secondary students and students who might be going for certification yet. So that's one example that we were watching closely around the consequences of impact of the COVID pandemic. That might be not a universal impact. It might impact on different communities in different ways. So that would be one example where we would need to listen to states and territories and to all sectors about how they're travelling in terms of student wellbeing and mental health.

Senator CHISHOLM: Sure. So would this be used to provide funding for counselling or would it be used to show that there needs to be work done in this area because—

Dr Bruniges : I think there's a number of evidence out there being collected from jurisdictions around that particular issue. I'm just citing that as an example—as one of the things I think that we don't fully understand—the consequences of impact that COVID has had yet. Most of the psychologists and counsellors will go to—it could indeed be a long-term impact. You mightn't see it upfront, but it could go over, for some students, a number of years. That's just one example.

Senator CHISHOLM: Who will be the decision-maker for the allocation of this funding?

Dr Bruniges : Senator, as Alex has said, we would have a set of guidelines. We would normally, through guideline processes, put up—we'd have a process behind those guidelines and an application process if we have guidelines in place. Those decisions are yet to be taken. In most cases, we put it up to the minister, I should say. After a process, we'll put it through to the minister.

Senator CHISHOLM: I wear another hat at the moment, which is chair of the inquiry looking into the sports rorts matter. I suppose what I want to know is that—whether we're going to see a similar thing here, where the funds are allocated to Liberal marginal seats in the run-up to an election or if it's going to be allocated on merit to communities that actually need it. What is going to be in place to ensure that that can happen?

Dr Bruniges : I can assure you that any program that we have put together and the integrity measures that we put—we've heard this morning in Childcare about the integrity measures that we put behind those and the probity and potential conflict of interest that we've been through. Several programs will be in place for whatever government makes a decision for on this aspect.

CHAIR: We will break for lunch. When we come back we'll still be in the schools area. Thank you very much.

Proceedings suspended from 12:29 to 13:31

CHAIR: I reopen this hearing. The secretary would like to say something.

Dr Bruniges : I would like to make a correction to the Hansard. When I was referring to the frequency of payments to non-government and government schools, I inadvertently reversed them. Non-governments are paid three times a year and governments are paid on a monthly basis. I think I said it the other way around; my apologies.

CHAIR: Thank you, Secretary. Senator Chisholm has the call.

Senator CHISHOLM: With respect to that $25 million budget measure, will public schools be eligible to receive support through the fund, or is it just for private schools, as with the government's funding for extra hygiene materials?

Ms Gordon : As I mentioned, the guidelines for the program are yet to be developed. The sorts of activities that might be funded through it wouldn't necessarily be funds that would go directly to schools. They might be things like commissioning research, targeted programs or interventions. It is a program for emerging priorities and emerging issues. There's a whole range of things that we don't yet know about the impact of COVID. Obviously, schools and education authorities at the moment are trying to better understand where those impacts have been and which students have been affected. As Senator O'Sullivan mentioned before, even with his children, there were different experiences and impacts. There's a lot of work already underway, and we're part of conversations with states and territories through the data strategy group under the Education Council, trying to look at what research is being undertaken. The outcomes of that research will help to inform the sorts of things that we might look at through this measure.

Senator CHISHOLM: You won't rule out the fund being for private schools only?

Ms Gordon : I can't really rule anything in or out, but it's unlikely that the funds will go directly to a school. It may be that funds are available for a group of schools, depending on what sort of activities are funded. It's likely that there will be things funded that will support all schools; because, if some research is funded through this measure, that research would help to inform addressing educational challenges in all schools.

Senator CHISHOLM: Minister, do you rule out this fund being used for private schools only?

Senator Birmingham: Yes, I'm happy to, because I think you're playing semantics. Ms Gordon has been quite clear in the sense that, although program guidelines are still being worked through—

Senator CHISHOLM: It wasn't semantics—

Senator Birmingham: Senator Chisholm, I am speaking.

Senator CHISHOLM: with the way that the hygiene material was used.

Senator Birmingham: The likely application of this funding will not be direct-school funding. It is instead about support measures, research measures and other types of things that would be deployed that are far more likely to be supporting all schools or clusters of schools.

Senator CHISHOLM: When the guidelines aren't put in place, how are we to know? We know that, when government funding was used for extra hygiene materials, that only went to private schools. Surely, these are legitimate questions.

Senator Birmingham: I just answered your question.

Senator CHISHOLM: Whose idea was the setting up of the fund in the first place?

Senator Birmingham: It was a budget decision.

Senator CHISHOLM: Was it the minister, the bureaucracy or Joe Blow who had an idea?

