Tanya Plibersek (Sydney, Australian Labor Party, Shadow Minister for Childcare) Share this | Hansard source

There are many provisions in the Family Assistance, Social Security and Veterans’ Affairs Legislation Amendment (2005 Budget and Other Measures) Bill 2006 that Labor is happy to support, such as the increase in the lower income free area for the family tax benefit part A from the current level of $33,361 to $37,500 from 1 July this year. We know that the new threshold will be significantly higher than the projected amount of $34,310 after adjustments are made for inflation. If these amendments were not put up, families would have suffered a loss in the value of the family tax benefit. We welcome the fact that this change will result in 530,000 families currently on family tax benefit part A getting up to $828 a year extra, depending on the number and ages of the children and their family income. We are also pleased that the government has finally recognised the logic of increasing the lower income free area for FTB part A—something that Labor has advocated now for many years.

There are some concerns, however, with this bill. I want to address some of those concerns now. The first is on the family tax benefit. While the government is acting to make sure that families on lower income levels are eligible to receive benefits and that benefits keep up with inflation, there is no attempt to stop people who are earning $1 million a year or more from receiving welfare benefits. I believe it is shocking that, in a country where some children are growing up without textbooks, money for school excursions or even an adequate diet, there are families on annual incomes exceeding $1 million who are receiving welfare benefits.

Let us make no mistake about this: family tax benefits are designed to be income distribution payments. They are welfare benefits. In the case of families on annual incomes over half a million dollars or $1 million, family tax benefit part B is a welfare payment paid out of the taxes of lower middle income families and singles who are struggling to afford the costs of raising children, a mortgage, the weekly petrol bill and groceries. This money is being transferred from struggling families to families who do not need the extra cash. Millionaires should not be the beneficiaries of income distribution, and under the Howard government they are.

Labor is taking the opportunity presented by this bill to end the family tax benefit part B rort which allows super rich families to claim up to $3,000 a year in obligation-free welfare from the government. We will be proposing amendments to end this outrageous welfare entitlement by introducing a family income cap for receipt of family tax benefit part B. Labor’s amendments prevent families with incomes of more than $250,000 a year from getting any family tax benefit part B from the government. It is a very generous income cap. Families with an income of over $250,000 surely do not need welfare payments.

Under the current rules, the total income of a family is not taken into account for the purposes of determining family tax benefit part B eligibility. As long as the income of the secondary earner in a family with a child or children under five years old is less than $20,951, or less than $16,316 if the child or children are over five, the family will get some family tax benefit part B. These rules enable very wealthy families to claim the benefit. Over 200 families with annual incomes of over $1 million a year have now claimed this benefit since it was introduced in 2000. These are not people who own a $1 million house. That is not our definition of millionaire. We are talking about families who earn $1 million a year. Last year alone, 70 millionaire families took advantage of this benefit for the wealthy and 2,000 families with annual incomes of over a quarter of a million dollars are receiving welfare from the government.

Labor does not believe that families earning over a quarter of a million dollars a year should be getting welfare payments from taxpayers, but we have seen consistently that the Howard government does. When challenged on this in the past, the former Minister for Family and Community Services, Senator Patterson, strangely enough claimed it would be too costly to implement a means test on this payment. I think this is an extraordinary claim when it is considered how many obligations are put on people receiving welfare more generally from the government. I would like to know from the new minister whether it is still the position of the government that it is too much trouble to check how much people are earning and whether they should be entitled to such payments.

Labor’s amendments will end this absurd loophole. In doing so, the system will be brought into line with community expectations. They are reasonable expectations that the system should be fair and consistent and that payments should be targeted at families most in need and not go to those who can afford to care for their kids without this extra taxpayer assistance.

Labor will move amendments to the carers allowance. The second amendment I will be putting is to provide a discretionary power to extend backdated carers allowance claims in cases where there are genuine reasons for delayed applications. This bill has the effect of severely cutting back the period for which carers can have payments for the care of a disabled child backdated from the current 12 months to just 12 weeks. It does not take too much imagination to understand how a parent who has just given birth to a disabled child or whose child has just become disabled through an accident or misadventure would not have in their first 12 weeks of coping with this new situation the time, energy or knowledge to get down to their local Centrelink office to start filling in paperwork.

