Parliament Updates

Zali Steggall MP speaks on the Family Assistance Legislation Amendment (Improving Assistance for Vulnerable and Disadvantaged Families) Bill 2020

24 August, 2020


I rise to speak on the Family Assistance Legislation Amendment (Improving Assistance for Vulnerable and Disadvantaged Families) Bill 2020. This bill makes important amendments to the legislation governing childcare assistance, with a focus on vulnerable and disadvantaged families or those who might be in less conventional family situations. The bill makes amendments to the A New Tax System (Family Assistance) Act 1999 by extending the backdating of additional childcare subsidy (child wellbeing) certificates and determinations from 28 days to up to 13 weeks in defined exceptional circumstances. The bill also extends the period from 13 weeks to up to 12 months in which additional childcare subsidy determinations can be made for certain defined classes of children, such as children on a long-term protection orders, including those in foster care. A further amendment will clarify that a provider is eligible for additional childcare subsidy for certain children, such as foster children. I support this bill and the measures to make it easier for families in difficult circumstances to access child care.

I'd like to acknowledge and thank the childcare workers across Australia, in particular in Warringah, who have been on the front line of the response to COVID-19. They have endured numerous changes in their conditions throughout the pandemic response and are now precluded from access to JobKeeper payments. The legislation is important in making it easier for families in unconventional situations to access the additional childcare subsidy. However, given this legislation was introduced prior to the COVID-19 pandemic, it does not go far enough and, I suggest, is an opportunity missed. There are wideranging issues within the childcare sector that need to be addressed. The affordability of services for families has become an increasingly important concern. Similarly, the COVID-19 pandemic has highlighted the impacts of interruptions to services on the children in care as well as on their families and their ability to re-engage with work.

In Australia we have one of the most expensive childcare systems in the world. The pandemic has shown that there are serious issues with the sustainability of the current model. We must take this opportunity to look at it and look for a new way to deal with child care. This particular bill is important to address inequalities that existed in the availability of the additional childcare subsidy scheme between those with traditional families and those with foster children. In speaking with interest groups, such as The Parenthood group, they recognise that this legislation is important to fix gaps in the current system. They argue, and I join my voice to theirs, that more needs to be done to address the broader issues in Australia.

Whilst this legislation is necessary and it is an ethical thing to do to improve access for disadvantaged and vulnerable families in our community, as I've said, more needs to be done. I've received a significant amount of correspondence from families, childcare centres, family day care providers and other interest groups in my electorate in recent months on the issue of child care. Since the start of this pandemic, there has been no solution implemented that satisfies parents, childcare centres and professionals. While childcare centres were struggling with falling attendance at the outset of the pandemic, parents too were finding it difficult to work from home with young children around. When the government announced free child care for all, parents were overwhelmingly pleased with the outcome. However, in many places—and in Warringah, perhaps more so than other electorates—childcare centres suffered greatly as the level of funding did not match the operational costs of centres. Many childcare centres saw their revenue cut by up to two-thirds. This was an unsustainable situation for childcare centres. We received numerous representations from childcare centres and parents alike, fearing the closure of centres due to the unsustainable operating model forced upon them.

Then we have the return to the childcare subsidy scheme, which has been welcomed by providers due to the compatibility with their existing business models, but that change has now impacted families. The Parenthood group conducted a survey of 2,200 households in June, which found more than half—some 60 per cent of Australian households using child care—would have a parent forced to reduce work when full childcare fees returned and in 68 per cent of those households the parent who would stop or reduce work would be a woman. Affordability of child care for families was already an issue prior to COVID-19. Now, with an increased number of people out of work, particularly women, access to affordable child care is a key factor in decision-making about how and when to return to work. On average, Australian families sending their children to child care pay between 30 and 40 per cent of their household income, when—and it's important to appreciate the difference—the OECD average is just 11 per cent.

The bulk of the caring responsibility in Australia still falls to Australian women. The Grattan Institute recently pointed out that, even before COVID-19, Australian women were doing 2.2 fewer hours of paid work on average but 2.3 more hours of unpaid work than men every day. A decade after the birth of the first child, the average mother does more caring and twice as much household work as the average father. The value of early childhood education to the wellbeing and development of our future leaders is well documented. Conversely, the impact on children of the interruption to childcare services can drive learning difficulties and mental health challenges for young Australians. These are not the outcomes we want. The need for consistency at a young age is paramount to our young people's success.

There is a solid business case for greater investment in childcare affordability. The Grattan Institute calculated that the return is more than two to one. Should the federal government spend an extra $5 billion a year on childcare subsidies, the pay-off would be an $11 billion a year increase in GDP from the boost to workforce participation, and $150,000 in higher lifetime earnings for the typical Australian mother. I would urge the coalition government, as a government focused on economic policy, to look at this sector and make the necessary changes. This would be a great step towards improving gender parity in earnings for Australian men and women. Similarly, reforms to the parental leave scheme could also contribute to enhancing male participation in caring and unpaid work responsibilities.

Given the disproportionate impact of the COVID-19 recession on women and female dominated industries, solutions for how to get women back into the workforce should be front of mind for the government in planning stimulus and recovery packages. Sadly, there has not been any such focus. At the recent Women's Job Creation Forum led by Minister Payne, child care was not on the agenda.

In conclusion, while I support this legislation, I urge the government to look further at the childcare system in place in Australia and develop a new legislation to make it affordable to all Australians. I urge the Minister for Women, the Minister for Education and the minister for social services to work closely together on these issues, because an integrated solution is required to make sure we can recover and come out stronger on the other side of this recession. We know that child care is good at getting women into the paid workforce and we know that it is important for the development of our children. Both of these elements contribute to a solid return on investment—let alone the ethical question. Our childcare sector needs work, and it is in the best interests of all of Australia to invest in it. I urge the government to do so.