Julie Owens (Parramatta, Australian Labor Party, Shadow Parliamentary Secretary for Small Business) Share this | Hansard source

I rise to speak on the Family Assistance Legislation Amendment (Child Care Measures) Bill 2014. This bill seeks to do two things: to freeze the childcare rebate limit at $7½ thousand per child per annum for three years and to freeze income thresholds for the childcare benefit CCB for three years. In the second reading amendment proposed by the shadow minister, Kate Ellis, we have made it very clear that on this side of the House the opposition calls for the two elements of this bill to be separated so that they can be considered separately and there can be real community consultation with families and childcare providers on the effects of these changes separately.

For Labor there is quite a difference between the two. The childcare rebate, firstly, was something that Labor also sought to freeze when we were in opposition. The then opposition of course fought against that and argued that it was poor decision and they went around the country saying that it was a poor decision. But at the time we were talking about freezing the childcare rebate in order to transfer that money into other areas of child care. The then opposition has now completely changed its mind and thinks that it is a very good idea not just to freeze the rebate but to take that money out of child care completely, in other words, reduce the amount of funding available to parents who seek to put their children into child care.

The second element, though, the childcare benefit is something that we on this side of the House have extraordinary concerns about. This benefit is very much about low- and middle-income families. In many ways the combination of the two, the rebate and the benefit, recognises that for lower income families the proportion of the disposable income they spend on child care is greater and this compensates lower income and middle-income families for that difference by providing an extra payment. I heard the minister this morning on radio pretending that the freezing of the benefit would not make a difference because parents would then pick it up in the childcare rebate. If you know anything about mathematics, of course you would realise that that is not true. The childcare benefit is a 100 per cent payment and the rebate is 50 per cent up to $7½ thousand, so the more you reduce the benefit the less a low-income family receives in assistance, and it can be a substantial amount over a 12 month period.

In many ways, this is the government of extraordinary contradictions. We have an amazing one here where we see on one hand the gold plated paid parental leave scheme, which reimburses a parent at their full rate of pay up to $50,000, presumably intending to assist women to move in and out of the workforce. On the other hand, on the same page, they then make it more difficult for families to afford the child care they need on returning to work. So, on one hand they argue that they are trying to help women return to work and on the other hand they take the very thing that assists a family in raising children for the years after the birth of a child—again, an extraordinary contradiction.

But we see it in so many other ways: the slowing down of the increase in the super contribution, which makes it more likely that a person will need the pension—and then they cut the pension. They cut all funding to urban rail projects, making it more necessary to drive, and then they raise the cost of petrol. They cut preventive health agencies, making it more likely that a person will need to see a doctor, and then they raise the cost of going to a doctor. They deregulate universities, presumably to allow more people in to universities, but make it less affordable in doing so. They increase the interest on HECS to six per cent so that the more you earn the less you pay. A person working in a lower-paid job with the same university degree will pay more for their university education than a person in a higher paid job. And of course there is this one, where they are providing extraordinary levels of assistance to high-income earners yet making it more difficult for women in the lower- and middle-income areas to actually return to work at all.

You can see from our record in government the extent to which Labor understands the economic benefits of child care and preschool. We invested considerably in those areas, because we understand, unlike the current government, that prosperity is built not by the assets that we have in the ground but by the assets we have in our minds. We heard the Treasurer mention the word '2050' recently in terms of the costs of pensions, but we never hear the government talk about 2050 in terms of prosperity and where this nation will be at that time. But those of us who do think about that know that in 2050 it will not be the coal in the ground that makes us prosperous; it will be what we have in our minds—our ability to think, our ability to outperform intellectually and outperform in innovation the extraordinary powerhouses to our north.

The assets in 2050 will not be 55-year-olds like me; they will be 35-year-olds. Given the speed of change, the assets in 2050 will be the minds of our 35-year-olds—who are being born this year, and it takes 35 years to make one. It takes 35 years to make a good 35-year-old. And, unlike many other assets, you cannot retrofit them. You cannot redo their first five years of life. When a baby's mind decides that it wants to learn about language, that is what it learns, and you either encourage it to do that or you do not. You cannot do it later at anywhere near the same speed and, if you try, it costs you more. It takes 35 years to build the good 35-year-old worker that we will need in 2050, and it starts this year with the birth of children. We knew that, and that is why when we were in government we invested incredibly in preschool and early childhood education and sought to raise the standards so that child care was not about child minding but was actually about building the lives and the assets of the future.

