Thursday, 11 June 2020
Matters of Public Importance
I inform the Senate that, at 8:30 am today, 15 proposals were received in accordance with standing order 75. The question of which proposal would be submitted to the Senate was determined by lot. As a result, I inform the Senate that the following letter has been received from Senator Brown:
Pursuant to standing order 75, I propose that the following matter of public importance be submitted to the Senate for discussion:
The Government's decision to snap back to a complex and expensive child care subsidy system on 13 July, as Australia enters its first recession in 29 years, will lead to child care becoming unaffordable and for families, particularly women, to think about going back to work and could now act as a handbrake on Australia's economic recovery.
Is the proposal supported?
More than the number of senators required by the standing orders having risen in their places—
I understand that informal arrangements have been made to allocate specific times to each of the speakers in today's debate. With the concurrence of the Senate, I shall ask the clerks to set the clock accordingly.
Thank you to Senator Brown for the opportunity to speak on what is a critical issue right now for hundreds of thousands of Australian workers and families, and, particularly, women. Australian women are asking themselves today: does this government really prioritise $150,000 bathroom renovations over the working women of Australia? Within the space of a week, this government has decided to hand out $25,000 grants to the very few people who can, right now, afford to spend $150,000 on their home renovations. They say that's to support tradie jobs, but we all know this scheme makes absolutely no sense whatsoever because it's subsidising jobs that were already there on projects already in the pipeline. Meanwhile the government is ripping JobKeeper away from 120,000 early childhood educators, three months early and three days after they said they wouldn't do it. These are hardworking women who've done everything that's been asked of them during this pandemic to support our community. So how is it that this government sees fit to kick them off JobKeeper while handing out money for $150,000 renovations? Now they've announced they're ending free early childhood education right at the time that so many women are struggling to get back into work to support themselves and their families in the toughest of economic times. That's on top of denying JobKeeper payments to so many women in the first place—women who work as casuals and in jobs that have been the hardest hit in this pandemic.
This is not a government that has the backs of Australian working women and this is not a government that understands the pressures that women face every day—and even more so in this COVID-19 crisis—including juggling lower-paid jobs than those of their male counterparts; casual jobs; jobs that have been shut down; juggling their caring responsibilities at home; exorbitant childcare fees; and trying to get back into work to support themselves and their families. But, as we enter Australia's first recession in almost 30 years, these are apparently the priorities of this Morrison government: giving out bathroom renovations with one hand and ripping away programs that support women with the other. For weeks now, MPs and senators on the government's back bench have been calling for an early snapback to cut off support, and now it looks like the government is giving in. This is a snapback to a complex and expensive early childhood education system that is prohibitively expensive for so many families who are now trying to get back to work. This is just so counterproductive at a time when we really need to support people to get back into jobs. This decision is going to hurt families, it's going to hurt businesses, it's going to hurt the economy and it is particularly going to hurt working women.
Household budgets are under incredible stress, and the last thing that households need is to go back to paying the same exorbitant fees which they were paying back in February which had soared by 7.2 per cent in one year alone. This is going to hammer families at a time when many parents are earning less, have seen a reduction in hours or have lost their jobs. This is happening at a time when many families are desperately trying to get back on their feet. It's happening at a time when many families are struggling to put food on the table and keep a roof over their heads. A recent national survey conducted by The Parenthood found that almost half of all families had at least one parent that had lost income. For families trying to go back to work or increase their hours, this is really bad news because, for many of them, the cost of child care won't make sense versus how much they could earn at work right now.
The Parenthood survey also found that ending free child care would force 60 per cent of households to reduce their work hours and 34 per cent of parents would need to reduce work days or remove their children from early childhood education altogether. That figure almost doubles to 63 per cent for those families whose incomes have been hit by this pandemic. This is going to set families back and it is going to set our economic recovery back too.
We know that the decision to end free early childhood education and care will have a much larger impact on women and their ability to work when compared with men. In The Parenthood survey, out of those households that said they would have to reduce their work hours, 68 per cent, or over two-thirds, said that it would be the women in the household whose work would have to go. This will just compound the damage already done by this crisis and by this recession, which we know has hit women the hardest. We know that more women than men have lost their jobs during this pandemic. We know that more women have lost more hours when compared with men and that women dominate the workforces of the industries that have been hit hardest by the pandemic. Women are far more likely to be casual workers, millions of whom the government has excluded from JobKeeper. Women are far more likely too to take on the extra caring responsibilities at home, which is probably contributing to the fact that they're twice as likely to have stopped looking for work right now.
Of course, history tells us that many workers who find themselves out of work during a recession find themselves out of work for a long, long time. If we don't take action to support women's jobs and their capacity to work, we will potentially put at risk decades of progress when it comes to women's wages and workforce participation. So we need to see policy choices from this government that support women in the workplace right now, and it's clear that removing free early childhood education and care makes parents' return to the workforce more difficult and much more difficult for women in particular.
