Tuesday, 10 August 2021
Family Assistance Legislation Amendment (Child Care Subsidy) Bill 2021; Second Reading
[by video link] I rise to speak on the Family Assistance Legislation Amendment (Child Care Subsidy) Bill 2021. I start by stating that Labor broadly supports this bill, because, of course, we support making child care more—
I'll try. Labor broadly supports this bill, because we, of course, support making child care more affordable and more accessible for more Australian families. But our support for the bill shouldn't be taken as an endorsement of the Liberals' childcare policy; it is not. We know that the Liberals' policy on childcare fee assistance doesn't go far enough. Indeed, it is a missed opportunity to drive the economic recovery and a missed opportunity to support families with children in early learning. When it comes to childcare fee policy—
Senator Smith, if you wouldn't mind for a moment: I'm having great difficulty hearing the senator speak, so, senators who are not participating in this debate, could you leave the chamber. I don't know if you can make it any louder, Senator Smith, but let's just try again. Thank you.
Labor's support for this legislation shouldn't be taken as an endorsement of the Liberals' childcare fee policy. It is not. It's a missed opportunity. As I said, it's a missed opportunity in terms of the economic recovery, a missed opportunity to support families with kids in early learning. Our policy, Labor's policy, is clearly more beneficial to more families and more children in care. It's better because we genuinely believe in the benefits of early learning. We believe in the benefits for productivity for our economy. We haven't, like the Liberals, been dragged kicking and screaming to a sensible position on fees. We value early learning. We value the children in it. We value the families who rely on it. We value the workforce which delivers it.
Despite promising a once-in-a-generation reform of early learning, we have seen consistent fee increases under the coalition government—indeed a 36 per cent increase since 2013. Childcare costs have been growing at approximately double CPI over the past quarter. The government predicts these costs to grow by a further 4.7 per cent in the next four years. Why does this matter beyond cost-of-living concerns? It matters because child care and early learning are beneficial for the children in it. It's beneficial for the many families who rely on it. It's beneficial for productivity. It's beneficial for our economy.
The policy which underpins this legislation was announced to great fanfare earlier this year. While the fee relief is welcome—of course it is—and that's why we'll support this bill, let's be clear about who misses out under the Liberals' policy. We know there are more than 700,000 families who will receive no lift at all. Under this policy every single Australian family with one child aged five or under in care with a combined family income of less than $530,000 a year will not receive any lift in benefit. Any extra support the Liberals' policy provides to families with two children in child care will be ripped away once the family's oldest child goes to school. What's more, it doesn't start until July 2022, which is absurd when we know how important and urgent fee relief is for families now.
Of course, there is another way. There is Labor's policy, which the government could adopt. Labor's policy, which does not discriminate based on the size of a family, which has no age cut-off and which applies to all children using outside school hours care during primary school. Our policy will boost support for every child whilst they're in child care and will leave one million Australian families better off. Push your pride aside and sign up to it. It's good policy. It's good policy if you genuinely believe in the importance of fee reform and fee relief. But of course, that's key, right? You've got to genuinely believe in it. You've got to genuinely believe in the sector which this legislation seeks to assist, the sector which holds the key to greater productivity, greater economic benefits and greater social benefits from improving access to early learning. Every time we invest in early learning in Australia we're not just investing in social reform, we're investing in productivity, we're investing in economic growth. That's critical to remember.
Labor gets it. We get the importance of early learning. I stand up here and I speak about this frequently. We get it. We believe the science. We've just had a far-ranging discussion in this place on science. Let's talk about the science of early learning. We know that in those first 1,000 days of a child's life critical brain connections are formed. If those brain connections aren't formed there can be dire consequences for the children involved. They're formed through some of the most simple and pleasurable things for a child: counting fingers and toes, singing songs, telling nursery rhymes. These sorts actions help a child develop. For some children the place they get that interaction, they get that stimulation, they have that opportunity for those connections to form, is in an early learning setting. For particularly vulnerable children that can be the only place where those brain connections have the opportunity to come alive. That's why it's so important for vulnerable kids especially. That's why our early educators are absolutely doing life-changing work every single day, life-changing work for the children in our community who stand to benefit the most from the work they do and the support they provide.
