Jonathon Duniam (Tasmania, Liberal Party, Shadow Minister for Environment, Fisheries and Forestry) Share this | Link to this | Hansard source

I'm pleased to commence the contributions to the second reading debate on the Family Assistance Legislation Amendment (Cheaper Child Care) Bill 2022 on behalf of the opposition. Much has been said by colleagues in the other place around the coalition's position, which I will restate now, and that is that we won't be opposing the bill, noting that we did support it in the House. It's important to outline from the coalition's point of view why we've reached that conclusion and also make it clear that, given the nature of our political foundation and our framework of beliefs, we do believe in choice and we believe that parents who engage in work or study should also be able to access care, whether that be through formal or informal arrangements. I think that's an important factor of this entire make-up of this sector of the economy—this service provision part of the economy—that hasn't been dealt with properly here.

In this bill, though, there is a lack of detail from the government. In particular, there's no plan to address a particular issue that is going to cause a high degree of concern for many—that is, the lack of a plan to address the workforce shortage and, of course, the pressures being faced by educators currently in the marketplace. I should also indicate that, up until recently, my family and I had a formal involvement in this industry and we know exactly what educators are going through. It is something that we do need to take account of here. There's no plan to address access to care. Many parents know and anyone who goes out into the community knows—and I'm sure it's across this place—that many parents are struggling to find a place for care and education of their child. It might be part of the week that they require that is covered, or it could be only a day, but the fact is that it is a difficult task to find a place for care. There's no plan to address thin markets and childcare deserts where there are little to no services, and there's no modelling to show that this bill will actually deliver on what the government has promised. There's $4.7 billion being spent through this legislation and not one single cent will be spent on creating additional places or services. As we've said previously, the bill we're debating today favours high-income earners over the rest of Australians.

In terms of workforce pressures, early childhood educators, who do an amazing job, have been under pressure for the last couple of years and have worked tirelessly throughout the pandemic. Now that we're out the other side, workers are leaving this sector for other careers. A range of issues have contributed to that, but, at the end of the day, childcare educators have become burnt out. There are currently 7,200 vacancies in this sector, but there are pieces of recent data showing there could be up to 20,000 vacancies, which points to the concerns the coalition have raised around this legislation. We've asked the government on several occasions now how many additional educators will be needed under this policy, and we're yet to receive an answer. It's an important fact to put on the table so that we know what we are actually dealing with, how the problem will be resolved and what the plan or pathway is to get there.

Goodstart Early Learning, the largest not-for-profit provider, estimates an additional 9,000 educators will be needed by July next year to match the influx of children expected under this policy. The government has been doing a lot of talking but, based on the fact that we don't have these important pieces of information to allay concerns, not much listening. Back in 2019, in opposition the now government campaigned on a platform of higher wages for early educators. That seems to have been dropped from the platform and the minister won't commit to higher wages for early educators. When asked about it, the government points to its fee-free TAFE places, which won't deliver immediate relief for the workforce, especially when they need it most. As I've already said, the educators are not happy and leaving the sector in droves. Many centres are capping enrolments and asking families to keep their kids at home, because they don't have enough staff to operate at full capacity. We're seeing an increasing number of centres applying for waivers because they can't retain teachers who leave the sector for better pay and better conditions in the education sector. With more children set to enter the sector from July next year, we need to understand how the government plans to ensure there is workforce that meets these needs and offers the support these kids deserve.

In terms of childcare deserts, thin markets and access to care, a report commissioned and published earlier this year from the Mitchell Institute showed that around one-third of Australian families, or nine million Australians, live in a childcare desert. A desert is described as being one place for every three children, so that's hardly making the mark. So 50 per cent of childcare deserts are located in metro locations and the other half in regional, rural and remote locations. This bill creates no extra places and there's no interest from the government in plugging that hole. Where are these new places going to open for all the new children entering the system? And what's the point of lowering out-of-pocket costs if you can't even get into care? These are key questions that need to be addressed here.

While the government has said it will continue the Community Child Care Fund, which provides much-needed funding through grant rounds for services in disadvantaged and vulnerable communities, there's no money in this budget for the next round, nor can the government tell us when the next round of grants will open. Indeed, it's important to point out that, if there was a real sense of care from the government around improving access, it would address the areas struggling most.

In terms of cost, the last time the government was in government, childcare fees jumped by 53 per cent in just a six-year period. The price tag of this policy has changed four times. It started at $5.4 billion, then went to $5.1 billion, was revised down to $4.5 billion, and is now back up to $4.7 billion. That does make one wonder how much work has actually gone into this. I've already talked about the lack of modelling and the lack of clear data around how many places and new educators are needed and how certain issues will be resolved, but this jumping around of numbers—the revision of what the cost of the policy will be—speaks to the fact that that is undercooked. Labor's $4.7 billion policy is, as I understand it, costed for three days a week. The average child attends early learning three days a week. If Labor really wanted to get kids attending care more days a week, it would have probably been prudent, I would have thought, to cost a policy for five days a week instead.

