Bill Shorten will pledge to bring down the soaring cost of daycare for parents on Sunday but will mandate that childcare workers are guaranteed a pay rise under the deal.
The New Daily understands Labor will confirm the policy over the weekend, in one of the biggest announcements of the 2019 campaign.
The spending increase will deliver direct Commonwealth funding for wage increases for some of Australia’s most low paid workers in childcare centres across Australia.
However, it will include a compliance system to ensure that workers get a wage increase and that childcare centre operators do not simply pocket the profits.
Labor leader Bill Shorten said he would have more to say about the ALP’s plan to end the gender pay gap in Australia shortly.
“We’ve got fair-dinkum policies – we’re going to announce some more on Sunday. We are about closing the gap. Whatever improvements have been made in the last six years … no wages have risen,” he said.
“But the point about it is – we are going to say to our big business, ‘Don’t hide behind pay-secrecy contracts anymore. We want to see what you’re paying the men in your organisation and the women. And if you’re not paying them the same, why not? If not, why not’, we’re going to make an impact on procurement – what is happening to companies bidding for Commonwealth work?”
Labor’s education spokeswoman Tanya Plibersek said there had been a “slight narrowing of the gender pay gap, but the real impact has been men’s wages falling.”
“We can’t reduce the gender pay gap by undermining the growth in men’s wages,” she said.
The majority of parents now say they are paying over $100 a day for childcare according to a recent survey and close to 40 per cent of families are as much as their home mortgage in out of pocket costs every week.
Last year, childcare workers with a Certificate III were paid an hourly award rate of $21.29, which is nearly half the average Australian wage of $42.84 per hour.
Labor’s new proposal will include inbuilt compliance measures to ensure that workers secure pay rises before money flows to childcare centres.
The reforms are similar in spirit to a proposal that former Prime Minister Julia Gillard rolled out in June 2013 towards the end of her time in the top job.
But the fund was slammed as a “union slush fund” and quickly axed by the Abbott Government in December, 2013.
The Early Years Quality Fund had planned to deliver childhood educators a pay rise for two years.
The Coalition instead decided to “redirect” nearly the funding to “professional development” programs for staff, not pay rises.
Around $62.5 million of the fund, which was already written into contracts with 16 childcare providers, was paid.
As a result, 15,500 workers received a $3 to $5 an hour pay rise – but only for one year.
Two years ago, the Turnbull Government unveiled its own childcare fix to bring down prices.
The Coalition argues those changes ensured that the typical family was around $1300 better off a year.
But it also introduced a new activity test to ensure low income families are working or looking for work. This has proved controversial with childcare experts who say in many cases access to quality childcare is vital for disadvantaged children and in some cases is the only time they secure access to quality meals and education.
The new Child Care Subsidy also phased out subsidies for very wealthy families earning more than $350,000-a-year in combined income which has reignited the debate in some quarters over tax deductibility for childcare – a reform that would benefit high income earners.