House debates

Wednesday, 17 March 2021


Family Assistance Legislation Amendment (Early Childhood Education and Care Coronavirus Response and Other Measures) Bill 2021; Second Reading

6:25 pm

Photo of Matt ThistlethwaiteMatt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Assistant Minister for the Republic) Share this | Hansard source

If there is one thing that is certain, it is that child care costs are out of control under this Morrison government. They've been increasing, and, in many capital cities throughout the country, child care is now more expensive relative to when this government came into office. It's a handbrake on economic security for families and it's a handbrake on productivity and growth in our economy, but, more importantly, it hampers the ability of kids to get access to early childhood education.

This bill, the Family Assistance Legislation Amendment (Early Childhood Education and Care Coronavirus Response and Other Measures) Bill 2021, makes some technical amendments to the operation of the COVID related legislation that was brought in earlier last year. It clarifies the circumstances where the secretary can declare an emergency or a disaster event and make business continuity payments, therefore retaining those payments as an ongoing policy response available to the government. It also removes the legal requirement for services to send weekly session reports to the department during these emergency events and extends the tax return deadlines for 2018-19 to 31 March 2021 to provide more time for people who have not lodged their returns during the pandemic.

Of course, we're supporting sensible changes such as theses. But the Morrison government certainly didn't do everything right and didn't get everything right in the early learning sector during the COVID-19 pandemic response last year. Their 'free child care for everyone with a job' policy, like most announcements from this government, sounded good but it wasn't quite what it seemed when it came into operation. The main feature of that so-called free childcare system was that a number of people were locked out of child care and a number of services were driven to the brink of collapse. I heard from early learning centre operators in my electorate and Labor heard from operators around the country who were struggling to keep their doors open after they found out that the reality of that system was that their funding had been cut. They couldn't offer new places and they couldn't take new kids to cover that loss and that shortfall, yet they had to remain open and, of course, they had continue to provide the number of educators, keep the centre running and meet those additional costs. Services found that they were cutting hours. They had to cut staff and cut places to try and balance their books. Family day care educators didn't suffer a drop in enrolments, but they were expected by the government to work for half the pay because they couldn't access JobKeeper payments. So it wasn't just the service operators that suffered but family day care educators as well.

Families were being denied places, including healthcare workers who had been asked to come back early from maternity leave to help with the crisis but were missing out on getting places. It seemed that some Australians were more essential than others. Another key feature was the government's exceptional circumstances fund which they set up to cover the one-third of early educators not covered by JobKeeper and which was exceptionally good at refusing to approve funding applications. The latest data from the department showed that only 39 per cent of applications were approved. The government boasts that 98 per cent of early learning services stayed open during the COVID crisis, but does the government know how many of those 98 per cent of services suffered massive financial losses and have really struggled to make those losses back? The government's own limited survey found that a quarter of the services were not financially viable and were losing money every day. It's no wonder the sector seriously struggled to deliver that free childcare commitment when they were being expected to do it with a lot less funding.

Naturally, the government's response was to blame the providers. They sent strongly worded communications to providers threatening their funding if they didn't provide enough places and hours, when they knew that they weren't funding the services to do so. Incredibly they set up a new hotline and encouraged families to dob in early learning providers. What was the government's response to the mess they made with their underfunded and poorly targeted policy? It was to snap back to the old, confusing, expensive childcare subsidy system. We all know that you only need to talk to a parent, particularly in the capital cities, to find out the exorbitant cost of child care, and the fees keep rising and rising and rising. For working families, we all know that wages aren't increasing, but the one area where we know that there has been price inflation is around early childhood education expenses. In some areas, the fees are out of control. Only 2½ years into their new system, the benefit has been entirely eroded for many Australian families.

When the Prime Minister introduced this system, he dubbed this a once-in-a-generation reform and promised that it would make child care more affordable, yet ABS data shows that, for parents in Brisbane, Sydney and Darwin, child care is now more expensive than when the system was introduced in mid-2018. So that promise, that commitment, has been completely blown out of the water by the Australian Bureau of Statistics and the data that shows that it's now more expensive than under the old system. Childcare fees have soared by 36 per cent across Australia since the election of the government in 2013. We know that that is an inhibitor to families getting the support that they need to ensure that people can return to work after having a child and continue to remain in work to support their families and also to ensure that we're growing our economy and that we're more productive, particularly when it comes to women.

