00:00So the Productivity Commission went into this project with two key ideas in mind, I suppose
00:06access and affordability, working towards the idea of universal childcare.
00:12And the key recommendation to come out of it is that universal childcare, should it
00:15be pursued by the government, and the Productivity Commission says it should, would look like
00:19three days a week of access for all Australian children under five, or 30 hours.
00:25That is essentially the baseline and should be available to every Australian child under
00:29five, no matter their parent's circumstances or where they live.
00:33On the affordability question, things get a little bit more complicated.
00:37The Commission looked at some big ideas for really a complete overhaul of the system.
00:43One is this idea of a low flat fee for childcare, that all Australian children would be charged
00:49the same for the childcare they receive.
00:52Another was a 90% universal childcare subsidy.
00:56Now the Commission rejected both of those ideas, arguing essentially that they would
01:01primarily benefit wealthier Australian households, and that would come at a substantial cost
01:07to the government for not as much return as they might like.
01:10Instead, they're recommending a different proposal, which is essentially adjusting the
01:14existing childcare subsidy scheme that is already in place.
01:19Now the key headline here is that a 100% subsidy would be made available to households earning
01:24less than $80,000 a year.
01:26That is effectively free childcare for those Australian households on lower incomes.
01:32On top of that, subsidies would be increased for all households earning less than $580,000
01:36a year, so only excluding the wealthiest Australian households.
01:41That the Productivity Commission says is the best way to increase affordability for the
01:46greatest number of Australian households, with perhaps the lowest impact on the budget.
01:50This is significant and meaningful change that the Productivity Commission is suggesting
01:55here, but it's not quite the complete overhaul that perhaps some advocacy groups and others
02:00had been suggesting.
02:01And the government's been fairly clear in suggestions really over the past few months
02:04that it's looking at a substantial childcare policy, perhaps with the next election in
02:09mind.
02:10That is, after all, why it commissioned the Productivity Commission to do this work.
02:14It has been taken in the past by this idea of universal childcare, how to make childcare
02:20more accessible and more affordable to all Australians.
02:23Even floating the idea of that 90% universal subsidy that the Productivity Commission has
02:28decided in this instance to knock back as an idea.
02:32That being said, it does note the significant cost that would come with this.
02:36Childcare is already expensive in the budget, it's worth about $12 billion a year.
02:40This would jump up that figure to about $17.4 billion each year.
02:45So a significant increase, billions of dollars extra in funding every year.
02:48That being said, they say they're looking at all these recommendations very seriously.
02:52Let's have a listen to the Education Minister, Jason Clare, speaking on this new report earlier
02:57this morning.
02:58At the moment, the childcare subsidy means that we provide about $12 billion of support
03:04to parents and support to families every year.
03:07The recommendations about the childcare subsidy would see that increase from $12 billion to
03:12$17 billion.
03:13And then there's other recommendations there that would require additional investment as
03:17well around the activity test, around inclusion, around developing centres where they don't
03:22exist at the moment.
03:23But we're also very conscious of this, that early education and care helps parents, helps
03:30families to go back to work, in particular working mums.
03:34It helps our children because it provides them with the education that they need to
03:38be ready for school.
03:40But it also helps all of us.
03:42As you heard the Minister touch on, there is more to this report, particularly recommendations
03:46like dumping, the activity test that's in place, and ways to increase accessibility
03:50for childcare centres right around the country.
03:53So there is more to this report, and likely more to discuss in the months ahead.
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