Ms Gordon : I'd need to take on notice where the original initial advice came from. Certainly, we'd been in discussions with the minister about some of the likely issues emerging in terms of educational impacts. As I talked about earlier in the hearing, this morning, we had commissioned some early research on potential implications for the extended periods of home based learning. That research clearly indicated that there were likely impacts that would be felt. It was clear that there will be issues arising from the experience this year, and this fund provides some flexibility; as it becomes clear what those issues are and where the biggest concerns are, this funding will enable some flexible responses to those. Some of the areas that might come into scope would be things like educational outcomes for Aboriginal and Torres Strait Islander students. There's some evidence in that we've been getting feedback from education authorities that a number of Aboriginal students who were attending boarding school and went home to community haven't returned to school. Clearly—

Senator CHISHOLM: That's not unusual, though. That happens outside COVID as well.

Ms Gordon : Indeed it does. There's obviously a lot of focus on how we might improve the educational outcomes for Aboriginal and Torres Strait Islander students generally, but this potentially has exacerbated that impact. Some of the other areas might be looking at new approaches to digital learning and some of the opportunities that come from the COVID experience as well: how do we harness some of the experiences that we've had with the use of technology in school education? Some of the funding from here might help with that agenda as well. There's a range of different things that we might be able to look at, as opportunities emerge or as challenges become clearer.

Senator CHISHOLM: More broadly, what plans does the department have to evaluate how many students have fallen behind throughout COVID?

Ms Gordon : We don't have direct access to student-level data. It's always something that we need to look at in collaboration with our state and territory colleagues. As I mentioned earlier, a data strategy group operates under the Education Council and there have been discussions underway about what states and territories have started looking at, to be able to identify where the issues are and understand where there might be particular cohort impacts or groups of students that need additional support. Obviously, at an individual school level or even at a classroom level, teachers and principals will be looking very actively at their students—which they do in the usual course as a school progresses during the year—and will have a constant program of formative assessment through the year to understand how students are progressing. In the context of COVID-19, it's obviously even more important to be able to identify those students who have fallen behind because of home based learning, to understand where they're at and to help support their catching up.

Senator CHISHOLM: Are any policies being worked on or prepared to help those children to catch up?

Ms Gordon : The first step is to understand what the issue is. It's hard to design a policy without actually understanding where the challenges might be. We know that, in a broad sense, there are likely to be. At the moment, as I said, each state and territory has a program of trying to understand where their particular challenges are. A number of them have already announced certain interventions. As I said we rely on that collaborative work with them to be able to understand where those concerns might be. From a Commonwealth perspective, the student outcome data that we do get access to is at the national-state level and school level with NAPLAN results. As you know, NAPLAN was postponed this year. From a Commonwealth perspective, we don't have access to individual school-level data to be able to do that analysis ourselves.

Dr Bruniges : It would be fair to say that the education ministers across the country originally started to have a conversation about the bushfire effect, but the directors-general and chief executives across the country are constantly looking at issues, from their own data, about what we might do as a collective. For example, there's been a whole range of sharing of digital resources across state and territory borders and between states where they're able to waive copyright to maximise access for teaching resources at home. That's one piece of work that is being shared and facilitated across states and territories. I know that it's top of mind for education ministers across the board, as they go through their state or territory.

As Ms Gordon pointed out, not having the 2020 NAPLAN data occurred at the height of the pandemic; collectively, the ministers made a decision not to pursue the testing this year. May 2021 will be the next data source; we will have that at three, five, seven and nine. The other thing I would say to you is that, in 2021, on the international scene, we will have the PISA sample test administered, if people choose—and we're going through that. Australia is to participate in that, and we'll have a very good benchmark and means of comparison not only within Australia but with other countries internationally, to look at student outcome data with a different lens.

Senator CHISHOLM: Thinking about these broader challenges, this would be the most disruption that school students have faced probably since World War II. The government has allocated $25 million over five years to help to understand and improve those outcomes. How many schools are there across the country—10,000?

Dr Bruniges : Yes, just under 10,000.

Senator CHISHOLM: It seems to be completely inadequate to be able to deal with the challenge that parents are confronting, and kids are actually going to face the consequences of it.

Dr Bruniges : When you look at the state recurrent flows of Commonwealth funding, the flow to government schools is increasing, as it is to non-government schools. Each state will have different initiatives as well. We have to look, in a collective sense, at what each state and territory is doing. There may be different needs in different states. The Northern Territory COVID-related need might be quite different from the Victoria COVID-related need. We might see a differential need and a differential response. I note that already some state and territory governments have put in strategies—I think it's the Victorian government—around tutoring to support the catch-up of students. That was a recent announcement; they felt the need to do that because of the extended length of time for Victorian schools. Other schools, I'm sure, are putting in a range of support mechanisms for students.