The measure being proposed is estimated to significantly reduce payments made to carers when they first apply for the allowance. The government estimates it will save between $35 million and $37 million each year. It really seems incredible to me that the government should seek to save this money directly out of the pockets of people who are caring for disabled children and relatives. It is phenomenal, considering how much money it saves every year through the efforts of carers, that the government should seek to restrict people’s access to backdated payments which they are legitimately entitled to because of their caring responsibilities. That $37 million is coming directly out of the pockets of people who are already incredibly vulnerable and hard-pressed in many cases to make ends meet. They are taking care of severely disabled Australians and it is not infrequent for carers to have an injury or a disability themselves. They are frequently not able to get to the Centrelink office because respite care is so difficult to come by. Without the help they need to get to Centrelink in the first 12 weeks, it is completely unreasonable to expect them to be running around filling in paperwork when they have a duty of care to the people they are looking after.

It is particularly shocking that the National Party have agreed to these measures, because some of the people who will be worst affected are people in the bush. It is much harder getting to Centrelink or to a Family Assistance Office if you are in an isolated or rural area. In some cases, people are travelling hundreds of kilometres to a town which has a suitable service. On top of that, getting respite care to get out of the house in order to seek the advice you need in the first place, to find out that these payments are available, is much more difficult. This of course comes on top of the emotional challenges that come with the day-to-day reality of caring for a newborn child, say, with a disability or a partner who has an acquired brain injury because of an accident.

We know, because the department admitted to Labor at estimates last year, that under current arrangements claims for ‘a high proportion of children’—that is a quote from their evidence—are backdated for 52 weeks. The department admitted last year that the proportion of claims backdated was ‘of the order of 90 per cent’. That means that, because of the stress, difficulty and complexity of caring for a newborn child with a disability, and because they have not made getting to the Centrelink office a priority with all the other things they have on their plate, 90 per cent of people who would otherwise be entitled to the 52 weeks backdated payment are going to miss out financially. It is unbelievable that a government which has $12 billion sitting in the bank should look to the pockets of carers for money in this incredibly cruel and thoughtless way. It really is beyond belief that the government should look for savings out of the pockets of some Australians who have the hardest lives—people who are caring for a child with a disability.

Labor’s amendment gives the Secretary to the Department of Families, Community Services and Indigenous Affairs the discretionary power to extend backdated carer allowance claims in cases where there are genuine reasons for the delayed application. Those reasons might include that the person is unable to readily access relevant services or advice just 12 weeks after their family member suffers the disability or, secondly, that the person was unaware of the carer allowance. I have heard of that situation on many occasions. When people are coping with the day-to-day reality of learning how to care for someone with special needs, the last thing they are doing is scanning the family and community services website for how they might help themselves financially.

A third reason that would be considered genuine under the amendments I am foreshadowing is that the parent underestimated the ongoing needs of their child and, perhaps months after the disabling condition arose, realised how much care would be needed. It is also worth remembering that, with a newborn baby, many disabilities are not picked up for many months. It is a gradual process of noticing that their developmental milestones are not being reached. It might be many months before a parent even considers their future—whether they will need to leave their employment and so on.

This legislation gives the secretary of the department the power to take allocated but unfilled places from out of school hours care and family day care providers. We will be moving amendments in relation to that. The justification for this new power is to allow the redistribution of places from areas of low demand to areas of high demand. If that is what this was actually going to do, people would not be so worried about it. The problem is that, at the moment, places take so very long to allocate that they will not be taken back from services that are not using them and reallocated; they will be taken back and never reallocated. There are still unallocated out of school hours care places in the system from the last budget. In December last year we were told that they numbered around 60,000. So the notion that there is a desperate need to take them back from existing services seems to be an effort to be seen to be doing something that, in fact, will have no positive effect for parents, children or child-care providers.

