The Assistant Minister for Education Sussan Ley said: “there needs to be greater choice in child care options for parents. Australian families should be able to plan child care around their work life, not their work life around child care”[1]. Here, here!
There’s been a 150% rise in Australian childcare costs in just one decade. One. The estimated cost of full-time childcare for one Australian child is estimated at $31,000/year.[2] The new Government report on our childcare system is a welcome one especially to those working parents struggling with access and cost of childcare in both urban and rural areas across the country.
The Productivity Commission’s draft report into Childcare and Early Childhood Learning recommends the system be made simpler and broader. One of its key recommendations is to introduce a single subsidy, scrapping the Child Care Benefit and Child Care Rebate. The overarching aim is to make childcare more affordable, shorten waiting lists and offer greater flexibility as well as make childcare more financially sustainable for tax payers. The roll on effect would be increased participation of women in the workforce, more full time workers and less financial pressure for those parents who are chronically stretched.
The Commission's recommendations:
- Provide a subsidy that is means and activity tested for up to 100 hours a fortnight. Families with a combined income of $60,000 or less would have 90% of costs subsidised, whilst those with over $300,000 would get a maximum 30%.
- The subsidy should go direct to a parent’s approved provider be that a centre or nanny so long as they have the required certificate that meets the appropriate National Quality Standards.
- Au pairs would not be eligible for the subsidy. However, visa requirements would be changed to extend the amount of time they spend with a family to 12 months (rather than the current 6)
- Remove restrictions on the number of childcare places for occasional care and the hours that centres have to be open in order to receive Government subsidies.
- Make school principals responsible for ensuring schools offer before and after school care, including care for pre-schoolers.
- 'Top up' subsidies should be offered for children with disabilities, while viability assistance should be provided to regional, rural and remote areas with fluctuating child populations.
Is it all pretty? Some things to think about…
- Currently parents who don’t work or study can get up to 24hours/week of childcare subsidised. Would this be cut and how would this impact stay-at-home mums?
- Either/or. Funding the subsidy may mean diverting funds ($1.5 billion is recommended) from the proposed Paid Parental Leave Scheme reducing parental leave contributions for some.
In her article Parental leave a distraction that will hurt childcare Women’s Agenda editor, Angela Priestley, encourages us to think long term and focus on what we really need and want as working parents…
“Based on my own conversations with new mothers on this very topic, I'm not convinced beefing up our existing paid parental leave scheme will help. It's not the amount of maternity leave a new mother gets that helps in her 'decision' to return to work (although some employers do request those who take such leave return for a period in order to 'pay it back') but rather her ability to access childcare once she's ready to return to work, along with flexible working arrangements that suit her changed circumstances.”
Angela Priestley, Women's Agenda.
The Commission has estimated that the proposed changes could boost workforce participation by 2.7% contributing to over 46,000 more full-time workers. It also estimated that it could boost GDP by $5.5 billion.
It seems there are more significant additional benefits to the broader community to reforming our childcare system as opposed to the Paid Parent Leave scheme, which seems to benefit few beyond those directly receiving it.
What’s more, Grattan Institute research shows that the two major factors influencing female workforce participation are marginal tax rates and the net costs of childcare. It found that ”government support for childcare has about double the impact of spending on parental leave” in influencing women’s workforce participation.
So if it is an either/or scenario wouldn't it be nice if working parents were the ones that got to choose?
What do you want from our childcare system? Though we shouldn’t have to decide, if it came to an either/or scenario between the proposed Paid Parental Leave Scheme and Childcare Reform what would you choose and why?
You have a chance to take part in the discussion. This was only the draft report and the Productivity Commission is inviting the public to respond to its ideas. Click here to have your say. You have until September.
“Two decades ago debate raged about how much women should work and if child care was bad for kids. Now we discuss how to boost women's participation in the workplace, the quality of care, trying to get it and how much it costs.”
Sarah MacDonald, The Drum - ABC.
Thankfully things have changed. Let’s keep the evolution rolling!
For a simple explanation of the report listen to Commissioner Wendy Craik talk about the key recommendations from the draft report into Childcare and Early Childhood Learning in this video.
[1] Sussan Ley, media release, viewed 28.7.14, http://sussanley.com/productivity-commission-draft-report-child-care-and-early-childhood-learning/
[2] SwitchedOnWomen, The Woman’s Economy, viewed 25.7.14 https://www.switchedonwomen.com/campaigns
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