Cory Bernardi (SA, Liberal Party, Shadow Parliamentary Secretary Assisting the Leader of the Opposition) Share this | Link to this | Hansard source

It is good to that we are onto this bill, and may I remind the committee just where we left off. We were examining some of the claims made by the then minister on duty, Senator Farrell, in his less-than-stoic defence in justifying this bill, which will, may I remind you, Madam Temporary Chairman, make it harder for families to afford child care. In his defence of the bill, Senator Farrell—and I am sure, Senator Collins, you will echo this in the talking points you have been given—said that the government took it to an election and that that somehow justifies its implementation or gives it a mandate, if you will. I heard Senator Birmingham, Senator Macdonald, Senator Nash and others detailing why this statement simply cannot stand with any legitimacy.

At the last election, the Australian people were reminded multiple times by the Prime Minister, Julia Gillard, as well as the member for Lilley, the Treasurer, Mr Swan, that there would be no carbon tax introduced under a government that they were part of. The Australian people were promised that time and time again. They were told there would be a citizens assembly to reach a consensus on climate change. They were told again and again that there were would be a cash-for-clunkers scheme. I have said to this Senate already that the biggest clunkers are the government themselves.

The Australian people were never told front and centre in any significant public forum or in any serious policy announcement that there was going to be a restriction on their ability to access child care. If any platitudes were mouthed in this area, it was about how the government was going to make child care more accessible and more affordable. It was about doing all of those sorts of things. There was no suggestion of such a claim in Prime Minister Gillard's then unscripted statements—I wish Hansard could pick up sarcasm, because that is what I mean by 'unscripted'; it was another downright misleading untruth—at the national launch of the Labor campaign. I do not recall Prime Minister Gillard saying, 'We are going to set a cap for the childcare rebate at $7,500 per annum and suspend the indexation of that rebate until 2014.' I do not recall that. I look to be reminded of the exact words that Ms Gillard said at the national campaign launch, for which we were all glued to our seats because she was speaking as the real Julia rather than the fake Julia, without any notes except the notes there were actually on the podium and only exposed later on.

Senator Birmingham interjecting—

It could well have been the 'fake real Julia' or the 'real fake Julia' as Senator Birmingham said. What we do know is the real damage this legislation will cause families. There are 20,700 families by the coalition's estimates, and more according to the Greens, who will be affected by this legislation. Do you think they are going to feel uplifted and benefited by this? I do not think so. What is the purpose of it? This government has misspent so much of the taxpayers' money. It has squandered it. It has thrown it around like the proverbial drunken sailor—and that is an insult to sailors, and I apologise to them—and this bill is going to save a paltry $86 million over four years by making it harder for Australian families.

Now I know it is very easy for members of the Labor Party to be removed from the day-to-day realities of life when they have slush funds and union funds to draw upon through credit cards and a whole range of things like that, but I feel it is my responsibility to remind those on the other side of the chamber, those in the government, that Australian families are doing it tough; they are doing it very tough. Sometimes they are forced to have both parents out at work and so we have this sentiment that child care is an important part of empowering families to be able to make ends meet, yet it is not without flaws, and I have said this repeatedly. Institutionalised child care is something we should be mindful of; it is not always the best option for families. But, nonetheless, it is there and it deserves the support of the taxpayers of Australia.

Senator Hanson-Young interjecting—

I take that point, Senator Hanson-Young. I absolutely agree with you. Some people do not have much choice, and I am about giving people choices in this area—I really am. I do not want to see us railroaded down one particular route where people are unable to access other forms of child care, including being able to afford to have a parent stay at home. It is a wonderful sacrifice, and I said that in my first speech. But I make the point that this bill also reduces the incentives for family day care centres and things of that nature to start up. It removes the benefits and the incentives, and that deprives people of choice. Senator Hanson-Young and I would not agree on every aspect of choice and every aspect of life—that would be an understatement of great proportions. But for somebody to be right somebody has to be wrong as well, and we can have that debate at some other time.

