Child care has the chance to rise like the phoenix

December 17, 2008

Now is the time to reassess the future of child care in Australia

ONE must really hand it to Julie Novak, of the Institute of Public Affairs, in her opinion piece on the collapse of ABC Learning Centres. (BusinessDay, 2/12). It could only be a free-marketer who would now stand up and say that a crucial public interest service like child care is best served by private enterprise.

Her comment that the Government has thrown "$22 million to prop up ABC operations" is simply the stuff of economic fanaticism.

The Federal Government is to be applauded for providing wage guarantees up to Christmas for this public service.

Her comment trivialises the stress and concern being felt by staff and parents.

The truth is that the collapse of ABC Learning Centres and CFK Childcare Centres now provides a tremendous opportunity to reassess the future of child care in this country. It may be odd for a union leader to say that good can come from such a collapse, but there is now a real opportunity to reassess where we are heading, perhaps without the ideological blinkers attached.

The market was always underwritten by huge federal subsidies to child-care users.

Not only in a 50 per cent rebate for out-of-pocket expenses for parents, but in the effective financial underwriting of the costs of child care. Parents only paid a proportion of the costs for the service — if not it would be out of the realms of affordability of the majority of Australians.

The reality for ABC Learning Centres investors is that the dividends were in most part a redirection of federal funding, or taxpayers' dollars, to share investors.

Indeed, the recent 11 per cent fee rise by ABC Learning Centres was on the back of the Federal Government decision to raise the rebate from 30 per cent to 50 per cent.

So much for profits being derived from "efficiencies", with fees moving at three times the consumer price index rate, it was an old-fashioned, monopolistic shakedown.

The Federal Government and families deserve better.

It is time to get a better deal for our dollar.

The opportunity now exists to reconnect families into their local community services through a return, where appropriate, of child-care centres to local government.

This means connecting them back into a level of government that currently provides quality child care, maternal child health services, immunisation programs, mobile libraries, baby capsule hire, health services, and so on.

Local government simply provides the best child-care services within an integrated service to the community.

For staff, they move to a place with, in general, better career structures, better employment conditions, more secure employment and better training options.

Families get the certainty and security of a stable permanent service for the local community.

For the Federal Government, we recommend the greater integration of child-care services into local government.

We also recommend a federal body be formed to gather data from centres, improve regulation, provide quality measures, and use information to track demographic needs of young families in our communities.

ASU is working with interested councils and local government bodies to link with the Federal Government to find a better and more permanent solution to the child-care crisis.