Helen Polley (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

I take great delight in being able to continue my remarks on this important piece of legislation, the Family Assistance Legislation Amendment (Child Care Budget Measures) Bill 2010. The Australian Early Development Index suggests that 23.5 per cent of all Australian children are vulnerable in at least one of the domains assessed by this index. The index looks at issues such as physical health and wellbeing, social competence, emotional maturity, language and cognitive skills, communication skills and general knowledge.

These measures will significantly benefit all children receiving child care and early education in Australia. There will be a small impact on very few Australians. I acknowledge that. The Abbott coalition thinks this should be deferred indefinitely. This is yet again a demonstration of how those opposite do not have the capacity to support good pieces of legislation that will do good things for Australian families, in particular for our children. It is hardly fair to defer this indefinitely. It is not fair to our children, to Australian families or to those within the childcare industry. Why should they have to wait?

While we acknowledge, as I said, that there will be an impact, you must agree that the benefits hugely outweigh the costs. I am sure John Stuart Mill would agree: there is a much greater good for the greater number—in this case, for all of our community, as our children will benefit. From my point of view, and from the government’s point of view, I would suggest that there is no greater investment than this investment and those we need to make in similar legislation for our children—into children’s health and wellbeing and their education. There is no doubt that the studies I referred to earlier in my speech reinforce that the money we invest in early childhood, in terms of getting them ready for school, has long-term benefits for them academically, socially and from a general health and wellbeing point of view.

I urge those opposite to reconsider and to support this legislation. This is important legislation. It is going to support families. It will go a long way to support the children in child care and those working in the childcare industry. I therefore commend this piece of legislation and urge those opposite to support it. (Quorum formed)

Sarah Hanson-Young (SA, Australian Greens) Share this | Link to this | Hansard source

I rise today to speak to the Family Assistance Legislation Amendment (Child Care Budget Measures) Bill 2010. Doesn’t it feel like Groundhog Day? We have spoken about this bill already in this chamber. We spoke about it after the budget last year. Of course, at that time, back in May and June, the Senate decided that they wanted to amend this piece of legislation because it was not good enough for the government simply to freeze the indexation for child care at the 2008-09 levels and not consider doing whatever they could to ease the burden on working families—those families who of course rely everyday on the childcare support measures.

So the Senate amended this piece of legislation so that we could have fortnightly payments introduced, to ensure that parents who have to pay their childcare fees on a weekly basis would only have to wait two weeks to get their 50 per cent rebate. That would go a long way to helping families manage their weekly, fortnightly and monthly budgets. Currently, the situation is that child care is repaid through the childcare rebate every quarter. So, despite some families having to pay up to $300, $400 or $500 in childcare fees per week, they would have to wait an entire three months before being able to get that 50 per cent rebate.

This chamber agreed that it was not good enough for this piece of legislation, as presented by the government, to be passed without ensuring that we can do other things to address the burden on families through childcare support. The Greens amendment standing in my name successfully passed through this chamber to do that. It then went to the House, where it was rejected. We have seen election promises. The Gillard government said, ‘Yes, fortnightly payments are a great idea.’ I do question why this was not supported in June last year, because we could already have been giving parents that much needed support. We have now seen this bill re-presented to the parliament in its old form, unamended.

There are a lot of things that need to be fixed in the way that the childcare rebate is administered and in the way it is given to parents to support them. We also need to look at having a broader understanding of how we support child care across this country. This chamber supported a 12-month inquiry into how we run various childcare support—the childcare benefit, the childcare tax rebate—in the aftermath of the ABC collapse. The report from that inquiry specifically said that things like the funding of the childcare rebate and the childcare benefit needed to be revised by the government of the day, because we are not being the most efficient in funding childcare services for Australian families that ensure the best quality of care for our youngest Australians.

