Summary
There were limited new measures relevant to our sector, and we were disappointed that education and care was not recognised as a key cost of living driver.
The announcement of $19.4m over five years, as part of the Community Child Care Fund designed to create new services, was welcomed as a modest start to supporting all families to have access to quality education and care.
We were encouraged by the inclusion of measures that will support the workforce, including the extension of the Boosting Apprenticeship Commencements and Completing Apprenticeship Commencements and the new, lower rate Australian Apprenticeships Incentive System, but warned that further action is needed.
CELA, ELAA and CCC released our ambitious 6 Point Plan for Education and Care last week. The plan demands that Government take action and commit to implementing solutions for the sector.
We are disappointed that only two of our six points have received any form of budget allocation, and will be advocating for more funding to support the plan as we approach the impending election.
Our Pre-Election forum is on tonight, we hope you’ll join us!
When: Tonight (Tuesday 5 April) at 7pm
REGISTER NOW
Overview
Firstly, the Government has announced a range of short-term cost of living measures. These announcements coincide with a Federal Election being called for May. The Government puts forward that the short-term measures are in response to stagnant wages growth, a tight labour market (unemployment is at a record low of 4%) and inflation of around 4.25% this year.
The measures include:
- A fuel excise cut for next 6 months ($3b)
- $250 one off payments to pensioners and welfare recipients ($1.5b)
- One more low and medium income tax offset of up to $1,500 for FY2022-23
Overall budget expenditure is $628b for 2022-23, growing to $687b in 2025-26. This is a deficit buget, after two years of heavy spending to support the economy during the pandemic. There will be an $80b deficit this year, but it is forecast to halve over the next five years.
The budget features a Women’s Budget, which includes three elements:
- Funding for women’s safety ($1.3b)
- Women’s economic security ($441.6m)
- Women’s health ($333.6m)
The Women’s Budget represents 0.32% of the overall budget. Looking into the women’s economic security measures, much of it is focused on supporting women to work in non-traditional industries like manufacturing, construction and tech. In other words, the Women’s Budget is solving problems for what are traditionally male-dominated industries. Ideally, there would be commensurate measures to encourage more men to work in education and care, to help balance out our highly feminised sector (96% of the education and care workforce is female1).
The Budget Papers also highlight the gender pay gap, which is currently at 13.8%, meaning on average women earn $255.30 per week less than men. It’s not great news, but nonetheless, the Government noted that it is the second lowest gap on record for Australia (the previous record was in 2020).
What’s in it for education and care?
In short, nothing much that we don’t already know about. The Child Care Subsidy will remain unchanged.
Regional and remote education and care
The only new item is $19.4m over five years from 2021-22 through the Community Child Care Fund for up to 20 new services in areas where there is limited or no access to child care. The Budget Statement says that:
“This will help regional Australian families by giving them proximate access to child care, leading to better flexible work options in our regions that will support women’s economic security.”2
CELA welcomes this funding as a modest start to supporting all families to have access to quality education and care, noting that 35% of Australia’s population are living in "childcare deserts"3 meaning they are unlikely to be able to access education and care for children when they need it.
We anticipate that the amount available per service will need significant additional investment to meet the high costs associated with establishing an early education service in remote locations. In addition, this initiative will be left wanting if it is not matched with workforce strategies which attract and retain suitably remunerated, qualified and skilled staff," says CELA CEO, Michele Carnegie
As outlined in our joint 6 Point Plan for Education and Care, we urge the Government to take a more active role in identifying, planning and funding the establishment of community-managed not-for-profit services where none exist.
Apprenticeships and training
The budget includes tax incentives for businesses to invest in accredited training with an external training provider, with an overall investment of $550m. Businesses with turnover of less than $50m will receive a 20% rebate if they engage in external training from an RTO.
The current Boosting Apprenticeships Scheme, which gives employers a 50% wage subsidy for apprentices in their first year (up to $28,000, then tapering off in the subsequent years), will end on 30 June.
The new Australian Apprenticeships Incentive Scheme will replace it. It will offer lower wage subsidies (10% for first and second-year apprentices and 5% for third-years) and is restricted to a list of "priority" occupations, of which education and care is included.
New apprentices starting training will get $5,000 in direct cash payments over their first two years.
While CELA welcomes any funding to entice new entrants to education and care, we believe this is inadequate to meet the significant workplace shortages plaguing the sector. Instead, together with peaks ELAA and CCC, we are calling for the federal government to fund and legislate for high wages and better conditions in the sector, as outlined in our 6 Point Plan for Education and Care.
What’s in it for children and families?
The Commonwealth Government’s Paid Parental Leave is being consolidated. It involves a $150m cut compared to last year, with new spending of $346.1m over the next five years to consolidate Dad and Partner Pay into the Paid Parental Leave scheme. It's also adjusting the income test to include a household income threshold of $350,000 a year. This Government argues it provides more flexibility over who takes parental leave, as it rolls up 18 weeks of primary carer paid leave and the two weeks of Dad and Partner pay, but experts have said it will act as a disincentive for fathers to share caring responsibilities4.
On the whole, our assessment of what’s on offer for families is that it falls short of what is needed to future-proof our economy. Families need to be able to access two days per week of fully funded, high quality education and care from whenever they need it. This would reduce barriers to re-entering the workforce by reducing the cost of childcare.
Now is the time to be ambitious for our children and our sector
CELA, ELAA and CCC released our ambitious 6 Point Plan for Education and Care last week. The plan demands that Government take action and commit to implementing solutions for the sector. A strong, viable and high quality education and care sector, with two days free access per week, will translate to:
- Improved learning outcomes at school, including a reduction in the achievement gap for vulnerable, disadvantaged and rural or remote children
- Better wages and conditions for educators, which contributes to closing the gender pay gap and leads to a more stable and experienced workforce, which in turn drives up the quality of education and care provided
- Opportunities for all parents and carers to work, leading to a stronger economy and more tax revenue for government
The 6 Point Plan for Education and Care proposes:
- Two days a week of funded early education and care for all children from birth to school
- A commitment to the inclusion of all children
- Mandatory National Quality Standard assessments and ratings at least every three years
- The creation of a national industrial instrument for the education and care sector to provide educators with fairer levels of pay
- A National Children’s Education & Care Workforce Strategy
- Properly funded infrastructure and sector support
How does the budget align with our 6 Point Plan for Education and Care?
We are disappointed that only the last two of our six points have received any form of budget allocation and will be advocating for more funding to support the plan as we approach the impending election.
Below is an overview of our response to The Budget based on each point from our 6 Point Plan:
DOWNLOAD 'OUR 6 POINT PLAN AND THE 2022 BUDGET'
Our Pre-Election forum is on tonight, we hope you’ll join us!
Would you like to find out how our politicians intend to address the chronic workforce issues our sector is facing?
Would you like to be part of the solution by showing your support for our joint recommendations?
CELA, ELAA and CCC are pleased to invite you to our Pre-Election Forum
When: Tonight (Tuesday 5 April) at 7pm
REGISTER NOW
References:
1. ECEC Census Workforce Profile, ACECQA, (accessed 1 April 2022)
2. Women's Budget Statement, Budget 2022-23, p.37, 2022
3. Deserts and Oases: how accessible is childcare in Australia?, The Mitchell Institute, 2022
4. Paul Karp, 'Federal budget 2022: policy change could discourage men from taking parental leave, experts say', The Guardian (30 March 2022)