In terms of higher income earners being set to benefit over low-income earners, families with a combined income of up to $355,000 are currently eligible for a childcare subsidy. Under this bill, that will blow out to $532,000. There has been no modelling done on whether increasing the threshold to $532,000 will actually increase the number of hours worked by those families nor on whether it will increase the number of days they put their child in care. We don't know what the families in those brackets currently do. We don't know whether they access care five days a week, whether they use a mix of informal and formal arrangements or whether they have a nanny, an au pair or a stay-at-home parent. Under this bill, taxpayers will fork out an additional 22½ thousand dollars for a family on a combined income of $360,000 a year with a minimum of two kids. Compare that with a family earning a combined income of $80,000. Taxpayers will fork out $2,488 a year for them.

It's clear there has been no due diligence and no modelling done on this policy. That is of great concern and should be for everyone. In terms of the out-of-pocket costs and the issue that all of us know our communities are dealing with—cost-of-living pressures—the last time the Labor party governed this country, childcare fees skyrocketed by 53 per cent in six years. Out-of-pocket costs are already rising, and fees will most likely rise before 1 July 2023. This will quite possibly erode a significant amount of the increased subsidies before they're even in place. While we were in government we kept out-of-pocket costs low.

The latest CPI data from June this year showed that childcare costs came down 4.6 per cent in the year to June 2022. While the minister has said that this policy will not have an impact on inflation, I'm not sure how one can stick to that. We know that it's just not true. The government has no plans to address rising out-of-pocket costs or rising cost-of-living pressures in child care. The 12-month, $10-million ACCC inquiry that they announced is too little too late. The inquiry will do nothing to alleviate current pressures in the sector, including—importantly—workforce shortages and access. The inquiry doesn't start until 1 January next year and won't report back until the end of that year. That means that nothing will be done to address the rising costs until 2024 at the earliest. Australian families can't wait that long. They need relief now.

With early education costs set to increase under this government, Australian families deserve to know if they will really be better off under this government, as was promised. It's time that this government focused less on politics and spin and more on a plan to ensure a strong economy that supports Australian workers and their families. They need to ensure that the policies that are brought forward are properly costed, that we understand how many extra places will be created or will be needed and where they will be needed, that all communities that rely on these services have access to them and that they happen in a timely fashion. As I've already said, and I think it is an important point to focus on, the underpinning of any good policy is good research, good data and good modelling.

There has been next to no modelling done on this policy. No GDP modelling has been done and no modelling has been done on how many additional childcare places or how many additional educators will be needed under this policy. Where will the educators come from, what cohorts are we looking to to fill these spaces and how will we get them to where they are needed in the community? There has been no modelling on whether this will increase childcare attendance by children and their families. There is no understanding or knowledge around the make-up of those who will benefit most from this policy, how they currently use child care or whether they'd use it more under the revisions. There has been no modelling on whether the sector will be able to meet the influx of new children nor any modelling on what areas the majority of these children will come from. The only modelling that has been done is on how many women have children aged zero to five and are either in part-time work or no work, which doesn't consider their income nor whether they want to return to work or take on more work.

It's important to place on record the coalition's investment in this space and what it yielded. We almost doubled childcare investment, to $11 billion, in the financial year 2022-23 and locked in ongoing funding for preschools and for kindergartens. We made the biggest reforms to the early childhood education system in over four decades. More than 1.3 million children from around one million families have access to the childcare subsidy. Under the coalition government, 280,000 more children were in early childhood education. We abolished the annual cap on the childcare subsidy, and around 90 per cent of families using CCS are currently eligible for a subsidy of between 50 and 85 per cent.

Since March of this year, we've provided a higher subsidy of up to 95 per cent for families with multiple children in early childhood education at once, increasing workforce participation and cheaper access to care. Our targeted extra support introduced in March 2022 made a real difference, and childcare costs actually came down—as I said earlier in my contribution—by 4.6 per cent in the year to June 2022. Importantly, we saw women's workforce participation reach record highs at 62.3 per cent in May this year, compared to 58.7 per cent when we came to government all those years ago.

In concluding, I indicate that I do have a second reading amendment that has been circulated, which I now move:

At the end of the motion, add ", but the Senate:

(a) notes that:

(i) this Bill does nothing to address broader challenges for access to early learning in Australia, namely:

(A) child care service gaps in regional Australia, and

(B) early childhood education and care workforce shortages which prevent families from accessing the services they need; and

(ii) the Government's cheaper child care package, which costs $4.5 billion, does not add one additional place for families, and

(iii) early childhood education and care providers have already increased fees since the Government came to office and the additional demand placed on services as a result of this Bill will put further inflationary pressure on fees; and

(b) calls on the Government to ensure that the promised savings for families will not be eroded by higher fees due to the additional demand for services as a result of this Bill; and

(c) notes that the Bill commits to higher ongoing structural spending; and

(d) calls on the Government to manage its spending commitments to improve the budget while standing by their promise to deliver legislated targeted income tax relief".

I encourage senators to consider supporting the amendment. It goes to the points that I've already made around the need to ensure that this bill, which does cost the Australian taxpayer a huge amount, does deliver benefits where they're most needed, and to make sure that this bill, which is costing the Australian taxpayer a huge amount, is founded on good policy and is therefore directed in a way that will continue to grow the economy and improve workforce participation for those in the community who currently need it.

