Kate Ellis (Adelaide, Australian Labor Party, Minister for Employment Participation and Childcare) Share this | Hansard source

in reply—It is my great pleasure to commend the Family Assistance Legislation Amendment (Child Care Rebate) Bill 2011 to the House and to thank the members of the House for their contributions to the debate today. This is very good legislation. It is very important legislation and it is legislation which will help the lives of families right across Australia. This bill will, for the first time, enable families to access the childcare rebate no later than fortnightly. This bill delivers upon our pre-election commitment taken to the families of Australia just last year, 2010. As a result of this bill we know that around 700,000 Australian families will be able to receive this essential assistance at the time that their childcare fees are due.

Importantly, many families will be able to receive this payment weekly because the majority of childcare centres submit attendance information weekly. From July this year families will have the choice of four options for receiving the childcare rebate. Families will be able to elect to have their childcare rebate payment made to their childcare service fortnightly, at a minimum, on their behalf as a way of fee reduction; they will be able to elect to receive their childcare rebate payments direct to their bank account fortnightly at a minimum; they will be able to elect to have their childcare rebate made into their bank account quarterly, or they will be able to have their childcare rebate payment made annually as a lump sum payment.

By providing families with these choices the Australian government is ensuring that families have significantly more flexibility to manage their childcare costs within their family budget. For the first time childcare services will be able to receive the rebate on behalf of families, delivering a direct fee reduction for those families that elect this method of payment. We know that families will welcome this option—98 per cent of families currently choose to receive childcare benefit this way.

To ensure that families do not accumulate any unforeseen debts as a result of overestimating their income, this bill also contains amendments to temporarily withhold 15 per cent of each rebate payment for families receiving a higher than zero rate of childcare benefit. This is consistent with the current arrangements for quarterly childcare rebate payments, where the final quarterly payment can be used to offset any childcare payment debts incurred by a family.

The measures outlined in this bill today build on the government’s impressive record of improving the affordability and quality of early childhood education and care. We have committed more than $18 billion over four years in funding for early childhood education and child care. This is more than twice the amount provided in the last four years of the Howard government. In 2008 we delivered on our election commitment to increase the childcare rebate from 30 t 50 per cent of out-of-pocket costs—from a maximum of $4,354 to $7,500 per child per year. Under the Howard government families could only claim a maximum of $4,354 per child per year—some 72 per cent less than under the Gillard Labor government. What this means is that since 2004, out-of-pocket costs for families earning $75,000 have reduced from 13 per cent of their disposable income to seven per cent of their disposable income in 2010.

We have also increased the frequency of childcare rebate payments to families from yearly to quarterly. Under the Howard government, families had to wait until the end of each year to receive assistance with their childcare fees. Overall we are providing $14.9 billion to help 800,000 Australian families annually with the cost of child care through the childcare benefit and the childcare rebate. This includes $8.7 billion over four years to 2013-14 to reduce childcare fees for low-and middle-income earners under the childcare benefit and $6.2 billion to assist working families with out-of-pocket childcare expenses under the childcare rebate.

When it comes to improving the affordability of child care our record stands head and shoulders above all others. Our government understands that child care is an essential enabler to parents—and particularly to women’s participation in the workforce—but we also know that when parents drop their children off at care they need to know that they will be safe and that they will be well looked after during the day. That is why we are working with the states and territories to roll out the national quality framework, which will deliver better staff-to-child ratios so that each child gets more individual care and attention. And it will boost the staff qualification requirements so that our dedicated childcare workers can better lead activities that help kids to learn and develop.

These are major reforms which will have a dramatic impact on the future health, learning, and social development outcomes of children right across the country. However, we also recognise that parents needs to be able to manage their care costs in what are, for many, very tight family budgets. We have already made massive inroads to ease this pressure and through this measure outlined in this bill we will give 700,000 Australian families real assistance with child care at the time that they incur those childcare fees.

The Australian government has an unapologetically ambitious agenda to improve access to affordable, quality early education and care for Australian families. This bill represents another massive step towards achieving this worthwhile goal and I commend it to the House.

Question agreed to.

Bill read a second time.

Message from the Administrator recommending appropriation announced.

See this speech in context