Jacinta Collins (Victoria, Australian Labor Party, Parliamentary Secretary for School Education and Workplace Relations) Share this | Hansard source

I thank senators for their contribution to this debate. I must say, though, Senator Nash, that I heard most of your contribution, which I would reflect was truly audacious. I am sure we will get some tedious repetition of the rhetoric that was covered in other matters that may be soon before us. I was very pleased to hear that you do indeed talk to parents and I thought, somewhat glibly, that some of my closest friends are parents. But, truly, in relation to the Family Assistance Legislation Amendment (Child Care Rebate) Bill 2011 and the general agreement to progress what I think is a very sensible matter, I think we will keep it as light as that.

As others have highlighted, this bill will for the first time enable families to access the child care rebate no later than fortnightly, and in many cases earlier than that. This has been a particular public policy venture of mine since the Howard government introduced the child care rebate and parents needed to wait until the tax year after the tax year in which they had expended those costs. As a result of this measure, as has been highlighted by others, around 700,000 Australian families will be able to receive this essential assistance at the time when their childcare fees are due. Importantly, many families will be able to receive this payment weekly, as the majority of childcare services submit attendance information weekly.

From July this year families will have the choice of four options for receiving the child care rebate. Families will be able to elect to have their child care rebate payments made to the childcare service fortnightly, at a minimum, on their behalf as a way of fee reduction; to receive their child care rebate payments directly into their bank account fortnightly, at a minimum; to have their child care rebate made to their bank account quarterly; or to have their child care rebate payment made annually as a lump sum payment. By providing families with these choices, the Australian government is ensuring that families have significantly more flexibility to manage their childcare costs within their family budget.

For the first time, childcare services will be able to receive the rebate on behalf of families, delivering a direct fee reduction for those families that elect this method of payment. Currently 98 per cent of families choose to receive the child care benefit this way. To ensure that families do not accumulate any unforeseen debts as a result of overestimating their income, this bill also contains amendments to temporarily withhold 15 per cent of each rebate payment for families receiving a higher than zero rate of child care benefit. This is consistent with current arrangements for the quarterly child care rebate payments, where the final quarterly payment may be used to offset any childcare payment debts incurred by the family. This measure builds on the government’s impressive record of improving the affordability and quality of early education and care and it will be widely welcomed by Australian families.

In 2008 we delivered our election commitments to increase the child care rebate from 30 per cent to 50 per cent of out-of-pocket expenses, from a maximum of $4,354 to $7,500 per child per year, a significant benefit to families and childcare affordability. Under the Howard government, families could claim a maximum of only $4,354 per child per year, which was some 72 per cent less than under the Gillard Labor government. I highlight these points to stand in contrast to the claims that Senator Nash was outlining earlier and to her rhetoric. The point I made earlier was that we have also increased the frequency of the child care rebate payments to families from yearly to quarterly and now to fortnightly, which is far better than in 2004, when families had to wait 18 months or so before they saw any support. Senator Nash may talk to parents, but many parents I talk to who were involved with childcare providers still remember the complexity of and the wait they had for childcare payments. At this stage I should mention that Senator Bilyk referred to herself and to me working in child care, and I should clarify that my involvement was in outside-school-hours care rather than in long day care—although outside-school-hours care is relevant here as well.

Overall, the Commonwealth is providing $14.9 billion to help 800,000 Australian families annually with the cost of child care through the child care benefit and the child care rebate. This includes $8.7 billion over four years to 2013-14 to reduce childcare fees for low- and middle-income earners, under the child care benefit, and $6.2 billion to assist working families with out-of-pocket childcare expenses, under the child care rebate. As a result of this massive investment, we now know that, since 2004, out-of-pocket costs for families earning $75,000 have reduced from 13 per cent of their disposable income to seven per cent in 2010. I think this point warrants repetition, given some of the rhetoric earlier, because there has been a huge increase in the affordability of child care in recent years. Fortunately, with a relatively considerable income, long day care is not a cost I need to meet, but for the many families who have significant childcare costs, some of whom have been referred to by other senators, this figure is very important. When people raise in debates the childcare costs to providers, it needs to be remembered that a significant proportion of those can be met by the Commonwealth government’s rebate, so in this debate we really need to be looking at issues around the out-of-pocket expenses faced by families. Indeed that is a critical and important issue amongst the issues of childcare service delivery such as improving the quality and the standards. The costs of improved quality and standards are at the very minimum met by a 50 per cent contribution from the Commonwealth through the child care tax rebate. Let me reiterate this point: as a result of Labor’s massive investment in child care, we now know that, since 2004, out-of-pocket costs for families earning $75,000 have reduced from 13 per cent of their disposable income to just seven per cent in the year 2010.

In conclusion, there are a few points that I would return to. When it comes to improving the affordability of child care, our record stands head and shoulders above the record of those opposite. Through this bill we will give 700,000 Australian families real and immediate assistance with child care. It is important that that assistance occurs at the time they incur their childcare fees. But it is also important, in conclusion, to go into some of the broader areas covered by Senator Nash in, I reiterate, some of her rhetoric. I remember the years 2003 and 2004, when I was working as shadow minister for children and youth. The minister at the time was Larry Anthony, and I recall that there was an agenda for early childhood that the Howard government paraded and paraded with no action, to the extent that the sector became more and more frustrated. The only action at that stage was the growth and further growth of organisations like ABC child care, whom of course Larry Anthony then went to work for.

So I think the credibility that this opposition has in child care needs to be very seriously questioned. They can criticise other measures that this government has undertaken whilst supporting this bill, but what they can never claim is that they actually acted on a national agenda for children. This is a very important and critical issue for the Labor government and we will continue down this path. It may well be that there are measures that need to be addressed that will not benefit 100 per cent of Australians, but we cannot be criticised for not having a national agenda, a national plan for significantly increasing the affordability and the quality of childcare services for Australian families.

Within that broader context, we return to the issue immediately before us, which is improving the regularity of payments for Australian families. This issue has a long history, dating back to when the Howard government first introduced the rebate at 30 per cent. It is now 50 per cent and families no longer have to wait 18 months, up to two years, before they see the assistance that should be immediately associated with their expenses in supporting their children. I commend the bill to the Senate.

Question agreed to.

Bill read a second time.