Gemma Acton: Childcare costs the real culprit for the gender pay gap

Headshot of Gemma Acton
Gemma Acton
The Nightly
5 Min Read
The $330 a day reason for the gender pay gap.
The $330 a day reason for the gender pay gap. Credit: Naomi Craigs

A lot of angry ink has been spilt over the results of the latest gender pay gap report which was compiled by a Federal Government agency and attests that for every $1 the average male worker in Australia earns, a female takes home just 78 cents.

While I am as disappointed and frustrated as many others that we still have such a gaping gulf, I believe we are hunting in the wrong place for the smoking gun. Indeed, the Federal Government should be looking a little closer to home for why women are still so disadvantaged rather than implying the problems are primarily caused by the private sector. This is an apolitical comment as the same problem exists under both Coalition and Labor leaderships.

Let’s knock any outdated (but surprisingly lingering) misconceptions on the head. In Australia women currently represent 60 per cent of all completed undergraduate and postgraduate degree courses so we’re eminently capable of enjoying successful careers. While many women do choose to stay home and prioritise their families after a certain point, many do not and end up defeated by a system set up to fail them.

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Gemma Acton, Seven Network Finance Editor. 7NEWS.
Gemma Acton, Seven Network Finance Editor. 7NEWS. Credit: Danella Bevis/The West Australian

I’ve worked in heavily male-dominated sectors (investment banking, wealth management and media) since I was 18 years old. My biggest career mentors, sponsors and closest workplace friends have always been an even split of men and women.

Returning to work this week after having my second child is the first time I’ve ever had to face the confronting reality that unless I take a long-term view on my career prospects, it would make more sense to throw in the towel now. Let me emphasise that this is in no way the fault of my employer who has a strong track record of working with parents to provide flexible arrangements according to their needs.

The culprit is the extremely flawed childcare model we have in Australia. I work full-time, I run two small businesses on the side and have two young children. The only currently available option for day care within 15 kilometres of where I live in the suburbs of a State capital is $330 per day. For two kids over a period of five years, that’s around $400,000 we’d be paying out (or looked at another way, close to double that we’d need to earn on a pre-tax basis just to pay for childcare during weekday working hours). Even at that outrageous amount, we can only get some days as there are no places left on Mondays or Thursdays so my husband and I will have to juggle one baby girl on those days until something comes up.

The only other day care centre that had a little availability was $390 per day. We applied for all options from long-day care in a large commercial chain to small family day cares in someone’s house. Unfortunately we don’t have nearby grandparents which is the solution so many of my friends understandably rely upon even though it is a tremendous ask of that generation and should not be the only way we can make it all work.

I use myself as an example but many women in their thirties and forties are in the same boat — it makes little to no financial sense to work.

As someone who pays all my taxes, takes no subsidies and has two children at a time when the birth rate is far below where Australia needs it to be, I can’t help feeling that I am doing everything I can to help the economy — and yet am penalised for it.

If I didn’t work, my childcare fees would only be $260 a day due to qualifying for a subsidy — or zero as I wouldn’t even need to send them at all. I am therefore completely disincentivised by the Government’s broken childcare system to work. I use myself as an example but many women in their thirties and forties are in the same boat — it makes little to no financial sense to work.

If you are not loving your job, if you have a tough commute, if you’re exhausted by the domestic workload on top of the business one or if your child needs special attention for any reason then you can see why so many people drop out at this point. Those people tend to be mothers because although societal expectations have changed an enormous amount, in most cases the decision is made for the father to keep working and the mother to take the leading domestic role.

When the Government increases childcare subsidies — as we saw last year — all that happens is day care fees go up. So families receiving subsidies are no better off while families who don’t receive any subsidies end up paying even more.

We need a childcare system which encourages parents to continue working at such a crucial career juncture. One idea would be to make childcare tax-deductible. If that feels unfair, read some of the research on the billions of dollars of benefits that would accrue to our economy and society if capable parents were to stay in the workforce.

As it stands, every time a working parent gets a pay rise, they lose some of their subsidy so again, they’re no better off. These disincentives are a very easy way to kill ambition at a time when the work-home juggle is often already taking a significant toll on wellbeing and marriages.

Another idea would be to do more to incentivise employers to have onsite childcare centres. That would save parents a lot of additional commuting time — firstly helping to unclog roads for all drivers during rush hours and secondly stopping parents from having to race out of the office early every afternoon to beat the traffic which can obviously impinge on career success overtime. There are already tax incentives in place for onsite childcare with regards to salary packaging but clearly the system is not particularly inviting as so few businesses offer it and so few parents seek out employers on that basis.

We saw the private sector in Australia take the lead with extending parental leave to fathers and improving the terms for both mothers and fathers with the Government crawling along behind.

It’d be great to see them step up again in the absence of governmental solutions. If the private sector can find workable solutions to help with the cost, availability and accessibility of childcare — such as teaming up with other nearby businesses to create onsite care — we’d move much closer to the pay equality which both the public and private sector claim to be fighting so hard for.

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