Fee relief is absolutely an economic reform, an economic measure, a productivity measure, but it is one of the greatest things we can do socially in terms of enabling children—and particularly those children who may not get a chance to go to an early learning setting if fee relief isn't provided—to attend, to have those brain connections form, to have that stimulation, that care, that support which is provided in an early learning centre. It's a way of ensuring that children get that opportunity for the basic fundamentals of their early learning and development. That's what should guide our approach in this place to early learning and early education.
Of course, early learning has been put at risk by the pandemic. We have seen the pandemic shut some children out of their early learning centre—shut them out of that connection with their educators, shut them out from the potential to have those connections formed. We've seen our early learning educators under extraordinary pressure in trying to deliver the life-changing and critical work that they provide for children. We've seen them ignored. We've seen them let down. We saw their calls for help go unanswered at the beginning of the pandemic, when they were saying: 'Where's the PPE? When I wipe a child's nose, where's my PPE?' They were performing essential work not just in terms of the work they were providing for children in their care. The essential work they were doing meant our essential workers in other industries could go and do their jobs. The parents of the children they were caring for were on the front line of this pandemic. They couldn't have done that work, couldn't have staffed the hospitals, couldn't have been in our aged-care centres, couldn't have provided caring roles or policing roles or, indeed, even political roles if it hadn't been for the incredible early learning workforce standing there behind them and supporting them. It's those workers and those educators who have been let down so severely by the government during this pandemic.
We're looking at a policy that to a great extent is about access, because fees—costs—determine access for many, many families. When you don't get that right, you don't give as many children the opportunity to attend an early learning centre. For many children, if they don't attend the early learning centre, they will miss out on so much.
Conversations in this place about early learning can be controversial. The reason for this is beyond me. This isn't about pitting families against each other. It isn't about your choices as a parent. It's about ensuring that all those children in our community who stand to benefit from access to an early learning centre, from access to our dedicated childcare workforce and from access to all the opportunities in terms of their development that early learning can bring have the opportunity to do that. That's what fee relief is about. It's about ensuring that all those parents who stand ready to make a contribution to our economy, to our society and to our community aren't prevented from doing so because they can't afford the hours and time in early learning and the hours and time in child care. It's absolutely critical on the economics, in terms of its social reform, in terms of productivity and of course for our children, for the kids in Australia who stand to benefit from it.
While I stand here as part of the Labor team, yes, supporting the legislation, we wish it went further. We wish it did better. And we wish it provided the critical recognition of the value of early learning, the value of child care and the value that the opportunity of attending care can bring to so many children. I earnestly wish that it did more, that it went further, that it did better, because there is so much more we can do to support the early learning and development of children in Australia. There is so much more we can do to show that we value our early learning educators, not just in what we say about them and how we thank them but also in how we pay them, how we respect them, how we treat their work and how we prioritise them as the essential workers they are.
There is a huge road ahead in getting early learning and childcare policy right in Australia. This was an opportunity to do so much more. Put your pride aside, follow Labor's policy and perhaps think creatively about the way our investments in this sector, our investments in early learning, could be truly transformative for our economy, for productivity, for families, for children in early learning and for our society as a whole. That would be a truly visionary thing to come out of this place, something worthy of the word 'reform'.
In saying that, we do support the legislation. We support any effort to provide fee assistance for families. I am happy to do that. But I will be fighting every single day in here to make sure we strive to go further—to deliver more, to value the children in early learning, to value the families who are using it and to value the sector for its contribution to Australia.
I rise to speak on the Family Assistance Legislation Amendment (Child Care Subsidy) Bill 2021. I want to make one thing very, very clear from the outset: this is not a women's issue. Whilst, yes, it's a family issue—a personal family issue of how they want to run their households, their lives and their working lives—most importantly it is an economic issue. We on this side of the chamber, the Morrison government, want to ensure that we get the best economic outcomes across the board. It is a concept that's evidently beyond the grasp of the Greens, judging from their contributions in this debate—and, to be fair, pretty much every debate. Senator Faruqi seemed to declare a formal power-sharing agreement with those opposite, something I've no doubt will send shivers up the spine of my friend the member for Hunter, Mr Fitzgibbon. But we can save that for another day.