Senator CHISHOLM: I will move on to bushfire and drought recovery funding. The government announced that it would spend an additional $8 million for mental health support through Beyond Blue to fund an extra 25 Beyond Blue liaison officers to work with local schools and early childhood services in bushfire-affected communities. Officers were placed in the following locations: within New South Wales, it was regions defined by local health districts—northern New South Wales, Hunter-New England, mid-North Coast, Nepean-Blue Mountains, Illawarra-Shoalhaven, southern New South Wales and Murrumbidgee. In Victoria it was regions defined by the primary health network—Gippsland-Mallacoota, Ovens-Murray and Snowy Valley. In South Australia it was Kangaroo Island and the Adelaide Hills. In Queensland it was the north and south coasts. Can the department advise which specific schools were assigned Beyond Blue liaison officers?

Ms Gordon : We'd need to take that on notice for the specific schools. I don't have that information with me today.

Senator CHISHOLM: Can you advise how many schools received liaison officers?

Ms Gordon : I'm not sure that I have that to hand.

Dr Bruniges : Perhaps we can take that on notice. My recollection is that there were 25 and I think some of them served a number of different schools. I think it was both hub and spoke but I would need to take that on notice because we work with our colleagues in the Department of Health who are already providing some places with some counselling and support and in other places there wasn't. I think I remember hearing there were a number of schools attached to some of those counsellors. But we're happy to take it on notice, if the team don't have it up there.

Ms Angus : We do have that there were 25 contact liaison officers; so that number is correct. They are working closely with local schools and early childhood services in bushfire-affected communities. But the specific schools we haven't got.

Dr Bruniges : Can I just say that what might happen is that they might be based in a high school somewhere and then servicing the feeder primary schools, for example. We'll just go back and check on that and see what information we can give you.

Ms Angus : That's actually correct. They're working across regions. They work in priority regions identified in New South Wales, Victoria, South Australia and Queensland.

Senator CHISHOLM: I think I ran through them; I think I mentioned those.

Ms Angus : Yes.

Senator CHISHOLM: How much time did the Beyond Blue liaison officers spend in the schools?

Ms Gordon : That level of detail we would also need to take on notice, I'm sorry.

Senator CHISHOLM: Are they still in these schools now?

Ms Gordon : Yes. My understanding is that they continue to support those schools. The funding is available over the 2019-20 and 2020-21 financial years but we'd need to come back to you with the detail.

Senator CHISHOLM: So the expectation is that they're still there and will continue to be there into next year?

Ms Angus : Yes. Part of the role is for them to continue to support people with the stressors that may be arising as a result of those, and that is the ongoing nature of some of that.

Senator CHISHOLM: Has the $8 million been fully expended and, if not, how much has been expended?

Ms Gordon : The Department of Health actually administers the contract with Beyond Blue because it's an extension of the existing program that they fund; so we've provided the $8 million to the Department of Health. I'd need to take on notice the extent to which that's been expended.

Senator CHISHOLM: Up to $2 million was allocated for additional school chaplains to be available for the 2020 school year. How much of that $2 million funding allocation has been spent?

Ms Gordon : My understanding is that the full $2 million was allocated. I'm not sure whether it has all been provided to schools but it has been allocated; so it would flow to schools.

Senator CHISHOLM: Where is this funding being drawn from?

Ms Gordon : I would need to take that on notice.

Senator Birmingham: It's additional in the way that you've described it in that it is in consolidated revenue or out of the bushfire recovery $2 billion or thereabouts that was allocated overall. We can take on notice to provide that detail but I would imagine that, in the way in which you have described it, it would have been out of that overall bushfire package.

Senator CHISHOLM: How many requests from state and territory governments did the department receive for additional school chaplains for this year?

Ms Gordon : I'm sorry, are you talking about how many requests for the $2 million or the overall program?

Senator CHISHOLM: Overall.

Ms Gordon : With the overall program, they each have a process of identifying schools to participate. I would also need to take that on notice in terms of how many additional schools for this year, sorry.

Senator CHISHOLM: Have those requests all been accommodated?

Ms Gordon : Each state and territory, as part of the agreement, will be aware of how much funding they have available and then they have a process for allocating the funding.

Dr Bruniges : We've got about 3,000 schools. Ms Angus is telling me that about 3,000 schools each year sign up to a project agreement enabling chaplains. Your question goes to the additional $2 million for the bushfire affected?

Senator CHISHOLM: Yes.

Ms Angus : I can provide some additional information on that. You are right; there are 3,296 schools receiving the services of the NSCP chaplain. In 2020, $1.96 million in additional funding was provided for school chaplains to support bushfire-affected states that requested additional funding support. That worked out to be 379 schools across New South Wales, Queensland, South Australia, Victoria and Tasmania, and the average funding per school was $5,181.

Senator CHISHOLM: So potentially you could provide some more information on notice on that?

