Sky News – child care cost increases

Friday, 30 April 2021

TOM CONNELL, HOST:  Inflation figures out this week confirm the government’s major reform of child care essentially tipping a lot more money into it has been eaten up via inflation. The government is said to include some form of boost in the Budget. Labor of course already has an alternative plan out there. And joining me is Amanda Rishworth, the Shadow Minister for Early Childhood Education, thanks for your time. You’ve got a plan, but doesn’t guarantee that it won’t be eaten up by inflation as well?

AMANDA RISHWORTH, SHADOW MINISTER FOR EARLY CHILDHOOD EDUCATION AND DEVELOPMENT: What we’ve got is a plan that increases subsidies, importantly for families gets rid of the annual cap, but also tells the ACCC to have a look at prices, to have a look at what is driving this, and also to look at how we might do some price regulation. Unfortunately, what we’ve seen is not only the subsidy being eaten up for families, but of course we’ve seen very, very high out of pocket cost increases with no regulation whatsoever. So our plan not only looks to try and tackle the subsidy, but also importantly looks at price and those price increases that we’ve seen

CONNELL: The price regulation that you say you’re looking at, could that operate similar to private health insurance increases? They put in submissions for increases and the government needs to approve them. Could you look at that for child care?

RISHWORTH: Well what we’re asking is the ACCC to have a careful look at this, along with the Productivity Commission. Because of course what we need to do is make sure that the benefit that the government is paying – and of course under Labor we have our short term plan, but we also have our plan to get to 90 per cent universal subsidy in the first three years of a Labor Government. And that will require price regulation, no doubt about it. So we will want to work with the ACCC. How private health insurance do it is one way, the NDIS for example sets prices as well. So there’s a range of different ways you can look at this, to make sure that the benefit of government spending goes back into family’s pockets.

CONNELL: A big part of recent increases, or at least a part, has been increased wages. And Labor also talks about how child care workers are underpaid. You took a 20 per cent pay increase to the last election, is that totally off the table now?

RISHWORTH: I’d like to see the evidence to show that indeed early educators wages are driving these increases. The problem we’ve got in the sector at the moment is there is no transparency whatsoever about what is driving the increase in cost. And so I think when you look at an inflation figure of 2.2 per cent in one quarter, the early educators that weren’t getting a 2.2 per cent increase in one quarter would be pretty surprised. So look at the moment, we are focused on how we deliver the best and cheapest possible child care to Australian families, because we see this as a big handbrake off the economy. And that’s what we’re committed to do.

CONNELL: Do you still think child care workers are underpaid?

RISHWORTH: I think early educators do amazing work and they do not get the pay and respect they deserve. For –

CONNELL:  So are you going to take a policy on the pay then or not?

RISHWORTH: What we are doing is looking at a number of levers to improve wages and conditions right across the economy –

CONNELL: But you took a specific one last time on child care. Are you taking that this time?

RISHWORTH: At the moment our policy is as it stands, but we are looking at other levers through the Industrial Relations Commission, particularly on gender pay cases. The issue in the Industrial Relations Commission is they have had to have a male comparison to really properly assess gender pay cases.. Well when you look at aged care workers or early educators, you can’t really compare them to construction workers. Their work, many would argue including myself, is critically important, not only to the economy –

CONNELL: I think a lot of people would agree with you. But just on that, I mean if that that sort of framework changes and ends up in a significant increase in wages, who pays for that?

RISHWORTH: That is where we’ve got to have transparency. At the moment we are looking at a 90 per cent subsidy, moving towards that. We have already said that an investment in early education is a smart investment because of the return on investment.

CONNELL: I’m not talking about transparency because that looks into the current system. I accept what you’re saying, you’ll have a review, you’ll see where the money goes, that’s fine. If separate to that there is a big pay increase that happens, who pays for that?

RISHWORTH: I’m not prejudging –

CONNELL: I know I’m just saying we’re talking about whether or not they’re paid fairly. You’re indicating you don’t think they are and there could be a new way to assess that. I’m saying if that is an increase in wages, who pays?

RISHWORTH: We’ve been very clear that we want to support families much more than they are being supported now. We’ve had a policy out for nine months, the government’s leaking a whole range of different thought bubbles that have not been committed. Now they said they were going to put downward pressure on prices and it hasn’t come to light. We’ve seen those figures out –

CONNELL: You’re indicating that you believe these workers are underpaid. And if it turns out they get a decent pay rise –

RISHWORTH: There was a process in place to do that for the community sector workers. And this is a lot of –

CONNELL: Labor said last time around it was going to pay for it –

RISHWORTH: – that’s what happened with the community sectors is the government was able to cover that. But we are not even talking about an pay increase actually happening, we’re not even talking about more relief for families. We are not the government. We are putting forward more proposals than the government, more sustainable proposals than the government, more thought into our childcare proposals. And it’ll be interesting to see if the government will play catch up with us on budget night.

CONNELL: It will be. We’ll talk after that, Amanda Rishworth, thanks for your time today.

ENDS

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