So we are here today discussing this bill again. While I find it perplexing that this bill will only save us $86.3 million over four years, it could cost some parents upwards of $1,000 extra per year. We want childcare standards in this country to be raised. That means we need to start paying childcare workers what they are worth. We need to ensure that there are more staff on the floor caring for our kids. All of these things are going to mean that childcare costs need to rise, because that is the only way we will be paying for the value of caring and looking after the early education of our youngest Australians. If we see a freezing of the indexation, as suggested in this bill by this government, with no recourse as to how we make thing easier for parents, we will see parents being forced to pay higher childcare fees. They will be struggling to keep their kids in places that have better quality care and resorting to care that is substandard, simply because they cannot afford the best-quality care that their children deserve.

I have said already that we know that this is going to affect Australian families. One of the key things that I found frustrating last time we discussed this bill was that the government would not be upfront with how many families this legislation was going to affect. Through the process of Senate estimates, which this chamber sponsors, we know that rather than just a few thousand families—as was promoted and reported by the Prime Minister herself when this legislation was first presented back in 2010—in the vicinity of at least 72,000 Australian families are going to have to pay more money because of this particular measure.

I know that the savings from this bill are going to go towards other areas of child care, including helping to implement the quality framework. Why aren’t we paying for that anyway? Why haven’t we funded that anyway? Trying to find budget savings in child care and early childhood education services just does not make sense. It is one of the places you would not touch if you were a government who believed in training and educating, in caring for our future generations, for our future schoolchildren and for our future workers, in ensuring that, right from the word go in those really formative years of zero to five, we give our young Australians the best support and the best chance possible. But of course this government has ignored that problem, has ignored that vision, and decided, ‘We will find some budget savings with the childcare rebate.’ I do not think that is good enough.

I am of course concerned that, despite Julia Gillard’s promises during the election campaign, saying that she liked the idea of fortnightly payments, we have seen time and time again many of these election promises being dumped. Already we have seen a variety of promises announced during the election campaign either put on the backburner or buried under the carpet altogether. The fortnightly payments should not land in the same place. The fortnightly payment of the childcare rebate is something that families actually need. It is something that would help them deal not just with the costs of today but the rising costs and the costs that would be implemented because of the freezing of the indexation.

My amendments have been circulated. I have circulated them before and this chamber has supported them before. It is time for the government to recognise that, if we are to support any type of change or reduction to the childcare rebate budget, we need to at least make it easier for families to access the money that they have already been promised. That means bringing forward payments to fortnightly intervals. That should not take until next year. It should have been able to be implemented last year. I want to make sure that these fortnightly payments are implemented and started by 1 July 2011. Until I see some legislation backing up the government’s promise on this or until we see this particular piece of legislation amended as the Senate has already agreed, the Greens will not be supporting this bill.

Louise Pratt (WA, Australian Labor Party) Share this | Link to this | Hansard source

This afternoon we are speaking about the Family Assistance Legislation Amendment (Child Care Budget Measures) Bill 2010. This bill represents the Gillard government’s strong commitment to ensuring that Australian families have access to quality early education and child care. This investment will be backed by more than $18 billion over the next four years. We are committing almost $11 billion more over the next four years than the coalition committed in its last four years of government. In other words, Labor’s financial commitment to early education and child care over the next four years is more than double that of the former coalition government.

In particular, the Gillard government is committed to ensuring that parents can afford quality child care—care that they need and that their children deserve. That is why this Labor government raised the childcare rebate to 50 per cent of a parent’s out-of-pocket expenses and increased the maximum for each child in care to $7,500 a year. Under the former government, the rebate was only 30 per cent, and the maximum that a family could receive was less than $4,500 a year. So in 2004, under the former coalition government, the out-of-pocket costs after subsidies for a family with one child in long day care earning just $50,000 a year was in fact 13 per cent of that household’s disposable income. In 2010, under this Gillard government, that proportion had declined to seven per cent. In other words, out-of-pocket costs as a proportion of disposable income for an average family with one child in long day care have almost halved under Labor.

We have also delivered on our promise to pay the childcare rebate quarterly. From 1 July 2011, families can choose to have their rebate paid fortnightly so that they can get assistance with their childcare costs as those costs arise instead of having to wait months for help. Altogether, this government is investing almost $15 billion over the next four years to help more than 800,000 Australian families each year with the cost of their child care. This is occurring through the education care benefit and the childcare rebate.

