Placement Solutions, Louise Dunham to Childcare Productivity Commission

By way of introduction, I was a National In - Home Childcare Association (N.I.C.A - now AHCA) founding member; represented NICA (now AHCA) on the Senate Steering Committee to write the Interim In - Home care standards in 2006, and represented NICA (now AHCA) through the Child Care Management System (CCMS) Industry Task Force- 2006 / 2007. I also was on the Industry Training Board that rewrote the Certificate 3 in Community Services Childcare in 2008. Further, I currently serve on the Executive Board of the International Nanny Association as both Second Vice President and Chair of the Ethics Committee. In this capacity I am the first non-American, hence first Australian, to so do.

Thank you for this opportunity to add to our public submission and to comment on the draft report on Childcare and Early Childhood Learning.

I welcome the recognition by the Commission that quality Nannies also known as in home child carers, have an important role to play in satisfying Australia’s need of child care flexibility particularly for working families with non-standard work hours.

Part of the scope of the inquiry was to look at…

Appropriate and fiscally sustainable funding arrangements that better support flexible, affordable and quality childcare and early child care learning

In my presentation I would like to discuss a number of issues that need to be addressed in order that we achieve the best results for our children and the best use of scarce taxpayer dollars. There are four main points I want to discuss.

1.      Cash in Hand Nannies. It is estimated that there are 65 percent of our industry working either outright cash in hand or erroneously with ABNs when the ATO have clearly stated that a permanent nanny must be either employed by the family itself or a labour hire firm such as ourselves. The Commission has noted that there is a significant part of the Early Child Care Education and care sector which forms what I will characterise as a “Nanny black market”. This market has several disadvantages for children, taxpayers and Nannies. For taxpayers the Nanny Black market means cash payments and the avoidance of GST, payroll and income taxes. For Nannies the Nanny black market means a loss of basic entitlements, potential exploitation, minimal reward and professional isolation and underdevelopment. For children the Nanny black market means lowered standards of care. If we are passionate about buying “fair trade coffee” then surely the Australian community should seek “fair trade Nannies” and agencies such as the Australian Tax Office and Fair Work Australia have their roles here. The Commission should enhance its report in this field of the Nanny black market.

Placement Solutions welcomes the creation of a level playing field in regards to payroll and fringe benefits taxation of agencies in childcare. A Nanny agency such as ours already faces the challenge of competing with the black economy. In - home childcare is a real alternative for many parents when irregular working hours, multiple children and parent travel time are factors. It is unfair and market distorting that some suppliers pay payroll and fringe benefits tax and others do not.

2.      Au Pair schemes These are running in Australia and running against generally accepted international rules as in the USA and Europe that an Au pair lives in; is a big sister; is not left alone with children under 5; works for 15 hours per week and is paid between $ 60 and $100.00 per week. I can provide hard evidence that both families and Au Pair agencies are exploiting this scheme.

3.      In - Home Care – as it exists the eligibility criteria is in the first instance that families cannot access other forms of government childcare. This implies that Nannies or in home child carers are not the first choice for many families and that it is a band-aid solution until real childcare is available.

4.      In Home Care- the extended eligibility is for those 1.      those that are

a.       Rural and remote

b.      Shift workers

c.       Main carer or child has an illness

Again this assumes that this form of childcare is not the choice of families and this is not the case. For example shift working parents tell me they want their child at home in their own bed not in a 24 hour childcare centre.

Those families who do not wish their nanny to meet National Quality Standards would not be eligible for assistance toward the costs of their nanny.

DRAFT FINDING 9.1

How much families pay for ECEC varies depending on their income, care use patterns and family size. However, for the vast majority of families, subsidies from the Australian Government cover more than half of their ECEC fees.

Current subsidy arrangements make ECEC more affordable for families. However, there are a number of issues with the way Government support is delivered:

• The existing system is complex and some families have difficulty understanding their entitlements under the Child Care Benefit and the Child Care Rebate.

• the design of these measures is resulting in a declining proportion of assistance to lower income families who are least able to afford ECEC services

• the Jobs, Education and Training Child Care Fee Assistance program and the Special Child Care Benefit program are not well targeted and have attracted families unable to get low cost access to ECEC under other more targeted programs.[1]

…makes absolute sense and I applaud this idea. As an agency that is energetic in the continuing professional development of our Nannies and one that rewards Nannies for their professional development we welcome the raising of standards in the industry. I  fought hard to introduce compulsory qualifications to a certificate 3 level when a member of the Senate Steering Committee

It is high time that there was a specific nationally agreed certificate III qualification for In – Home childcare and we support the Commission’s recommendation on that.