I also note that earlier in the debate Senator Pratt was a bit upset about an internal debate within the coalition government. I appreciate that internal debate, a discussion of ideas, must be a very strange concept to those opposite, and perhaps even more surprising must be diversity of opinion. As Liberal women, we more than know that we're dismissed by those opposite, the so-called sisterhood, as nothing more than lapdogs to the men of our party, doing as we're told. We know it because when many of us on this side of the chamber receive derogatory and, unfortunately, often violent threats, which are publicly visible as they're usually transmitted over social media, what is it that we hear? Is it the cavalry? No. If it's coming to the defence of conservative women, that would be crickets we hear from those opposite, with a whispered, 'Well, they deserve it,' from the Caro-Wilkinson feminazis.
To come back to the legislation and to Senator Pratt's point, I really do enjoy the irony that the whole concept of independent thought is foreign to you and, in fact, banned by your bosses. We on this side have our own agency, the ability to stand up for what we believe in, and in fact we support all women—and men and families—who want to make choices as to how best they support their family life and work life. I know that to you guys on the other side of the chamber—through you, Madam Deputy President—the whole idea of personal choice and personal responsibility, the idea that not all families fit into the designated box of whatever union is currently pulling the opposition leader's strings, is anathema. Families come in all shapes and sizes—two parents, single parents, shared parents. Children can live mainly with mum; they can live with mum and dad; they can live mainly with dad. It's actually the women on this side of the chamber—outrageously!—who don't assume it's always dad who's the main breadwinner, with mum at home watching Bluey in her apron. Sometimes it's actually mum who's the main breadwinner. Sometimes mum has the bigger career. And sometimes, even once they become parents, both want to return to their careers. Some families, single-parent or not, don't have that choice. They're forced back to work for financial reasons. We need to support all of these families to best manage their lives, and we need to support most significantly those families who need the most support.
Child care needs to be more affordable. We're actively supporting families with more than one child to get back to work sooner, should they wish to, without losing any additional income to childcare payments. This childcare subsidy will benefit around 250,000 Australian families. Subsidy levels in some cases will increase from 30 per cent to 95 per cent, with 50 per cent of those families paying on average just $21 a day for two children in care. Tens of thousands of families are set to benefit from the removal of the annual cap on the childcare subsidy. This will make it fairer for all Australian families. The removal of the cap will remove any disincentive for families to remain working or to increase their workforce participation.
Why do we want to do it? Because we believe in supporting families. We support all families. We want parents to believe that they can have more children. I heard Senator O'Sullivan reference the Peter Costello quote: 'One for mum, one for dad and one for the country.' I have my three, and I have had a bit of a joke with Peter that I'm still asking where the one for the country should be sent, but, in truth, he's the light of my life, I love him dearly and I wouldn't send him anywhere.
We do want families back in the workforce and we do want to allow them to arrange the care that suits their families the best way they can, if that's what they want to do. We want to put money back into the pockets of these families—not unions and not the black armband curriculum brigade—because we know families can make better use of that funding and will be able to keep more income. We want to see children access quality early learning and care. We want it to be more affordable for families, and we want to make sure that all of that assistance is as targeted as it can be to ensure the families that require the most support receive that support.
[by video link] I rise to speak on the Family Assistance Legislation Amendment (Child Care Subsidy) Bill 2021. This bill is a half-hearted attempt to fix the growing affordability crisis in early childhood education for Australian families. Affordability of early childhood education is in crisis. It's a crisis ignored by the Morrison government and a crisis which is putting pressure on Australian families. This bill is just fiddling around the edges, and it goes nowhere near the reforms that families need to access the high-quality early learning system that they are absolutely deserve.
Once again this government has offered nothing to support the hardworking and dedicated early childhood educators who are absolutely at the heart of this system. There is nothing for transparency to ensure the additional funding will actually go towards supporting high-quality education programs and nothing to ensure that any additional funding will go to the workforce. There is nothing to protect their hours and their pay, which have been so hard hit during this COVID crisis. This bill is the government's cynical attempt to save face with the women of Australia, and it shows that this government remains woefully out of touch with the experience of working people raising families, out of touch with families who are paying some of the highest fees anywhere in the world, out of touch with the families who are struggling to access the early learning that they need and out of touch with all of those families who are struggling to balance work and family in a system that is overly complicated and, fundamentally, in crisis.