This is really a double blow for women's jobs. At the same time as making it harder for women to return to the workforce, the government are making the job security of 120,000 early childhood educators, of whom we know 97 per cent are women, even more uncertain. Not only have they risked the stability and viability of early childhood education services around Australia by removing free child care; they're also removing early childhood educators from the JobKeeper scheme months earlier than originally planned—what a slap in the place for those hardworking women.
Our early childhood educators have been absolute heroes during this pandemic. Throughout it, they have faced extreme uncertainty. Some have lost their jobs and others have been fearful about the survival of the sector. Many have been fearful for their own health as well as they've gone to work. Social distancing is just not an option in early learning centres when working with small children. But, through it all, hundreds of thousands of educators continued to go to work, caring for and educating our children. And they did it with absolute professionalism every day. We all need to be saying a massive thankyou to our educators, not making their work even more insecure during this recession. They are essential workers that are too often undervalued, and their professionalism allowed other essential workers to continue to do their jobs too. So why is it that the government is kicking these workers off JobKeeper first? It's concerning that this government thinks it's appropriate to remove JobKeeper from these workers at such a crucial time.
It's even more concerning that the government has said that more so-called adjustments could take place for other workers into the future. It was only last Friday that the Prime Minister guaranteed that workers would be able to rely on JobKeeper until September. Three days later and that promise, like so many others, was broken. This time it was broken for 120,000 early childhood educators. It's not just that these decisions are bad for working women; they are bad for the economy as a whole and they are bad for the recovery. Economists have been warning for weeks not to remove support packages like JobKeeper too early and free child care too early. Why? Because it risks jobs and it risks our recovery. The government needs to be doing all it can to create jobs and support parents and women to get back into work. Women have been hardest hit by this economic crisis, but there is no need for them to miss out on the government's economic support as the economy recovers. The end of free childcare education is the start of the snapback—a snapback that will be bad for workers, bad for families and bad for women.
I, too, at the start of my contribution would like to recognise the hard work and commitment of those involved in the childcare sector. They were pretty tense times a few months ago. We clearly and rightly recognised the workers on the frontline of our health system at that time, continuing to be there in response to this coronavirus crisis. But there were other crucial sectors as well that contributed to keeping all Australians safe, and our childcare sector was an essential one because, without those types of services, the healthcare workers that we essentially need couldn't continue to do their jobs. Many of them relied on having access to childcare services so they could be at testing centres, be at fever clinics and be adjusting our intensive care facilities in preparation for what we thought might, or feared might, occur. That's why the government acted very early and swiftly to put in place arrangements to help childcare places stay there.
The concern, obviously, at the beginning of this situation was that large numbers of parents, if they didn't have to go to work or their older children weren't going off to school, would also take their children out of child care and that that would cause a spiral for the economics of childcare centres and that, if they were only servicing the essential workers in the middle of a pandemic or a broader lockdown, they would not have the money to survive. They would not have the money to stay open, and then they wouldn't be open for the essential workers. That domino effect, so to speak, was what the government was responding to when it introduced what was always intended to be a temporary package. We would no longer charge parents fees—I'll come back to this in detail—but the government would provide, I think, around 50 per cent, about half, of a childcare centre's normal revenue. That would be provided by the government to help them keep open, and the JobKeeper scheme was also made available to help them effectively get the other half, if you like.
I think the scheme was correctly designed for what we feared was going to be a significant increase in coronavirus numbers and a significant reduction in Australians working, or at least physically attending workplaces, and the scheme has been successful, at least in terms of childcare centres remaining open. The review that has been recently completed found that 99 per cent of the around 13½ thousand childcare services around the country remained operational as at 8 May, so the objectives of the scheme have been clearly met. That's not to say, though, that there weren't some unintended consequences of it. It was always a scheme designed for a particular fallout in the economy. It did actually make it hard for some childcare centres.
This is a complex situation, but it's one that has been glossed over by Labor senators because it's unhelpful for the slogans and the headlines that they're seeking to pursue here. But either they are ignorant of the complexities of the childcare sector—or haven't made themselves familiar with them—or they're just wilfully ignoring those complexities. I think it's the latter, because I'm sure they've been contacted by childcare centres in the last few months, in the same way I have been, and I'm sure they have had the same issues raised with them about this particular package.
