Paid Parental Leave is fast becoming a noisy distraction to the real issue confronting working parents, which is the cost of childcare.
There is a growing divide between the reality of raising a family and the political language associated with it. Paid parental leave is an excellent example of this, and recent calls by the Centre for Independent Studies to replace it with a HECS-style loan scheme demonstrate how wide the gulf has become. I argue PPL is fast becoming a noisy distraction to the real issue confronting working parents, which is the cost of childcare.
Like most Australian workers, I believe in PPL. It provides a means for retaining women in the workforce, encourages families to have children and protects the right of women to have children free from discrimination.
The main block to mothers (and increasingly fathers) returning to work after parental leave is not the continuity of their pay. It is the ongoing worry of the cost of childcare. Childcare costs have been rising in recent years as more mothers choose to return to work earlier and to work in more demanding positions.
The Rudd government’s national quality framework for early childhood education and care, which meant all educators had to have qualifications in childcare, led to steeper rises; the average cost of childcare has risen by about 7 per cent since its introduction in 2012, and by substantially more in areas of high demand. A loan scheme would only magnify the impact of this wage decrease, so that parents would have to worry about a 4 to 6 per cent wage cut for at least five years after returning to work, on top of the cost of childcare.
Before we chose to revert to a single income, my family was in this dilemma. Living in the central west of NSW, we had our two daughters in a local long daycare centre, at an annual cost of about $20,000 after the childcare rebate, a figure higher than our rent. Upon researching our options for our son's high school education, we found only the three most expensive private high schools in our area cost more in a student's final year than sending an infant or preschooler to a LDC. Without the rebate, any LDC would be more expensive than all but the most elite private schools nationwide.
How can a high school, with its staffing, extra-curricular programs, pastoral care and somewhere in there a complex education for young adults possibly be less expensive to run than a preschool for 40 to 60 preliterate two to five-year-olds?
The answer appears to revolve around compliance, and the cost of establishing an LDC seems prohibitive. With the Rudd government’s quality framework, workers need a minimum of a certificate III in early childhood learning. In many childcare centres, the walls are adorned not with paintings or Paddle Pop stick artworks, but with printouts of government regulations and what looks like curriculum outlines.
Parents are just not as convinced as education bureaucrats about the need for comprehensive early childhood learning programs apart from school preparation, or preschool.
The cost of childcare seems to be coming largely from the demands of government. The response of the government should not be HECS-style loan schemes: these just offset a cost that is rapidly spiraling beyond the means of many.
The PPL scheme introduced by the previous Labor government will cost $1.9 billion this financial year. The scheme proposed by the Abbott government has been estimated at more than $5 billion a year. Were that extra $3 billion directed at cutting the cost of childcare, either by reducing regulation, creating incentives to make the market more competitive, or at least increasing subsidies, the rewards for the economy would be far greater, and the gratitude earned from working parents much deeper.
Given the choice between maintaining their wage for six months to have a child, or having a reduced rate of pay for a time but a better deal on childcare when returning to work, there are no odds on what most working parents would choose. A wise politician chooses his battles, and recognises when he cannot win. Tony Abbott needs to listen and choose the right battle on parental leave.
Jonathan Hastie is a secondary teacher from the central west of NSW. He and his wife have three children, and are expecting a fourth in October.