Press Conference - Productivity Commission draft report

  • Assistant Minister for Education

Press Conference
SUBJECT/S: Press Conference with Sussan Ley, Federal Assistant Minister for Education.

SUSSAN LEY: It’s lovely to be here in the ACT with Senator Zed Seselja and the community in Gungahlin at this lovely early learning centre. Thank you, Fiona, for having us here. We value the investment that people like Fiona and her team make both in the infrastructure here, which is amazing, but also in the quality learning that’s happening. I’ve just met Mel, the preschool teacher. She’s talked about the bush tucker program and that’s an example of the focus that long day care centres have on early education and care and we’ve come such a long way since when my children were at school which was a long time ago. But what I want to say, today, is just make some remarks about the Productivity Commission’s draft report which hit the deck this morning and, firstly, say it is a draft report. The final report will come out in October and then the Government will be in a position to make decisions [pause] to make new decisions about policy settings for the future. Because what we know is that the system we inherited from Labor is pretty much broken and when you consider that child care costs went up 53 per cent in the last six years and out-of-pocket costs for parents went up 40 per cent, what it’s told me is that just by adding more money and more band-aids, it’s not working for families.The affordability they need is not there and the flexibility that they need is nowhere in sight and I talk to parents across the country who say we feel as if we’re designing our work life around our child care when what we should be doing is designing our child care around our working life. And I also speak to parents completely frustrated because they want to participate in the workforce but they can’t afford to and then, on the other hand, they can’t afford not to. In April there were 165,000 individuals who didn’t work because they couldn’t get the child care that they needed, the hours that they wanted. So, this is, as I said, a draft report from the PC. It’s pointing some interesting ways forward. We’re going to consider the final report in October. Between now and then there’s an opportunity for people to have their say and I encourage them to do that because this is, as I said, a once in a generation opportunity to change up a system that really is straining at the edges.

QUESTION: A lot of parents would be quite shocked with the idea of means testing the targeted rebate. A lot of parents will be against that. Are you able to rule that out now or is it something you’ll consider?

SUSSAN LEY: Well look, I just don’t want to rule anything in or out but affordability is an issue for families on any income so [pause]…[General chatter]…I’ll just pick up your point again. Look, I recognise that affordability is an issue for families on every single income. So, it’s not about us picking winners, really, it’s about saying it’s not working no matter whether you’re participating in the workforce two days a week, you want to be fulltime, you might, for example, be an emergency services worker who just can’t get the hours that your circumstances demand and you’re just struggling at the moment. The long commute to work, putting children in the car, unpacking them, taking them out, just a – you know, the stresses and strains of modern living. These are the things we want to address and affordability and flexibility are central to that.

QUESTION: [Indistinct] hard is it going to be or how has government [indistinct] to go about making some of the reforms that you do take on later on in the year, [indistinct] there’s going to be no funding allocated to [indistinct]?

SUSSAN LEY: What we’ve said is we’ll look at this within the existing framework. So, we have budgeted $28.5 billion over the next four years. That’s a strong financial position from the Commonwealth. So, I believe there is plenty of scope within that funding envelope to build a better system and what I learnt from Labor’s attempts was that just adding dollars doesn’t necessarily get it right. When it comes to flexibility there are many things we can do that aren’t necessarily attached to dollars. So, you know, I am confident and optimistic that we can do better and we will.

QUESTION: Regarding the nannies…

QUESTION: Have you any ideas - is taking out some of the money from Paid Parental Leave into Child Care, is that something that the Government will consider?

SUSSAN LEY: Look, Paid Parental Leave is a separate policy and Child Care is a separate policy. Paid Parental Leave is about an entitlement for women in the workplace and it’s also about women having time to have babies, to spend those vital early months bonding with their child and when I talk to parents who say I’m putting off having a child because I just can’t afford it, I know that our Paid Parental Leave system will actually give them the freedom to do that. This is about supporting family’s choices in how they have children. But Child Care, on the other hand, is about supporting family’s choices in how they go back to work and how they participate in the workforce and what they do, you know, regarding hours and times.

QUESTION: But you’d be aware that the report recommends that funding from the PPL would be – should be re-diverted - sorry, should be re-diverted to help pay for, say, funding nannies, for instance. You’ve said that the Government’s not going to rule anything in or not. Can you rule that idea in or out today?

SUSSAN LEY: Well, I can certainly say that we will consider Paid Parental Leave as a separate policy as we already have and nothing changes there. I know that the PC has made some comments and that’s a reasonable thing for it to do. This is a draft report, it’s entitled to have a view as do many other people who have put submissions in. But these are two separate policies. What I am focused on is fixing the Child Care system for the next generation.
QUESTION: Are you open to funding of nannies, though?

SUSSAN LEY: We actually asked the Productivity Commission to look at nannies or in-home care and some of that happens already with family day care, so, we know because we’ve heard long and loud from families who cannot get child care outside the long day care setting. So we do need to be flexible. But what I’d say about nannies is they would not be funding for nannies or in-home carers outside of our existing formal regulated system.

QUESTION: So you’d be seeking to introduce nannies into that particular system without any additional costs?

SUSSAN LEY: Well look, I’ve heard some comments from the Nannies Association saying this is the opportunity to professionalise their sector and they welcome this and they support qualifications and the right sort of regulation that actually gives them the same standing. And remember that this is about parental choice. Sometimes a family might need a nanny and then they might go to long day care, participate in the fabulous pre-school program at this centre, which is outstanding. But it’s about government supporting parent’s choices all along the way from when the children are babies to when they go to school and, by the way, out of school hours care as well, that’s something we haven’t touched on but it’s important.