Mehreen Faruqi (NSW, Australian Greens) Share this | Link to this | Hansard source

I rise to speak on the Family Assistance Legislation Amendment (Cheaper Child Care) Bill 2022, and I'm going to start with the title of the bill itself. We heard during the Senate inquiry on this bill that the language of 'cheaper child care' undervalues the role of educators. In her submission, Tamika Hicks, on behalf of the United Workers Union early childhood education delegates, expressed bitter disappointment with the choice of words and questioned how educators could ever change the narrative about the value, recognition and importance they deserve without support from the top. We know early learning educators are some of the lowest-paid workers. Theirs was the first sector from which JobKeeper support was withdrawn by the coalition during the pandemic. But they ought to be highly respected, and their contribution to children's development, the community and society ought to be highly valued. When we talk about respect, language matters. The Greens support the view of UWU and other educators and consider the government should take a leading role in shifting public discourse by replacing the words 'cheaper child care' with 'more affordable early education and care' in the title of the bill. I will be moving an amendment to that effect. We should also commit to consistently using the term 'early education and care' instead of the term 'child care'.

I'll turn now to the bill itself. The bill increases the maximum percentage of child care subsidy, CCS, available to families and extends access to the CCS to all families earning less than $530,000. The bill introduces a new base level of 36 subsidised hours of child care per fortnight for First Nations families, regardless of their activity levels. It also introduces new transparency measures requiring large providers to report annually on their financial information and lease arrangements to the Department of Education and enabling the department to publish this information. The bill enables providers to offer a discount on fees to their educators whose children also attend the centre. Finally, the bill introduces good governance as a core eligibility requirement for provider approval and imposes a new requirement for providers to submit accurate records, receive gap fees by EFT and keep proper records.

The Greens believe early childhood education and care is an essential service that should be universal, free, accessible, well funded by the government and never run for profit. While the bill does not go nearly far enough to achieve our vision of universal and free early learning and care, we support the bill as it represents a step in the right direction in making early learning affordable for more people. This was really such a good opportunity for the Labor government to fix the early childhood education and care system once and for all, but they unfortunately chose not to do that.

There are some key issues that still need to be addressed by the government, and the first of these is workforce. The early childhood education and care workforce is in crisis. It is estimated that around 9,000 more educators will be required because of the reforms introduced in the bill, and there are currently 7,000 vacancies already in the sector. Assuming attrition rates continue as they are, it is estimated that there will be over 10,000 vacancies next year. That would mean there would be a need for around 19,000 more educators in July next year, when this bill comes into effect.

A big driver of this attrition is poor pay, with degree qualified educators often being paid 20 to 30 per cent less than primary school teachers. But also governments have long failed to adequately value the profession. This is what early educators are telling us. I am now going to read what a few of them have told us in the United Workers Union's submission to the inquiry into this bill. One says:

I've been an early childhood educator for over 25 years and I'm now looking for another job not in child care as I'm so burnt out and over everything else I don't feel the quality of care is there anymore as I have so much paperwork we are just getting through the day.

Another says:

We have always been taken for granted, and after all that we went through during covid and all its implications where we were essential, we still are not recognised for what we did. We're so tired of being undervalued, underpaid, and overworked, we are over our profession.

The last one I'm going to read out is this:

With the cost of living rising, educators are leaving every day, as it is near impossible to survive on the wages we receive. After over 20 years in the industry, I've lost my mojo, mostly to the pay but also educators well-being.

This is an atrocious condition for those people who serve such an essential, respected and professional role in society—that is, the development of our children.

Currently, the only measure in this bill aimed at attracting and retaining educators is the provision of a permissible educator discount that providers may offer to their educators. Under this measure, early childhood education and care providers will be permitted to offer a discount on fees to staff engaged as educators without affecting the amount of child care subsidy payable for the educator. We support this measure and want it to be extended to all staff employed at centres, including cooks. But it is completely inadequate to address the scale of the workforce crisis.

Let's not forget that a vast majority of this workforce is women, who already face a huge pay inequality gap. We support calls from the sector that the government should provide an urgent interim wage supplement. The government should implement protections to ensure that the wage supplement is passed on in full to educators. For clarity, this measure should be interim while longer-term structural changes are undertaken to improve educator pay and conditions, such as proposed changes to the Fair Work Act to address gender pay equity and improvements to bargaining processes. As the inquiry into the bill heard, immediate action is need to address workforce shortages and the pay and conditions that workers face before the bill commences in July to ensure at a very basic level that the policy aims of the bill can be realised. The government has been made aware of this fact loudly and clearly and cannot ignore it any longer.