The primary issue is that our scheme was all about keeping a childcare centre open for business, not necessarily viable at 100 per cent of its capacity. Because we required no fee from parents—so they couldn't charge a fee—that meant, of course, that revenue sources available to a childcare centre were limited to the government's support plus the JobKeeper subsidy. For some centres, that did not actually add up to 100 per cent of their capacity. Now, we thought that wouldn't be an issue, because there was going to be a significant reduction in utilisation of childcare centres. That has not always worked out, because we have not had the fallout. Thankfully, it's been a good outcome that we haven't had the fallout and that we haven't had an increase in coronavirus cases. So there were many cases, which I'm sure have been raised with Labor senators and with Greens senators, where centres were not able to keep 100 per cent of spots open, even though parents were willing to pay money. Parents were willing to pay fees to help centres stay open, but we said, 'No, we want to make child care free through this period to keep them open.'
It was a perverse outcome, which has been reported on. On 10 June the Ballarat Courier reported that Sebastopol's Brady Bunch Learning Centre had a waiting list of 30 families and daily inquiries about childcare facilities. I had childcare facilities throughout Queensland contact me. I won't name them, because I don't want to embarrass them, but there were many who said, 'We want to provide more services.' I have spoken to many parents in Rockhampton. They want to pay for child care; they're happy to. They've got jobs. They're lucky enough to still have jobs, but they don't have places, because they are being rationed. That's what happens when you put price controls in place—you get rationing. And that's why we've had to make sure that we adjust to the circumstances we have right now and that we adjust to the fact that we have not had the fallout in coronavirus numbers. We have not had the reduction in working that we thought we would have, and effectively returning to the old system, with some transitional assistance—that's key—is the best way to go about things.
Another thing I'm sure you will not hear from Labor and Greens senators in their contributions is the reaction of much of the childcare sector itself to the government's announcement that we would transition back. For example, Josephine Tait, the CEO of the Weipa Community Care Association in Cape York in my state of Queensland, said, 'We are pleased the government has listened to our requests and has vowed to implement some very favourable changes.' Emma Murphy, the CEO of Kids Capers Childcare in Queensland, employs 200 staff across eight centres and she said, 'It's really exciting to see that early educators have been recognised and federal government funding has changed and adapted to help the community.' The Australian Childcare Alliance has commended the Australian government for putting a transition process in place that supports the early learning sector.
As I say, this is a complex arrangement that we have in place to help support parents in their childcare needs. The childcare subsidy, which we are re-implementing, ensures that those who are on low incomes have the vast majority of their fees subsidised by the taxpayer. Up to 85 per cent of childcare fees are subsidised through the childcare subsidy payment. In fact, under the childcare subsidy, out-of-pocket costs for parents were less than $5 per hour per child for 72.4 per cent of parents. The vast majority of people using child care have a job. That's why they need child care, because they've got to go and work somewhere else. They're earning a wage. They're earning a salary in that job. It's good that they've got a job. It's great that unemployment has not risen as much as we feared. Therefore, for those people who have a job, we think it's right that there is a co-contribution. But there is significant support from the government that will continue under the arrangements we have in place, with transition arrangements as we move back to a more a normal economic circumstance.
This is the right decision to make. This is the right decision to make to support normal childcare services being widely available for Australian parents and Australian working families. That's why it is supported by those actually in the industry and those who know. What is happening though is that a commonsense response is not being pursued here in this chamber by those moving and supporting this MPI. What there is is an attempt to run a different agenda about whether or not child care should be free. That's a different debate.
The Labor Party has not committed to making child care free—let's make that very clear. We had an election last year. They could have done that. They could have taken a policy to make it free. It would cost billions and billions of taxpayers' dollars. They didn't do that. Does the Labor Party support people earning $300,000 or $400,000 a year having their child care paid for? Is that what the Greens support? I don't think that's fair. If you're earning hundreds of thousand dollars you probably should make a contribution to your child's care. You shouldn't expect the taxpayer to have to pay for you. Those on low incomes absolutely deserve to have significant support, which they do through the childcare subsidy scheme. But for those on high incomes, those who can afford to look after their own circumstances in life, including their own children, I think, it makes sense and is fair for them to pay those costs, not to impose those on taxpayers—some of whom will earn less and be less well-to-do than themselves.
This is what we're returning to. All I can finish on is by saying that the government has a track record of supporting businesses that have been hurt by coronavirus. If circumstances change, if things get worse, we will live by our track record of continuing to help assist and help Australians, making sure we survive through the coronavirus.
I can honestly say that I would not have been able to complete my masters and PhD, nor embark on a career in engineering or academia, and then eventually state and federal politics, without access to affordable child care. When I migrated to Australia from Pakistan in 1992 and commenced my studies at the University of New South Wales, I pretty quickly realised that the available child care in my area was just unaffordable. It was too expensive. And that's how I got involved in a campaign to establish affordable student-centred child care at the university. We won that campaign, and that was really the only way I was able to complete my studies.