The point is that, with something as valuable to our future generations as caring for them, we want to make that care as amenable and as successful as possible. I recall that Senator Farrell said the government was going to spend $20 billion in this expanded area, but there is a legitimate concern that if you are going to spend $20 billion—20,000 million dollars, money that the government clearly does not have; it is going to borrow it—why are we trying to save this relatively paltry $86 million over four years? It would hardly pay the booze bill at the Lodge. Some 20,000 families will face a cap on their childcare rebate, with no chance of any increase whatsoever over the next four years. That strikes me as the wrong approach to take.

I know the Labor Party are desperate to claim some fiscal credibility but I think we are going to have to accept that they should wash their hands of that ambition—any credibility they may have had is just not going to be resurrected. Even with Labor's own personal desire to reclaim power at any cost, why would anyone penalise families? This is just a sense of social justice. I do not think I have used that term before, ever, but it makes me feel deeply uncomfortable that Australian families who are already doing it so very tough can be affected in this way. I think we have to agree on that, and I will look for an acknowledgement in Senator Collins's response that Australian families are doing it very tough. They are doing it very tough, particularly with food prices going up, electricity costs rising enormously and job security decreasing in the current environment, as we saw yesterday with the 1,000 jobs being lost from the BlueSteel plant.

As well, we have these great threats of additional imposts—the first of which is the mineral resource rent tax or whatever its latest incarnation is. It will divert investment in this country and suck money out of the productive economy into perhaps the most unproductive government we have ever seen. I remind the Senate and the good people of Australia that the government swore that the carbon tax would never be introduced until there was community consensus. Of course there is always community consensus for the Labor Party because if you disagree with them you are labelled a crank or an extremist or irrelevant or something like that. We heard about the convoy of no consequence—they are all very good at platitudes and sayings and demeaning others, but the fact is this: the government promised not to introduce a carbon tax and now one has been introduced and is likely to get up. That is going to put increasing pressure on Australian families. I think Senator Collins knows instinctively that this is a tax on electricity. I do not know whether she has tried to spend a day without electricity, but I cannot imagine it would be very pleasant. I deliver meals on wheels and I see people who struggle to pay the bills to heat their homes, particularly in winter. It is dreadfully disappointing to see people forced into circumstances where they have to sit with blankets on them rather than have the heater on. I guess there are some who are a obeying the government's propaganda to cuddle your pet rather than turn the heating on. That strikes me as unusual because many pensioners and families out there who are doing it tough can hardly afford to feed themselves so I do not know how they can afford to feed a pet they can cuddle to keep them warm, as the government propaganda suggests. But that is another topic. What we are establishing here is that families are doing it extraordinarily tough, not only with the price of food and electricity but also with the normal utilities. Labor administrations around the country are ramping up prices and taxes—whatever they see they try to grab and spend. Unfortunately this government is no different. I will be the first to acknowledge that fiscal prudence is a virtue in any government and that there need to be effective measures to cut costs, waste and spending, particularly in a spendthrift government like this. But there also need to be priorities. Priorities, in my view, should revolve around the primacy of the family. You do not disable or disempower families by restricting their options and availability for such paltry sums. To the men and women of Australia, $86 million over four years is a lot of money. In terms of the waste under this government it is not, but to the men and women of Australia it is a lot of money, and they are concerned that this government is wasting billions and yet trying to penalise them for that $86 million. It might not seem much when it rolls off the tongue of Senator Farrell and others that it is only $8 or $9 a week. That is notwithstanding the fact that—

Senator Jacinta Collins interjecting—

Senator Collins, maybe you can answer this question. The other analysis done by industry experts suggests that it is somewhere between $12 and $23 a week. Rather than the lines that were just given back to me, I would be interested in the justification for why no serious, competent analysis was done other than the single scenario that was put forward by Access Economics which said Australian families would be $8 a week worse off. As I said, $8 a week does not sound much when you are wasting billions, but $8 a week can mean the difference between having a full belly and not having a full belly. It is the difference between receiving a Meals on Wheels delivery one day and not receiving one another day.

These are the sorts of issues that Australians are worried about and yet they see a government that does not seem to care. This is a real problem. It is a government that sees no real cause for concern about tomorrow with what they are starting. Every time you create a snowball and you push it down a hill, it gets bigger and bigger. And their disasters keep getting bigger and bigger.