Moving to the activity test, the Greens welcome the new baseline entitlement to 36 hours per fortnight of subsidised early childhood education and care for Aboriginal and Torres Strait Islander children regardless of the activity levels of their parents. This change has been long overdue. The reality is that the activity test as a whole is cruel, punitive and beyond repair. It denies access to early childhood education and care for the most disadvantaged children and punishes families who have insecure casual work. The activity test should be abolished entirely, as many witnesses to the inquiry stated, including Early Childhood Australia, the Australian Childcare Alliance, UWU, The Parenthood and Lisa Bryant. As Lisa Bryant put it, the activity test is:

… a punitive measure introduced by the previous government more or less on ideological terms which said that only the deserving should get access to child care.

No child should be penalised for what their parents do or can't do.

According to an August 2022 report from Impact Economics and Policy, the activity test is also contributing to at least 126,000 children from the poorest households missing out on early education. The report found, because of the activity test:

Removing the activity test would represent significant progress towards delivering universal early learning and would ensure that the full benefits of the CCS increase can be realised by all families and children. Thousands of children from disadvantaged families are missing out on early education and care now. There is sufficient evidence to warrant abolition of the activity test immediately. The government does not need to wait for the outcome of the Productivity Commission's inquiry to act on this. I will be moving an amendment to abolish the activity test and encourage my colleagues to support it.

The Greens agree with the many stakeholders that supported a need for greater transparency in the early childhood education and care sector during the inquiry. Many early learning centres are run by large non-government providers. There has been a proliferation of for-profit providers in recent years, and it is no coincidence that prices have risen by 41 per cent in the past eight years. Given the substantial public money that providers receive, there is a compelling need for a robust transparency regime. I therefore welcome new reporting requirements for large providers but believe that these requirements should be expanded to cover all providers and that this information should be publicly available. I also believe that for-profit providers should have to publicly report full finances, including their profitability, dividend payments, executive compensation, wages expenditure, investment in quality and inclusion, rental costs and fee increases. At the end of the day, education should never be for profit, and we should be phasing this out altogether. I will be moving amendments to that effect later on during our committee stage.

Once the bill comes into effect, it will increase demands for early learning. This needs to be matched with the corresponding investment and providing extra places. As pointed out by regional and rural stakeholders during the inquiry, waiting lists in many places are already too long. According to a report from the Mitchell institute earlier this year, 35 per cent of the population live in neighbourhoods classified as childcare deserts, where there are more than three children per one place. People in regional areas are more likely to live in this desert, while those in remote regions are highly likely to also be living in areas where there are limited places. The Mitchell institute report noted that areas with the highest fees also generally have the highest levels of accessibility, suggesting that providers are establishing services not only where there are greater levels of demand but where they are likely to make greater profits. The government must develop a plan to phase out for-profit early childhood education and care, which has clearly contributed to these inequities, and must work with states and territories to invest in greater availability of early childhood education and care.

The Greens will be pushing for the government to consider this issue in the context of the Productivity Commission's review of the sector, which will commence next year. I look forward to working with the government on this review, which is badly needed. The Greens will keep pushing for an early childhood education and care system that we can be proud of—one where every child in this country has access to high-quality, free, accessible early childhood education and care, no matter their postcode, their bank balance or their background, and every early childhood educator is respected and has better pay and conditions which reflect their profession and the responsibility they take on in the development of our children. I will be moving a Greens second reading amendment which will reflect this by noting that the bill only provides limited support for families that are currently paying exorbitant fees for early childhood education and care, only makes modest changes to the activity test and does not do anything to address the work force crisis and which will call on the government to make early childhood education and care universal and free and to address the workforce crisis by immediately funding an interim wage supplement.

High-quality early childhood education and care can give children the best start in life and is a critical component of lifelong learning. It also enables women to pursue career opportunities and ensures they aren't held back because early learning and care is too expensive or not available. As a migrant parent with no family in Australia, I would not have had the opportunity to study or embark on my engineering career, nor would my children have had the opportunity of early development, if it wasn't for affordable child care at that time. The government should scrap stage 3 tax cuts, which benefit billionaires and the wealthy, and instead invest in an early education system which is universal and free with higher wages and better conditions for workers.

Nita Green (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

I'm pleased to rise today to speak on the Family Assistance Legislation Amendment (Cheaper Child Care) Bill 2022. I rise to proudly speak on this bill today, because this is a bill that will make a system fairer. This is a bill that will make a system more accessible and it is a bill that recognises the importance and value of early childhood education. For far too long, under those opposite, early childhood education has been overlooked and undervalued. But it is so incredibly valuable. Early childhood education gives our youngest Australians the best start to life, and it enables parents, especially mothers, to get back into work when they want to.

I know a few of those opposite and in the other place may disagree with the value of this bill. It is particularly interesting to hear those opposite now concerned so deeply with access and workforce shortages and wages issues after spending ten years treating early educators so poorly and dismissing their continual concerns that the early education industry should be valued for what it is. Their disagreement is well documented from the last ten years and in the media. We've heard things from those opposite like, 'The best place for children is at home,' and, 'Working women are outsourcing their parenting when they use child care.' Well, these old, antiquated points of view do not belong in Australia in 2022, and they certainly do not belong on government benches. It is why this government is so proud to introduce this bill, to pass it through the parliament and to deliver our promises to early childhood educators and to parents across the country.

