Business

Rethink of childcare needed to get mums back to work

I FINISHED last week's column with: "Government must provide the platform for Australia to move forward, and that means stopping the rot in our decade-long ailing productivity. The key? Get our women back to work for one."

Fifty per cent of those who finish Year 12 are girls.

A significant number enter university. Others do other tertiary qualifications. The skills they acquire are lost to us for extensive periods in the cycle of their lives for one reason and one reason only.

Successive governments have not seen the wisdom in getting a child-minding regime in place that will encourage our skilled women to make the contribution they're trained for.

Women should be allowed, no encouraged, to make their choices. Many women find being a stay-at-home mum unfulfilling and there is much research to indicate that child-minding has a positive, not negative, effect on children's development and wellbeing.

The main thrust of my contention in last week's finale was that it is government which has the responsibility and power to encourage women into the workforce and stabilise unemployment.

In 2008 during the global financial crisis it was entirely appropriate for the Rudd government to throw money at pink batts and school buildings as the economy had to be stimulated to avoid recession.

The problem was Labor's naive management of these packages.

Equally, it is entirely inappropriate for the Abbott government to continue those Keynesian policies of fiscal largesse and we're seeing signs that they understand that.

They've effectively jettisoned the car manufacturing industry, denied SPC a cash injection, signed free-trade agreements with South Korea and Thailand, and will boost business by ending the carbon and mining taxes and re-introducing the vital Australian Building and Construction Commission.

What this sort of "dry" economics does is reduce the nation's debt as Abbott keeps saying, but more importantly it gives the government the loot to direct towards improving national productivity.

A skilled workforce is the key to productivity and where are our dormant skills right now? At home with young mums.

The Productivity Commission must address the immense problem of how to get women to work - as a priority.

The key is throwing out current thinking on child minding and maybe even replacing it with a free system.

Where does the money come from? Saving on middle-class welfare, dumping inconsistencies like providing drought relief to pastoralists, propping up Qantas (in the face of our new "no grants to poorly managed industries" policy), subsidising relationship counselling and maternity leave, and fixing a very broken tax system.

I mean, seriously, what skilled mum would reckon it's better value for Abbott to levy big business to pay new mums up to $75,000pa to stay home for six months than help them get to work and use their skills?

Yet Abbot might be onto something. My view is that the commission should look at a model where employers can pay for child minding as part of an EBA and gain exemption from Fringe Benefits Tax.

Inputs in such a model would include the $6.8 billion spent by government on subsidies last year going up at a rate of about 10% per annum.

The loss of FBT income would not be a relevant input as the benefit would be a "new" thing.

The cost of the deduction to company tax receipts would, however, be an input in such a model.

Of course, such a plan would require a far more flexible industrial relations system than we have had since the advent of Fair Work Australia.

Solve this problem, and at once solve the skills shortage and our waning productivity. That's the challenge.

Author and researcher Leslie Cannold shares her opinion on this topic here.

Topics:  bob lamont, childcare, federal government, gladstone business



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