I support moves to make childcare more accessible and more affordable for all Australian families. Not only is this sensible economic policy; it will also provide our children with the best possible start in life. It will increase female participation in the workforce. It will reduce the gender pay gap and make childcare affordable for all families. Early education plays a crucial role in our society. However, right now, many families struggle to access childcare places, and the cost of childcare is a huge barrier for many women as they seek to return to the workforce. This bill is a step in the right direction towards universally accessible and affordable childcare.
When it comes to female participation in our economy, Australia is behind our international peers. For although the World Economic Forum's global gender gap index ranks Australia No.1 for education of women and girls, we are ranked way down the line, 70th, for woman's workplace participation—a slide from 12th in 2006. According to the Workplace Gender Equality Agency, the gender pay gap in Australia has also worsened this year and now stands at 14.1 per cent. This equates to the average Australian woman earning nearly $264 less every week than the average Australian man. In other words, a woman must work 60 extra days a year to earn the same amount. Women are also retiring with 42 per cent less super than men, and women aged over 55 are now the fastest rising segment of our population experiencing homelessness. Obviously, this is not fair and not right, nor is it economically viable for our nation to continue to disincentivise over 50 per cent of our population from working.
For too long, women have been economically left behind in this country, and reform to make childcare more affordable and accessible is long overdue. Research also illustrates the crucially important role early education plays in the development of our children. According to the organisation Thrive by Five, nearly a quarter of children are starting their primary school years in a vulnerable state due to a lack of quality early education, and evidence shows that most never catch up to their peers. If we do not make high-quality early education affordable and accessible to all Australians, we will simply fail our children. A child should never be denied critical early learning, nor should a women lose the opportunity to work because childcare is too expensive.
Many mums in Mackellar and on the Northern Beaches have approached me on the street or emailed my office to tell me that something absolutely must be done about the rapidly rising cost of childcare and that the cost of childcare is the main reason they have not returned to work. The cost of childcare has risen 14 per cent in just the last 12 months. Intelligent, hardworking, qualified and willing workers from all sectors of the economy are choosing not to work and not to re-enter the workplace, because it doesn't make economic sense to do so. As the Grattan Institute's Danielle Wood told the Jobs and Skills Summit earlier this year:
I can't help but reflect that if untapped women's workforce participation was a massive iron ore deposit, we would have governments falling over themselves to give subsidies to it and get it out of the ground.
Modelling shows that the Family Assistance Legislation Amendment (Cheaper Child Care) Bill 2022 will create around an extra 37,000 full-time jobs, covering up to 220,000 additional days of work each year. This bill goes some way to mining that amazing talent pool that we are currently ignoring, and that is Australian women.
However, we can't pretend that this policy will be a silver bullet. There are a number of issues that must be addressed for the cheaper childcare bill to be successful. Currently, one-third of families live in what is called a 'childcare desert', where there is simply no childcare available. So, it doesn't matter how affordable childcare becomes, these families still won't be able to access childcare, as it doesn't exist in their area. These childcare deserts are predominantly in rural and regional areas, but they also exist in all capital cities. The Productivity Commission review of the childcare sector that was promised at the Jobs and Skills Summit must examine these supply constraints in the early childhood education sector. There must also be regulation to ensure that the increase in the childcare subsidy for families does not end up with childcare services simply increasing their fees and neutralising the benefit to families.
Additionally, the activity eligibility test, which looks at whether or not both parents are working, should allow for a base entitlement of 36 hours a fortnight for all children, regardless of whether their parents do or don't work. Often, it is the children of parents that do not work who are most vulnerable and are in most need of the intervention and support that early childhood education provides.
However, one of the biggest challenges to the success of this bill is the fact that we are in the middle of a jobs and skills shortage, and the early education sector is one of the industries that is struggling to find enough workers. As we make childcare more affordable and more accessible, so too will demand for early child educators rise. In August this year there were already 7,200 vacancies in early childhood education, and modelling shows that on top of this an extra 9,500 full-time educators will be needed to make this policy work.
Fiona Spencer is someone who lives in my electorate. She has operated childcare centres in Sydney and Canberra for over 11 years. Fiona told me that, despite welcoming this legislation, she has grave concerns for the future of the industry and worries about where the extra workers will come from. Fiona told me how COVID has made labour shortages even worse. In her words, she said:
The system is failing children and failing staff to support the children. It needs a structural approach and a massive overhaul.
While I commend the Australian Government's commitment to the fee-free TAFE positions for early educators and to increasing the number of positions available to early educators in our skilled migration program, more can be done. From my discussions with the sector and other experts, it is clear that the No. 1 thing that we can do to halt the exodus of workers from early education and to attract more people to the sector is to increase their wages. In many places, you can earn more at Bunnings than you can working in childcare and early education.
Analysis by the Australian Association for Research in Education and The Parenthood shows that the early education sector has an attrition rate of 35 per cent, up from 20 per cent. A survey of 4,000 workers during COVID showed that 73 per cent intend to leave the sector within the coming years. Data from the national early childhood education regulator reveals that, in the first quarter of this year, 8.1 per cent of childcare providers operated with a staffing waiver, which allows them to remain open despite having inadequate staff numbers.
Despite having similar qualifications, early childhood educators are paid, on average, 30 per cent less than their counterparts working in the school system. We need to reverse this figure for this policy to be successful. To do so, The Parenthood is recommended that government fund a 10 per cent increase in wages for early educators. With cost-of-living pressures paramount in people's minds, this would help people to choose a career in early education and childcare and it would send the message that their work is valued and vital. The Parenthood has calculated that a 10 per cent wage supplement for two years would cost $700 million.
I support this measure and call on the government to support this pay rise for our early educators, most of whom are women. Supporting a thriving and viable early education sector and making childcare accessible and affordable for all Australian families is good economic policy. It's good for our children and it's a positive step in reducing the gender pay gap. I commend this bill to the House and congratulate the government for prioritising this legislation in order to get our country moving forward again.