Why investing in childcare makes good budget sense

News Corp Australia/The Daily Telegraph
Jessica Irvine, National Economics Editor

IT was a shining moment of clarity amid an otherwise grey and trouser-dominated weekend of meetings between G20 finance ministers and central bankers.

“Women are the most under-utilised asset in most of … the economies in the world,” declared Angel Gurria, the Secretary-general of the Organisation for Economic Co-operation and Development.

Of the 52 finance ministers and central bankers who assembled in Sydney last weekend, just six were women — albeit among them Janet Yellen, the chair of the US Federal Reserve and arguably the world’s most powerful woman.

But while small in number, women were not entirely absent from the agenda of the G20. You see, women’s liberation has long since ceased being a radical feminist idea.

And you don’t need to be a woman to be a feminist. Some of the most staunch feminists these days are economists, who regard equal rights for women as a central pillar of economic policy.

Gurria is one of them. And Hockey too, if frequency of nodding and “mmm”ing are any indication.

The two men held a press conference on the sidelines of the G20 meetings last weekend in which Gurria implored countries to find ways to unshackle women to join in the pursuit of wealth creation and to boost economic growth.

“You need, like they say in the marines, ‘all hands on deck’ and ‘every able body’ and certainly you need all the women you can get. They are just as educated, they are just as confident, they are just as smart — or more,” Gurria declared (with Hockey interjecting “more”).

All women need, according to Gurria, is the chance to participate: “How do you do that? You free them up from the need to be taking care of children.”

And get this, all you guilt-ridden mothers: you can leave your mother guilt at the door of the childcare centre.

According to Gurria, children who live in countries with above average attendance at early childhood care centres go on to score higher in educational tests.

“Early child hood care and education has very good results on the children themselves,” he said. “But the most important thing is it frees up the women to go into the labour force.”

Australia’s female workforce participation rate ranks above average for OECD countries, but it is hardly best practice. Australia’s economy could be $25 billion bigger if women here participated in the workforce as much as Canadian women, according to the Grattan Institute.

With Tony Abbott’s paid parental leave scheme in the cross hairs of his Audit Commission, which reportedly has concluded it is too expensive, the government is being urged to ditch the scheme and spend the money on childcare instead.

The reality is we need to do both. Paid parental leave is an election mandate for Abbott and will likely pass in some form.

But urgent action is also needed on childcare.

Australians are already accessing more formal childcare than ever before. Over half of 2 to 4 year olds today attend some form of childcare. In 1991, just 250,000 children were in approved childcare. Today the figure is more than a million.

Abbott’s Productivity Commission inquiry in childcare and early childhood learning is underway, but not due to report to government until October 2014.

Already it has received 426 submissions, indicating the demand in the community for strong recommendations on better and more affordable care.

Indeed, of all the OECD’s economic policy prescriptions for Australia, reforms to alleviate the high cost of pre-primary education were emphasised in a recent report “Going for Growth”.

“In the case of Australia, expanding early childhood education service may put pressure on the fiscal balance, at least in the short run. However, it contributes to a narrowing income inequality by enabling a more equal formation of human capital at early age and by facilitating full-time labour participation by women.”

That’s a fancy way of saying that better formal early childhood care not only helps kids get a head start at school but also helps women to achieve their goals in the workforce.

It’s time we too changed the way we think about childcare, not as a subsidy or welfare check, but as an investment.

And some investments are so good, they are worth making regardless of the budget balance — because they earn a return greater than their cost.

Childcare is one of them.

Money spent on childcare has a boomerang effect on the budget: it comes back in greater tax revenue from the incomes of working women.

And that just makes good business and budget sense.

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Income Splitting: So Divisive It’s Splitting the Tories

Why Harper’s going ‘Mad Men’ retro with his $3-billion tax gift to social conservatives.
Andrew Jackson, Tyee


Discouraging women from working outside the home is surely not an appropriate goal for tax policy. But that may just be the motivation behind the Harper government’s plan to introduce “income splitting” for families — an expensive tax gift to traditional families with one breadwinner and a stay at home spouse.

The gift is already proving costly to Conservative party unity. The Harper government’s own finance minister is speaking out against the policy that would deprive the treasury of tax revenues while benefitting mainly big earners.

But Minister Jim Flaherty is up against social conservatives in Tory ranks who built income splitting into the party’s platform….

Pushed from far-right fringe

REAL Women of Canada is an avowedly conservative women’s movement that has led the charge for family income splitting since at least the mid 1990s. They are a profoundly anti-feminist organization that also supports anti-union laws, and oppose public child care, abortion and same-sex marriage.

In a 2012 pamphlet titled “The Importance of the Family,” REAL women argue the case for tax changes to support the traditional family with a stay at home spouse, usually a woman.

“Although there are serious financial disadvantages to single-income families, ie. decreased disposable income, there are, nonetheless, some important emotional and sociological advantages for such families, and, in the long-run, for society. That is, when one partner (either the mother or father) is the sole provider, energy can be directed by the other partner to full-time parenthood. This allows for complete attention towards the nurturing of the children and assists the family by creating values, faith and traditions, which are more readily achieved by this close family arrangement. Healthy families ensure the future of mankind.”

British Columbia-based Focus on the Family Canada has also taken the lead in advocacy of tax measures to support the traditional family. They have links to the major American evangelical Christian organization of the same name and, according to journalist Marci Macdonald, received $1.6 million in services from the larger American organization between 2003 and 2006.

Focus on the Family Canada’s mission is to “encourage and strengthen the Canadian family through education and resources based on Christian principles”; and its guiding principles include the preeminence of evangelism, the permanence of marriage, and the sanctity of human life. Like REAL Women of Canada, Focus on the Family Canada has opposed a publicly delivered national child care program, same-sex marriage, and gay rights in general (including the right of gay couples to adopt children.) It is anti abortion and promotes spanking in the interests of child discipline….

But the social and religious conservatives are less interested in promoting real choices than in promoting a traditional family model in which women are expected to stay at home for extended periods to care for children. That is why they not only call for tax measures to subsidize stay at home parenting, but also oppose government spending on badly needed childcare services.

And that is likely why Finance Minister Flaherty exposed a rift in his Conservative Party when he said of income splitting: “I’m not sure that overall it benefits our society.”

No it doesn’t. Canadian families deserve better.

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2014 Federal Budget


Response and analysis of the federal budget 
CCPA staff and Alternative Federal Budget partners

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Federal Budget 2014: No help for families here
February 12, 2014

The Harper government claims that this year’s federal budget will create jobs and stimulate the economy but in reality, it’s just more of the same old austerity story. Flaherty says the budget will address unemployment yet it offers nothing for families struggling to access affordable child care. Canada’s ongoing crisis in child care across the country, marked by exorbitant parent fees, a shortage of regulated spaces, low staff wages and quality issues as well as the abysmal failure of the market model, is once again sidelined in the budget.

As a result:

• The majority of Canadian families with children under 5, faced with unaffordable fees and a critical shortage of spaces, will continue to turn to unregulated care.

• Canada’s commitment to ending child poverty will continue to lag behind.

• Canada will continue to rank last among 25 developed countries in meeting the minimum benchmarks for early childhood education and care (UNICEF).

• Canada will continue to fail to meet its international treaty obligations as a signatory to the Convention on the Rights of the Child.

There are solutions that would support all Canadian families – check out the Alternative Federal Budget

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Budget 2014: Children in Poverty Wait while Surplus Accumulates
Campaign 2000

Celebrating Family Day

Carol Ross, Executive director Parent Support Services Society of B.C.
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