Intervew 774 ABC Melbourne Mornings with Jon Faine- Childcare, Productivity Commission Draft report, Paid Parental Leave

  • Assistant Minister for Education

774 ABC Melbourne Mornings with Jon Faine

SUBJECT/S:  Childcare, Productivity Commission Draft report, Paid Parental Leave

JON FAINE:            To turn to the federal sphere, Tony Abbott continues to defend his paid parental leave scheme and, clearly, he thinks he’s on solid ground doing so reinforced perhaps by new government figures showing that the nation is dealing with some sort of an emergency on child care. There is clearly something going on when fees have gone up over the last couple of years by 50 per cent and the number of facilities offering child care has nearly doubled.  There’s enormous demand and the community is struggling to meet it.  So what are the options to resolve the bottle neck?  Sussan Ley is the federal Minister responsible for child care in the Abbott Federal Government. Ms Ley, good morning to you.

SUSSAN LEY:         Good morning, Jon.

JON FAINE:              New figures provided – I’ve rattled off a few of them.  What are other significant stats as we try and grapple with the [indistinct] problem.

SUSSAN LEY:         Well, look, the one that really hits me in the face is that out of pocket costs for parents went up 40 per cent in the last four years of the Labor Government.  So when you talk about fee increases of 53 per cent, yes, and some of that you would get back through the rebate but out of pocket costs going up 40 per cent is just not sustainable for families and, unfortunately, when child care gets too expensive, parents take their children out, use informal arrangements.  There’s 10,000 au pairs in the country today and, what’s worse, they actually don’t go back to work.  They don’t participate in the workforce to the extent that they want to and that’s bad for the economy.

JON FAINE:              I will get back to you in just a second, Minister. Victorian State Parliament, the government is moving a motion of contempt against Geoff Shaw. It’s currently being considered. It’s being debated in the Parliament as we speak and I will bring you all the details as it happens in a moment or two as well.  We will see exactly what might happen.  The Government should be able to get that motion through depending on what the Labor Party choose to do procedurally and we will see where that goes to. Keeping a close eye on it for you. Back to the Federal Minister for Child Care, does it solve the problem to make nannies a tax deduction?

SUSSAN LEY:         Well, nannies or in home carers were a specific term of reference in our productivity commission review which concludes in October and the reason for that is mainly flexibility. People can’t get child care, the hours that they want and, you know, we no longer live in a 9 to 5, five day a week economy but, rather, a 24/7 one and if you’ve got two children, by the time you pack them into the car, commute to work, find child care, worry that the boss is going to ask you to stay past 6 o'clock, you know, you won’t get back before the child – the long day care centre closes. You start panicking and in the end you decide it’s all not worth it. Of course, it makes sense to look at in home care. So that’s on the table as is everything else, by the way, as we work our way through this productivity commission review. A whole of the economy look at child care and recognising that the policy settings of the last generation just don’t belong to the next 30 years. So we are going to change things up.

JON FAINE:              Minister, can I just come back to you in a moment. We have an emergency in the Victorian State Parliament.

SUSSAN LEY:         Sure.

JON FAINE:              I do want to ask you more questions but I just very quickly want to get a word or two from our state political report where a vote of no confidence is being moved against the Frankston ex-Liberal Independent, Geoff Shaw, and our state political reporter, Frances Bell, can quickly bring us up to speed on what all this means.


JON FAINE:              Time will tell. I better let you get ready for that press conference. Thank you. Frances Bell, our state political reporter. Back to the federal Minister responsible for child care, Sussan Ley. Apologies for that, Minister.

SUSSAN LEY:         That’s perfectly fine, Jon.

JON FAINE:              But it was breaking news from the State Parliament...

SUSSAN LEY:         Yes.

JON FAINE:              And this has been, I might say, somewhat of a saga in the Nordic sense. Leaving that aside, another option other than making nannies tax deductible is to provide some form of government payment to grandparents. How could that work?

