E&OE TRANSCRIPT ABC NewsRadio Breakfast
SUBJECT: Productivity Commission’s draft report into Child Care
SANDY ALOISI: A new report to the Government calls for sweeping changes to childcare assistance, scrapping the existing schemes and replacing it with a single, means-tested payment. The draft report from the Productivity Commission says childcare subsidies should be extended to cover nannies and it says part of the cost could be met by diverting funds from the Government's proposed paid parental leave scheme.
Sussan Ley, the Assistant Minister for Education is responsible for childcare; she's speaking here to Marius Benson.
MARIUS BENSON: Sussan Ley, the Productivity Commission is calling for quite sweeping changes to childcare provisions. Do you see merit in particular recommendations?
SUSSAN LEY: Well I certainly see merit in the recommendations around reducing red tape, which will bring down costs to the parents, something that is straining the system, it's almost at breaking point. But it is a draft report and it is to Government and we'll wait until the final one comes in October and between now and then there'll be lots of opportunities for people to have further submissions and have their say. And that is important, because this is raising a lot of questions and we don't have all the answers, but it's a terrific start for a once in a generation reform to the system.
MARIUS BENSON: At the moment the system provides 50 per cent rebate to parents, working parents, without any means-testing and the Productivity Commission says that should change. Are you in favour of that means-testing provision?
SUSSAN LEY: Look, the PC has come up with a complex cost model and they've asked for people's thoughts on that. So that's actually something that's important for everyone to have their say around how that particular cost-benefit model works for
families. But at the moment we have no plans to means-test the rebate. What we do want to do is make the system more affordable for parents.
So I don't want to see a system where parents look at the structure and say, well it's even less affordable for me to go back to work. Because what we want is for those parents, particularly - it usually is mums who are in two days to three days work a week and saying look, it's just no point in doing any more, I'll drop out of the workforce or I'll do a job that I'm not particularly trained for. We lose out on their contribution; the economy loses out on the participation that they add. So this is about making a system more affordable and flexible for families, not less affordable.
MARIUS BENSON: When you say you have no plans to means-test provisions, do you mean you've decided on that, or are you open-minded about it, are you prepared to consider the Productivity Commission's recommendation of means-testing?
SUSSAN LEY: Look, everything is on the table until the final report comes through, and indeed it's still on the table then because this is a report to Government and we would, I anticipate, take recommendations to the Budget in 2015. But I do stress that this is not about making a system less affordable. We're spending 28 and a half billion over the next four years. That's a strong financial position, a strong contribution from the Commonwealth towards the childcare system. And I know that we've got lots of scope within that funding envelope to actually deliver a system that works for parents.
Remember that over the last six years under Labor, costs went up 53 per cent. And every day, I meet parents who say to me, effectively, I'm designing my work life around my childcare, shouldn't it be the other way around? Shouldn't I be designing my childcare fitting in with my work and what I want to do? And that's a sure indication that they system is at breaking point.
MARIUS BENSON: When you say everything is on the table, does that include the Productivity Commission's suggestion that some of the costs of childcare be met by using funds from the paid parental leave scheme? Because the Productivity Commission seems underwhelmed with that as a scheme.
SUSSAN LEY: No look, that's actually not on the table. The paid parental leave is a separate policy and I've always seen it as such. It's about babies, it's about the first six months of a child's life and the important bonding experience.
MARIUS BENSON: But are you concerned that the Productivity Commission seems to think it's such a bad scheme, the paid parental leave scheme?
SUSSAN LEY: Look, that's not my take on the report, that they think it's a bad scheme …
MARIUS BENSON: [Interrupts] They think the money could be better spent elsewhere in childcare.
SUSSAN LEY: Well, they've made some suggestions about moving money around and they're the PC suggestions, they're not my reflection on what are in fact two separate policies. One is a workplace entitlement, one is about having children; and the other is about childcare on return to the workforce. Two quite separate policies.
MARIUS BENSON: This is a draft report; when might there be action, when might there be changes to childcare provisions?
SUSSAN LEY: Well, the PC is taking submissions - they're going on the road, they're having public hearings, they want to hear from people up until September 5. Their final report is due to Government in October and then we've got the opportunity to work out new policy leading into early next year. So, this is something we promised in Opposition, this is well underway. It's a good process, it's a rigorous process and as I said, the childcare settings we've got now belong to the last generation, not to the 24/7 working economy and not to the working world in which most of us live and operate.
MARIUS BENSON: Sussan Ley, thank you very much.
SUSSAN LEY: Cheers, thanks Marius.
SANDY ALOISI: Sussan Ley, the Assistant Minister for Education, responsible for childcare, speaking to Marius Benson.