I have the utmost respect for those who educated and cared for my two children when I was working and studying. I will be eternally grateful to them. So it felt really personal when the University of New South Wales announced recently that it would shut down and privatise child care on campus. This is devastating as it is indicative of our society's broader undervaluing of child care.
Those centres—three of which my children attended at one time or another—were a lifeline to me. I had no family in Australia when I migrated here, and that meant that there were no real options for me if I wanted to work or study. It breaks my heart that very soon they may not be providing the same education and care for little ones and women like me will have very few choices left to them.
COVID-19 has exposed the existing inequalities in our society, including the gendered nature of these inequalities. There is no denying the fact that this pandemic is, and will continue to be, a gendered crisis. Women have been on the front line of this crisis as nurses and others in the healthcare system, as teachers, as childcare workers and as early childhood educators. All of these women are in areas with a predominantly feminised workforce.
More women than men have lost jobs and hours of work. Women are still doing much more of the family care work, which has skyrocketed during the pandemic—especially if you've been juggling children at home and working from home as well. Lockup and isolation at home have placed women at even more of a risk of domestic violence. So there is no doubt that the compounded impacts will be felt much more by women who already generally earn less, have less savings, have less superannuation and hold insecure casual jobs.
When rebuilding and recovering, women and women's organisations must be front and centre of decision-making, and we must make sure that, within this group of women, those who are even further marginalised—including Indigenous women, migrant women, women of colour, women with disability and transwomen—have an equal voice so their specific needs are addressed. We have an opportunity to rebuild after the pandemic to create a more equal and just society. A shake-up of how child care works has to be central to this.
This is the first time the government have grudgingly recognised that child care is an essential service. But they have decided to snap back from it in the middle of July, forcing millions who have lost work in the meantime to pay fees and make some really hard choices. While Labor's motion rightly points out that going back to a complex and expensive childcare subsidy system will lead to it becoming unaffordable for families, particularly women, it fails to acknowledge what we really need to do: to make free child care permanent. Thousands of Australian families have benefited enormously from fee-free access since the beginning of April. The minister should make free child care permanent.
The pandemic has opened up a conversation about the long-term viability of our existing approach to child care. This is an opportunity that is too good to let slip away. The reality is that the old system, which we may soon return to, was a broken, underfunded one, with some of the highest fees in the world. There is a compelling case for free and universally available early childhood education and care. It would have enormous social and economic benefits for our community. Too often, women have to give up work and career opportunities because child care is too expensive or just not available.
In our patriarchal society, our entire economy relies on the unpaid and underpaid work of women in caring roles and the skilled, difficult work done at childcare centres and in early learning and education. It's just an extension of the work that women do. Investing to make child care free and well funded and supporting carers and educators are essential to dismantling these retrograde ideas. Rather than doing that, the government is going to end JobKeeper for early childhood educators and the care sector before all other workers in Australia. How unfair and how insulting.
We women have known that child care is an essential service, but now this view must stick. The gaps that have emerged in our childcare system should, of course, be fixed as we move to make child care free and universally available. In the long term, I know that, to achieve this, our work is cut out for us. We must work together to lock in the right to free and universal child care for all, with higher wages and better conditions for workers to reflect the value of their enormous contribution to our community and our society.
The COVID-19 crisis has had a disproportionate impact on women. First of all, women in the workforce are more likely to be engaged in insecure work, the kinds of jobs that were the first to be lost as a result of the restrictions that were put in place. On average, more women than men are losing their jobs or having hours of work reduced. Women also take on a disproportionate share of caring and household duties and are spending one extra hour per day on unpaid housework and four hours on caring for children. Women are also far more likely than men to be the victims of domestic and family violence, which has markedly increased as a result of the lockdown measures.
As I said, women are more likely to be engaged in insecure work, yet 1.1 million casual workers are not covered by the government's JobKeeper scheme because they have been with their current employer for less than 12 months. Women retire with average superannuation balances half those of male retirees—a situation which will no doubt be made worse through the early access to superannuation scheme. Younger workers who access $20,000 of superannuation early could be costing themselves hundreds of thousands of dollars by the time they retire.
As if the situation for women wasn't bad enough, the Morrison government has just kicked 120,000 early childhood educators off JobKeeper earlier than anybody else. What makes this decision even more outrageous is that Mr Morrison promised on Friday that JobKeeper would remain in place for eligible workers until September. The announcement that workers in early childhood education and care would no longer have access to JobKeeper from 13 July came only three days after that. It took just three days for Mr Morrison to break his promise to early childhood educators. The consequences of this decision are far reaching, especially for women. It will impact on workers, on parents, on the economy, and, worst of all, on children. This decision threatens the viability of a number of early childhood education services and puts at risk the jobs of educators. When women are already disproportionately impacted by the pandemic, it beggars belief that the first industry to be removed from the JobKeeper scheme is one in which 96 per cent of the workers are women, or maybe that's why it's happened.