There were a number of submissions on this that said that the cost of child care will continue to rise from the national quality agenda measures which will quite simply increase overheads for childcare centres. Even some unions have said that without alternative allocation of funding the proportion of affected families will certainly increase over subsequent years.

Senator Collins, I know you probably were not paying attention to the debate before but I want to remind you of the scenario we were dealing with and the picture that had been painted. Quite frankly, I was very disappointed in the responses I got on the serious concerns of Australian families. I really would like to know why there was no additional modelling undertaken. I would like to know how saving $86 million and penalising families that need and rely on this support is in our national interest given that you are squandering billions of dollars elsewhere. Senator Collins, this is the challenge for you: come clean on the broadcast. Come clean with the Australian people. Let them know exactly why you are adding an $8 a week burden to their childcare costs now and why it is going to rise further in the future. Also, please explain to them how you can justify this given that you are going to be slugging them with a terrible carbon tax that will increase the cost of almost everything else they use. Might I remind you that that was a tax that you went to the last election, as did your entire team, promising never to introduce. While you are at it, you could explain why the Australian people should be able to rely on what you tell them now when it has been so demonstrably apparent that they cannot rely on anything else this government has ever said.

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

I would like to formally withdraw the amendment that has been circulated by me on behalf of the Greens. This was an amendment that was circulated some 12 months ago and it was going to amend this legislation to ensure that we could deliver fortnightly payments in order to ensure that parents could access the child care rebate fortnightly as opposed to quarterly. But of course since this amendment has been circulated the government has introduced a separate piece of legislation to do exactly that. Thankfully, this place has been able to pass that legislation so parents can access that. It started as of 1 July this year. So there is no need for the amendment, and I formally withdraw it.

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

by leave—Despite discussion during the committee stage, I understand we need to formally move the government amendments. I move government amendments (1) to (4) on sheet BM231 together:

(1)   Schedule 1, item 2, page 3 (lines 9 and 10), omit paragraph 84F(1)(e), substitute:

  (e)   for the income year ending on 30 June 2011—$7,941; and

  (ea)   for each of the income years ending on 30 June 2012, 30 June 2013 and 30 June 2014—$7,500; and

(2)   Schedule 1, item 4, page 3 (line 18), omit “1 July 2010,”.

(3)   Schedule 1, item 4, page 3 (line 20), omit “1 July 2010”, substitute “1 July 2011”.

(4)   Schedule 1, item 4, page 3 (line 22), omit “1 July 2011,”.

These amendments seek to change the start date of the measure from 1 July 2010 to 1 July 2011. As Senator Hanson-Young highlighted, it has been before the Senate for quite some time. This will ensure that the legislation is not retrospectively applied into the 2010-11 financial year and that we do not need to reclaim childcare rebate payments paid to families.

I take this opportunity to reiterate that the average childcare rebate claim is below $2,100, well under the cap of $7,500, meaning that the overwhelming majority of families will not be affected by this measure. In 2011-12 we expect more than 95 per cent of families will have no change—I stress no change—to their assistance. This measure will not affect the vast majority of families but will provide funding for essential improvements to the quality of care for Australia's children. Following some of the earlier remarks from Senator Bernardi, I can stress that the savings produced by this measure will be directly reinvested into delivering the national quality framework and thus improving the quality of care that families are experiencing.

For a family to reach the cap of $7,500, they would need to be paying for care for at least 10 hours a day for more than four days a week at average fee levels. The average use of child care in Australia is much lower, with most parents using around 2½ days of care a week. The most recent childcare rebate information shows claims of less than $2,100, well below the cap of $7,500. We expect that fewer than one per cent of families using child care, who earn less than $100,000 a year, will be impacted. Most importantly, as I have stressed, the measure produces savings to be directly reinvested in delivering the national quality framework. It will also help fund our $59.4 million investment in improving the quality of around 140 budget based funded early childhood services located in rural and remote Australia that provide care to some of Australia's most vulnerable children.