In the 2010-11 budget, the government made a decision to keep the childcare rebate cap at the level promised during the 2007 election—that is, at $7,500 per year. This means that under Labor the cap is still more than $3,000 a year higher than it was under the coalition, so we know that the vast majority of Australian families will not be affected by the change reflected in this legislation. In fact, only about three per cent of families currently using approved child care are going to be affected. It is estimated that by 2013-14 the average childcare rebate claim will be about $2,300. That is well under the cap of $7,500. In order to reach the cap, most families would need to be placing their child in care for at least 10 hours a day for more than four days a week at average fee levels. But we know that in Australia the average use of child care is much lower, with parents using it for around 2½ days a week. We also know that less than one per cent of families using child care who earn less than $100,000 a year will be impacted by this change in 2010-11.

You can see that this initiative is a sensible, well-targeted savings measure, one that will not affect the vast majority of Australian families using approved care. It is a savings measure which is expected to generate more than $86 million over the next four years. This represents more than $86 million which will help fund the National Quality Framework for Early Childhood Education and Care and which will also help fund the Gillard government’s $59 million investment in budget based funded early childhood services that are mostly located in rural and remote Australia. This national quality framework has been agreed upon in partnership with the states and territories. It will for the first time set a national quality standard for early childhood education and care providers across the country.

The quality reforms are about improving staff-to-child ratios so that each child will get more individual time and attention. The reforms also look to improving staff qualifications so that staff are better able to lead activities that inspire our youngsters and help them learn and develop. The reforms will also introduce a quality ratings system so that parents know about the quality of care on offer and can make informed choices, because parents in this country need peace of mind when they entrust their children to a childcare service. They need to know that their children will be safe, happy and in stimulating environments that will help them develop and learn.

Most childcare centres across Australia do their job well. Unfortunately, however, the latest report of the National Childcare Accreditation Council shows that too many centres are failing to meet basic safety, hygiene, education and wellbeing standards. Australian parents and their children deserve better than this. We can do better and we must do better when it comes to the safety, wellbeing and early learning of our children. That is why the Gillard government is working in partnership with the states and territories to lift the standard of child care across the nation by implementing this national quality framework.

For the coalition, implementing this national quality standard is all too hard. We know that the Leader of the Opposition, Mr Abbott—aka ‘Mr No’—wanted to put this important reform on hold indefinitely. The Gillard government does not believe that stalling is an option. It is not an option when the welfare and development of the youngest children in this nation are at stake. This government has made the tough decisions necessary to make the savings necessary to progress this vital reform. It is about safeguarding the wellbeing and early learning of Australian children.

I am pleased that the savings measures in this bill will also help fund the Gillard government’s $59 million in investment in over 140 budget based funded early childhood services. As I said before, these services are most commonly in rural and regional Australia and they provide care to some of this nation’s most vulnerable children. I know many of the communities in Western Australia that have these centres, and the great work of these places desperately needs more government support. It cannot be a one-size-fits-all investment. Our investment is targeted at supporting these services to provide children with higher quality early learning experiences.

The research has repeatedly demonstrated that high-quality early learning services are particularly important to disadvantaged young children. Such services play a critical role in shaping the future health, development and wellbeing outcomes of these vulnerable children. It is about things like substantially increasing the number of qualified staff in these services to ensure that staff are better equipped to provide high-quality care and, through infrastructure and facility upgrades, ensuring that children will be able to learn and play in a safe and appropriate environment. Importantly, we will also be working with services to improve their governance and administrative capacity, because we know how important these things are. They are the key to providing high-quality care now and in the future.

