New child care package; Calls for a Royal Commission into aged care

Simon Birmingham:     The Turnbull Government is now a little under three weeks away from providing the greatest improvements to Australia’s child care support and subsidy system in forty years. We’re putting in place a new model that is going to provide more support for more Australian families, based on ensuring the greatest number of hours of subsidised child care support go to those working the longest hours, and the greatest level of subsidy and support go to those families earning the least amount. This is about a better, fairer model for child care support and our evidence shows that of those 800,000 plus families who’ve registered already, we’re predicting that they’re around $1300 per child, per annum better off as a result of these changes. Now, we’re encouraging, of course, all families eligible to claim child care subsidy to make the switch by 2 July, and we’re quite encouraged by progress to date, with 800,000 plus, and we’re confident that we’ll see many thousands more make the transition, and of course we’ve provided a clear three-month safety net thereafter.

 

It is of course curious though to see that here we are, weeks away from federal by-elections across the country, and the Labor Party's position in relation to these child care reforms is completely inconsistent and unclear. They have voted against these reforms in the parliament, and if they hadn't voted against them, we indeed could have brought them into effect a year earlier, providing greater support to more Australian families. They seem now to stand for a policy that would spend an extra $1 billion per annum, remarkably, on some of the most high-income Australian families, or on people who don't even meet a simple four-hour activity test of working, studying or volunteering to access child care support. I think Australians would rightly question Labor's judgment in this regard, where they want to spend even more taxpayer dollars without any sense of the direction as to how they're being invested on some of the highest income families, rather than doing what the Turnbull Government has done, which is fix a broken model of child care, ensure that hardworking families don't run out of support halfway through the financial year, and instead have the opportunity to work the hours and days that suited them. Ultimately, providing around 1 million Australian families with benefit and helping around 230,000 Australian families to choose to work more hours, work more days as suits them.

 

Question:                     You said yesterday that 230,000 people will increase their work hours, including some who will go back to work for the first time. Do you have a breakdown of how many people you anticipate will actually enter the workforce, as opposed to just increasing their hours?

 

Simon Birmingham:     Well look, this is a study that was undertaken and overall it's about a measure of increased workforce participation. The data is research that doesn't break down to a granular level, but it does indicate very clearly that families find the current model an impediment to continuing to work or work the hours and days that suit them. You don't have to be Einstein to understand why, as the Productivity Commission in their analysis rightly identified, too many families around February or March or April of the financial year find their Child Care Rebate is just cut off; that they reach the $7500 cap and therefore have to make a decision about either working fewer hours throughout the year to be able to stretch that rebate further, or deciding that they're going to just work to pay the child care bills for the remaining few months of the year. Neither of those outcomes are acceptable. That's why we’ve put in place a model where, for any family earning less than $187,000 or thereabouts, per annum, they're going to have an unlimited claim on the child care subsidy, based on the hours they work, based on the income their family takes home. That's what makes it so fair. That's why we expect to see a lift further in workforce participation, which notably under the Turnbull Government, we've not only created 1 million new jobs across Australia, but female workforce participation is at the highest level on record, and these reforms to the child care subsidy are going to help drive that higher.

 

Question:                     The red tape committee is meeting today to discuss child care. Submissions have shown that organisations are worried this will actually increase red tape for child care centres and for families. They're the ones who would know, wouldn’t they?

 

Simon Birmingham:     Well, we’ve actually made changes to the regulations to reduce some of the requirements on child care centres in terms of no more mandating the minimum hours they must operate each day, or a minimum number of days a week, and these changes are delivering dividends that will benefit Australian families. Already, Goodstart Early Learning, the nation's largest childcare provider, have made changes to the way in which they offer sessions of care that mean there are more flexible options available to families. No longer will a family have to just choose a 12-hour session of care to be able to attend one of their services, they'll have other shorter sessions, which is good news in terms of what those families pay, good news in terms of what taxpayers pay, and a sign that in fact the regulatory changes we've made here are making it easier for providers to offer services that better suit the needs of working families.

 

Question:                     Last night, Bill Shorten seemed to angle he’ll leave open the door for a royal commission into the aged care. Is that something the Government would support,  do you run the risk of falling behind if you let Labor take the high ground on that?

 

Simon Birmingham:     Well, Labor has no grounds upon which they can take the high ground on a matter such as aged care. I'm a South Australian senator, I know full well that the Oakden aged care scandal, a facility that was run by the state Labor government, government owned, operated and run in South Australia by a Labor government, was indeed the genesis for that question. And, of course, it comes on top of the fact that the Labor Party have failed over many years in relation to aged care support, cutting funding when they were last in government, failing to do some to the things that the Turnbull Government's done in terms of the way we are now delivering checks around aged care facilities, as well as an independent regulator or complaints authority to be able to ensure that anybody, anytime can have their concerns heard and addressed in relation to aged care facilities.

 

Question:                     Aged care’s been a bit like the banks, hasn't it? Each time we turn over a rock, we seem to find another cockroach. Do we need to investigate a little bit further what's going on?

Simon Birmingham:     The Turnbull Government has acted, acted comprehensively already in terms of providing strengthened powers for regulators in terms of the way aged care places or localities are checked. As well as ensuring that a new independent regulator is able to receive complaints, administer those complaints to ensure that if any Australian has any concern about the aged care services they're receiving, they should speak up, have it investigated, get in touch with the authority responsible for doing so, which we've established.

 

Question:                     This is just back on to child care. Why is it, do you think, that 350,000 families still haven’t signed up?

 

Simon Birmingham:     We're not at all surprised that many families would choose to leave it until the last couple of weeks, before the new financial year. That may better suit them in terms of estimating their family income for the next year. They may just have noted that it's a 2 July start date and decided to do it closer to the starting time. But we are very pleased that more than 800,000 have done so to date. We're very confident that many thousands more will do so, and that between those extra thousands plus the three-month grace period in place this will be a smooth transition to the new child care subsidy. 

 

Question:                     Can you spell out succinctly for them the consequences if they don't sign up/switch over, what happens?

 

Simon Birmingham:     Well, families really should take the action of registering and updating their details before 2 July, and they can do that at education.gov.au/childcare.  But if they don't, then we have a transition period in place where they can still update their details, make application, and ultimately receive back payments. But the best thing they can do to avoid any disruption to the timing of their payments is to make sure they get their details updated before 2 July.

 

Question:                     But if they do nothing, the payments stop at a certain point?

 

Simon Birmingham:     Well, 2 July is when the new child care subsidy kicks in. And families need to register for the new child care subsidy to receive it. We do have a grace period of three months for them to be able to receive a back payment.

 

Question:                     Some parents, like yourself, have said that it only takes 10 or 15 minutes. I've heard complaints from others that it's taken them days of phone calls and e-mails with Centrelink to try and link their account with myGov and to try and sort everything out. Do you concede that it's not as simple as 10 minutes for some people, and that might be putting people off?

 

Simon Birmingham:     Look, of course there may be individual circumstances. But what we did was put in place additional support in terms of the call lines to be able to help people step through the process. And from my understanding, those call lines have been operating quite efficiently in terms of the services they’re provided. And my message to Australians, first and foremost, is take the steps to register. But secondly, if you're having any difficulties, then pick the phone up to ensure you get the help needed to make it as smooth a process as possible.

 

Thanks guys.