Parent backlash forces Wayne Swan to retreats on child care cuts
By Simon Benson
From: The Daily Telegraph
April 19, 2011 12:00AM
Proposal to means test childcare rebate rejected
Sources claim decision based on policy, not politics
Other measures agreed to "would be unpopular"
A BUDGET proposal to means test the 50 per cent childcare rebate for families was rejected by Treasurer Wayne Swan's razor gang after a marathon session yesterday.
Government sources revealed Mr Swan ruled out the measure, in which families would be means tested for the first time for generous childcare help of up to $7500 a year.
Sources confirmed the Treasury and Departmental wish list of Budget cuts put at the meeting in Canberra included means testing of the 50 per cent rebate for families on incomes above $150,000.
"If you live in western Sydney with a family and you earn $150,000 combined, you wouldn't exactly be going around saying you are well off," a Government source said yesterday.
It has been confirmed the proposal was put to a meeting of the expenditure review committee in a "rule in rule out" session of savings measures to be ticked off between key ministers and Treasury and departmental officials, ahead of the May 10 budget.
The move comes as employers have warned the government that they would oppose any means test on the childcare rebate in the budget if it reduces women's participation in the workforce and exacerbates the nation's skills shortage.
Australian Chamber of Commerce and Industry chief Peter Anderson told The Australian while his organisation supports moves to reduce government benefits to middle- and high-income earners, "particular care is required on childcare".
"The criteria we would apply is whether the means test has the effect of reducing the net overall participation of women in the workforce, and if it were to do that, we would oppose it," he said.
Unions have warned that a means test would hit ordinary workers such as teachers and nurses and could add to skills shortages by encouraging women to cut back their hours to get incomes under the $150,000 threshold.
Meanwhile the budget razor gang also rejected another proposal to slash funding to the National Health and Medical Research Council which would have saved more than $300 million.
The Treasurer's rejection of two key savings measures flagged over the past week came as the Gillard Government slumped to a new low in the polls yesterday.
Sources claimed, however, that the decision not to go ahead with the means testing for the 50 per cent childcare rebate was based on policy, not politics.
Mr Swan had previously refused to rule the measure out.
However, he is reported to have argued in the meeting yesterday that the axing of the rebate would kill the Government's long-term plans to boost workforce participation, despite the measure also being potential political dynamite for the Government.
The Treasurer has been softening Australians for the prospect of a horror budget, warning that savage cuts will have to be made to government programs to achieve its goal of returning the budget to surplus by 2012/13.
Sources claimed, however, that other measures which were agreed to yesterday by the razor gang would be very unpopular.
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I actually think we get an awfully good bang for our taxation buck. I am a recent recipient of health care to the tune of many tens of thousands of dollars in the public system. Ok so yes it involved sitting a long time in some pretty boring waiting rooms, but I had state-of-the-art care by specialists who are the best in the game (and who other people pay many thousands of dollars to see privately) and it cost me? NOTHING. Compare this to the US where many people do not get the most basic cancer treatment because they have to argue for months with their insurance companies until finally they DIE, we've got it pretty damn good in this country.
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