As a senator for the largest state in our nation, one with a large Indigenous population and with many regional and remote communities, I am very aware of the need to ensure that children in these communities do not miss out on the early learning opportunities available to their city peers. That is what these budget based funded early learning childhood centres are about. I am familiar with many of the communities whose childcare services will be receiving the extra funding as a result of our additional investment in budget based funded early childhood services. These are high-needs communities. They face significant issues related to poverty, isolation and cultural barriers that inhibit families from accessing community based services and activities. They are communities like the Indigenous communities in and around Port Hedland, where the Rose Nowers Early Learning Centre is located. This centre has been in existence for 20 years and is now undergoing a much-needed major redevelopment of its building and backyard. It is increasing the available places for Indigenous children in the Pilbara. It is also providing a new, more stimulating environment for its existing children. It is heavily involved in Child Care Links, a Commonwealth program that enables staff working at the centre to get out to the remoter parts of the Pilbara to offer playgroups and other early learning activities to young children and their families.

These are the kinds of things that we are making possible through this bill. Other centres include the Fitzroy Valley Early Learning Centre at Fitzroy Crossing and the Little Nuggets Early Learning Centre at Halls Creek—again, both childcare providers servicing very remote Indigenous communities. There is an absolutely pressing need to upgrade early childhood education and care services in both communities and to better integrate such services with other family services—things like parenting programs and maternal and child health services. The Shire of Halls Creek is in fact the fastest-growing shire in Western Australia and the region. It also has the youngest population in the state, with over 12 per cent of the Indigenous residents in Halls Creek aged between zero and four years. So the Commonwealth is working with the state government to upgrade the Little Nuggets Early Learning Centre to a children and family centre. That is going to enable a wider range of services to be provided at the centre, including mobile playgroups throughout the region. The Commonwealth will also fund two Indigenous childcare traineeships at Little Nuggets, to help improve the quality of the day care services currently offered at the centre.

A fourth service which will receive extra funding as a result of our additional investment in budget based funded early childhood services is the Saranna JET creche. This is an absolutely amazing service. I have visited it a number of times. This service provides care to the children of women participating in the residential treatment services offered by Cyrenian House to women affected by alcohol and drugs. The primary aim of the Saranna program is family preservation, where serious family dysfunction associated with alcohol or drug abuse has placed mothers and their children at the risk of separation. Saranna aims to address and prevent patterns of family dysfunction by providing therapeutic services to the women concerned, while simultaneously providing quality care to children that preserves and enhances the natural parental role. It is part of an on-site residential family program for these mothers and their children. It really underscores to me the importance of these budget based funded centres in supporting and providing early learning opportunities for vulnerable children in this country. I have been very privileged to visit Saranna, to talk to the team providing childcare and therapeutic services there and to meet some of the very beautiful children. There are not really adequate words for describing the difference that Saranna makes to the mothers and children who find safe haven there and rebuild their lives together.

Our additional investment in budget based funded early learning childhood services is going to help centres like these right across Western Australia. It will help them offer higher quality early learning opportunities, from Albany to Broome, from Kalgoorlie to Carnarvon. It is also going to assist creches at educational institutions, early learning centres in remote Indigenous communities and long day care services in our major regional centres, centres that in Western Australia are growing rapidly as they service the mining boom that is driving our national economy. These services will help our citizens of today learn, earn and contribute to the nation, knowing that their children are well cared for. They will also ensure that our citizens of tomorrow, even the most disadvantaged, have a greater opportunity of leading fulfilling lives in the future.

So you can see that the savings measures embodied in this bill will not affect the vast majority of Australian families, but they will fund essential improvements to the quality of care through the national quality framework, from which 800,000 Australian families will benefit. From this, many more children and parents will benefit into the future as the standards are lifted at our childcare centres right across the nation. The national quality framework reflects the Gillard government’s commitment to what is an ambitious reform agenda that is unapologetically based on improving affordability, access and quality. It is about access, quality and affordability for all early childhood education and care across the country.

