The Federal Government is combining a range of stalled and revised welfare measures into a single bill to try to force billions of dollars’ worth of savings through the Parliament.
After months of negotiations with the Senate crossbench, the Government will also announce it has made concessions to its proposed cuts to family tax benefits in a bid to secure the passage of its child care reforms.
The Government had planned to abolish the end-of-year supplements for Family Tax Benefits (FTB) Part A and B — and use the savings to pay for its child care package — but the move was blocked by the Senate.
The ABC understands the Government has now agreed to make the FTB fortnightly payments slightly more generous to compensate families for the loss of the yearly supplement.
Both the child care changes and revised cuts to family tax benefits will be introduced into Parliament today in a so-called omnibus bill, which will also include the abolition of carbon tax compensation payments for new welfare recipients and changes to the Government’s paid parental leave (PPL) scheme.
PPL scheme extended but ‘double-dipping’ still blocked
Social Services Minister Christian Porter has agreed to extend the taxpayer funded PPL scheme from 18 to 20 weeks, but women will still be prevented from accessing the full benefit if their employer also offers paid leave.
Currently, women earning less than $150,000 a year have access to 18 weeks’ leave at the minimum wage, on top of any employer contributions.
The new plan is expected to save the budget about $490 million over four years.
By combining the measures into a single bill, the Government is not only hoping to expedite its passage through the House of Representatives, but to also put pressure on Labor over the issue of budget repair.
Federal Treasurer Scott Morrison said today’s bill was the product of discussions the Government has had with the Senate crossbench and “involves compromises to get savings achieved”.
“We have to deal with the crossbench because the Labor Party isn’t serious about bringing the Budget back to balance” he told the ABC’s 7:30.
“Having lit the fire on the Budget when they were in Government, they now refuse to support the Government as we seek to clean up their mess.”
Early childhood sector concerned about savings bill
The bill includes the Government’s long-awaited changes to child care payments for families, which will boost support for low to middle income earners and remove the annual cap on subsidies for most families.
But the early childhood sector is still concerned about aspects of the bill, including the decision to make parents satisfy an activity test before they qualify for Government support.
There will be a safety net for families earning less than $65,000 a year. They will still be able to access 12 hours of subsidised care a week, even if they fail to meet the activity test.
The Australian Childcare Alliance wants that amended to increase the minimum guaranteed access to 15 hours a week for all children.
The alliance president Paul Mondo said it was crucial for early development.
“Engagement in an early learning environment encourages development of social skills, that 15 hours is spread over two days and that seems to be, from the evidence, an appropriate amount to further encourage those social skills, their cognitive development and their physical development,” he said.
“The Government has been in consultation with the sector for a long time, we seem to have received some positive feedback in relation to the proposed changes the sector has put forward.
“However, we’re still waiting for confirmation that that is something the Government is willing to incorporate into the current legislation.”
Mr Mondo’s concerns are shared by early childhood academic Associate Professor Susan Irvine from Queensland University of Technology.
Associate Professor Irvine argues the minimum 15 hours a week would have enormous benefits.
“The research is unequivocal. A couple of years of quality early learning makes all the difference for all children,” she said.
“It makes a particular difference for those children from low-income families or are experiencing disadvantage.
“The research shows that children will transition to school feeling more confident, that they’re likely to have some dispositions that will set them up for success and that the benefits are actually sustained over time, evidenced in children’s achievements in school.”
Education Minister Simon Birmingham said he was working with the Senate crossbench to ensure the child care changes could pass the Parliament.