Budget 2020: Labor’s childcare support package ‘not welfare for the wealthy’

Shadow Treasurer insists there is nothing wrong with families earning $530,000 receiving extra government support for childcare.

Opposition Leader Anthony Albanese and Jim Chalmers, who said there was nothing wrong with families earning $530,000 receiving extra government support for childcare because it was not a welfare measure.

Opposition Treasury spokesman Jim Chalmers says improving female workforce participation was one of the “defining challenges in the economy” as he defends attacks from the Morrison government that Labor’s $6.2 billion childcare package favours the wealthy.

With Labor attempting to bolster its credentials as a party of aspiration rather than class warfare, Dr Chalmers said there was nothing wrong with families earning $530,000 receiving extra government support for childcare because it was not a welfare measure but a “key economic reform”.

“This isn’t a welfare measure. This is about making sure more women are participating in work, it is about making sure that more Australian women can grab the opportunities when the economic recovery comes,” Dr Chalmers told Sky News.

“You can’t fix the budget unless you fix the economy, you can’t fix the economy unless you address what has been one of the defining challenges in the economy, which is women’s participation in work.”

Under Labor’s plan, unveiled in Anthony Albanese’s first budget reply speech on Thursday night, the $10,500 childcare subsidy cap for families earning more than $189,000 will be scrapped.

The maximum subsidy rate, which applies for families earning less than $69,000, will be lifted from 85 per cent to 90 per cent, with Labor stating a long-term aim of applying the maximum subsidy rate for all families.

All subsidy rates will be immediately increased under a Labor government for families earning less than $530,000, with 97 per cent of families saving between $600 and $2900 a year.

Scott Morrison on Friday said Labor’s plan would favour the top 10 per cent of income earners.

“When we announced our childcare changes, it was focused on those low- and middle-income earners,” Mr Morrison said.

Mr Morrison also criticised the Opposition Leader for increasing debt and deficit “with no indication” of how he would fund lower childcare costs.

Dr Chalmers said Mr Morrison’s claims of Labor increasing debt levels was “absolutely laughable”.

“This is a government that has racked up more than $1 trillion in debt. They announced $98bn in new spending on Wednesday night which wasn’t offset and now we have this stupendous hypocrisy which says that a tiny fraction of that, a $6.2bn commitment, needs to be immediately offset,” Dr Chalmers said.

“Obviously Labor will make sure that, between now and the election, we will make it clear as to how all our policies are being funded.”

Dr Chalmers said the time for the government lecturing Labor about fiscal responsibility was “well and truly over”.

“The time of the government dusting off all of the scare campaigns about the budget has been once and for all torpedoed by the fact that the government has racked up more than $1 trillion in debt and has hardly anything to show for it,” he said.