What we have before us is also an additional investment in budget based funded early childhood services, and that is an extra commitment to providing assistance for those young children in our nation who are most in need. It is also about making sure that children in rural and regional Australia are not missing out on the critical early learning opportunities available to their peers in our capital cities. These are commitments that I share and I will certainly be keeping a close eye on the impact of these reforms as they are implemented in the years to come. I look forward to talking to the many childcare centres across Western Australia about these reforms. The children of Australia deserve a government that is 100 per cent committed to investing in their early years so that they can get the best opportunities in life. This is a commitment of the Gillard government represented in this bill. I commend the bill to the chamber.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

I indicate that again I cannot support the Family Assistance Legislation Amendment (Child Care Budget Measures) Bill 2010, but it is worth reflecting on what Senator Pratt said. The 2010-11 budget provides $273.7 million for the introduction of the National Quality Framework for Early Childhood Education and Care, the NQF, and the commentary is that this framework will involve, amongst other matters, a progressive phase-in of improved carer-child ratios and higher qualification requirements for carers. These are unambiguously good things. However, the flip side to that is that it is expected that, of necessity, this new national quality framework will increase the costs faced by childcare services, who will then in turn seek to pass on those costs to consumers. That is one of the policy dilemmas and policy conflicts inherent in this. No-one is questioning the need for higher standards, but it will come at a higher cost. The question is: who ought to pay for that and where should the money be found?

I did not support it in the last parliament and I do not support it now. This legislation will reduce the annual childcare rebate limit from $7,778 to $7,500 and will also crucially cap indexation for the next four years. The government says it is doing this to save $86.3 million over the next four years, but what concerns me is who will actually pay for this. It is my belief it will be the mums and dads who put their children into childcare centres. Under these changes the cost of care could increase by as much as $22 a day, and I oppose this additional impost on Australian families. The costs associated with child care are already significant and it makes no sense at all to be adding to the burden on families and making it even less affordable for parents to access child care.

It is rather ironic. On the one hand, the government wants to support parents with paid parental leave—which is completely laudable, something I strongly support. I thought it was a good and significant step in dealing with the issue of paid parental leave. The government should unambiguously be commended for that. But, on the other hand, the government penalises parents when they want to return to work by making child care less affordable. That is a consequence of this. The case for opposing the cuts to the childcare rebate cap has been put very well by the Australian Childcare Alliance and Childcare Associations Australia. The alliance makes the point that women’s participation rates in this country are extremely low by OECD standards and are at their lowest amongst women aged between 25 and 44, the prime child-bearing years. Secondly, the Henry tax review was asked by the government to make coherent recommendations to ensure appropriate incentives for, amongst other things, increased workforce participation. The key finding of an April 2010 Treasury department working paper was:

…  in contrast with previous Australian estimates, the cost of child care does have a statistically significant and negative effect on the labour supply of married mothers. This finding supports policy that reduces the costs of child care to encourage maternal labour supply.

That is what the Treasury paper said, and that makes a lot of sense.

I think it needs to be placed on the record that I believe this is a bad piece of legislation. We should look at the broader national interest in terms of productivity. By making child care more affordable, you will increase workforce participation rates. That is a good thing for our productivity and a good thing for our nation, and this piece of legislation would go against that. When you consider it in the context of the budget, $86.3 million is not an insignificant amount but it is not a huge amount. But this is something that will be hugely felt by families across the country. It will unfairly increase the costs of child care and therefore it ought to be opposed. I support the measure to change payments to fortnightly but cannot support this legislation to reduce the annual rebate limit and to cap indexation for the next four years.

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

I would like to thank senators for their contributions to this debate. I also note the Greens’ commitment to the more regular payment of the childcare rebate. It is an issue I have been following for many, many years, which I will come to in a moment. The government, of course, shares this commitment. It is why we moved from annual payments to quarterly payments in 2008 and why we committed, from 1 January this year, to giving families the option of having the rebate paid fortnightly. Acknowledging Senator Hanson-Young’s comments, we will be introducing legislation for fortnightly payments shortly. Receiving their rebate from the government closer to the time that their childcare bills arise will ease the pressure on many families’ weekly budgets.

Once again I would like to draw the attention of senators to the importance of this bill. This measure will return the childcare rebate annual cap to $7,500 per child per year and pause indexation of the annual cap for four years until 30 June 2014. This is in order to generate $86.3 million of savings that will be directly reinvested to support the government’s quest to increase the quality of child care and early education in Australia. It in part answers, although again I will come to more detail, Senator Xenophon’s point about where the money for the quality reform agenda should actually come from.

