TUESDAY, 27 SEPTEMBER 2022
SUBJECTS: Labor’s Cheaper Child Care Plan; ACCC review of child care pricing; defrauding of the child care system; Anti-Corruption Commission.
GREG JENNETT: So that’s the goal, and there will be a Senate inquiry into the Government’s child care package, but debate on it can at least get underway in the House from now. Jason Clare will have carriage of all of that and he joins us, happy to say, right here in the studio. Welcome, Minister.
JASON CLARE, MINISTER FOR EDUCATION: Thanks, Greg.
JENNETT: So that was the case made by your colleague. You’ve also made much of the fact that there is modelling suggesting 37,000 extra workers could go back to work because of this package. There are other legitimate reasons, though, why people put kids into child care, approved study is one of them. Does that figure include people in all those categories as well or could these benefits of participation be even greater?
CLARE: Well, you’re right, there’s lots of benefits here. It’s good for children. I’m a dad with a little guy at child care. He’s not there now; I suspect he’s at home with my dad who’s looking after him – and happy birthday, dad, it’s his 77th birthday today.
JENNETT: Go ahead. Best wishes. Yes.
CLARE: Sorry about that. I couldn’t help myself. Having an opportunity for children to be in early education and care helps set them up for school, so it’s fundamentally important. Their brains are like sponges when they’re little kids and this is a great opportunity to make sure kids get more access to care. That’s why as part of this we’re also amping up the opportunity for Indigenous kids in early education and care because we’re seeing the gap in school readiness for Indigenous kids go the wrong way – the gap’s getting worse, not better.
So, first, it’s good for kids. Second, it’s good for parents. A lot of parents want to go back to work when they’ve had children, but the finances don’t work out for them. It works out that much of what you’d earn on a fourth or fifth day working gets gobbled up in child care costs and, so, there’s a big roadblock for people going back to work if it’s so expensive. And what that modelling talks about – it’s the Treasury estimates – is that if you cut the cost of child care, then for a lot of parents, in particular for a lot of Australian women, they’ll be able to work more paid hours, or more paid days, and that adds up in total to as much as 37,000 full‑time workers.
JENNETT: But do other things as well, presumably, because there are other legitimate purposes to receive the subsidy?
CLARE: It’s got other benefits. And maybe the third part of it is the massive benefit to the economy, because we talk all the time about productivity. We talk about the lack of skilled workers. Businesses are screaming out for skilled workers. Many of the people who we are talking about who are at home looking after children are skilled workers and if they can get back into the workforce, it’ll help with that as well.
JENNETT: Yeah. Now, it’s safe to assume, or let’s for the purposes of our discussion assume that this passes Parliament, and it comes into effect in July next year. There is an embedded price signal to the child care sector simply by fact of its passage through the Parliament, isn’t there? That being the case, why start this ACCC review of pricing in January of next year? Why didn’t you put them on the job in, let’s say, October?
CLARE: It’s why we’re asking them for initial findings before the 1st of July next year. So, yes, they start in January. They deliver their final report in December. But it’s important to note, Greg, we’ve asked them, we’re asking them, to provide initial advice before this legislation comes into effect, so it’s designed in that way that if they think there are extra things we need to do to put downward pressure on prices, we should do it. There are caps at the moment that are designed to do that, but we’ve said to the ACCC if there’s extra things we need to do here before the legislation comes into effect, then give us that advice.
JENNETT: Do you have ideas on that? I note earlier today you said if there are further measures needed to place downward pressure on prices, then you’d consider it. You’d have to have a few defences in mind, wouldn’t you?
CLARE: And they exist already. There are price caps set around the childcare subsidy that do that work. But we said before the election that we want the ACCC to tell us if there are additional things we need to do in the forms of price cap mechanisms and so that’s part of the terms of reference that we’ll ask the ACCC to look at and give us that advice.
JENNETT: How much of a concern is fraud? Whenever you get Government money going into sectors – we know from family day care that it was there a number of years ago. Embedded in your bill today are what’s called “integrity measures”, including making sure that people don’t pay with cash, making sure that they can pay their gap fee electronically. That’s suggesting a problem, on what scale?
CLARE: Yeah, it’s serious and it’s real. Effectively what the fraud is, is that a parent might sign up to a centre and the centre registers them as being there three days and they’re only having the child there for two days, but the Commonwealth pays for all three days through the child care subsidy, so the Commonwealth is effectively being defrauded for that third day. Now, there are a couple of things that we do as a Commonwealth Government to try to stop that. As well as having investigators in the field, the advice to me from my department is that by making the gap fee an electronic payment rather than a cash payment that’s a way in which we can help to put a foot on some of this fraud.
JENNETT: And that will become, what, mandatory under this bill, will it?
CLARE: That’s exactly right. I set out in the speech this morning that there might be cases for exemptions here. I’m thinking potentially about a remote Indigenous community where there may not be wi-fi and there may not be the potential to do that, and if there are genuine reasons for that, then I’ll set those out in Ministerial rules. But, by and large, we want to go to this electronic model because it’ll help us to stamp out this fraud.
JENNETT: You obviously have suspicions as well about larger corporates in the child care sector. That’s why you had transparency provisions in the Bill as well, obviously, to keep an eye on margins and price gouging that we’ve already discussed. Is that an apprehended fear or a real one?
CLARE: Well, child care costs have gone up by 41 per cent in the last eight years. Anyone who has a child in child care knows just how expensive it is. There are a number of things we promised during the election campaign. We promised this legislation, which will cut the cost of child care for more than a million Australians. We also promised the ACCC inquiry. But we also promised to take action here as well, Greg, to provide more transparency here. I think parents have a right to know where the money’s going.
JENNETT: Why target only larger corporations, though? There’s lots of different players in this market; all are capable of price gouging.
CLARE: That’s very true, but this is the best place to start where you’ve got the biggest companies involved.
JENNETT: All right. I’ll take you slightly outside of your portfolio, but it’s a pressing concern for your Government as a Cabinet Minister. The integrity commission. It looks like a range of concerns have been accommodated by Mark Dreyfus in the design of this one. Does that reflect or indicate a deal or an understanding with the Opposition for its support?
CLARE: No, well, I think it reflects a determination to introduce legislation that’s got teeth and is actually going to deal with the challenges of corrupt conduct at a Commonwealth level. Anybody who thinks that corruption doesn’t exist at a Commonwealth level, I think, is naive. This, as we talked about the child care legislation, a big promise that we’re implementing this week. Another big promise that we made in the election was to set up a national Anti‑Corruption Commission. We’re implementing that this week as well.
I think it’s fair to say, and I suspect most people watching would agree with me, that a lot of Australians have lost trust and faith in Australian politics and Australian politicians. This is designed to help restore that. That’s why it’s important that this legislation is strong, that the commission has the power to decide what it investigates and the potential to hold public hearings. We want this –
JENNETT: Although it’s limited potential; it’s around exceptional circumstances.
CLARE: Sure, but the power is vested in the Commissioner, so the Commissioner, he or she, will make that decision. Under the model that the Coalition were proposing but never introduced, there would never be a public hearing into a politician but there would be a public hearing into a potentially corrupt federal police officer. That doesn’t pass the pub test. So, I think Australians have been wanting this. It’s got a longer run‑up than Dennis Lillee waiting for this. Scott Morrison said he would do this four years ago. We promised we’d do it and that we’d implement it this year, and that’s what we’re doing.
JENNETT: Yep. I’m sure we’ll be talking more about that through the remainder of this week and the months ahead. Jason Clare, you’ve got a bit on your plate right now. Thanks so much for joining us this afternoon.