It was those opposite who ripped JobKeeper from dedicated early childhood educators during the pandemic. Early educators were the very first to be cut off when JobKeeper was ripped away. Early childhood educators were, at the time, at the forefront of the pandemic, in settings where being COVID safe was just impossible. Early educators were ensuring that other frontline workers could do their jobs, but they were completely dismissed by those opposite. So it is now completely shocking and disgraceful and absolutely shameful to hear those opposite trying to mask this behaviour when we talk about the lack of educators and the workforce shortages that are being faced.

Early childhood educators are underpaid. I don't think anyone on this side of the chamber is arguing anything other than that. They are also undervalued, and they were undervalued for almost a decade by those opposite when they were in government. Early childhood educators are leaving the sector in droves—we know this—because under the former government they were treated so poorly. They don't see the value in their work add up in their pay packets. That is unfair, and it is time for that to change. Our incredible early childhood educators aren't just caring for our youngest Australians; they're ensuring that our children are getting the best start to their lives and their education. It's why this bill will see more kids in child care and more mums participating in the workforce.

There is more work to be done to get wages moving for educators and to make the system fairer for educators. We don't pretend that this bill to deliver cheaper child care, more affordable child care, for every Australian who uses the system is a one-stop shop. We know that there is more work to do, and I'm really proud that in this sitting fortnight the Senate will get a chance to have its say on the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill, because, if you support early childhood educators getting a pay rise, then you can support this bill as well. I think early childhood educators would be pleased to hear those opposite finally concerned about their wages, finally concerned about the fact that their wages haven't kept up with the cost of living. It will be incredibly interesting to see what the crossbench and those opposite do when given the chance to support a bill that will deliver wage growth for workers like early educators.

It is only our government that understands the importance of early childhood education, and that's why we took this promise to the election. We know that making early childhood education more affordable and more accessible to families is an economic measure. During the election, we heard from those opposite that we had a lack of economic policies. They're so dismissive of this policy being an economic measure that they don't see the value in it. But we do—our government does—and that is why we are delivering through this bill. This is a policy that will make our entire country better. It will get more people into work, and it will mean that mums are, finally, not financially punished for wanting to work more, which is how the system currently operates. This bill makes sense. It works for Australians. It works for young Australians and it means better wages for Australians.

Finally, I say to those early childhood educators who have spent decades campaigning and getting out there to talk about the value of their work: you have finally been listened to. We value the work that you do. We thank you for caring for our children. We could not do our jobs in this place or, indeed, across the country without the support of early childhood educators. You are valued. We support the work that you do, and this bill brings delivering a better childcare system for every single Australian just one step closer. We need to deliver cheaper child care, and that is what this bill will do.

Matt O'Sullivan (WA, Liberal Party) Share this | Link to this | Hansard source

I rise today to speak on the government's Family Assistance Legislation Amendment (Cheaper Child Care) Bill 2022. At a time when calls for this government to support families and businesses have fallen on deaf ears, particularly with the ramming through of their shonky industrial relations bill, let me reiterate the coalition's wholehearted support for real policies and measures that will help to ease cost-of-living pressures faced by families. The coalition fully supports giving families and parents the choice to be able to determine how best to raise and care for their children in whatever form will best work for them, whether through formal law, informal arrangements or the combination of both.

While in government, the coalition was able to deliver increased access to child care, almost doubling the investment to $11 billion, locking in ongoing funding for preschools and kindergartens in 2022-23. Under the coalition, more than 1.3 million children had access to the childcare subsidy and we abolished the annual cap on the subsidy. Since March this year, we have provided a higher subsidy, up to a rate of nearly 95 per cent, for families with multiple children in early education, helping to increase workforce participation and providing cheaper access to child care. In doing so, we have continued with our track record of supporting the economic empowerment of women.

Women's workforce participation reached a record high of 62.3 per cent in May this year under the coalition, compared to 58.7 per cent when Labor were last in office. The gender pay gap has reduced—from 17.4 per cent under Labor to 13.8 per cent under the coalition. This is something that the coalition is very proud of achieving. We're very proud to have seen it occur under our watch. These are just a few of the achievements of the former coalition government, but the fact is that the coalition have always supported Australian families. It's part of our creed. It's central to what we believe and it's central to who we are as a party. So we support this bill in principle, but we also have some valid concerns about the delivery of Labor's so-called cheaper childcare policy.

Over several weeks, as the Deputy Chair of the Education and Employment Legislation Committee, I attended hearings in Canberra and Melbourne, and we had a closer look at the fillings of this bill. At this point I would like to acknowledge the work of the committee and particularly of the chair who, I've got to say, does a very good job in keeping things running smoothly and in order. I think, so far in this parliament, this particular committee has had a huge amount of work to do. Of course, the real signature piece that's coming through at the moment is the industrial relations bill. Despite the huge disagreement across the committee in relation to some of the issues that come through the committee, we actually do work really well together.