Free child care was a big help to parents who were experiencing the loss of household income through the economic impacts of COVID-19, especially given Australia has some of the most expensive, out-of-pocket childcare expenses in the world. Many Australian families were already struggling with high childcare fees before the pandemic. Now, during a recession in which 2.6 million Australians are unemployed or underemployed, paying for child care is beyond the means of many more. Australian families, early childhood educators and the Australian economy cannot afford a snapback to the old, complex, confusing and expensive childcare system. Snapping back to the old system three months early is going to make it more difficult for families relying on child care to balance the budget and to get back to work again as the economy recovers. This is a situation that will not just put financial pressures on family but will put a dampener on workforce participation and slow the economic recovery. And, once again, women, parents and carers will be impacted more than men.
If children are removed from child care or their hours are cut back, this is also going to have consequences for their educational development. As a former early childhood educator, I understand this. I get this. I know how important this is. This is why we refer to early childhood education as 'education' and not just 'care'. You need to think of early childhood education as a form of learning, like school but possibly even more vital for childhood development. Its importance has been verified by numerous studies. This is why early childhood education needs to be affordable and accessible.
We know from studies the enormous contribution that early childhood education can have to the physical, psychological, social and emotional development of children. That's why developed nations are investing heavily in early learning and many of them are streets ahead of Australia. And I have to say that I was completely gobsmacked during yesterday's debate on the motion to take note of answers to questions without notice. The comments of Senator Rennick, who suggested in that debate that parents should just stay at home and raise their children, showed exactly what that side of the chamber think about child care and early childhood education. Not only was Senator Rennick actively discouraging parents from engaging in the workforce but he was dismissing the enormous value of quality early learning, and he was also presuming that everyone can afford to stay home and mind their child or children.
When I heard Senator Rennick's contribution, as I said, in the taking note debate, I actually thought that maybe we'd been transported back to the 1950s. It was particularly galling to hear early childhood education referred to as:
… the hand of government reaching in and taking away our children's youth.
Senator Rennick gave a very bizarre speech yesterday in the taking note. I've been here for 12 years or so and I really think it was one of the most bizarre ones I've heard. I'm not sure if Senator Rennick, who referred to the Wizard of Oz, realises that the Wizard of Oz is a fiction which actually came to fruition in the late 1930s, but he sounded like he wanted to go back that far. He was insulting and he made outrageous slurs against the thousands of early childhood educators who uphold the highest professional standards and deliver high-quality early learning to children in their care. What message are Senator Rennick's comments sending to parents—particularly women—who want or need to participate in the workforce? How dare he suggest that these parents are complicit in taking away the youth of their children?
These backward-thinking comments must be rebuked by the government in the strongest terms but, of course, Liberal members and senators have been completely silent on them. I'd be very interested to hear what the Minister for Women, Senator Payne, has to say about these comments and whether she agrees with them; or the Minister for Education, Mr Tehan, in the other place; or his portfolio representative in this place, Senator Birmingham. Those opposite must disassociate themselves from Senator Rennick's comments or else, by their silence, they implicitly endorse his slur against early childhood educators.
It's okay for Senator Rennick to take four years off: what a wonderful man he was—he took four years off, I think he said, to look after his own children. I don't find that at all strange, if you can afford it. I don't know why he thought that he shouldn't, in actual fact, because we do understand that in these days of equality fathers should have equal access to caring for their children. He wasn't babysitting them; he was their father, and one would expect that a father who could afford to do it maybe would. But not everybody can afford it. Not everybody goes to work because they just like to go to work. Many, many people—especially women and especially those women in low-paid work, often casual work—go to work because they have to, to pay the bills. It's not because they can afford not to—
Senator Rennick interjecting—
So, as I said, those opposite must disassociate themselves from Senator Rennick's comments or else, by their silence, they implicitly endorse his slur against early childhood educators. It's no wonder that the ranks of women on that side are so thin by comparison to the boys club that is running the Liberal Party. The boys club and its 1950s attitudes was clearly voiced by Senator Rennick yesterday. This goes a long way towards—
Senator Rennick interjecting—
Order! Senator Bilyk, please resume your seat. Senator Rennick, you will do the courtesy of listening to the member opposite without interjections. But, Senator Bilyk, I would point out that you are coming very close to breaching standing order 193 in terms of imputations and personal reflections on a member of the Senate.
This goes a long way to explaining why the policies of the government leading up to and during the pandemic have failed to address the inequalities in women's workforce participation, because the truth actually hurts for those over there, doesn't it? Be careful what you say, because, oh, I might say that you've done something naughty! Well, seriously!