QUESTION: The Productivity Commission itself admits that some middling income parents will get less under these changes of means testing. I mean, how is that better for families? Having less money from the Government to afford child care?

SUSSAN LEY: The Productivity Commission has come up with a cost model and they’ve actually asked for input into that model and I know they’ll get plenty of that over the next few months before the final report comes out so I don’t want to pre-empt that and I don’t want to dive too deep into their cost model. But what I want to say is this is not about making family’s child care less affordable but more affordable. And I know that families on all incomes struggle with this and I know that lots of parents say I can afford to work two days a week or maybe three and after that I can’t. We will build a system that supports the choices of parents to participate in the workforce to the level that suits them and that matches their family circumstances.

QUESTION: How are you going to do that? I mean, is this a case where, you know, Australia has lived for too long with people on very high income earnings also getting part of the rebates. Is that something that you think needs to change?

SUSSAN LEY: Look, I think we need to look at the whole model. I think we need to look at the benefit and the rebate, not just the amounts but the complexity of administration. Just remember the amount of hoops that you have to jump through just claim these payments, just to deal with the centre, with the family assistance office, with the Department of Social Services, with all of the bodies that need to know what’s going on in your child care world, that itself, is administratively complex and expensive. And while we’re talking about – I mean, we talk about reducing costs. I do want to note that the PC made special mention of the regulation and red tape under which child care centres operate and the fact that that is driving up prices and it’s unnecessary and something can be done about it.

QUESTION: So can you guarantee that no parent in Australia, no family in Australia will be worse off if you adopt the – this draft recommendation from the Productivity Commission?

SUSSAN LEY: Well, look it would be lovely to guarantee and rule things in or out, but I’m not going to do that. I’m going to wait and see what the PC says. But I just want to remind people that this is a report to government. We will decide what happens following the final report. I’m still hearing from parents and people involved in the childcare sector every day and I want that to continue and we’ll watch with interest how the conversation and the discussion develops. But it is about a more affordable flexible system. It is about meeting the needs of families and it’s about recognising as we do that what we have now is not working, is not suitable to the modern world and actually reflects the policy settings of a generation ago.

QUESTION: And can you promise that there will be better access to childcare, we won’t see the waiting lists we see now for a lot of child [indistinct]?

SUSSAN LEY: I know that in certain parts of the country there are waiting lists and I believe that that is part of the problem. But that’s one problem. There’s also a huge issue around getting childcare the hours that you work. So we’ve heard from nurses and police and emergency service workers, step away from the workforce to have a child and come back in and they’re back in the office because the office job is nine to five. So we lose their contribution and we lose their passion and that’s not a good thing. So we do want to build a more flexible system, one with better access.

QUESTION: So how do you, do you say the centre’s open until eight o’clock or nine o’clock at night rather than closing at six o’clock?

SUSSAN LEY: Look it’s not up to the Government to tell centres what to do and centres will make decisions and choices. But I would like to see centres freed from the regulation and red tape under which they operate now and able to respond to the needs of the community in which they live and work.

QUESTION: The paid parental leave scheme obviously is – now we criticise on a number of different areas and from your perspective, you know, you’re the Childcare Assistant Minister, do you think that genuinely we need a paid parental leave scheme that is that expensive when you already have one operating and that this money as your Productivity Commission said could be funnelled into childcare and making life easier.

SUSSAN LEY: I absolutely support the current paid parental leave system and I always have because I see it as a separate policy from childcare policy and I always feel frustrated on behalf of families who say we can’t afford to step away from the workforce to have a child because we can’t meet our mortgage payments, we can’t meet our household bills, we just might put it off for two or three more years. That’s not a good thing and it’s also not a good thing if parents feel - as they sometimes do, that they need to rush back to work in order to pick up the household bills and get the finances back on track when they really could be spending those vital six to 12 months with their baby, bonding with their baby in those vital months of life, completely separate policy. And look I haven’t even started on the workplace entitlement aspects of PPL which are also important. Why should a woman over the course of her working life miss out because she stepped away from the workforce to have a child? And it’s important that we know – I mean we do know the numbers of women who are low on superannuation, low on savings in their middle to later age and often that’s because they took time out to have children and the economy treated them differently. But we want them to participate. I value the participation that women make and I don’t want to lose that.

QUESTION: How will women afford to go back to work though if you means test a childcare rebate and a lot of women [indistinct]…? The women I spoke with this morning said [indistinct] means tested she [indistinct].

SUSSAN LEY: And I’d love her to make a submission. I’d love to hear from her. We need to hear all of these voices. This is not our report, this is the Productivity Commission’s report and we will ultimately decide how we respond.

QUESTION: Regarding nannies, if the Government adopts the Productivity Commission’s findings about subsidising nannies basically, how do you think low and middle income earners would feel if they are more out of pocket as a result of these stages and they can’t access those some services? They can’t afford them.

SUSSAN LEY: Again, I don’t want to pre-empt what the Productivity Commission might finally say. But I would pretty much disagree with your proposition and this is not about picking winners. This is about supporting everybody’s choices to participate, to find the childcare they need, the hours they want at the price that they can afford. I mean that’s what this is about. We’re not talking about winners or losers. The workplace and the economy as a whole is going to be the winner if we increase that participation for everybody. And just remember when somebody says to me – I think somebody says to me I can’t afford to go back to work, I can’t afford to stay at home, I know the system is not working, so I’m sure - I can guarantee that I will road-test whatever policies we come up with against those realities that working families face every day when it comes to their childcare choices.

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