Childcare cuts will send home those who should be in the workforce
First published by the Sydney Morning Herald, 16 January 2012
When a PhD candidate at the University of Sydney surveyed students about their plans for the future, the men spoke of careers but the women also factored in families and children. One said she was planning for a life in the diplomatic corps, where built-in domestic help would allow her to combine a family and a career.The future diplomat’s response now looks wise indeed, after a recent call by Cassandra Goldie, the chief executive of the Australian Council of Social Service, to cut childcare subsidies to “well-off” households
When I entered university in the late 1980s, not many of us had a clear vision of the future, let alone big-picture plans. Our so-called “slacker” or “options” generation grew up in a world where constant change was the new normal, and the nuclear gloom and doom of the 1980s seemed to suffuse a big cloud over the future.
After passing through university – perhaps taking a year or two off to travel, run a nascent political movement, start up a band – we faced the recession of the early ’90s. Do not worry, the bosses and universities told us – just get one more qualification and you will get a cracker job. By our late 20s, many of us were still working to get any sort of real purchase in the job market.
Even if we did find partners who also wanted children, paying back the Higher Education Contribution Scheme (HECS) debts and servicing the huge mortgages in a booming housing market meant children had to be carefully factored into any financial plans. No wonder so many found themselves in their mid- to late-30s in a mad – in many cases desperate – rush to squeeze in the one or two (very occasionally three) children they suddenly realised they wanted.
The lucky ones did not have too many fertility problems, managed to qualify for paid maternity leave, found affordable childcare, had jobs that allowed for some flexibility, partners that shared the load equally and extended families that filled in the financial or childcare gaps. But dropping out of work for long periods was not an option.
In many ways, it is as if Generation X has been through a giant social experiment, where extended education, rapidly changing job markets and fragmented social structures have combined to push our physical, economic and social ability to conceive and raise children to the limit.
I look admiringly at the generation coming up behind us, who seem infinitely wiser to the potential hurdles and pitfalls that await them: collecting two degrees now seems a starting point for many, as is staying home with family for as long as possible to afford their first mortgage. Today’s 20-somethings realise there is very little room for error if they want the career and the children.
Childcare tax rebates are a crucial part of the equation. As Juliet Bourke, the chairwoman of the Taskforce on Care Costs, notes: “It might seem like a large outlay now, but if we can keep women in the workforce during the years of early childhood, it’s much more cost effective than getting them to re-enter after 10 years when their skills have been degraded, their confidence has been eroded and they still have to pay for after-school care.
Women are entering universities in greater numbers than their male peers. Why on earth would we want to see them spending most of their 30s out of the workforce, or working only part-time?
Patricia Apps, a professor at the University of Sydney, has written extensively about how low- and middle-income women bear the highest tax burdens when the combined effect of government subsidies cutting out and higher tax rates cutting in are taken into account.
In my case, with one school-age child and one in childcare, part-time work is almost the only option. When most childcare centres cost $100 a day or more, the tax rebate (capped at $7500 per child) cuts out after day three. When you have two children to care for, and when working more than three days takes you into a higher tax bracket, you are almost at the point of paying to go to work.
If you buy dinner at the end of a working week because you are tired and have no time after the daily commute, working an extra day might net you $20 or $30. If anything, childcare rebates need increasing, not cutting.
This might sound like middle-class whingeing, but childcare subsidies absolutely affect workforce participation decisions (as the academics would say) of the very people you want to keep attached to the modern workforce.
Researchers have been busy for many years showing how children’s outcomes on all sorts of measures are positively correlated to a mother’s educational achievement. It’s an important by-product of education, but surely not the only one.
A friend’s mother used to tell her that the baby boomer generation was luckier than ours. As part of the second wave of feminists, her mother’s generation was more likely to have had traditional mothers themselves to help them with child-rearing. And by having kids younger, they were young enough by the time their children were independent to have second careers if they wished to.
It would be a travesty if we changed the rules yet again to make this the first generation of women whose aspirations and achievements actually went backwards.