In the issue of the pay gap between men and women, the issue about the appointment of women to senior executive roles and the issue of superannuation balances of women, this government has actually made them worse. That's because women's policy is being dictated primarily by men who understand nothing about the drivers of gender inequality in Australia. And I am very proud to be a member of a party that has introduced important policies aimed at driving equality for women workers.
Labor introduced publicly funded paid parental leave. Labor legislated for equal remuneration orders and provided funding to implement the first equal remuneration order issued by the Fair Work Commission and Labor established the Workplace Gender Equality Agency and advocated in opposition to expand the reporting requirements to include reporting by individual companies on their gender— (Time expired)
At the start of the COVID-19 pandemic, the childcare sector was on the brink of collapse with large-scale withdrawals of children from child care. On 6 April the government put in place a temporary childcare package because the sector was facing unprecedented challenges. The Morrison government was quick to respond. It introduced a temporary childcare relief package to ensure that childcare services were available for essential workers. This is because we were committed to ensuring that the sector remained viable and that, importantly, childcare centres would still be available after the pandemic.
The childcare relief package was an outstanding success, and an early review demonstrated how successful it was, with 99 per cent of the 13,400 services operational as of 8 May. I should repeat that figure for the Labor detractors who have nothing better to do than tear down the work the Morrison government is doing to support Australians—99 per cent of services remained viable thanks to the Morrison government's relief package. A second survey showed that child attendance levels increased to 74 per cent in the week of 11 May, with families and businesses reporting an increase in demand as people began to return to work.
Our government has been responsive to the childcare sector. We've listened to parents who've told us they want childcare places and services expanded to offer more care. And we're continuing to invest in children as well as workers and parents in the sector as a whole. Just yesterday, on 10 June, the Ballarat Courier reported that there was such a demand for child care that one centre had a waiting list of 30 families and they receive daily inquiries about the availability of childcare. So much so, the centre is building another facility 2.5 kilometres down the road.
So, what is the next step? Well, because of Australia's success at flattening the COVID-19 curve, our life and economy are starting to return to normal. The temporary childcare package, which includes free child care, will end on 12 July. But we are not abandoning this important sector. We're not abandoning the children, the parents or the workers; nor are we abandoning the childcare centre owners. We're replacing one type of support with another type of support. And, importantly, it includes a safety net for the families that need it.
From 13 July, the government will continue to support families by providing more than $8.3 billion a year through the childcare subsidy to help parents with childcare costs. We'll provide about $2 billion for childcare subsidies in the coming quarter. Why? Because our children are important. And we'll continue to support Australian parents.
Our government will also provide support to childcare businesses in addition to paying the childcare subsidy with a transition payment of 25 per cent of fee revenue in the reference period. This will also be paid from 13 July. The childcare subsidy for parents is means-tested to ensure that those parents who earn the least will receive the highest level of subsidy. As a family's income decreases, the amount of subsidy they receive increases to the point where 85 per cent of their childcare fees are covered. It's good news for families because, as their income decreases, they will pay less out of pocket for child care.
Under the childcare subsidy, out-of-pocket costs were less than $5 per hour per child for the parents of more than 70 per cent of children in centre based day care in the September quarter last year. Out-of-pocket costs were less than $2 per hour per child for the parents of around a quarter of all children in centre based day care. After close to two years, our childcare package still has lower out-of-pocket costs—3.2 per cent lower than they were two years ago. The Early Learning and Care Council of Australia has welcomed the transition package and confirmed that it will support childcare centres to remain open for more children.
The childcare package has a record of supporting increased activity amongst women, whether it be working, training, studying or volunteering. In fact, in November an Aruma survey of parents found that our childcare package had increased activity levels for women by seven per cent. The number of women reporting more than 48 hours of activity in a fortnight rose from 56 per cent prior to the introduction of the package to 63 per cent in November last year.
We're introducing a fee cap as part of the transition package that commences on 13 July. It will support families that struggle with their fees by requiring childcare services to cap fees until 27 September. Our government will also ease the activity test until 4 October to support eligible families whose employment has been impacted as a result of COVID-19. These families will receive up to 100 hours of subsidised care per fortnight. This will assist parents to return to the level of work, study or training that they were undertaking prior to COVID-19 and ensure continuity of care for their kids. For example, if a parent who was working full time in February is today working part time because of a reduction in available shifts, the family is eligible for 100 hours of subsidised care per fortnight. And because their family income has been reduced, they will receive a higher rate of subsidy for the days their children are in care. They will receive more child care and they will pay less for their child care this coming quarter.
If you're looking for more evidence that we're getting it right, the Early Learning and Care Council of Australia has said that the childcare subsidy activity test will mean that those impacted by COVID-19 will be more able to access and afford early education. We're calling on families who are experiencing reduced hours of activity or reduced income to update their details so that they do receive a higher subsidy rate than they were previously.