Dr Bruniges : Yes. We'll take that away and see what we can give around bushfire related. Also I think we've taken on notice the source of that funding.

Senator CHISHOLM: Yes, and in what locations as well?

Dr Bruniges : Locations, yes.

Senator CHISHOLM: Will the additional school chaplains that have been assigned to states and territories be available to those states and territories in 2021?

Ms Gordon : The additional funding was available for this year, the bushfire funding. It depends on how they use their funding. That money won't be available next year but it's up to them how they wish to distribute the funding between schools. They may wish to provide for a larger number but at a slightly lower rate of funding.

Senator CHISHOLM: Or the government could give them more money? That would be the other option, I suppose.

Dr Bruniges : We've already got about $247 million over four years to continue the chaplaincy program. That's in addition to the $2 million and is a kind of recurrent flow, and that's from 2019 to 2022.

Senator CHISHOLM: But for these specific ones that were funded by the extra $2 million, there's not necessarily the funding to continue that? That would have to be made up by the other funding?

Dr Bruniges : Yes, that's right. There are 247 recurrent over the four years and there was an additional $2 million for 2020; so we would normally revert back.

Ms Gordon : In many cases that additional funding was used to extend the number of hours of existing chaplains rather than necessarily having a new chaplain. A lot of the schools that already had chaplain services used the funding to extend the number of hours because of the additional need this year because of the bushfires.

Senator CHISHOLM: The government allocated $20 million in 2019-20 for specialist circumstances funding for eligible drought-affected, non-government schools experiencing financial difficulties to help ensure the viability of these schools. How many non-government schools have requested this funding?

Ms Gordon : Bear with us for a minute; we just need to find the relevant information. On 7 November 2019 the minister announced $10 million in support and on 28 January this year that was extended to $20 million, based on the level of interest that we had in the funding. The funding targeted schools with students from the 128 local government areas that were eligible for assistance under the drought communities program. Applications were received from 250 non-government schools across ACT, New South Wales, Queensland, Victoria and South Australia.

Senator CHISHOLM: How many non-government schools have received funding under this measure?

Mr Sawade : Funding is allocated at the approved authority level. As Ms Gordon said, there were 250 schools and they were represented by 62 approved authorities or approved system authorities. In the independent sector there were 58 approved authorities that were provided funding and then four systems in the Catholic sector across New South Wales, Victoria, Queensland and South Australia were provided funding in total.

Senator CHISHOLM: So that's systems rather than actual number of schools?

Ms Gordon : It's approved authorities, which might be a mix of individual school-approved authorities or an approved system authority.

Senator CHISHOLM: Can you actually provide how many non-government schools specifically received funding?

Ms Gordon : We would need to take that on notice.

Senator CHISHOLM: How much of the $20 million has been spent?

Mr Sawade : All of the $20 million was provided to those approved authorities in February 2020. That will then be acquitted by those approved authorities when they acquit their funding for the 2020 year midway through 2021 as part of their standard reporting.

Senator CHISHOLM: So just as an example, it would have gone to the Rockhampton diocese, for instance, and then they would have allocated it to those schools that were eligible?

Mr Sawade : Correct.

CHAIR: Senator Rice, we'll go to you. Can you hear us?

Senator RICE: I can.

CHAIR: Thank you. We can hear you.

Senator RICE: I also want to follow up on the issue of funding for school chaplains but first I'll follow up on some of the questions that Senator Chisholm asked. The extra $1.96 million, you've said, went to 379 schools. Were they extra schools or were they already included in the 3,296 schools that were already receiving funding under the school chaplains program?

Ms Gordon : As I indicated earlier, my understanding is that a large number of schools used the funding to extend the hours of the current chaplains who were already working in those schools; so you wouldn't be able to just add those on. But the thing that I don't know and I'd need to take on notice is whether there were new schools that joined the program to get assistance through this additional funding but I'm happy to take that on notice.

Senator RICE: There may have been some new schools? Can I also confirm that the money is allocated by the state and territory governments?

Ms Angus : No. The program is administered—

Senator RICE: Is it given to them to then allocate to schools; is that how it works?

Ms Angus : Yes, state and territory governments administer it.

Ms Gordon : Under this additional funding those states and territories came to us to express an interest in the additional funding to allocate to those bushfire-affected schools.

Senator RICE: Was it all states that were affected by bushfires?

Ms Angus : Would you just repeat that, please, I'm sorry?

Senator RICE: I am just wondering whether it was all bushfire-affected states that actually came to you to get that extra funding.

Ms Angus : Yes. When I read the list out before, it was New South Wales, Victoria, South Australia and—I'm sorry, I'm just going to get it back in front of me. I read it out before. I'm sorry, I just realised that I'm actually able to confirm that they were top-up funds provided that were provided this year; so from the states' and territories' point of view, they were existing.

