The Childcare Rebate, providing parents with 50 per cent of their out-of-pocket expenses, could be abolished, with money going directly to child-care operators to dramatically boost their standards under radical proposed changes to be unveiled today.
A Senate inquiry into child care and the multimillion-dollar collapse of private operator ABC Learning is expected to recommend sweeping changes to industry regulations and increased government funding to improve staff ratios and staff qualifications.
While child-care centres would receive direct access to greater government funds, they would also be subject to affordability constraints to ensure parents were not hit by significant fee rises under the new rules.
The Senate inquiry, initiated by Greens Senator Sarah Hanson-Young in the wake of ABC's collapse last November, is expected to be tabled today. It also calls for an end to any future market gouging of the child-care sector by private, for-profit operators.
When ABC collapsed last year, the Government was forced to spend $56million of taxpayer funds to prop up more than 1000 ABC centres across the country. Since then, 55 centres have closed, 241 ''unviable'' centres have been sold by receivers McGrathNicol to new operators and the remaining 710 are still up for sale.
While the Government placed restrictions on who could buy the first tranche of 241 failed centres in March requiring 75 separate, experienced and financially sound operators it has given receivers carte blanche to sell the remaining centres, with McGrathNicol indicating it would accept bids by a single conglomerate.
The inquiry is expected to strongly recommend against any one company holding a significant proportion of the centres, proposing much stricter regulations in the case of future corporate buy-outs.
In terms of improving standards, the Government would be encouraged to use new funding levers to mandate higher ratios of staff to children and higher staff qualifications.
While the Government has already floated ratios of one carer for every four children under the age of two in its new national quality framework for child care to be signed off by the Council of Australian Governments next month the inquiry is expected to go further and recommend the ratio come down to one carer for every three children under two and one carer for every four children over two.
In order for centres to afford the new ratios and to train and hire more qualified staff, the committee has considered several submissions calling for substantial and ongoing Commonwealth investment in the child-care sector. Submissions have also warned against imposing any further costs on families.
In return, the Government could link its funding to benchmarks, ensuring quality, affordability and accessibility across the sector, with ABC's collapse exposing poor levels of care for children and unacceptable working conditions and staff pay levels.
The inquiry is expected to use the failed ABC Learning model as an example of why the corporatisation of child care should not be allowed in the future and why taxpayer money must be tied to improved standards.
The inquiry is also expected to advocate new national regulations on the sector to take precedent over the current system of differing state and territory standards and licensing arrangements.
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