The childcare package has a generous safety net that's designed to provide higher subsidies to families who are experiencing financial difficulty. The additional childcare subsidy is available for families who are under temporary financial hardship and provides increased childcare fee assistance to those families who are under financial stress. A loss of income, loss of employment or inability to pay childcare fees are just some examples of circumstances for which families may be eligible for this support. Eligible families can receive free care for the maximum 100 hours per fortnight. The additional childcare subsidy is also available for families who are transitioning to work. For example, families on jobseeker would be eligible for a subsidy of 95 per cent up to the hourly rate capped fee. This would mean that a family might be paying 60c per hour for care where the service charges a fee of $12 per hour.
How successful have we been in addressing challenges that parents are facing? Well, the Australian Childcare Alliance president, Paul Mondo, has said:
We would like to wholeheartedly thank Minister Tehan, the Treasurer and the. Prime Minister for listening to our members and recognising the importance of ensuring that all Australian families have access to high-quality learning services.
This is more evidence that we are supporting Australian families and businesses with fair and equitable support during the transition back to business as usual. Our transition package ensures that government support is accessible to every childcare service.
We are continuing to look after childcare workers. In a sector with approximately 200,000 employees, around 120,000 employees have been receiving JobKeeper payments. Our new transitional package will reach the additional 80,000 workers, most of whom are women. When we are replacing one type of support package with another type of support package, it's important to look at the combination of packages. From 12 July, childcare services would receive approximately $2 billion in childcare subsidy and $708 million in transition payments, along with the means-tested parent contributions. JobKeeper will cease for the childcare sector from 20 July, and the employment guarantee with the transition package will be in place from 13 July. When Labor says we're turning our backs on this sector, I can only suggest that they need to do more homework. It's not just the organisations that represent childcare businesses that have praised the Morrison government's response; the praise has also come from business owners.
But we should also look at the Labor government's record when they were last in office. Childcare fees increased by more than 53 per cent and their compliance record was woeful. They did fewer than 500 checks and failed to cancel or suspend a single service, while our record is 3,900 important compliance checks, with 317 cancelled and 34 suspended services. Simply put, we care enough about this sector to pay attention.
What I read is that childcare costs in a normal year are approximately $8.3 billion or about $2.07 billion over a three-month period. Now, I'm the older generation. I admit that. I had my kids in the seventies and eighties. I had four kids. At that period of time, I was a single mum. Did I have child care? No. Our responsibility was, if we had the kids, we looked after the kids. If you couldn't, grandparents looked after the kids. I worked part time, so I really did need that help. But it was my responsibility. I brought the children into the world. They were my responsibility. That was the older generation. You worked together as a family.
But now it seems that the government just wants to open up, and it's happened. Both sides of parliament are behind the vote. You're encouraging people out there to have kids and saying, if they're lower socioeconomically and can't support their own children, they can rely on the taxpayer or the tax dollars given to them. Then, on top of that, you're saying: 'You don't have to look after your kids. We will allow you to put them into a childcare centre. That's not your responsibility.' That's why the cost is coming to $8.3 billion.
I heard Senator Carol Brown's comments today that it's unaffordable for families, particularly women. Well, that in itself says a lot. I know a lot of men who have responsibility for their children as well and it is a huge cost to them. What we need an investigation into is the childcare centres and what they actually charge. I know that childcare centres charge on a holiday. They still get paid their money. On a holiday, they are still getting paid what it would cost to put those children in. The cost to families is outrageous. Some centres in Victoria are charging $150 a day. In Tasmania you're looking at $90 a day. It is terribly unaffordable. We've allowed it to escalate to that point where these childcare centres are making a fortune out of it because the federal government is picking up the bill.
If we want there to be free enterprise and people to take on their own responsibilities then they should be paying for their child care more so than the taxpayer. Taxpayers are footing the bill. You want to increase what we're paying out. Gonski is $22 billion, the NDIS is another $23 billion, you want the subs at $90 billion and here you want to put more money in, which could blow out to $15 billion a year. I want to know who's going to pay for this, because—I tell you what—the taxpayers out there have had a gutful of picking up the bill for all these people who are actually not facing their responsibilities. So I will say it: you can get a helping hand when you need it, but people have to start taking responsibility for their own actions. If you bring children into the world, they're your responsibility.
This government continues to make balls-up after balls-up in its terrible response to the COVID-19 crisis economically. It consistently misjudges and does not understand the financial and economic situation that people find themselves in, day after day, in the midst of this pandemic. We see that the education minister, Dan Tehan, announced that the government thinks it's justifiable to return to full fees because participation in early childhood and care has now returned to 74 per cent across the board. That is a ridiculous premise on which to base this policy. That is a return to 74 per cent of previous participation in a system that had free fees. So you're now about to return a system that has 74 per cent participation based on free fees and use that to justify a return to a full-fee-paying system?