With this bill, the government is saying, 'We will ease some of these costs but only for some families, only for a short time and only if you have more than one child in child care.' Let's imagine a family with two children in an early learning service aged one and four. That family can expect to be paying childcare fees for five years for each child. Only three of those years will be while both children are in care. For those three years, this bill will only reduce the fees for one of the children. This is a pittance. They aren't really serious about addressing this crisis. This is penny pinching. It's something made up on the run to look good for a photo-op in an early learning service, but it doesn't look good when you're doing the family budget.
This government is penny pinching at the expense of the children and families increasingly locked out of the early learning that they need. Now more than ever families need a system that is simple, one that they can rely on. This bill does nothing to provide certainty to thousands of families who are affected by the Morrison lockdowns. Families have been required to pay fees while their children can't attend services—families who are doing the right thing and staying at home to protect the health of the community, families who are scrambling to find the money for fees when they've lost hours, jobs or disaster payments.
Right now, the minister could support these families by giving them one less thing to worry about. He can decide at any time to allow services to waive parent fees and give them the financial break that they need. He can decide to give early learning services the certainty that they need to keep their doors open. He can decide to protect educators' wages and their hours while they continue to work to support children during this pandemic. Instead, every lockdown announcement means families are left wondering what they will have to pay and whether they can afford to pay it. Services are left wondering if enrolments will plummet as a result or if they can in fact remain viable. Educators are left wondering if they will have the hours they need to support their own families. Families in Greater Sydney were forced to wait two weeks into the lockdown before the minister confirmed services would be allowed to waive parent fees. Families in other lockdown states, including my state of Victoria, missed out altogether. This government needs to do its job and give parents, services and educators the certainty that they need.
It is clear in the face of extended lockdowns that the childhood sector cannot afford to sustain parental fee waivers without government support. But, once again, this government are simply not willing to step up and do what is needed. This government are straight out of the 1950s when it comes to this sector. They are yet to realise that almost a million families rely on early education to support them to return to work. They are yet to realise that over 1.3 million children benefit from high-quality early learning. They are yet to realise that this is a sector that employs 200,000 Australians—200,000 educators and teachers. The minister knows what needs to be done, but he is simply not doing it.
If the Prime Minister had done his job and delivered a speedy rollout of the vaccine and a purpose-built quarantine system we wouldn't be in this situation. Instead, parents are forced to continue to find the money to pay fees for early learning that they just can't access and the services who can waive parent fees are left wondering how long they can afford to do so. This government has failed to act yet again, and we have to ask: who is left to bear the brunt of its inaction this time? It is the hardworking and dedicated early childhood educators and teachers. The longer this government fails to act, the more hours and income these educators will lose as their services struggle. But the government, as we know, has shown absolutely no regard for the early childhood educators of Australia. This is the government that made the extraordinary decision to kick this workforce off JobKeeper last year, long before anyone else.
But, every day of this pandemic, educators have continued to work and support children and families in really difficult circumstances. They have turned up each and every day, despite the risk to their personal health, despite increased workload and stress, despite the constant risk that their hours could be cut and despite the fact that social distancing is impossible in an early learning centre. They have turned up because they know that the children and the families of Australia need them.
It is time that the Morrison government recognised that, too. Instead, educators across the country are still faced with loss of hours and loss of income as a result of the government's refusal to act and to properly fund the sector through this crisis. Early educators are already at breaking point, and this pandemic has only further exposed a problem that was already there. Educators are exhausted, undervalued and leaving the sector at record levels. A report released today by the United Workers Union reveals that 37 per cent of early educators are planning to leave the sector. That's around 70,000 educators who will leave, when the sector needs an additional 40,000 educators to meet demand just in the next couple of years.
COVID has been the breaking point for thousands of Australian educators. Educators are leaving. They are saying, 'Enough is enough.' When educators leave, parents and children miss out on accessing the early learning that they need. There is simply no early learning, no critical development in those early years, without dedicated, hardworking, professional early childhood educators. This crisis will only get worse while this government fails to do its job and support families, support services and support our early childhood educators.
Labor's amendment will give families and the early childhood sector the certainty they need by taking the decision out of the minister's hands. Our amendment makes an automatic exemption from charging families gap fees as soon as the state or territory government declares a lockdown. As soon as a lockdown is announced—not two weeks in and not a month in but as soon as it is announced—families and services will know what to expect. They'll have the certainty they need. Families will know that they can keep their children home in the interests of their health and wellbeing. They can do that instead of worrying about fees. It will keep services open for the children and the families who need them, making sure this essential service doesn't just survive the crisis but is there to help power our recovery.