Senator RICE: I think you said Queensland as well.

Ms Angus : Yes.

Senator RICE: Was the ACT included also? Did they request money?

Ms Angus : No, I don't believe so.

Senator RICE: They were certainly bushfire affected. Can you remind me whether the chaplains program is available to government and non-government schools?

Ms Gordon : That's correct.

Senator RICE: Can you give me the breakdown of those 3,296 schools, how many are government schools and how many are non-government schools?

Ms Gordon : I think we'd have to take that on notice.

Senator RICE: This $2 million, you have said, was on top of the $247 million over four years which, on average, is $61.7 million. There are many students who want to talk privately particularly about issues related to sexuality and gender identity, which we know is a big issue in terms of young people's mental health. They tell us that they avoid chaplains, given the historic attitude of churches towards LBGTQIA people, and there has been no assurance that a chaplain would give appropriate counselling in these situations. First of all, I want to ask: either as core funding or as additional top-up funding, is there any funding which has been made available for trained non-religious counsellors in schools?

Ms Angus : To provide chaplaincy services under the program you don't have to be of a particular denomination or faith. Often, the chaplains are psychologists or other professionals.

Senator RICE: Even though they may not need to be a chaplain, they have to be associated with some faith, don't they?

Ms Angus : That's right. They have to be associated with the program, but they don't have to be of a particular faith or, in fact, have a faith.

Senator RICE: But the definition of a chaplain is that they are faith-related. You do not have secular chaplains. You have secular counsellors.

Ms Gordon : Under the program, the organisations that deliver chaplains are required to have a faith affiliation. They may choose to employ individuals who are chaplains under the program who may not be a religiously affiliated individual.

Senator RICE: Do you have any statistics about how often or how much that occurs?

Ms Gordon : We don't have that information. The program does require those participating as chaplains to have some certification and credentials to support their work. I don't have it to hand, but they are required to have, as I understand it, a cert III certification to be able to be part of the program.

Senator RICE: A cert III—

Ms Gordon : I don't have it to hand. I might see if one of my staff might be able to send it to me while we are talking.

Ms Angus : A range of training is required. In 2019, all states and territories complied with the project agreement and the project requirement has a number of requirements. Those requirements include things like 'chaplains must have completed professional development training to better support students who have experienced cyberbullying' as a particular element.

Senator RICE: Can you tell me exactly what professional development training that is—what is the definition of that? That could just be a two-hour online module.

Ms Gordon : We might need to take this on notice. We don't have the detail to hand. I don't want to mislead you in trying to answer these questions.

Senator RICE: I would appreciate that. Perhaps you could also take on notice what information you have about how many chaplains are employed who are not people of faith.

Ms Gordon : Yes.

Senator RICE: You have given me the example of organisations who employ secular counsellors. However, can I also confirm that no funding is available for trained nonreligious counsellors and that, basically, all of this funding has to go through those faith based organisations?

Ms Gordon : Under this program, that's correct.

Ms Angus : Under that program, yes.

Senator RICE: What actions are being taken? You're going to get back to me about what level of qualifications these contractors have to have; I am very interested to hear that because I want to know what training and qualifications they have that would make sure they are not potentially, for example, encouraging LGBTIQA+ students to consider informal conversion practices.

Ms Gordon : We can include that in the information we provide on notice.

Senator RICE: Are you taking any actions currently to ensure that's the case?

Ms Gordon : The program itself is administered by state and territory governments—

Senator RICE: But it's federal—

Ms Gordon : Yes, under the partnership agreement that we have with them. But the arrangements with the organisations that administer the program and deliver the chaplain services in schools are with the state and territory governments, so they are the ones that have the responsibility to ensure that it is being appropriately administered under the agreement.

Senator RICE: Do you have any oversight of that? Do you have to sign off on those arrangements?

Ms Angus : The states and territories have signed the project agreement, which provides the funding, and that includes the requirements.

Senator RICE: So does the project agreement go to any issues about ensuring that these chaplains are not informally encouraging conversion practices?

Ms Angus : Under the project agreement, states and territories are required to ensure that participation by schools and students is voluntary; that chaplains may be of any faith; that they are not permitted to proselytise; that they must respect, accept and be sensitive to other people's views, values and beliefs; that they must comply with state and territory child protection laws and policies; that they must meet minimum qualification requirements, including completing professional development training; and that they must respond to cyberbullying, which I mentioned before. In 2019, all states and territories complied with the project agreements.

Senator RICE: You have said 'not proselytising'. There would be a lot of people of faith who would say that discouraging people from affirming their gender identity wasn't proselytising. Is any auditing done of the level of compliance with these guidelines?

Ms Angus : On the nature of the auditing, I would have to come back to you with more specific information. But all states and territories complied with the project agreement in 2019. So, yes, for 2019, they all complied.