On this particular bill, we were able to work exceptionally well together, so I acknowledge all of my fellow committee members and, indeed, the secretariat. The secretariat has had a huge workload, particularly in relation to the industrial relations bill, with only 22 days in which to consider a significant bill and report back. The hearing on this legislation was a truncated experience as well. It was very short in comparison to the traditional way that legislation is dealt with, certainly in my experience in the last parliament. Generally bills are given much more consideration, but we're seeing a pattern under this government of dealing with things very hastily. It's happening across many portfolio areas, and it's something that I hope this government doesn't continue with because I think it's a real discredit to this place—in particular to the Senate—and we've got to make sure that legislation is properly scrutinised.

Nonetheless, we did manage to go through this legislation, even though it was over a short time. We were able to highlight quite a few deficiencies in it, and I just want to take you through some of those right now. Again, we certainly support this legislation. We'll be voting to support it, but there are some issues that we must deal with. Why are we supporting this? We are a party that backs in business. We're a party that backs in families and supports families. We're a party of economic stability and empowerment, and we're a party of sensible economic management. It is concerning, however, that this policy that we're seeing in this legislation is lacking modelling. We heard from the department, and, sadly, we heard that there was no economic modelling and that there are, in fact, incorrect assumptions right throughout this bill.

At the hearing in Melbourne on Wednesday 2 November, Treasury confirmed that the only modelling that they've done is on the impact of the policy on mothers with children aged zero to five. The Albanese government has argued time and again that this policy will increase access to early learning for families, increase workforce participation and reduce out-of-pocket costs, but what has been put forward by Treasury has painted a completely different picture. When questioned about the modelling underpinning this policy, Treasury admitted that they had done no modelling on the impact of the policy on gross domestic product, no modelling on wage costs or increases, no modelling on the provision of early childhood educators and no modelling on the impact of rising fees. The government's policy also assumes that, by 1 July 2023, there will be enough places in the sector to meet the expected increased demand and that fees will remain at their current level. Yet we've seen no modelling—none at all—as to whether or not the sector will be able to meet the influx of children. The department took us through why it is difficult to do the modelling. If we accept that then how is it that this government is out there proclaiming the virtues of this policy and yet we are seeing Labor members of the House of Representatives in their own electorates claiming that this policy will increase X number of places, will assist X number of families? The member for Kingsford Smith said it's going to help 7,000 families in his electorate. How is it they're able to claim these sorts of figures and these sorts of stats when there's no modelling? There's no modelling to demonstrate any number at all, so there's a real vacuum there.

Many educators have raised important issues, such as low wages and mental health stresses, and Senator Faruqi took us through some of that in her contribution. We're seeing an increase of red tape and burnout as their top concerns, and the sector suffers from a high attrition rate. Providers are struggling to attract and retain educators. Centres are having to cap their services at 70 per cent to 80 per cent capacity, sadly due to a shortage of educators. Good Start Early Learning, a terrific provider and the largest not-for-profit provider in Australia, estimates an additional 9,000 educator will be needed by July 2023 to meet increased demand as a result of this policy. There are currently 7,200 vacancies in this sector. But once again, there's been no modelling done by the government to show how many educator will be needed or how they will address the current workforce crisis that we have. It's absolutely mind-boggling that no real modelling regarding access and educators has been done by the government.

All of this is of on top of nothing being done to address thin markets and childcare deserts where there are little to no services available to families. I asked a question throughout the inquiries time and again, said you don't have to go far out of Perth, where I live, you don't have to go even to the outer suburbs, and you start to see childcare deserts, not to mention the absolute dearth of provision in regional Australia and certainly in some of the more remote parts of our country. You go across the Kimberley and it's almost impossible to find a childcare place. Even in the Pilbara, in the more populated cities like Karratha, there's a massive shortage and you can't get access to child care. This makes it difficult for these towns to attract people to come and base themselves there, bring their families and work in these places. Often these places have a fly-in, fly-out environment, so how do you attract workers when you can't get access to childcare in these places?

Unfortunately, this bill does nothing to address those sorts of issues. The Mitchell Institute reported earlier this year that around a third of Australian families live within a childcare desert, where there is only one place available for every three children. I can say that $4.7 billion is, of course, an incredible amount of money and yet not a single cent of that $4.7 billion is going to be spent on creating any additional places or services. If you're one of those families that can't access a childcare centre, who can't get a place, then how is it possible that this policy is addressing your cost-of-living issues? The government is saying that this bill will address that—and I remember throughout the campaign them saying, 'We're going to address the cost of living by reducing childcare costs.' They were elected on that platform, I get that, they've got the mandate. But how is it that you can still say that this bill is going to address the cost of living when we know that this bill is not going to actually deliver an additional childcare place anywhere in the country? If you can't access child care, how is it possible that it's going to reduce your cost of living? All this is not to mention the accessibility challenges that are facing young families living in rural and regional and remote areas. This is a critical issue and, sadly, the government have shown so far that they're just about the headlines and they're not interested in addressing these big challenges. Instead, they've presented this half-baked, undercooked, very expensive policy, with zero modelling that's been done to back up their claims, expecting it to be some magic bullet to solve cost-of-living pressures for families.