Labor knows the real value of early childhood education. We know that it's an essential service that not only supports working families but is critical to supporting the early development of children. It is an investment in the future prosperity of our nation. We have a vision for an early learning sector that is high quality and simple, that families can rely on and that truly values professional educators at its heart. Our child care for working families plan will see fees reduced for all children and families for longer. No child should miss out on the benefits that quality early childhood education can deliver because of high fees.
Under Labor, that family of two that I mentioned earlier would pay lower fees the whole time their children are accessing early learning, not just for a few years and not just for one child. Labor's plan will increase the base subsidy for all children to 90 per cent for the whole time that they are using the service. Unlike this bill, Labor's plan does not differentiate on the size of a family. It has no age cut-off, and it will apply to all children using outside-of-school-hours care during primary school. As a result, over 86 per cent, 850,000 families, would be better off under Labor's policy.
Labor is also committed to ensuring early educators are not left behind. These are our frontline workers, but they are underpaid and undervalued. We are determined to repay them for their essential work during this crisis. We know their value to families, we know their value to children and we know their value to our society and our community. That's why we're committed to building an early childhood education sector for the future—one that children, families and educators can rely on in a crisis and in recovery.
Early learning is critical to the future success of our children and our economy. This sector deserves a real plan for the future, not half-hearted platitudes like this. This government does not value early learning, and it doesn't value our early educators. It's clear from this half-baked bill, which doesn't address affordability for most families in the long term. It's clear when they kick early educators off JobKeeper. It's clear, when government members say that early learning is 'outsourcing parenting', that the Morrison government is woefully out of touch with how modern families operate today, and this government is woefully selling our children and our economy short.
Unlike this government, Labor knows the life-changing impact of early learning. We know that the first five years are the most crucial time in a child's development. We know that early learning is one of the best investments that we can make for the future. Only Labor has a vision for a world-class early learning sector with educators, respected and valued, at the heart of that system—an early learning sector that every working family can rely on; a sector where every child can access the early learning that they need to grow and to thrive.
I just wanted to briefly explain to the chamber why I will not be supporting the Family Assistance Legislation Amendment (Child Care Subsidy) Bill 2021. In doing so, I want to make three quick points. First, I do support funding for child care. I do support helping families who would otherwise struggle to look after their own children or make decisions to go to work, and I do think we should support families on low to middle incomes to do that. We already do, of course, provide substantial assistance to low-income families. Up to 85 per cent of childcare costs are covered for families on lower incomes and, with a sliding scale, on over $180,000 or thereabouts. This bill, though, would of course remove caps for families on very high incomes—above-average incomes of nearly $200,000 a year. I will come back to that.
The main issue I have, though, is not necessarily the change in this bill itself. The second point I would like to make is more that, if we have $1.7 billion to allocate to support families, it seems completely out of whack and out of balance to me that we cannot find any assistance for those families who decide to look after their own children. As I say, I support families and want to support families who make the choice to work and therefore have to provide and pay for child care for their young children, but there are, of course, families who make the decision for one or other of the parents, or sometimes both, in combination, to look after their own children. We should support that choice as well. We should support parents in any choice as to what is best for their own children, because I do want to say that those mothers and fathers who look after their own children at home are often ignored in this debate. I don't like calling them stay-at-home parents. They are work-at-home parents; I know that. My wife, for a long time, did work at home, looking after our children. She's back working a little bit at the moment, but she works a lot harder than I do in this job. She was working at home, and others were working at home, looking after kids, long before it was cool, during the coronavirus, and they have not been recognised adequately.
I want to say here that I recognise the effort they put in, and I think it was summed up in a quote that's attributed to CS Lewis: 'The homemaker has the ultimate career. All other careers exist for one purpose only, and that is to support the ultimate career.' And that is exactly right. The point CS Lewis was making was that our defence forces are there to defend the home. Our businesses are there to make wealth to support the home and the education of the children in the home. It's ultimately, then, the homemaker—the person who is looking after the home, supporting children and raising a family—who has the ultimate career, because all other careers are just there to help them.
