Jane Prentice (Ryan, Liberal Party) Share this | Hansard source

I rise to speak on the Early Years Quality Fund Special Account Bill 2013. Any piece of legislation introduced in this House in the area of childcare policy needs to have the express aim of improving the industry for providers and workers. It must ensure that child care is more affordable, more available and more flexible to the needs of Australian parents which, in turn, could improve workplace participation rates. Ultimately, it is about ensuring that a child is receiving the best, positive early experiences during their most critical period. Unfortunately, the Early Years Quality Fund Special Account Bill does not have any relevance whatsoever to these goals. It neither addresses any underlying problems in the sector and nor does it genuinely improve wages and conditions for workers.

This bill proposes to provide for a $300 million fund, over two years, to set up a special account to administer the Early Years Quality Fund to cover pay increases for some childcare workers. The government has proposed a two-year fund, with $135 million in the first year and $165 million in the second year. To qualify for funding for their employees, childcare providers enter into enterprise bargaining agreements, EBAs, and apply to a seven-member childcare advisory board, which will then determine who receives the funds. The explanatory memorandum states that these funds have the very laudable but lofty aim to retain qualified hardworking professionals in the sector and to reduce the numbers of educators leaving the sector overall. However, there are several very important concerns about this bill: the way it operates and, importantly, the way in which it affects providers and workers in the childcare sector.

The Senate Education, Employment and Workplace Relations Legislation Committee conducted an inquiry into this bill and reported on 17 June 2013. The coalition senators of the committee published a dissenting report to highlight many of the concerns that we have and to highlight the concerns that stakeholders raised throughout the committee process. The Labor government introduced the bill into the House on 30 May 2013 and it was referred to the Senate committee that day. With their focus always on the latest leadership challenge rather than on proper governance, this gave stakeholders only six working days to make a submission. Fortunately, more than 62 individuals and organisations used that opportunity to note their opposition to the many stark deficiencies in this bill. As coalition senators remarked in the opening of their dissenting report:

Coalition Senators consider this bill to be among the least meritorious pieces of legislation put by the Government in the 43rd Parliament. It proposes and promotes inequality in the workplace, and in doing so, creates division and workplace disharmony.

That is a very blunt assessment of this bill. However, these comments are justified for two main reasons: firstly, the fund is a short-term fix which does nothing to foster real long-term wage growth in the early childhood sector, while many employers and employees are left out; and, secondly, this is a blatant attempt to favour unions and to increase unionisation within the workforce.

Important questions remain as to how many childcare workers will actually be covered under this fund. The United Voice union have been campaigning since 2008, with requests for wage increases ranging from $7 to $10 an hour. Their proposal was that the government fund the increase in full, to the tune of $1.4 billion per year and indexed afterwards. The proposal before us today is a far cry from that figure. It is only $300 million, which ceases after two years. Therefore, as the Senate committee has noted: 'Only up to 40 per cent of the workforce would be eligible for a wage increase.'

The primary problem with any increase in wages as a result of this bill is that it will not be targeted in such a way as to increase quality. Providers are already struggling to comply with the National Quality Framework, due to come into effect on 1 January 2014, and to ensure that they have the required number of qualified educators. I have heard already from long day care providers in my electorate who are concerned that they simply will not cope with further changes to the childcare system. They are worried about more red tape, more boxes to be ticked and more vague procedures to be followed.

I do note that at this stage the specific grant guidelines have not yet been determined, meaning stakeholders cannot determine whether the guidelines are in any way fair or reasonable. Instead, it appears that funds will be allocated on an ad-hoc basis to those who are able to submit a grant application to the 'advisory board' faster than another provider. Those who do not submit quickly will miss out, which will only result in differential wages for similar work between different centres. Furthermore, the grant is payable only to those working in long day care. It will not benefit those working in preschools, family day care, out of school hours care or other types of early childhood care or education. This creates division between workers at different providers and potentially even division between childcare workers at the same provider but in a different category of child care.

As the Chief Executive of the Child Care Centres Association of Victoria noted, there is the potential to distort the market locally—for example, where there are only two centres in an area, such as in a regional town. If one centre receives a grant, if for no other reason than it manage to submit the paperwork faster than another provider, how is a community supposed to perceive these changes to wages? Parents certainly cannot base their determinations on either the quality or the true affordability of the centre because it is receiving supplementary government funds. I expect such discrepancies to result in post-hoc disruptions across the country whereby employers deliberately poach the employees of another provider, further reinforcing a two-tiered system between those who do receive the government funds and those who do not.