Perhaps I might also use this opportunity to stress a few further points, following Senator Bernardi's contribution—at least so far as it related to these particular measures. Apart from what seems to be a fairly obvious filibuster, Senator Bernardi is seeking to use this opportunity to attack Labor's record on affordability. The affordability issues in child care are critical and are very important, and Labor's record here is quite strong. Let me highlight that over the next four years, as I think Senator Farrell mentioned earlier, our government will provide a record $20.1 billion in childcare assistance for families. It is important to contrast this figure with what occurred under the Howard government. This is more than double the funding for direct assistance that was provided in the last four years of the Howard government. So for Senator Bernardi to talk about the pressures being faced by families—and we certainly do acknowledge that there are some significant cost-of-living pressures faced by some families—and to seek to use childcare assistance as a means of making that point is almost laughable.

The boost in funding is a direct result of delivering on our commitment to increase the childcare rebate from 30 per cent to 50 per cent of parents' out-of-pocket expenses and of increasing the maximum limit for each child from $4,354 under the Howard government to $7,500. Remember that distinction: $4,354 under the Howard government and our cap, which will be $7,500 a year. This 72 per cent increase in the rebate has assisted more than 735,000 Australian families to pay for their child care since 1 July 2008. The proportion of family income is perhaps the most critical point when we are talking about cost of living expenses and the cost of child care, as we know from some of the modelling and other data available to us since becoming far more transparent about childcare costs and funding arrangements. We know that the proportion of the family income being spent on childcare out-of-pocket costs has almost halved since 2004, dropping from 13 per cent to just seven per cent in 2010 for families with one child in care and earning less than $75,000 per year. Rather than those measures that seem to be plucked out of the air by Senator Bernardi, such as the $8 per week increase in childcare fees, the most critical figure for Australian families is what the out-of-pocket expense is for them. We know that that has decreased from 13 per cent under the Howard government to seven per cent last year.

The other important issue that Australian families are most sympathetic about is the quality of child care, and that is what this measure targets. We are not reducing overall spending in child care; we are generating a small amount of savings to ensure that the support to deliver the National Quality Framework is there and that it will deliver better quality care. I would ask any senator to contemplate the questions that I often ask families with children in child care: if you had a child under two years of age, would you prefer a five-to-one carer-child ratio or a four-to-one carer-child ratio, and would you be prepared to pay a marginal amount more to increase that level of care? Almost unanimously, those families I discuss this issue with say yes. This issue around the quality of care is extremely important.

There was one final issue in Senator Bernardi's remarks that I would like to clarify because it is relevant to these amendments—that is, the amendments mean that the paused indexation is now only for three years and not four years. To correct the record, Senator Bernardi was reading from an old copy of the bill and his figure of $86 million is now $81 million.

Fiona Nash (NSW, National Party, Shadow Parliamentary Secretary for Regional Education) Share this | Link to this | Hansard source

I thank the parliamentary secretary for her answer. I appreciate that you are now here, Senator Collins. Senator Farrell admirably tried to answer questions in your place and I am sure that the answers he gave us were entirely consistent with those that you would have given us if you had been here.

Senator Collins, you raised the issue of families being prepared to pay a little more. Just to enlighten you, some of the discussion we had a little earlier was about the fact that if the government had not mismanaged the economy so badly it would not have to use child care as a cash cow to fund the National Quality Framework. I noted in your contribution that you were espousing the funding that was going towards the National Quality Framework. Interestingly, according to the government's own budget website, the $59.4 million you referred to for budget based funded early childhood services is not for new services; the funding is to help them meet the national quality standards that you are talking about. I just wanted to clarify this because it certainly seemed that it was like an extra bucket of funding that was going to be raining down from the sky.

