The Business Council of Australia has released a blueprint on how to ‘Fix the broken child care subsidy system’ and ‘Make paid parental leave work for modern families’.
In an interesting move to jump on the bandwagon of women’s interests, the council believes that these changes can grow the economy by five billion, make it easier for women to return to work and give families more freedom in how they raise their kids.
Business Council Chief Executive Jennifer Westacott is spearheading the conversation: “A women’s budget is not just about fixing the cultural problems we’ve seen writ large across society, it’s also an economic imperative.
“More than 90,000 people across Australia said they weren’t in the workforce last year mainly because of the high cost of child care.”
Speaking on ABC radio, Ms Westacott expressed how far the importance of this issue extends for women: “This is not just about women getting in the workforce. It’s about them realising their potential. It’s about them being able to take that extra shift, get that promotion, do that new job without the penalty of losing a lot of your childcare subsidy or all of your childcare subsidy.”
Ms Westacott explains how in the current system, there are specified amounts of money that once you earn over that specified amount, you’ll suddenly lose large amounts of your childcare subsidy. The Business Council’s plan suggests both a more gradual tapering off system, as well as an increase from 85% to 95% subsidy for lower income households. You would then lose just one percentage point of your subsidy for every additional $4000 in additional family income.
Ms Westacott sees this as far superior to the current system: “We say there aren’t enough women in leadership positions. Well, surprise, surprise, if every time you get a promotion or every time you want to do a bit extra, you get whacked from losing your childcare subsidy, surprise, surprise, people aren’t taking up those opportunities.”
Also crucial to getting women back into work are the proposed changes to the parental leave system. The current system offers 20 weeks of paid leave for parents, however, 18 of these weeks goes to a primary caregiver and just 2 to a secondary caregiver. Given that in a heterosexual relationship the primary caregiver is almost always the mother, this means the mother would miss 18 weeks of work and the father only two.
The proposed changes involve a more flexible system where families can decide themselves how to split up the 20 weeks and a more even share of the weeks will be rewarded with one or two weeks each of additional funded leave. Furthermore, the aim is for a gradual growth towards 26 weeks of parental leave.
Ms Westacott comments on this plan: “It’s good for women’s participation. It’s good for the community, but it’s going to drive major cultural change in our workforce.”
“It reflects…that people want to raise their children differently. They want to share in the caring responsibilities and that reflects the modern family.”
The proposed plans have clear and important benefits for women, but will also deliver significant general economic benefits.
“For every dollar we invest in child care, we’ll get $2 back. KPMG estimates that the cost of our child care plan would be around $2.5billion but it would deliver a boost to the economy of around $4 to $5 billion.”