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SME group campaigns for free and permanent childcare

Adrian Flores
Adrian Flores
11 August 2020 1 minute readShare
SME group campaigns for free and permanent childcare

A collective of business owners has demanded that the federal government reconsider its decision to abandon its free childcare policy, saying the current system is “inaccessible and unaffordable”.

Prime Minister Scott Morrison announced free childcare in April as part of a broad range of stimulus measures in response to the economic impacts of a national lockdown to address the effects of the COVID-19 pandemic, before ending policy in June.

However, the “Make It Free” campaign, led by 52 businesses across a range of industries, is calling on the government to make childcare free, permanently.

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Make It Free co-founder Dee Behan said the cost of childcare is so high in Australia that it is a real barrier for parents who run their own businesses.

“The devastating economic impact caused by COVID-19 has just exacerbated how unaffordable it is, while simultaneously proving how invaluable and essential it is,” Ms Behan said.

 

While not necessarily calling for permanent free childcare, Australian Small Business and Family Enterprise Ombudsman Kate Carnell pointed to a new report by the Grattan Institute that puts forward an economic case for childcare that is at least affordable.

The report estimated that an overhaul of the childcare subsidy system would add $11 billion to the GDP per year and increase hours works by 13 per cent.

As a result, the Grattan Institute recommended that the federal government invest an extra $5 billion per year on childcare subsidies.

“Thirty-eight per cent of small businesses are owned and operated by women and that number has been growing,” Ms Carnell said.

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“Many of these women are mothers who rely on childcare as they work to get their businesses back up and running again.

“For those surviving on JobKeeper, childcare fees are unaffordable. That means one parent — mothers more often than not — needs to spend more time at home. It’s bad for business and even worse for the economy.”

Ms Carnell also pointed to the report’s “workforce disincentive rate”, something she said leads many mothers to work three- or four-day weeks because working an extra day would offer virtually no take-home pay.

“The report shows that under the current system, a family with two kids in childcare on $60k FTE — the primary carer gets $2 per hour for day four and nothing for day five,” she said.

“There’s no doubt that affordable childcare would allow more women to work on growing their businesses, which would deliver productivity gains.”

SME group campaigns for free and permanent childcare
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Adrian Flores
Adrian Flores

Adrian Flores is the deputy editor of MyBusiness. Before that, he was the deputy editor for SMSF Adviser as well as features editor for ifa (Independent Financial Adviser), InvestorDaily, Risk Adviser, Fintech Business and Adviser Innovation.

You can email Adrian at [email protected].

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