We know that, because of the way the system works at the moment, there's a disincentive for families, particularly women, to work a fourth or fifth day while using child care. Many mothers that I've spoken to in my electorate over the course of the last couple of years have said that, when they sit down with their partners to do the sums and work it out, that fourth and fifth day is simply not financially viable, because all of the money that they earn on the fourth and fifth days is going to pay the childcare fees because of the way the cap operates on the amount of the subsidy that can be accessed by families. That is a handbrake on productivity. That is a handbrake on growing our economy and creating more jobs, which would enable us to reduce the unemployment rate, put more people in employment and, ultimately, grow the economy so that there's a bigger pie for all to share and so that you can talk about reducing taxes and other regulatory payments and have businesses thrive. But, under this government's system, there's a built-in disincentive to that occurring, and it is harming our nation's economic growth and productivity.

The other point about this sector is that workers in the sector are undervalued by this government and have been so since they came to office. Anyone with kids knows that you'll often drop your kids off at eight o'clock in the morning when you go to work and, when you come back at 5.30, those childhood educators are still there. They're still working, looking after your kids when you come back, after hours, to pick them up, yet you can bet your life that, on average, that childcare worker is earning less than the parents that drop them off. Historically there's been an undervaluation of this profession and its value to our community and our society by this government. We haven't recognised that there's a deeply emotional element in caring for children and that there's a deeply positive element in ensuring that kids get access to education at an early age. All of the studies throughout the world—and so many have been published—indicate that the earlier you begin educating a child in a systematic way and begin that important social interaction with other children and adults in a learning environment the better the educational outcomes will be, the longer they will stay in school and the more likely they will be to take on tertiary education, get into a trade or university and, ultimately, get into a better job and earn more income and be more productive for the Australian economy. Yet we don't recognise the value of those that provide that structured education and that social interaction. The teaching that they provide to children has not been valued by our society, and that's particularly the case under this government.

That's why Labor went to the election pledging a policy that recognised the value of the work performed by childhood educators and promising to fund an increase in their wages—to basically fund from government support an increase in the wages of people working in this sector—to finally say that this parliament values the work that you do, appreciates the work you do and, importantly, understands its value to our society and economy and ensures that you are paid more for that work. Do you think the Liberal government, the Morrison government, would ever do anything like that? Certainly not. Do you think this Liberal government would ever countenance saying to the Fair Work Commission in the minimum wage case or in any other case: 'You know what? We value the work of early childhood educators. They're underpaid and we believe they should be paid more'? We've got Buckley's chance of that submission ever being put to the Fair Work Commission by the Morrison government or by any other Liberal government. In that it's deeply fair to say that this government does not value the work that early childhood educators do. If they did, they'd ensure that they're paid more, as Labor was promising at the last election to do.

Not only is this an issue that's very important for working families and individuals, particularly women—it's a key issue in income equality, it's a key issue in women's participation in the workforce and it's a key issue in ensuring women get access to the rights and opportunities that men get; it's an issue of national significance to our economy in growing productivity. We all know that the more access that working families get to work, particularly women, the more productive they are going to be. Their earning capacity increases, and the nation benefits. But there's a built-in disincentive in the system as it works at the moment, and it's specifically in the childcare subsidy cap, which, as I said, discourages work on the fourth and fifth day because it makes it financially unavailable. It means that parents cannot afford to have a child in day care or in early childhood education four or five days a week. It doesn't add up for the family, so why would you do it?

That's why Labor has announced a policy—and Anthony Albanese has been so strong on this—as a budget reply last year to scrap the $10½ thousand childcare subsidy which sees women in particular losing money for extra days worked. We're also pledging to lift the maximum childcare subsidy rate to 90 per cent so that working families get better support to ensure that they can work the hours that they need to and want to. We're also pledging to increase the childcare subsidy rates and taper them for every family earning less than $530,000. Overwhelmingly, 99 per cent of families in Australia will benefit from Labor's policy. Fees will come down, access will be increased, families will get access to the days that they need, workers will get more access to work and grow income, productivity will improve, the economy will grow, more jobs will be created. It's a simple equation. If Labor's policy is implemented, the economy and workers and families and, importantly, children, will be better off.

The ACCC will be tasked with designing a price regulation mechanism to shine light on costs and fees and drive them down for good. The Productivity Commission would also, under a Labor government, conduct a comprehensive review of the sector with the aim of implementing a universal 90 per cent subsidy for all families. That's Labor's plan for cheaper child care. It represents consultation with the industry, with early childhood educators, with families and with operators to ensure that families get access to the hours of support that they need so they can work the hours that they need for their families and, importantly, so that kids get access to that early childhood education service.


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