The child-care allocation system is extremely slow and unresponsive. Out of school hours care centres and family day carers often face a wait of up to two years to regain places that they lose under this system. We have been told many times by family day carers that it can take up to two years from when they apply for a place to when they receive that place. Nobody can run a business or a service that way. Family day care providers have to be able to prove that they have employees available to perform that care—they have to be able to show that they have someone to do the work. They cannot engage someone to do the work until they can show that person that there is a real prospect of them having a job, and they cannot prove that until they have the places allocated. We have this ridiculous catch-22 situation that sees family day care in particular chasing its tail to receive places.

With out of school hours care, from what they tell me, I think that services would be perfectly happy to give unallocated places back into a pool of places if they knew that they could dip back into that pool if the numbers changed. It is phenomenal when, for instance, you can have a service that has been approved for 50 kids and at the end of January one year they find that school numbers have grown a little more than expected and they could easily provide for 53 kids at the service. They have the staff, they have the room and they have the kids who need the space, but they need to wait till November for the next funding round to actually get those places. It is a nonsensical system.

Who will have the power to decide when to take back places and when to reallocate them? The department will have that power, and it is the same department that admits time after time, because of this government’s shocking negligence when it comes to child care, that they do not know where the shortages are. For long day care in particular, they do not have a clue where the shortages are. They tell us that time and time again and they say that it is not their responsibility to know where the shortages are. I cannot have any confidence in a system that puts the same department that takes two years to allocate the places in charge of taking them back and reallocating them. I cannot have any confidence that this will improve the efficiency of the system.

Labor senators recently asked how well prepared the department is to deal with these new powers and whether the department was convinced that it would know more about where the shortages and areas of excess were than individual child-care operators know about demand for their services. Frankly, the answers were quite alarming. The department admitted that it does not have any measures of demand at regional levels. It does not know how many places are not currently being utilised; it only has ‘some sense’ of the numbers and it has not even decided on a definition of ‘excess places’. In other words, the government has decided to propose a new power to take away child-care places from providers that have been ‘consistently unused’, but it does not know what ‘consistently unused’ means. We are being asked to allow child-care places to be forcibly removed from providers despite the fact that the government does not know where the areas of high and low demand are or how long a vacant spot needs to be vacant before the government can swoop down and take it away.

Our objections could be expressed in this way: we are worried that places removed from one service do not have to be reallocated to another service and certainly do not need to be immediately reallocated to another service. We are worried that the system for allocating and reallocating places is rigid and slow, that generally places are only allocated within advertised windows when services are invited to apply, that there have been fewer than five such windows since 2000 and that services, as I have said, often have to wait up to two years from the point of request for new places to have those places finally allocated. No-one can plan for the operation of their service in those circumstances.

Parents around the country might be without a child-care place simply because the allocation system lags behind new demand. We can have a situation where the government has actually allocated the money in the budget for out of school hours care places or family day care places, the service provider says, ‘We’re happy to take more kids, we’ve got the staff and we’ve got the space,’ parents are desperate for the service and their kids want to go but, because the cogs turn so slowly in the absurd allocation system that we have, those kids, those parents and those service providers might not be able to use those places. It is ridiculous, and to give the opportunity in those circumstances of taking these places back is actually extraordinary.

The government’s ability to accurately assess unmet need for child care is poor. It has admitted this on many occasions. In fact, it uses it as a defence. When I ask questions about unmet demand in various areas, the government is very happy to say, ‘We don’t know; we don’t keep those figures; we’re not interested in keeping those figures; we don’t see it as our job to keep those figures.’ So the notion that we should then entrust to that system a new power that can take back places when we have not worked out how we will define that they are being underutilised or unutilised and we have not defined how and when they will be reallocated fills me with dread rather than giving me any cause for confidence. Labor have said in the past that we should have a pool of places where existing service providers that have passed the relevant state licensing requirements, where they exist, and have the space and the staff should be able to operate above their quota. They should be able to dip in very quickly and get extra places so that when they find out that they need extra places in January they are not waiting till November before they can apply for those places.

I will be moving amendments in the consideration in detail stage that will have the effect of, firstly, limiting the secretary’s power to reduce the allocation of places to a service until it has been continually vacant for 12 months; secondly, reallocating the place to another service within seven days of removal; thirdly, obliging the secretary to assess applications for additional places to meet demand throughout the year; and, fourthly, requiring the government to include reporting measures on the number of places that have been taken back and reallocated.

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