There has been a considerable amount of research done on this. It is incredibly impressive—not just the impact of child care on three- to five-year-olds or two- to five-year-olds but the impact of child care on zero- to two-year-olds. Goodstart.org.au has provided some incredibly well-researched data. It assessed all year in year 1 against seven development domains, and it found that children who did not attend preschool were 50 per cent more likely to be developmentally vulnerable than children who did and that children from the poorest 20 per cent of households were twice as likely to be developmentally vulnerable as those from the richest 20 per cent. In other words, as a government, you need to invest in the poorest 20 per cent of households to lift them. If you want to be a 'lifter'—to use the language of the government—you invest in the poorest 20 per cent of households, because they are the ones where the difference will be greater, where there is a 50 per cent greater chance of them being developmentally vulnerable than there is for a child who did not attend preschool. Children who were developmentally vulnerable were also three times as likely as other children to perform poorly in reading, numeracy and NAPLAN tests in year 3, year 5 and year 7, again demonstrating that you cannot retrofit those first years of a child's life.

Children who attended three years of early learning or more performed much better on four-year literacy and numeracy tests. These tests, in 2011, were done over 40 developed countries that participated in international tests in literacy and numeracy and science for grade 4 children. Children who had three years of early learning or more scored an average of 30 to 40 points higher in the tests than did children who had no early learning and around 20 points higher than those who attended only one year of early learning. So, again, these early years are incredibly important in setting up those foundations across those incredibly important disciplines of reading, maths and science. Children who were taught by a preschool teacher with a diploma or degree qualifications scored 20 or 30 points higher in year 3. So, again, that quality framework that Labor introduced was done for a reason. It was done to ensure that our children in those incredibly important years of age zero to five had absolutely the best start in life so that when they reach 35 years of age and they are competing against these powerhouses to the north they will be the employees that our businesses want and they will be able to build good lives for themselves.

These are incredible results. A 15-year study of 3,000 English schoolchildren found that access to high-quality preschool had a strong effect on later literacy and numeracy and that the effect of 18 months of preschool was stronger on literacy and numeracy at age 11 than were all the six years of primary school. In other words, you can make a greater difference with that 18 months of preschool than you can in six years of school—again, absolute evidence for why governments should be investing in these early years to an incredible extent and why a bill before this House that makes it more difficult for people from low-income families to keep their children in child care to an extent that benefits the child is incredibly poor decision making. It indicates an extraordinary lack of vision for the future and indicates a government that claims to be thinking about the future but actually is not in any way.

That is why Labor, when it was in government, did a number of really important things, and it is really sad to see this government undoing those things as quickly as it can. Following its election in 2007 it increased the Child Care Rebate from 30 per cent to 50 per cent of out-of-pocket expenses and increased the cap from $4,300 to $7,500 per child, an incredibly important measure that meant that the number of children in child care at any one time grew to over one million, an increase of nearly 30 per cent since 2007.

We also introduced federal funding for preschool, and as a result the number of children benefiting from 15 hours of preschool—that is the number of hours covered in the survey from the UK—increased from 12 per cent of children, in 2008, to over 56 per cent of children in 2008. We know that attending 15 hours of preschool leads to higher scores in year three NAPLAN tests and year four maths, science and languages. In other words, that 15 hours of preschool is essential to building the assets this country needs.

We are benefiting from historical advances in education that we inherited, largely due to our history. With the extraordinary efforts that our neighbours to the north are putting into education on 50-year plans, if we think we can continue the way we are and still be competitive in 2050, we are kidding ourselves.

Let's look at what the government has done. They campaigned on making child care more affordable, yet they have done exactly the reverse. They stripped almost $1 billion from early education and care, $450 million for outside-school-hours care is gone, $157 million for family day-care centres is gone, support to help parents complete study and get back to work has been cut, programs to increase childcare places are completely gone, and Aboriginal Child and Family Centres funding is gone. How extraordinary is that from a government that speaks the language but cuts the programs. Then there is $300 million in support for educator wages, which is completely gone. Now, they are out on the attack on the backbone of the childcare system, which is the Child Care Rebate and the Child Care Benefit. I stress again that the Child Care Benefit is the one that assists low- and middle-income families to keep their children in child care to the extent necessary for that child to benefit from that outcome. They have also cut funding to the Partnership Agreement on Early Childhood, which funded preschool attendance of up to 15 hours per week, which again is something that will have an extraordinary impact on the future of our children.

I heard the minister this morning on radio saying that you can move from the benefit to the rebate. A basic understanding of maths would indicate that that is not the case. I would hope that in future our children who attend preschool for more than 15 hours a week would be able to see that, because it is actually quite basic mathematics. She also said that the government had no choice. That is an extraordinary thing. I did a quick calculation this morning on paid parental leave and the Child Care Rebate, given that the Child Care Benefit, even in its most expensive year of the forward estimates, would save the government $76.9 million this year. But I would say that it will cost Australians far more than that in the future through opportunity cost. But $76.9 million is about 1.5 per cent of what they would spend in a year on the paid parental leave scheme. So instead of paying 100 per cent of wages for women, up to $50,000, they could pay 98.5 per cent of wages and that would actually cover the difference. So they do have choices. They are making choices to put money into one area and not another, and this is a very bad place to start cutting.

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