The evidence is clear that the early years of a child’s life are critical. In fact, a child’s experiences in their first five years shape their future outcomes for life. We have heard this not only in the Ken Henry review but in myriad productivity related reports covering education and other aspects of the economy. It is extremely important for Australia’s future. This measure will return the childcare rebate cap, as I indicated, to $7,500 per child and pause indexation of the annual cap for four years in order to generate the dollars to be directed towards the national reform agenda. The government firmly believes that the 800,000 Australian families that place their children in care each week deserve to know that when they drop their children off to care they are safe and in happy and stimulating environments. Yet although we know that many childcare centres across Australia are doing well and certainly on international standards they are doing very well, the National Childcare Accreditation Council’s latest report shows that, sadly, too many childcare centres are failing to meet basic safety, hygiene, education and wellbeing standards. For instance, of the 1,129 centres that received an accreditation decision between 1 January and 30 June, 30 per cent had failed to ensure that toileting and nappy change procedures were consistent with the advice from recognised health authorities and 32 per cent had failed to ensure that potentially dangerous products, plants and objects were inaccessible to children.

These figures demonstrate just how important it is to support our hardworking and dedicated early education and childcare workers to do the job they do best and to lift the quality of child care and early education across Australia. That is why we are working in partnership with state and territory governments to implement this national quality framework that will lift standards of child care across Australia. Through the national quality standard we will improve staff to child ratios so that every child gets more individual attention and care. We will raise staff qualifications to ensure staff are better able to lead activities that help children learn and develop. We will introduce a quality rating system for all childcare centres so that parents know the quality of care offered and can make more informed choices. And we will reduce red tape related to services so that providers only have to deal with one regulator and can spend less time on paperwork and more time on the care of the kids that they are caring for.

While the opposition wanted to put the national quality standard on hold indefinitely, the government believe that we can and must do better when it comes to the safety, wellbeing and early learning of our children. That is what parents expect from us, and through our quality reforms that is what we will deliver. Importantly, this measure will also help fund the government’s $59.4 million investment in improving the quality of over 140 budget based funded services. These services are predominantly located in rural and regional Australia and provide care to some of Australia’s most vulnerable children. Our investment will be targeted at supporting services to provide children with higher quality early learning services which will critically shape their future health, development and wellbeing outcomes. The childcare budget measures will not negatively affect the vast majority of families but will fund essential improvements in the quality of care from which 800,000 Australian families will benefit.

At this stage I would like to concentrate on that very point about where better quality in child care should be funded from and also on some other of Senator Xenophon’s comments with respect to where the impact of these particular measures is likely to be felt. The question that has been raised is whether low-income families as well as wealthy families will be hit by the government’s move to return the annual childcare rebate limit to $7,500. The answer is a very clear no—the impact is quite limited. This measure will not affect the vast majority of Australian families. In fact, in the year 2010-11 only three per cent of families will be affected by the change, and less than one per cent earning less than $100,000 per year. But it will fund essential improvements to the quality of care, from which 800,000 Australian families will indeed benefit. I am aware of the media claims that families with income as low as $37,000 will be affected by this measure. However, families with this level of income would receive significant assistance through the maximum rate of the childcare benefit. A family earning $37,000 a year and eligible for maximum childcare benefit of $3.68 per hour would need to be using full-time child care at a cost of $94 per day, or over $24,000 per child per year, to exceed the childcare rebate limit of $7,500. On average, families use only 26 hours of care per child per week. Families with one child in care cease to be eligible for the childcare benefit when they have an annual income of around $134,000. Families with this level of income, or higher, would need to be paying around $15,000 a year in childcare fees per child—remember that this is per child—before they reached the rebate limit.