The last time Labor was in government, childcare fees skyrocketed by 53 per cent. That's their record: a 53 per cent increase in just six years. Out-of-pocket fees are already rising. Inflation is rising; we've been seeing that. Fees will most likely rise before 1 July 2023, before the impact of the implementation of this bill is felt. Fees will already have risen by then, and the government have no modelling on how this could potentially erode the impact of subsidies before they're even in place.

I studied economics when I was at school. I didn't do it post school, but one of the 101—I know Senator Scarr has his book there. Basic economics, supply and demand—I'm sure it's there. Senator Scarr will point to the particular page it's on. We know that when you increase demand, you see that there will be an increase in cost. This is going to impact families, and there's nothing in this bill, nothing in what the government have demonstrated to us so far, that is going to protect families from rising childcare costs. This subsidy could easily just be eroded. It could easily just be taken up without there actually being any impact on reducing the cost of living.

Our families need to know if they are really going to be better off under this bill. They need to know whether they will be better off under this Albanese Labor government. So far they haven't been. Everything's going up. Everything's going up except for wages and the money in people's pockets. Our families, the backbone of our society, are counting on this government. Our families, the future of our nation, are depending on them. It's time for the Albanese Labor government to come up with some real policies that are actually going to support families, that are actually going to impact on the ground and that are going to deliver for the workers of this country.

David Pocock (ACT, Independent) Share this | Link to this | Hansard source

I start by saying how welcome the Family Assistance Legislation Amendment (Cheaper Child Care) Bill 2022 is. Improving access to more affordable early childhood education has so many upsides for people: for families in our communities, for our communities and for society more broadly. There are upsides for children in terms of their learning and development as well as their socialisation skills. There are upsides for parents because it will enable a significant increase in workforce participation. And, of course, there are flow-on upsides in terms of the economic benefits and productivity improvement from this.

As the minister noted in his second reading speech, some 1.26 million families are estimated to benefit from this, with just over 23,000 of them here in the ACT. Treasury estimates that this bill will increase the hours worked by women with young children by up to 1.4 million hours per week in 2023-24. In the midst of a tight labour market and the high cost of living, the extra work, coupled with lower costs for early childhood education, will make a big difference.

Of course, with better access comes higher demand, as pointed out by Senator O'Sullivan. In many areas, waitlists are long and workforce shortages are acute. There is huge concern across the sector that, with the welcome and long-overdue increases to pay rates in the residential aged-care sector, competition for early childhood educators will only become more acute.

With this legislation, clearly, the need for early childhood educators to receive a pay rise is important. It is crucial. It is urgent. As people in the ACT have said to me, you can earn more working at Bunnings than educating and caring for the next generation of Australians. We need to change that urgently. The government's proposed industrial relations changes to what is proposed to be the supported bargaining stream—as I've told the government, this is the part of the legislation that has my full support—aims to do that, but we need to do more. If there is to be an increase in early childhood educator salaries, the government needs to come to the table and fund it. It also needs to ensure that taxpayer funded increases are flowing through to workers and not simply being absorbed as profits.

I'm proposing a number of amendments to this bill. I would like to thank the government, specifically Minister Clare and his team, for their open and constructive approach to considering the changes to the bill. The first change I'm proposing is to the name of the bill. I note that Senator Faruqi has also raised this issue. Pay rises for early childhood educators are essential, but there is more to recognising and valuing the critical work they do than just money. Language is important and influences the way we think and behave. That's why I support calls from the sector to amend the name of this bill to be about providing more affordable early childhood education and care. After talking to early childhood educators, there is a lack of recognition for the work that is done in this sector. I hope that this is something that will begin to address this and begin to place more value on the important work that early childhood educators are doing. There are few things more important than playing a role in shaping the lives of children.

It's also important to recognise the way that centres operate and the valuable roles different staff play. After talking to the government, I'm pleased that the government has agreed to expand the scope of the optional discount that can be offered on fees to the children of educators working in centres to include cooks. This bill is a really important step forward, but there's more work to be done in pursuing this reform, especially when it comes to improving access for disadvantaged children, reviewing the activity test and sector workforce requirements.

The government has committed to tasking the Productivity Commission with undertaking a comprehensive review of these issues and the sector more broadly. I believe this will serve a more constructive material outcome than a statutory review for this particular piece of legislation. I note concerns about the lack of modelling and the need for more thorough modelling, and particularly how important reviewing the legislation is to ensure that it's doing what it sets out to do. I can't think of too many other places where you simply try to deal with an issue, set it, and then largely forget about it. We need to be actively reviewing, monitoring, and, when needed, amending and ensuring that we are heading down the right path.

Delivering the aim of implementing a universal 90 per cent subsidy for all families is a worthy goal. I look forward to supporting the government's effort to implement this on behalf of the people of the ACT.

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

I rise to speak on the Family Assistance Legislation Amendment (Cheaper Child Care) Bill 2022. Under the reckless governing by those opposite, childcare costs were allowed to increase by 41 per cent over the past eight years, and the cost of living was allowed to skyrocket. This has had a devastating impact on Australian families and their ability to send children—their children—to early education and care. It is also a further reflection of the lack of importance and value that the coalition places on women in the workforce and the benefits of childcare and early childhood education.