I often say my job as a senator is very important, but it pales into insignificance compared to my job as a father and a husband, and likewise for my wife. That is the most important job any of us can do, yet it is barely recognised in our tax or welfare system. It is barely recognised because, today, if you make that choice, to look after your own children, you are massively penalised by our tax system, which only looks at the individual and does not look at the household choices that families make. I make decisions with my wife as a team. We are a team. I'm not sure if my kids are on that team half the time, but we are on the same team. We are working together, yet the tax system treats us as two completely separate entities. When we had young kids, if we'd made a choice for my wife to go back to work we would have been much further ahead because the tax system would have supported us. We would have had two tax-free thresholds. It would have made an enormous financial difference.
I'll put that difference into stark terms. Right now, let's say there are two families. One is a double-income family on $150 grand a year. That sounds like a lot of money, but the average full-time wage today is nearly $80,000, so $150 grand a year is not unusual for a household with two incomes to be on. Let's split that, with $100,000 a year coming from one parent and $50,000 a year from another. They pay, under our tax system, roughly $32,000 in tax. They would receive, roughly, another $7,000 or so in childcare subsidies. That has to be estimated. I've assumed three days a week at $10.40 an hour, the prescribed rate. In total, when you net off those childcare subsidies, their tax bill comes in at $25,000 a year for a household income of $150,000.
We then have a different family, a single-income family, that says: 'Look, one parent is going to go out and earn the money. They're going to work a bit harder, maybe work longer hours, and they're going to earn $150 grand, and the other parent is not going to earn anything but is going to stay at home and look after our child.' They will have exactly the same income as the other family, but their tax bill will be $43,000 a year. They of course get no childcare subsidies because they're not using it, so their tax is $43,000 a year. The difference between those two families is nearly $18,000 in net tax per year. They have exactly the same household income of $150,000 a year—a little bit above average, but it's not unusual for households to be on that amount of income today—and yet the difference in tax is nearly $18,000 a year. That is completely out of whack. It is grossly unfair and, of course, it ultimately distorts the decisions parents make about their children and the raising of their children, because it is a very, very costly choice to look after your own children.
I note the contribution of the previous speaker, who said it's really important that we support the education of young children. I couldn't agree more. Absolutely it's very important, yet all the evidence shows, especially for children under the age of one, that if a parent—a mother or father—can spend more time with them it makes an enormous difference in their development. That is not me speaking. OECD reports and psychological studies have all shown that the more time a child under one can spend with their biological mother or father, the better it is for their development.
So why aren't we doing anything, with these arrangements, to support the child? Isn't that what it should be about? As I said at the start, I do support helping parents who want to go back to work, helping them to put their children in child care, and I hear a lot about that in these debates, but I hear very little about the child. In a childcare bill, shouldn't our children be front and centre of what we are trying to do? That is another reason why we should be seeking a more neutral outcome in this legislation.
My final point is this. I don't have a fundamental objection to supporting families more. I do think, though, that families that are on over $200,000 a year, who this bill helps to support, shouldn't be at the front of the queue for government assistance. If you are lucky enough to have a household income of that kind of amount—I'm in that category—and you decide to bring a child into the world, I think, primarily, it should be your responsibility to look after that child. There is some government assistance there, but I don't support the idea that through this legislation we would now spend another $1.7 billion on the richest people in our community—the absolute top few per cent.
This bill only helps out those few who are in the absolute top few per cent, like us. This bill's for us, by the way. We'll all benefit from this bill, but not people in single-income families on $80,000, $90,000 or $110,000 a year. They're often at those levels when they're just starting a family. If you're a young family, you might not be earning a lot of money. We're not doing anything for them. I know so many families who would love to spend more time with their children when they are young, and they are not necessarily earning high incomes yet. We are not doing anything to help and support those choices, yet we are helping out the very lucky few that are very rich. For that reason, I'm sorry, I cannot support this legislation.
[by video link] I would like to make a contribution to the debate on the Family Assistance Legislation Amendment (Child Care Subsidy) Bill 2021. The bill implements the Morrison government's amendments to the childcare subsidy that were announced as part of their budget this year. Their announcement of this policy was, as per usual, full of spin, because their changes not only have been squashed by the data analysis; they don't even come into effect until July next year. That's right: families will have to wait almost 12 months before they see the benefit of the Morrison government's plan. Families are struggling right now to pay rising costs of childcare fees, and this bill will offer them little consolation. They will have to wait too long and it will help out only a small number of people.