In this debate senators and the public more generally need to be reminded that the impact of these measures is very well targeted and highly contained. But it does take us to the point that Senator Xenophon raised, which is: where should the money for quality be found? Indeed, the Prime Minister has also had to address this question on some occasions. As a past shadow minister for early childhood, I have noticed that some of the figures are actually referring to the impact of increases in costs while forgetting about the impact on increased costs of payments from the government through the childcare benefit or through the childcare rebate. So when we see some services saying that fees are going to increase by $10 a day or $30 a week they fail to account for the amelioration of the overall cost that occurs through the government’s other childcare support measures.

In that sense I think the Prime Minister’s response on this point is the most accurate. She said, ‘Yes, we do need to pay some more to ensure we have better quality in child care, but that cost is and should be shared.’ It is not being borne solely by parents. It is being borne also by the government not only through the cost-saving measures, such as those involved in this bill, but also through our ongoing payments through the childcare benefit and the childcare rebate.

I will address the issue of what the government is doing about affordability more generally. This is quite a longstanding issue. In fact, in my initial comments I entered the debate at a certain point in time whereas I should have perhaps gone back about four years earlier. I think I cited that the changes were made in 2008 to the annual payments of the rebate. What is forgotten is that the policy taken by the coalition to the 2004 election had a very interesting mechanism in it; it introduced the rebate back then at 30 per cent, which this government increased to 50 per cent to assist in affordability, but the very odd measure at that stage was that families needed to wait not only to claim it in their tax return but one year further. I recall this because I saw it as somewhat of a bizarre mechanism because I could not think of any other measure, and still no-one has brought to my attention any other measure, in the tax system where families would need to essentially wait one year further before they could present a claim. This was obviously done by the Howard government as a means of delaying the cost of election measures that they were introducing in 2004. A number of families complained about having to wait almost two years to receive the government assistance that would help them bear the cost of child care. We acted to ensure that that was improved to annually and we have now improved it to quarterly. We are now looking at making it even better by giving families the opportunity of fortnightly benefits. It is important for us to remember that when this tax rebate was first introduced families needed to wait up to two years for assistance.

Unlike the Howard government, this government is committed to delivering affordable, high-quality early education and care, and to demonstrate that fact there are quite a number of measures beyond those that are included in this bill. I will cover a number of these. Overall we are investing $14.9 billion over the next four years to help over 800,000 Australian families each year with the cost of child care. We have raised the childcare rebate from 30 per cent to 50 per cent of parents’ out-of-pocket expenses and increased the maximum for each child in care to $7,500 a year. Compare this to the assistance under the former coalition government, where the maximum was only $4,354 per year per child. Since 1 July 2008 this 72 per cent increase has assisted 735,000 Australian families to pay for their child care.

We know that the proportion of family income being spent on child care out-of-pocket costs has almost halved since 2004. Perhaps Senator Hanson-Young and Senator Xenophon should be very mindful of that figure. Whilst we are certainly seeking to implement some targeting measures to help us fund the quality reform agenda, we do need to be reminded of this point: the proportion of family income being spent on child care out-of-pocket costs has almost halved since 2004. It is dropping from 13 per cent to just seven per cent in the year 2010 for families with one child in care and earning $55,000 per year.

We also promised to pay the childcare rebate quarterly so that parents do not have to wait until the end of the year or, as it was originally, the end of the tax year after the tax year, to receive this crucial assistance, and we have delivered on this commitment. When this amendment is being addressed we will be providing fortnightly childcare rebate payments and these will provide significant benefits to families which will make it easier to manage childcare costs and the family budget.

I will go back to the most significant point and perhaps the most critical principle of this debate. I think Senator Xenophon hit it right on the head when he made the point that everybody agrees that the quality of child care needs to be improved considerably. On that point, he again raised the issue of who should pay for this. If you heard the original debate or if you listened to some of the media coverage you would get the impression that the cost of the quality reform agenda is to be met solely by parents and families. This argument needs to be comprehensively debunked. The Labor government has introduced a range of affordability measures that have halved the out-of-pocket expenses for child care in recent years, and in the future this will continue to be the case. We have the circumstances where families will be faced—

Debate interrupted.