The cheaper childcare bill is an important and necessary bill that will help make a meaningful difference to the lives of Australian families, to the Australian job market and to the Australian economy. It is a multibillion dollar commitment to Australian families and to our children, and it holds another Albanese government election commitment. We value families and children, and we want to see them thrive. As a mother myself, I understand just how important it is to have the options available for affordable early education and care for our children. This bill is a crucial step in helping women return to the paid workforce.

I make the reference to paid work because, as everyone who is a parent will agree, parenting is one of the hardest and most underpaid jobs you will ever do, and I don't want to diminish the value of that important work. But, for those parents who want to return to the paid workforce, this bill will make it more accessible for them. It is widely known that in Australia mothers are typically the parents who spend more time raising their children. In 2016, the Australian Institute of Family Studies found that approximately five per cent of families had a stay-at-home father compared to 27 per cent having a stay-at-home mother. It was also estimated that fathers spent approximately 13 hours a week on child care compared to a mother's 27 hours. This is a huge difference, and mothers who want to return to work need affordable child care. Otherwise, it simply isn't a feasible option.

The Australian Bureau of Statistics announced in February 2022 that there were approximately 745,000 people who wanted to work and were able to begin that work within four weeks but were still unable to. Of these people, 113,600 were unable to work due to childcare constraints, and 106,800 were women. Better enabling the approximately 106,800 women who have been unable to join the workforce will contribute to gender equality by accelerating work to close the workforce participation, pay and, very importantly, superannuation gaps. According to the Workplace Gender Equality Agency, the national gender pay gap is currently 14.1 per cent. This bill will help reduce this and will allow women to better support themselves now and into the future. This is a win for women, for their families and for the Australian economy.

This bill will enable more children to access early childhood education and care. This is so important when it comes to helping set up our children for formal schooling in later years. This bill will support approximately 16,400 Tasmanian families. They will get the help that they need. This is a significant step in filling these gaps. It will also reduce the cost-of-living pressures. Parents who want to will be able to return to the workforce, where their skills and knowledge will be greatly appreciated.

With the timely passing of this legislation, these changes should come into effect by July 2023. This will be such a relief for Australian families. This bill is not a handout; it's an investment in women, in children, in families and in the Australian jobs sector, and, most importantly, it will enable these women and these families to contribute to our economy. Supporting families and children in Australia should be a bipartisan issue. We shouldn't be them versus us, so I urge those opposite and around the chamber to support this very important piece of legislation.

Anthony Chisholm (Queensland, Australian Labor Party, Assistant Minister for Education) Share this | Link to this | Hansard source

I thank those senators who've spoken on the Family Assistance Legislation Amendment (Cheaper Child Care) Bill 2022 for their contributions to this debate. It's a bill which is good for children, good for families and good for our economy. It will support the development of our youngest Australians in those crucial early years. It will provide more choice to parents, in particular women, in choosing to re-enter the workforce and work more hours, which is so desperately needed in the economy.

Treasury estimates that these measures will unlock the equivalent of up to 37,000 full-time workers in the first year alone. It will make early education and care cheaper for more than a million families. It will introduce a base level of 36 subsidised hours per fortnight of early childhood education for First Nations children as well. It will improve transparency and integrity measures in the sector, and it delivers on a key commitment made to Australian families in the 2022 federal election.

I thank Senator Pocock for his contributions to this bill, and the government will support those amendments. This bill has won widespread support from families, the business community and the early childhood education and care sector, and I commend it to the chamber.

Sue Lines (President) Share this | Link to this | Hansard source

The question is that the second reading amendment moved by Senator Duniam be agreed to.

Sue Lines (President) Share this | Link to this | Hansard source

The question now is that the second reading amendment proposed by Senator Faruqi be agreed to.

Australian Greens circulated amendment—

At the end of the motion, add ", but the Senate:

(a) notes that this Bill:

(i) only provides limited support for families that are currently paying exorbitant fees for early childhood education and care,

(ii) only makes modest changes to the activity test, which restricts access to early childhood education and care for the most disadvantaged children and families, and

(iii) does not do anything to address the workforce crisis; and

(b) calls on the Government to:

(i) make early childhood education and care universal and free, and

(ii) address the workforce crisis, including by immediately funding an interim wage supplement while taking action to ensure educators permanently receive better pay and conditions in the longer term".

Sue Lines (President) Share this | Link to this | Hansard source

The question now is that the second reading amendment proposed by Senator David Pocock be agreed to.

Senator David Pocock 's circulated amendmen t

At the end of the motion, add ", and the Senate:

(a) notes that:

(i) this Bill will improve affordability of Early Childhood Education for Families,

(ii) workforce shortages are an important issue for the Early Childhood Sector, and

(iii) Treasury has forecast that this Bill will increase workforce participation, and therefore demand for of Early Childhood Education and Care will increase; and

(b) calls on the Government in the forthcoming Productivity Commission review to include consideration of activity requirements, education outcomes, addressing access for disadvantaged children and sector workforce requirements as part of its work".

Question agreed to.

Original question, as amended, agreed to.

Bill read a second time.