09 October 2020

SUBJECTS: Anthony Albanese’s Budget Reply; child care; wage subsidies; aged care.
CRAIG ZONCA, HOST: Let's get into politics. There's been a lot going on in the federal arena. It's been all about money and the federal budget this week, hasn't it?
LORETTA RYAN, HOST: Yes, and a proposed overhaul of Australia's childcare system to the tune of 6.2 billion dollars over four years was one of the main ingredients of Anthony Albanese’s budget reply last night.
ZONCA: That's right, it was the headline-grabber, if you like. So why child care the focus? How much would it cost? Six-point-two billion they say. How would it be paid for? That's the big question. Stephen Jones is the Shadow Minister for Financial Services and the Shadow Assistant Treasurer. Stephen Jones, good morning to you.
STEPHEN JONES, SHADOW ASSISTANT TREASURER: Good morning good to be with you.
ZONCA: Lots of numbers being talked about this week. Let's delve into this childcare promise a bit more. Six point two billion dollars it would cost over four years. Exactly what would it mean for Australian families?
JONES: It means 90% of families would have 90% of their child-care cost covered. It means that families literally won't have to make a choice between whether they stay at home with their kids or whether they go back to work because the marginal tax rates, the effective tax rates, of going back to work because of the childcare costs are as high as 75%. Now, I've been talking to families who are telling me that it would cost them less if they had their kids in a private boarding school than it cost them to have their kids in childcare. Now that's crazy. We've got a participation challenge coming down the line. Population growth is slowing. Workforce numbers are shrinking. We are going to get to the other side of this pandemic and we're going to get to the other side of this economic crisis. We're going to need every worker possible and we want to ensure that we don't lose fifty one percent of the workforce, and that's the female workforce, because they can't get back to work because of childcare costs.
ZONCA: So you see Child Care is being critical to that. It would cost over 6 billion dollars to do something like this. Where would that money come from?
JONES: We're working through some costings that we’ll be able to publish much closer to the election. But this is one thing that we are certain of. You get more women into the workforce, more families being able to participate fully into the workforce. You're lifting productivity. You are lifting economic capacity, increasing tax returns. So a good portion, a good portion, of this initiative because of the economic boost that it will create is going to pay for itself.
ZONCA: But that's a bit of an issue here isn’t it? Out of everything that Anthony Albanese he spoke about last night, there was talk of renewable energy plans and so on, as well as childcare. They’re the two big headline grabbers as we wake up this morning. But in terms of paying it, you haven't actually outlined how you'll do that. And already we know we're in for big deficits and big debt. Are you sending us deeper into debt under a Labour plan?
JONES: Look, absolutely not. We’ll be able to lay out quite clearly what the cost of this will be to the budget much closer, when all the numbers are in, when the final numbers are in, much closer the next federal election, which is probably more than a year away as we sit today with a lot of change in the economy to occur before now and then. But one thing that we are absolutely certain of, that this is going to be good for households and good for the economy as a whole. Because we know we are going to need to boost participation in the workforce. We know we're going to have to boost productivity in the workforce because of the economic challenges we're going through at the moment. The best way to do that is to get 51% of the workforce more engaged, not dissuaded from entering the workforce because of those effective marginal tax rates, which are as high as 75%. I mean we've had a big debate about tax rates in this country, about the fact that our tax rates are so high in some in some brackets they’re a disincentive to people working more returning to work. Nothing could be higher than the effective tax rate that is a result of child-care costs preventing workers from working, going from 3 days a week to four days a week or five a week or returning to work at all.
RYAN: What about the over 35’s? There was a lot said in the federal budget that they were missing out. How will, what incentives for businesses will be out there be to employ them?
JONES: An important point, just to tie the former to conversation to the one you've the question you’ve just asked me. People are delaying having their first child, and it's much more common now that somebody is in their early 30s when they're having their first child than they were 15-20 years ago when they having it in their early 20s. So our child care initiative will help boost participation in the workforce for those people over the age of 35. No, we are not critical for the government for putting in place wage incentives for workers under the age of 35. Yes, we are critical of the government for leaving those workers over the age of 35 hanging without putting additional support in place for them, because it does that mean that you're in a situation where there is potential discrimination.
ZONCA: Stephen Jones, does that mean that you'd raise the age, so to speak for the government's Job Maker scheme, which was announced on Tuesday night?
JONES: Well, we're calling on the government to do it now. As I said before, it's probably 12 to 18 months before the next election. We don't want to see all the damage happen between now and then. We're calling on the government to do that now. Look, we won't be in government, even under our best-laid plans …
ZONCA: But you have to set a rule somewhere. So if it wasn't the age of 35 that the wage subsidy drops out what, what age would you make it?
JONES:  We think the government shouldn’t be setting up schemes which discriminate between older workers and younger workers? There should be an equivalent level of support or an appropriate level of support for those workers over the age of 35, an appropriate level of support for those workers over the age of 35 and there are 900,000 of them who are currently on unemployment benefits.
ZONCA: So would you see no age limit on that job maker program?
JONES: I think the challenge, there is capacity for some flexibility and variance here. But what you don't want to do is set up a scheme which creates incentives and creates discrimination in the workforce between older workers and younger workers. And that's what we have as a result of this.
ZONCA: Yeah, but you're not necessarily saying that you'd make it, you know, workers up to 40 workers up to 50 that could be a part of that Job Maker scheme, which would see people on who are currently on the Job Seeker program if they're given a job their employer would be able to access this wage subsidy. You're just saying there needs to be a program. Well, that's the program that's been announced. How would you change it?
 JONES: The point I'm making, the government needs to do something today to ensure that those workers over the age of 35 aren't discriminated against. Because that is stands today, they are. One group of workers is going to get a $100 to $200 a week wage subsidy. The other group of workers aren't. That's going to create an incentive today. So we're calling on the government to do something today. And if that program isn't fixed in 18 months’ time, by which time a lot of damage will have been done within the workforce, we’ll have to turn our minds to how we as an alternative government remove that discrimination. We don't want that to happen. We don't have to be in that position in 18 months’ time because a lot of damage is going to be done between now and then.
RYAN: Stephen Jones is Shadow Minister for Financial Services and Shadow Assistant Treasurer. Mr. Jones, what about aged care? What's going to be done there?
JONES: Absolutely a missed opportunity in this budget to address the crisis of neglect in aged care. We fully expected the government to say that we are we said we're going to fully back the Royal Commission's recommendations, and here's the money to back that in. There was a gaping silence in the budget on Tuesday night. Again, 18 months before the next election before we’ll get the opportunity to fix it, we don't want to wait that long. We’re calling on the government to immediately put in place the right staffing levels to ensure that those aged care facilities have staff on the ground to be able to provide the care that is necessary. And more critically than that for those people, which is the majority of people in aged care who are not in residential care but ageing in their in their own homes, to ensure that there is additional aged care home care packages in place for them.
How many?
 JONES:  Good question. There's 110,00 people on a waiting list. The government is barely keeping up with the annual rate of growth, which is about 10,000 a year. We need to ensure that the way you get off that list isn't to die. But the way you get off that waiting list is to get access to care. So a significant …
RYAN:  Because they said 23,000. So how many?
JONES:  I'm glad you raised that the 23,000 is over two years. That's how much the list is going to grow between now and 2022. So they've done nothing about the backlog. There’s about 110,00 people on that backlog. The government has to put forward a plan which is going to reduce that backlog to zero.