Senator RICE: They all complied, but the federal government hasn't done any audits to see just what that looks like.

Ms Angus : No. That's not what I said. I said that I am not sure exactly what the form and function of the auditing was. We would need to come back to you with the detail on that.

Ms Gordon : We do require states and territories to provide reports to us as well about the operation of the program.

Senator RICE: Are all the guidelines or arrangements that the states and territories have operational within their states with particular schools on the public record?

Ms Gordon : I would need to take that on notice. I don't know the answer as to whether their agreements are publicly available.

Senator RICE: Please take it on notice. In any case, I would like you to take on notice tabling those agreements. Finally, is the federal government concerned about the risk of informal conversion counselling, given how much we know about students who are struggling with their sexuality or gender identity and the fact that the conversion practices that are of most concern are not out where they are very highly focused; they are informal practices. Some conversations are suggesting to students that they want to go down that track. Is this an issue of concern to the federal department?

Ms Gordon : We're not getting feedback to suggest that that is occurring in any widespread manner; I would need to check about complaints. As far as I am aware, we haven't had complaints that that is occurring. States and territories are required to have a complaints-handling process in place as well. If you're aware of any circumstances or any examples, we would be very keen to hear about them in order to follow them up. But certainly, if we become aware of certain instances, we would raise them with the relevant state or territory and see what was happening. But I am not aware of any particular examples where that is happening.

Senator RICE: Do you have oversight of those? Do you have complaints forwarded to you, or is it just the states and territories—

Ms Gordon : Under the agreement, I understand that there is the requirement for a complaints-handling process, so they are required to have something in place to allow for that. Obviously, sometimes individuals might provide a complaint directly to the Commonwealth; I am not aware of our having received any such complaints.

Senator RICE: What I want to know is: if there's a complaints process in place at the state and territory level, would you then see those complaints, or is it all handled at the state and territory level and you don't have oversight of those?

Ms Gordon : We wouldn't necessarily be made aware of the individual details of individual cases of complaints, for privacy reasons and other reasons, but I understand that part of the reporting that comes back to us from states and territories is an overview of the level of complaints. But I would need to take that on notice and come back to you about what that process looks like and the level of reporting back to the Commonwealth.

Senator RICE: Please do that, as to what the reporting back to the Commonwealth is. Also, please take on notice any information you have about the level and nature of those complaints.

Ms Gordon : We're happy to take those on notice. I'm sorry that we haven't been able to answer all of your questions at this point, but we'll come better prepared next time.

Senator RICE: Thank you.

Senator KENEALLY: I have some questions around the 2020 Prime Minister's Spelling Bee competition. My first question is to confirm that the competition has been cancelled for 2020.

Ms Angus : That is correct. It has been delayed to 2021.

Senator KENEALLY: Can you advise me about how much of the News Corp Prime Minister's Spelling Bee website grant of $345,240 has been paid to News Corp Pty Ltd to date?

Ms Angus : The total amount has been paid and the money has been acquitted.

Senator KENEALLY: Have the grant contract terms been amended, given that the 2020 spelling bee has been cancelled?

Ms Angus : It has only been postponed. It hasn't been cancelled; it has just been pushed back.

Senator KENEALLY: Does that change the grant contract terms at all?

Ms Angus : The money has been expended and it has met the accordance of the agreement, which was setting in place the resources and the website and the development work; so they've met the terms of the contract.

Senator KENEALLY: So they have done what you asked them to do.

Ms Angus : That's right; they've acquitted the contract, as required.

Senator KENEALLY: Will you use that work for the spelling bee in 2021, or will you go to a new grant and build a new website?

Ms Angus : The establishing of the resource and the building of the platform, et cetera was expected to be an ongoing thing, so we would anticipate that that would be used in 2021.

Ms Gordon : Just to clarify, this is a News Corp initiative that we have provided some funding towards. It's not an Australian government initiative, but it's obviously with the support of the Prime Minister.

Senator KENEALLY: But it has been deferred. You've agreed to it being deferred to 2021, I presume?

Ms Angus : I think it was originally scheduled to have happened in May. Yes, there must have been agreement.

Ms Gordon : We would need to take on notice the form of that agreement and the process that was gone through.

Senator KENEALLY: It's a News Corp project, not an Australian government project, but done with the support of the Australian government and, you have just indicated, the Prime Minister. Who has carriage of the funding and the contracting? Is it your department, or Prime Minister and Cabinet?

Ms Gordon : I should be a bit more specific. Obviously, the Prime Minister agreed to use the 'Prime Minister's Spelling Bee', but the contract and the support have been provided by the department of education.

Senator KENEALLY: To go back to my question earlier, it has been deferred to 2021 and presumably you have agreed to that; you'll take that on notice.