In many submissions to the committee, concerns were raised about what might happen to those centres who do not receive grants. Given the relative mobility of childcare workers, will all providers now have to immediately offer a higher pay rate in order to keep staff, and then try to absorb those costs without passing them on to parents? The usual course for increases in wages arises through rulings of the Fair Work Commission, established by this government with responsibility for determining appropriate and fair levels of remuneration. I do not dispute that childcare educators are often low paid and that they are struggling, as are childcare providers. It is worth noting that unions, including United Voice, have refused to lodge a wage claim with Fair Work.

Relying on government funds to top up wages means, in this case, that $300 million is allocated for only the next two years. The question then is what will happen to the wages of employees once the funds run out. Providers will face the very tough decision of having to in fact reduce the wages. I expect, however, that many of those in the unions will be relying on providers and management maintaining their nominal wages rather than dropping pay rates. This would only create further tension in the workplace and providers will be forced to source those funds elsewhere. Often the only way that childcare providers can do this is by passing on the costs to the parents, who are already struggling with skyrocketing childcare costs. This is not a desirable outcome for providers, their employees or parents who use childcare services.

One of the central tenets of this bill is that employees in the childcare sector will only be eligible for a grant if they are covered by an enterprise bargaining agreement. At present, according to the Department of Education, Employment and Workplace Relations, only 20 per cent of providers currently have an EBA with their employees. This is reflective of the way in which this market operates. Often a provider may run only one or two centres with a small number of employees, where an EBA is not necessarily the most appropriate workplace structure. There will be cases where this is an EBA which covers not just long day care workers but also those in preschools, family day care, out of school hours care and others, and then all workers may have to vote for an amendment to the EBA to cover wage increases for only the long day care workers. Those other workers will be rightly wondering why they are being asked to approve wage increases for others when they themselves are not deemed worthy of a pay rise. As the coalition senators have noted, such a ballot being required would only involve great 'cost, inconvenience, confusion, anger, disappointment and ultimately disputation' and would only promote disharmony between the employees.

However, unions such as United Voice have used this bill as an opportunity to launch an orchestrated campaign to encourage workers to unionise, even when the unions know that there is no guarantee of a wage increase for those who join. The union has made other spurious claims, including telling workers that if they do not sign up their colleagues will not receive a pay rise or that joining will guarantee a pay rise. This led the Department of Education, Employment and Workplace Relations to write to United Voice in April this year to remind them that 'union membership is not a prerequisite to potentially receive a pay rise'.

When appearing before the committee, Mr Michael Crosby from United Voice admitted that legislating and funnelling a wage increase through EBAs will benefit his union. He said:

Any enterprise agreement helps unions to sign up members, there is just no doubt about that … Every enterprise agreement we do starts off with a message to workers to join the unions … I heard this attack, and I saw it in the Australian yesterday, that we are using this to sign up workers. Of course we are.

Every worker has the right to voluntarily join a union if they believe it will serve their interests. What I strongly object to is this Labor government introducing legislation that serves only the interests of the unions and not their members. As I have said, in this case the vast majority of workers will not see a wage increase whether they join the union or not.

It is therefore unsettling to see evidence in submissions to the committee about intimidating behaviour from the union and its members. The Australian Childcare Alliance, or the ACA, informed the committee:

Many of our members have reported that … union activity has been intimidating to both themselves and their staff. Our members around Australia have been advising us of the strong arm tactics of the United Voice Union organisers who have been telling members that they must have 60 per cent plus membership to engage with them to submit the Enterprise Agreement.

The ACA also indicated its concern that United Voice may have breached privacy laws in making public information about approved providers and educators:

The ACA President has had a photo of her home posted by a union organiser on the Big Steps Facebook Page with disparaging comments and also on the same organiser's personal Facebook page and her personal email address advertised to the general union membership.

Any breaches of privacy or the targeting of individuals are not acceptable. I note that the union involved has not apologised for the actions of its members.

The coalition recognises the importance of affordable child care to help Australian families meet increasing cost-of-living pressures, especially as the need for a second income has become more important for more Australian families. We support improved standards and conditions for early childhood educators to ensure quality care is provided to all Australian children, but we are very mindful that child care must also be affordable. Ultimately, this is a poorly designed and inequitable proposal which will have a far-reaching negative impact on the sector. The coalition opposes this bill.

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