00:02I've got an idea for next month's federal budget, although it's probably a bit too
00:05late. Nationalise childcare and kindergarten and make them free. That is, extend public
00:12education to kids under five. It should never have been allowed to be entirely private.
00:18It is subsidised up to 90 per cent for low income families, but the way the means test
00:23tapers, middle class families often have nothing left after the mortgage and childcare. This
00:29is a gender equality issue as well as a housing affordability and cost of living problem.
00:34While the workforce participation of fathers hasn't changed for decades, that of mothers
00:39has increased from 60 per cent to 80 per cent. But nationalisation? That's crazy talk. Well
00:47yes, but anyone who examines this always concludes that something needs to be done. The Productivity
00:52Commission says either raise the subsidy to 100 per cent for low income families and then
00:56taper it down from there, or make it a flat 90 per cent for all. But 70 per cent of
01:02the
01:02operators are for profit. In the private school system, only not-for-profit operators get federal
01:08subsidies and tax deductibility for donations. Should we really be giving the shareholders
01:13of private childcare companies subsidies of 90 or 100 per cent of their product? But
01:19wouldn't it be too expensive to nationalise the industry and then run it? Well, it would cost
01:23about $60 billion to buy them all. I reckon the Government could issue childcare bonds for
01:29that amount to super funds. And at the current 10 year bond rate, the interest would be $3
01:33billion. The cost of running them and employing the staff is about $20 billion a year. But
01:39if it was free, more families would use it, so the running cost would probably be more like
01:42$30 billion in the end. So, a total of something like $33 billion a year. About half that would
01:50be covered by the cost of the current subsidies, which is $16 billion a year. Call the rest an
01:55investment in workforce participation, productivity and gender equality. It would also be an effective
02:02way to deal with housing affordability, the cost of living and staying in power.
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