SUSSAN LEY:         Well, this issue has been picked up because of the Productivity Commission Draft Report. It hasn’t made specific comments about grandparents per se; it simply said that if you are an in-home carer receiving a subsidy from the government you should have a minimum Cert. III qualification. In other words, you should come under the formal regulated system that we have now in long day care.
As I like to say, we’re not going to pay anyone to have someone unstack the dishwasher and be in the home babysitting. You know, childcare has moved past that, it’s early education and care. So this isn’t really about grandparents. If grandparents have a Certificate III – and many of them do – they could of course participate if indeed we get to that point following this review and that becomes our policy. It’s, as I said, all on the table at the moment.

JON FAINE:              Isn’t that a rort, for a government payment to be made to grandparents to do what most of them do for love rather than money?

SUSSAN LEY:         No. It’s a proposal by the PC that anyone who offers in-home care should come under the formal regulated system, and, actually, grandparents can be registered as carers now and receive some support from the government. It’s about not making the distinction between a grandparent and someone else who is inside the regulated childcare system. The issue that we are grappling with is flexibility for families, and, mostly, grandparents will continue to do what they always have. In fact, it’s funny, Jon, because after the report came down, grandparents’ groups said, this is terrible, you’re now telling us, government, that we must have a qualification to look after our grandchildren, something we do anyway, which of course is not what we were saying and not what anyone is proposing. It is simply that we need to solve the issue of flexibility, and we need to find ways to allow parents to return to the workforce, and they’re not doing that in the way that they want to, the hours that they want to, in the job that they want to, because of the childcare crisis.

JON FAINE:              But if it doesn’t pass the common-sense test, I mean, one of the big problems we have, for instance, is all sorts of government payments that aren’t means-tested. I might be a bit old fashioned here, Minister, but I don’t think governments should ever give anybody money unless they need it. So, giving money to people unless it’s means-tested seems to me to be a terrible waste of taxpayers’ revenue.

SUSSAN LEY:         Well, I don’t think the PC – the Productivity Commission – is proposing that either. They’ve come up with a very complex model of the deemed cost of care. So what, obviously, governments have to do is work within what we can afford, what is the real cost of childcare, and then determine what support through subsidies...

JON FAINE:              Would you means test payment of that kind, to a point of being rorted, so that...

SUSSAN LEY:         That’s not...

JON FAINE:              ...well-off families don’t institute some sort of system where grandparents do what grandparents were doing anyway, but get paid for it when they don’t even need the money.

SUSSAN LEY:         Look, we’re not suggesting that anyone would rort a future system in the same way that we are careful about that now. So, yes, but childcare affordability is a problem at every income level, so while we have no plans to means test the rebate as it exists now, what the Productivity Commission is proposing is one payment based on the deemed cost of care. For example, some centres have luxuries. They have French lessons and cordon bleu cooking. Clearly, the taxpayer should not be paying for that through government subsidies. So we have to work out, what’s the real cost, how are parents’ affordability impacted. We’ve got $31 billion in the childcare funding envelope over the next four years. That’s a very strong position that the Commonwealth is in. That’s why this economy-wide review and the resulting policies – we’ve got scope to do things much better. But I’m focused on affordability and flexibility...

JON FAINE:              And while you’re focused on that, and while you’re trying to get the best bang for your buck, the Prime Minister’s pet project of a paid parental leave scheme that is extraordinarily generous of course has to come in for some scrutiny as well.

SUSSAN LEY:         It’s a separate policy, and I’m a strong supporter of...

JON FAINE:              They’re related.

SUSSAN LEY:         Well, look, one is about having children a workplace entitlement, and if I can just give you this example. There are a lot of women who are the main breadwinners in their families, and dad is on lower income or more of a stay-at-home. So, if that woman steps away from the workforce to have a baby, isn’t it reasonable that she continues to receive her wages as a workplace entitlement, just as she would for any other type of long service leave, sick leave, et cetera? And if she can’t, then there’s every chance that she won’t have, whether it’s the first, second or third child. So this is about families having children and about workplace entitlement. Childcare is about going back to work after you’ve had children and finding someone to educate and care for your child so that you can participate in the workforce. They’re absolutely two separate things.

JON FAINE:              Thank you for your explanations this morning and apologies again for the interruption.

SUSSAN LEY:         Thanks for having me on the program, Jon.

JON FAINE:             The federal Minister responsible for childcare, Sussan Ley MP, and those reports there’s further events taking place later in this week.


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