Ms Angus : I can provide you with that advice now. Yes, a decision has been made to postpone it until March 2021 and further postponement of the spelling bee and discussion of the agreement—changes were required—has occurred. As I said, they financially acquitted, which acquittal was received at the end of September. That acquittal shows an overspend which News Corp have confirmed they will absorb themselves.

Senator KENEALLY: What were the deliverables for the contract?

Ms Angus : The program was to provide a free annual online spelling bee competition for Australian school students in years 3 to 8 across all states and territories. The objective of the spelling bee was to promote and encourage literacy in schools. It was to be hosted by News Corp Australia Pty Ltd, and the grant was to cover the cost of the technology build for the spelling bee. News Corp Australia will bear the costs of ongoing operation, support and promotion of the spelling bee. The purpose of the original funding was as an establishment contribution.

Senator KENEALLY: Just remind me: has this been run online before, or was this to be the first time?

Ms Angus : This was to be the first time.

Senator KENEALLY: Why did an online spelling bee need to be cancelled during the COVID-19 pandemic?

Ms Gordon : As you'd be aware, the education sector was experiencing significant disruption at the time, so a number of initiatives were postponed, cancelled or delayed, even if they weren't directly impacted by COVID, because schools and teachers particularly were essentially adjusting to home based delivery of online learning.

Senator KENEALLY: To moving online.

Ms Gordon : It is online, but it's difficult really.

Senator KENEALLY: They've had to adjust to being online. I guess I'm curious as to why an online spelling bee had to be cancelled, since everything was going online.

Ms Angus : I think originally the conversation was whether it could be pushed back until later in the year, so perhaps to term 3 or 4. But, as Ms Gordon has already indicated, a fair amount of adjustment was happening in the school space and, to get the best possible outcome, postponing it until next year was thought to be the best way of supporting that initiative.

Senator KENEALLY: I'm sorry, Ms Gordon?

Ms Gordon : I was just going to say that it's the same thing with NAPLAN online; that was also scheduled for May and it did not proceed. Education ministers took the decision across the country for that not to occur.

Senator KENEALLY: I get NAPLAN, but are teachers actually using the spelling bee as a teaching tool? Why couldn't News Corp just go ahead with its own spelling bee? If kids wanted to sign up, they could sign up, presumably. Is it being used in the classroom as a teaching tool?

Dr Bruniges : I'm sure spelling is being taught in classroom; I would hope it is.

Senator KENEALLY: I'm just trying to understand why—

Senator Birmingham: I think there are quite a number of these sorts of competitions across maths, spelling and other spheres that are sometimes run by universities and media outlets. Usually, in terms of the execution of them at the student level, they are more school based than home based. In terms of the school encouraging some of their best and brightest to participate and celebrating those successes in the school environment, officials have taken on notice some of the details or otherwise around the decision not to proceed at that time this year; but I can imagine that many of those sorts of school extracurricular activities tended to be deferred.

Senator KENEALLY: I thought this was meant to be up and running, though, by March 2020.

Ms Angus : Perhaps I can provide some further clarification for you.

Senator KENEALLY: Yes.

Ms Angus : The original design was that it would be integrated into the kids' news website and provide access for years 3 to 8 in the classroom. The spelling bee itself has several different levels; and the concept design was for that to occur or for participation in the spelling bee at school online, but it would be supervised by teachers. There was an expectation that it would be a classroom based activity rather than completely online, so the winners at a class level, state level and national level would kind of accumulate.

Senator KENEALLY: It was meant to be up and running by March 2020. When was the decision made to defer it?

Ms Angus : It is my understanding that it was in May, but I haven't got that in front of me to confirm it for you.

Senator KENEALLY: Can we try to get to the bottom of that? It just seems odd that something that was meant to be happening before schools had even shut down had to be deferred because of COVID.

Senator Birmingham: Ms Angus thinks it was May. You think it was March, do you?

Senator KENEALLY: I think the website actually said that it was going to be in March, but let's see if we can get to the bottom of that.

Ms Angus : The delay was directly in response to the pandemic restrictions, so that was the basis on which the decision for deferment was made.

Senator KENEALLY: The website also said that 'lots of students and teachers were already registered'. Do you have any idea of how many students or how many teachers were registered?

Ms Angus : No, I'm sorry. I don't have that information in front of me.

Senator KENEALLY: Have the registrations and the student data from the now cancelled or deferred competition been deleted?

Ms Angus : I'm sorry; I don't have that level of detail. My assumption is that they would have been registering with the website that News Corp held—

Senator KENEALLY: Would they be registering through their school? Could the school have handed out the forms or directed them to the website? Would they have done it in school?

Ms Angus : I'd have to take that on notice to give you more detail. I'm sorry; I just don't have that level of detail—

Senator KENEALLY: Would parents have had to have given them permission to register?