The bill also does not address the problem currently facing thousands of families who are currently in lockdown and are having to pay the gap fees. Whilst many families are under stay-at-home orders across the country, childcare centres have remained open as essential services for essential workers. However, families staying at home have still been charged gap fees by the centres, as they are legally required to levy the fees. The minister has the ability to give centres an exemption from charging gap fees and did so for Sydney childcare centres two weeks into their lockdown. However, the government has yet to grant exemptions again for other lockdowns, which have since been endured and are likely to continue because of their failure to administer a timely rollout of vaccinations across the country.
That is why Labor moved a second reading amendment in the other place to take out the exemption to the minister's rule and put it in the act, so there is an automatic exemption from charging gap fees as soon as a lockdown is declared. But like in March, the Morrison government has voted this down again. It is a deliberate decision of this government to slug families with additional fees throughout what is already a very difficult time. While we're having to deal with the completely bungled vaccine rollout and Mr Morrison's refusal to build purpose-built quarantine sites, lockdowns are going to continue. By voting against the amendment, he was clearly telling families that they will have to continue to pay the gap fees for child care they're not receiving.
Parents need a real plan on child care. Not only will it help the pockets of Australians; it will boost participation in our economy. Under the current agenda, the Liberals have a broken system, and fiddling with the childcare subsidy, as this bill does, will not fix the problem. There are two schedules to the bill. The first will remove the annual cap from the family assistance law so that there will no longer be a limit on the amount of childcare subsidy that families over a specified income can receive each year. The second schedule will increase the rate of childcare subsidy by 30 per cent for second and subsequent children aged five and under up until a maximum rate of 95 per cent. However, as soon as the second child is six and starts to go to school, this support will be ripped away, despite the fact that they may be in before- or after-school care. So whether they're in after-school care or before-school care, it is still going to be ripped away from them.
In contrast, Labor's plan for cheaper child care will assist more families and for a longer period of time. Our policy accommodates families of all sizes, does not have age restrictions and applies to all children using outside school hour care during primary school—and, not only that; there is data to back it up. Analysis of the Parliamentary Budget Office's modelling shows that 86 per cent of families are better off under Labor's policy, while a mere eight per cent of families are better off under the Liberal's system. We wouldn't mind if they just took our policy and implemented it, because, after all, we want to ensure that families benefit. There is really no comparison. Our policy works and it will work for a significant number of more Australians.
While we will support the bill, it's important to note the stark contrast to what we would provide. Also, as I said earlier, this bill will be of no support to families who are currently in lockdown or inevitably will be in the coming months as we struggle to contain the delta variant and deal with Mr Morrison's bungled rollout of the vaccine. This has not, however, stopped the Morrison government from praising themselves for providing better assistance to families with three children in child care at once. The bill may do this, but it will only help the 1.8 per cent—less than two per cent—of families who have three children under the age of six. What about the other 98 per cent?
Childcare fees and costs are out of control under the Morrison government and Australian families are paying more out-of-pocket costs for child care than ever before. Since the Liberals were elected in 2013, childcare fees have risen by a whopping 36 per cent. In my home city of Launceston, over the past 12 months local childcare fees have risen by a staggering 4.1 per cent, well above the national average of 2.4 per cent and substantially exceeding inflation. The childcare subsidy is pegged to inflation and means that families in Launceston and throughout Tasmania are paying more out-of-pocket costs for child care. This is all at a time when wages have been stagnant, and who knows what's going to happen in the future? We know that casualisation of our workforce is causing insecurity for people. Clearly, the system is broken and Mr Morrison has failed families.
Data from the Productivity Commission's report on government services, released this year, shows that the high cost of child care is a barrier to parents, particularly women, entering the workforce. It makes no sense for a parent to work if it is only going to just pay for the child care. Parents should be encouraged to work if they want to and they should not be held back by exorbitant childcare fees. Joining the workforce will boost our participation rate and have a positive flow-on effect on the economy.