Senator Jacinta Collins interjecting—

By way of assistance, I note we had a discussion with the minister earlier around what consultation had taken place with the sector and also with families in the community. The minister was asked a couple of times about that. Unfortunately he was unable to provide the Senate with an answer about the consultation that had taken place but he did, from his point of view, try to assure the Senate that indeed this was a policy that had been taken to the election, that before the election people were very clear that this was a government policy and that they were well aware of that before the election. 'Before the election,' I think he said, 'we consulted with the Australian people,' through the information that was available to them before the election, 'on this particular piece of legislation.' Perhaps though it might be useful for the chamber, given the government's election policies, that I quote into the Hansard that it said 'it will reintroduce the indexation of the childcare rebate to help eligible families meet their childcare costs and the childcare rebate covers 50 per cent of out-of-pocket childcare expenses for approved child care' up to the annual cap of $7,500. That is from the government's own election document prior to 2010. My understanding of that would be there was no indication at all to the broader community that that was actually going to be a change to the current policy—going back to Senator Farrell's comments earlier that people were well informed—and also it would seem that at that point in 2010 there was not an annual cap of $7,500, and indeed that is only going to come in if this legislation passes.

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

Perhaps I should start by going back to some of the earlier comments by Senator Nash and come to that final question in a moment. Childcare funding is not a cash cow. I am astounded that she would even use an expression such as that when we are dealing with affordability and cost-of-living pressures being faced by families. What this measure seeks to do, as has been covered on many other occasions, is reconfigure existing funding to help ensure that the quality of child care available to families is improved. Certainly this measure does involve saving measures. This measure was government policy at the last election and the minister spoke at several community childcare forums during the election period with parents and childcare workers about the changes. This proposed measure was contained in the 2010-11 budget papers. The minister meets regularly with representatives of the childcare sector including the Childcare Alliance, the Australian Early Childhood Association, Family Day Care Australia and United Voice. All of the sector has been committed to the national quality framework. Indeed, these measures have been discussed and consulted on during countless forums relevant to the national quality framework.

But I need to stress again that what the government is doing here is going to impact on less than one per cent of families with a relatively limited impact to ensure, being fiscally responsible, that we reconfigure existing spending to support and drive the changes in childcare quality that are necessary to deliver good services for Australia's families and children. We have not suggested in any sense that the moneys being accounted for here relate to any new services or the delivery of new services but, rather, to assist existing services make the transition to providing better quality care.

Fiona Nash (NSW, National Party, Shadow Parliamentary Secretary for Regional Education) Share this | Link to this | Hansard source

I note the somewhat tone of umbrage the minister used when referring to my comments on a cash cow. I think that is exactly what it is. If you need to take money from something to pay to something else that thing is providing you cash. In this particular instance it is the changes to the childcare rebate and the costs associated being borne by families that are providing that cash. Senator Farrell indicated earlier that that was indeed the case, that it was indeed a savings measure, as you have just mentioned, Minister. It is interesting to note—as you say, it is important to be financially responsible—that the parents who are going to have to bear the burden of the increase would say that, if the government had been financially responsible, they would not need to make any changes at all to the current childcare rebate to be able to access funding for other measures. That is the point, Minister, and it has been raised very clearly in this place—that the reason you need to find the funding stream, the savings measures, indeed from the childcare rebate itself, is the government's mismanagement of the finances. Again, Senator Collins was not here earlier, so to assist: I drew the analogy that the government had wasted $80.9 million administering an emissions trading scheme which does not even exist. Perhaps if that had not happened the $81 million could have been used for this purpose. It is ironic that the figures are almost identical. That is what concerns people.

You have indicated the importance of the childcare sector and these measures. Perhaps the minister might inform the chamber of the importance the government is placing on this particular area. Labor's own website talks about policies and their comprehensive agenda, and of the 51 items on that comprehensive agenda to take Australia forward not one mentions child care. Not one of 51 policy issues on the Labor govern­ment's own website mentions child care. Yet we have those on the other side trying to say how important this issue is. There are 51 policy areas and child care does not rate a mention.

To give the government the benefit of the doubt, I saw at the bottom of this, 'More information on Labor government initiatives'. So I thought I would go to that and that maybe it is hidden further down. Interestingly, no. It did not even rate a mention under 'Fresh ideas for work and family', which was apparently about financial assistance for small business, I think it was, to balance work and family. The only enlightenment I got from reading that, Senator Williams, was the fact that there was no more money available and that it had actually shut.