Dr Bruniges : Sometimes that all depends on the age of the child. It's a bit like premiers' reading challenges and so forth that we're all familiar with, where parents actually do register in terms of challenges or spelling bees. If it goes from year 3 to 8, I would imagine the younger students' parents might be involved. But we're happy to take that on notice and get the detail.

Senator KENEALLY: I'd be really interested to know how students are registering, if they're registering through the schools, particularly if it was designed to be an in-classroom pedagogic exercise. I am interested in knowing if the registrations have been deleted and who is responsible for either protecting or destroying that data.

Ms Angus : Certainly. We'll take that on notice.

Senator KENEALLY: Do you know if News Corp engaged subcontractors for that work, the website—their contracted work?

Ms Gordon : Based on the discussion that we had at the last estimate hearings, the code was a subcontractor issue, so I think the answer to that is yes. I'm not sure of the extent to which they've subcontracted the work or the operation of it.

Senator KENEALLY: I'm quite interested in whether the department, News Corp or a third party is responsible for protecting, storing or deleting the students' data.

Ms Angus : We're certainly happy to take that on notice and come back to you.

Senator KENEALLY: Thank you. Will extra government funding be required to hold the postponed spelling bee in 2021?

Ms Angus : The original grant was a one-off payment. I'm not aware that we've received any further requests for support.

Ms Gordon : I'm not aware of any requests.

Senator KENEALLY: It's my understanding that all subcontractors do have to be disclosed under the terms of a simple grant contract with the department; is that correct?

Ms Gordon : I'd need to take that on notice; I'm sorry.

Ms Angus : Do you mean publication? That's managed through the grants hub. Is that what you mean: the publication of who is the recipient of the grant?

Senator KENEALLY: Yes.

Ms Angus : Yes, it would be normal practice for it to be published.

Senator KENEALLY: I don't have a copy of that contract here in front of me, but I'd be keen to know if you have all those subcontractors disclosed and, as I've said, in terms of the responsibility for protecting, storing or deleting the data, who has that responsibility.

Ms Angus : I can provide you with the advice that grantees must ensure that all systems, services and online product purchases developed or provided by a subcontractor third party meet the information technology security requirements; the information must be hosted and maintained onshore; and the department has the capacity to request an independent assessment to ascertain the security of proposed system services and online products. If there are any security incidents or cybersecurity incidents in relation to the systems, the grantee is required to report those immediately they occur.

Senator KENEALLY: I appreciate that you have taken on notice the question about what we're doing in this context where students have registered. They may have registered at the urging of their teacher or under a direction in the classroom—I don't know—but, now that this event is not going ahead, or even if it did go ahead, what happens to their data after it's done? Also, really, what kind of data do they have to provide to register?

Ms Angus : I'm sorry; we'll have to come back as part of that response.

Senator KENEALLY: Is there anything in the simple term grant contract or in the agreement with News Corp that talks about whether or not the data that they've collected can be used for other purposes, such as commercial purposes or targeted advertising?

Dr Bruniges : I think, in those common grants in the guidelines or contracts, there'd be standard clauses that we are asked to use around those aspects. So we'll go and check. As I said, I don't have a copy of the contract here either. But, under procurement rules, there are certain clauses that we must have that would go to privacy issues and so forth. We'll take that on notice and get back to you.

Senator KENEALLY: Thank you; I appreciate that. You mentioned the kids' news website. I must confess, as the mother of now grown adults, I haven't looked at the kids' news website in recent times. Does it have paid advertising?

Ms Angus : I'm sorry; I don't have that information.

Senator KENEALLY: Right. There's a lot that we don't know about this. Does the department have any process that it would usually use to determine that no third party's interests would be affected by the making of the grant to News Corp?

Ms Gordon : As the secretary pointed out, we do have standard clauses that go to IT and privacy and security issues. I just don't have the detail of those in front me to be able to give them to you, but we're very happy to take them on notice.

Senator KENEALLY: I get it. My kids participated in science competitions at UNSW through their public school. It's not that I don't see the value in it, except there's a difference between a university and a for-profit company. It is about the extent to which we've entered into an agreement where we're essentially directing children to go to a for-profit company perhaps to be exposed to advertising by their advertisers or have their data collected and the extent to which we've given this for-profit company taxpayer money to make this all happen. I'm just very interested in the range of questions that I put to you today, and I look forward to your answers. Thank you.

Ms Gordon : Thanks, Senator.

Senator KENEALLY: Thanks, Chair.

CHAIR: If there are no further questions, I would like to thank you for coming along. You are free to go, so you are released. Thank you very much. I now call forward representatives from the Australian Curriculum, Assessment and Reporting Authority, who I believe are attending via videoconference.