There was a report by UNICEF, which is additional evidence that the Morrison government is failing Australian families. The report, titled Where do rich countries stand on child care, ranks Australia 37th out of 41 countries based on childcare affordability, access, quality and parental leave. The report also found that Australia is one of only eight countries where child care costs parents a quarter of their income. This adds to the mounting evidence that, under this Morrison Liberal government, Australia is falling behind the rest of the world. We are ranked third-last in the OECD for our vaccination rates, our housing market is the third most unaffordable in the world, we are ranked 87th out of 133 countries globally in terms of economic complexity, and our average internet speeds are embarrassingly ranked at 61st. Mr Morrison may be going hard and strong on the Olympic rhetoric recently, but Australia is running last in the race on too many indicators. Our lives should be improving, but under the Liberals we're falling far behind. This tired Morrison government's lousy childcare policy will fall short of what is needed to deliver genuine assistance to Australian families who are struggling with the obscene childcare fees, and it will fail to bring reform to the system that is so desperately needed.
Our plan for child care will deliver for working families and have a meaningful impact. It will scrap the $10,560 childcare subsidy cap, which often sees women losing money from extra days work. It will lift the maximum childcare subsidy rate to 90 per cent, increase childcare subsidy rates and taper them for every family earning less than $530,000. The plan will bring the cost of child care down for all Australian families and better support parents to work the hours they need and that they want to work. As it stands, the second income earner in the family is usually a woman; they should be rewarded for working more hours and contributing to our economy.
On so many fronts the Morrison government have failed Australian families. They are disappointing Australian families and letting those families down. Their track record is abysmal. Although we will support this bill, because something is better than nothing, it will do nothing to aid Australian families at a time when they need a boost. We are seeing lockdown after lockdown because of this government's failure to protect Australian families throughout this country by rolling out vaccines in a timely manner. They are failing aged-care workers. They're failing early childhood educators. They are failing parents. They're failing people with disabilities. Australian families deserve so much more. Australian parents whose children are in those early learning years depend on the Commonwealth government, their federal government, to deliver child care at an affordable rate to support them to enter the workforce again. I call on the government to improve what they've laid out in this bill and support the families who most need it.
It's great to be up here tonight to speak to this bill, the Family Assistance Legislation Amendment (Child Care Subsidy) Bill 2021. Let's just get a couple of things out on the table before I start getting taunts about being a dinosaur and all that sort of stuff. I stayed at home for four years, at my choice, so I could help raise my children. I happily attended mothers groups and things like that. I want to be clear, I'm not talking about kindergarten either. I come from a long line of working mothers. Indeed, my great-great-aunt taught maths and physics at All Hallows' School for 50 years. She had a hall named after her. My grandmother was a teacher who had eight children, four before the war and four after the war. My mother, my wife and my sisters all worked. So this is not an attack on working mothers or anything like that. However, I would like to see greater choice in child care.
One thing I think we've got common ground on is how expensive child care is. I would argue that one of the reasons child care is so expensive is that there is very little choice or competition and very little flexibility in the type of child care that parents can choose. The government now pays the childcare centre directly, rather than the parent, so that removes the choice the parent has. If, for example, they want to have an at-home nanny for three hours a day rather than eight hours a day, they are forced to pay a full day's child care. This just doesn't work for a lot of shift workers, for example. Either they might work early, from six o'clock in the morning through to two, or they might work from two through to 10 or 11 o'clock at night. So it's very difficult to use what I'd call the formalised childcare system if you're a childcare worker.
Likewise, if you come from a regional part of Australia where you're out on a farm and the nearest town is 40 kilometres away, are you really going to spend half an hour to 40 minutes driving into town and then driving back to the farm, only to have to waste another hour and a half going back five or six hours later? Farmers just don't have the time to drop off their children at child care. Why would they? I grew up on a farm and I've got great memories of hanging out with my dad in a big old Bedford truck when I was a child. However, having said that, I did go to kindergarten. My dad was the president of the kindergarten for four years before going on and being the president of the P&F.
My problem with this bill is that it continues the arms race whereby the more we increase childcare subsidies, the higher childcare fees go. I'm not convinced that parents and children are getting better outcomes out of it. Twenty years ago we spent, I think, about $500 million on child care. Today we spend over $10 billion. I'm not sure that parents get greater choice or greater flexibility in the type of child care that they get. The other thing I'd like to point out too is that the cost of child care for low-income earners hardly makes it worth the low-income earners going to work. I've got different numbers here, but it looks like it's somewhere between $15,000 to $20,000 per child.