In all of this website there is absolutely nothing on policies for child care. Given that prior to the election, as Senator Farrell was saying earlier, this was all very clear in the minds of people out there in the community, perhaps the minister might like to give us more information—and I thank you because it is the first information we have had about the community consultation. How many forums were held and roughly where across the country? I am genuinely interested just to get the spread of where that community consultation took place.

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

I do not know the basis for Senator Nash's computer searches or internet searches on the Labor Party's website, nor indeed the processes she undertook to reach that figure of 51 policy areas, but I can say from my former experience—

Senator Nash interjecting—

I am not sure it would assist because it does not necessarily guide us in the nature of the process you went through or indeed what information you potentially avoided to achieve that figure.

Fiona Nash (NSW, National Party, Shadow Parliamentary Secretary for Regional Education) Share this | Link to this | Hansard source

On a point of order, Madam Temporary Chairman: this might help the minister be a little more relevant because it is self-explanatory as to where it came from.

Claire Moore (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

It is not a relevant point of order. We will continue to the end of the contribution and then you may seek to table the document.

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

I know from my experience that you can trawl through the internet and achieve all sorts of complexions. It is a bit like doing social research; it really depends on what questions you are asking, where you are looking and how you conflate what you have.

Senator Nash interjecting—

The main point here—once Senator Nash quietens down—is that it is fairly obvious, from what Senator Nash is putting before us now and her questions about wanting detailed information on consultation of measures that have been before us for well over 12 months, that she is seeking to extend this discussion for some reason I cannot necessarily comprehend. Perhaps it relates to the coalition's former record on children's policy that I can recall from my days as a shadow minister. If we are going to make comparisons—and I will not allow myself to be provoked into a discussion of this nature for too long—I seem to remember Larry Anthony and a national agenda for children that never surfaced despite five years of discussion about the Howard government having a national agenda for children.

What we do know, what I have said before and what is very clear is that Labor has a very strong record of childcare affordability. The proportion of family income being spent on childcare out-of-pocket expenses has almost halved from 13 per cent down to seven per cent. Families see this; families know the level of support that they have been receiving from the government in child care. I can see the comparisons between what was available when I had young children and the support that families are receiving today. This is perhaps the most stark issue in trying to understand why the opposition is seeking to delay dealing with this matter. Again and again, we get stories about, 'It is going to cost more; there will be problems,' but why this opposition is steadfast in seeking to delay improvements in the quality agenda—the carer-to-child ratio for young children—astounds me. I really think, Senator Nash, you need to reconsider occupying the chamber's time with questions and information which is deliberately designed to protract this debate.

Fiona Nash (NSW, National Party, Shadow Parliamentary Secretary for Regional Education) Share this | Link to this | Hansard source

I did not realise that Senator Collins had actually managed to morph and pop herself inside my head and see why I am asking these questions. Apparently, she has a very good handle on exactly what I am doing on this side of the chamber. Unfortunately, she is incorrect. I have a genuine interest in this issue and I think it is quite appropriate during a committee stage to ask questions. If you do not want the scrutiny, that is up to you, but it is entirely appropriate in the committee stage to ask questions for as long as it takes to get the answers that satisfy senators. You know that very well, Minister, as everyone else does in this chamber. We often have committee processes in this place that go for a very long time.

I have a very genuine interest in this. Like you, I have older children who were young once, and I have a very genuine interest in how this is going to impact on families in the community. If Senator Farrell had been able to give us more detailed answers earlier in regard to the consultation process and what had happened, perhaps we might be a little further through the process. Through no fault of his own, I am sure, he was not able to provide the committee with that. I am not going to apologise for standing here for a period of time and asking questions on behalf of Australian families about the rationale and the consultation behind it. There are other questions that are still to be asked. I am sorry, Minister, if you do not particularly want to be here and would prefer to be somewhere else, but this is the nature of the committee stage of legislation.

The question I ask for clarification relates to amendment (1) on sheet BM231, paragraph 84F(1)(e), to substitute 'for the income year ending on 30 June 2011—$7,941'. That is an amendment to the existing legislation which previously was $7,500. Could you indicate to the chamber the reason for that change and am I correct in assuming that the reason for the change is that, from 1 July this year, the $7½ thousand threshold may already have been increased?

Progress reported.