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Media Release by The Hon Mal Brough MP

Labor Blueprint for child care – no costing, added complexity and no guarantee of extra places

Today’s announcement by the Australian Labor Party amounts to yet another uncosted mish mash – that adds complexity without guaranteeing additional places.

Despite today’s proposal being promoted as a plan for more places, the ALP’s Tanya Plibersek has already admitted Labor ‘can’t guarantee a number’ (Radio National).

Federal Minister for Families, Community Services and Indigenous Affairs, Mal Brough, today said much of the ALP’s plan is a rehash of a former announcement, but those new uncosted elements had no detail and would make child care more complex for parents, for business and tax agents.

"Labor has said that only businesses that can demonstrate that they are ‘expanding supply’ or ‘substantially improving quality of existing care’, will get the concessions so it is not clear how the announcement would really improve the current system," Mr Brough said.

"This announcement would introduce a substantial new caveat in the tax law to get an FBT exemption or a business tax concession that would require complex tax rulings. It is unlikely to help anybody but the biggest employers – who can already use the current provisions.

"It would require the tax man to judge whether a place is in fact a new one or is of better quality than was previously provided for a child. An employer won’t really know if he is adding to supply or simply replacing places already in the market.

Mr Brough said the Howard Government already provides assistance to parents through the Child Care Benefit and the Child Care Tax Rebate which helps make child care affordable and has been instrumental in doubling the available places.

"Parents should realise that if employees salary sacrifice child care – which they already can – then it is not possible to get access to government Child Care Benefit fee subsidy or the Child Care Tax Rebate. For most parents this would provide little or no out of pocket benefit," Mr Brough said.

"Mr Beazley also suggests providing a system of accelerated depreciation, but this is only of benefit if the employer intends to construct a stand alone facility, it does not provide for those who lease premises.

"Three months ago Kim Beazley said Labor’s plan was to end the double drop off by providing child care at schools, even though he can’t nominate where those centres would be. Today he wants the child care provided closer to work rather than home or school. Tanya Plibersek doesn’t know if that will create any more places but it will create more drop offs."

Mr Brough said the Government has already announced major changes to the quality and accreditation system and is engaging in sector consultation on that process. Labor is playing catch up – noting that their State Labor colleagues are yet to implement an agreement of 10 years ago to meet agreed Quality National Standards for child care.

"The Howard Government has more than doubled the number of child care places to 600,000 from Labor’s 300,000 and is estimated to increase to around 700,000 as a result of the uncapping of places," Mr Brough said.

"The Howard Government has doubled the investment in child care to a record $10 billion over four years. Notwithstanding the significant support for families, the best way that Government’s can help families is to provide a stronger economy, the option for jobs and improve real wages.

"Today’s announcement by Labor is uncosted, doesn’t guarantee new places, adds to the complexity of child care and the tax system and provides absolutely no detail of how it would work.

"Labor has had 10 years to provide a costed detailed policy and has failed."