Australia already has one of the most expensive childcare systems in the world. Families were already telling us, in response to the government's so-called new childcare package, that the system was too expensive and that they could barely afford it before the pandemic and now you're asking them to return to these fee structures in an environment where many households have lost income and jobs. In fact, many of those households that will be struggling with these fee increases have had dramatic drops in income.
This government made a complete balls-up again of the interim arrangements. We saw some childcare centres that were forced to offer free child care—for example, in the family day care sector—have absolutely no way of meeting their basic expenses to cover the costs of that care. Why? Because they weren't eligible for things like JobKeeper. It was patently ridiculous.
I saw other examples in the north-west of Western Australia. Skilled people still in employment were unable to get child care because the government had offered free child care and again the centres couldn't afford to open because they couldn't meet their expenses under the government's free childcare model. As a result, working families who were prepared to pay fees couldn't even get a place.
Instead of thinking intelligently about how you respond to the needs of centres, the needs of working families and, most importantly, the needs of children, the government has just announced snapback to a system that is intrinsically not built for the current post-COVID circumstances. In an environment where women's working opportunities are more challenged because they were the first to be casualised, you are now asking them to undertake an activity test to be eligible for a couple of days of week child care. If you've lost work, you have to look for work two days a week. That sounds fair enough until you put on the table the complexities of what it's like to look for work when you're trying to organise your life around child care.
What does it mean if you're suddenly offered a full-time job and you can secure only two days? Many families would like to say: 'I'm looking for a full-time job. That's my commitment. My child is three. They're going to school soon. If we get organised, we can do three days a week and I can move up to four days. We can get our child ready to make that transition.' In many cases you can't just say: 'I'm doing my two days while I'm looking for a job. Now I want a full-time place because I've found a full-time job.' This government is simply not listening to the needs of families in our nation.
First of all I would like to acknowledge Playgroup Australia. Playgroup Australia is a volunteer organisation whose vision is to create a village through play, by supporting and connecting parents and their children. Both my wife and I when we stayed at home volunteered at Playgroup Australia. It is an excellent way to interact with other parents. I'd also like to acknowledge the stay-at-home parents. They make an important contribution to early learning and help our teachers, especially in primary schools. Whilst at Playgroup I learnt that a lot of mothers and fathers actually wanted to stay at home with their children for as long as possible.
Honourable senators interjecting—
Yes, I'm getting there. This idea that it's good to rush parents back into the workforce isn't always the view expressed by all parents. Many do want to go back to work eventually, but not until later in their children's life. I'm committed to giving parents as much choice as possible as to when they go back to work. This is why the focus shouldn't be on getting parents back into the workforce but on making it financially easier for parents to have greater choice as to how they raise their children. So, if parents want to stay home longer, they can. But most of all it should be about the welfare of the children. It's important that our children don't get left behind in today's rat-race—not that Labor care about the welfare of the child; we know that because there's nothing in this MPI that mentions the welfare of the child. Not once today have I heard any Labor speaker mention the welfare of the child. They're just interested in subsidies so they can deduct union fees from them. All they care about is collecting money to fund their re-election campaigns.
I was pleased to give a speech this morning on the Paid Parental Leave Amendment (Flexibility Measures) Bill 2020, which would give mothers more choice about going back to work. I was shocked to be heckled by Senator Watt about such an important issue. Can you believe this? He was mocking me for speaking on a bill that was going to help mothers stay home with their children for longer. Women go through a lot to bring our children into the world: nine months of pregnancy, followed by childbirth and breastfeeding. It takes a huge toll and some women aren't always physically or emotionally ready to go straight back to work, especially if there is more than one child to look after—not that Labor would care about the welfare of the mother; they just want to clip the ticket.
You would think that being a member of the Queensland Labor Party, a party that has closed down over 30 maternity wards in regional Queensland, Senator Watt would show mothers a bit more respect. Do you know why it's so important that children stay at home with their parents? Because no-one can give their children the self-belief they so desperately need like their own mum and dad. As I said in my first speech, there is no substitute for mum and dad. And, of course, we must teach them respect, because, can I tell you, Labor and their left wing institutions won't.
You've only got to look at Twitter to see how the Left think. It's characterised by hatred, blaming, self-loathing, virtue-signalling and, of course, the modern day equivalent of bullying: the pile-on. There is no respect whatsoever. It is pure 1920s communism. Let me tell you that Lenin's useful idiots are not the role model that the Australian people want for their children. They want them to be strong and independent, and the best way to achieve this is to ensure that mum and dad are allowed to make the right choices for their families.