CHILDCARE SAVINGS WELCOME BUT ONLY A $10/DAY CAP WILL DELIVER TRUE RELIEF FOR FAMILIES

Childcare savings, today announced by the Federal Government, have provided some relief for families with young children grappling with the cost-of-living crisis, but only a $10 daily fee cap will deliver real affordability for all families.

According to analysis conducted by the Department of Education, families have saved $7,000 a year on average since the government increased the rates of the Child Care Subsidy (CCS) [1].

Campaign Director of The Parenthood, Maddy Butler, said that while the savings were welcome, the current subsidy system remained too complex and confusing for many families, and many childcare providers, around 70 per cent of whom are for-profit enterprises, hiked their fees in response to the subsidy increase.

“It is a positive sign that according to the government’s analysis childcare costs have come down for families, but we know that many are still doing it tough,” Ms Butler said.

“Increases to the Child Care Subsidy funded by the Albanese Government have brought some relief but unfortunately a huge share has been absorbed by fee hikes [2].

“Not only is the CCS too complex and confusing for families to navigate, long term it is not the system we need as the government rolls out universal early education and care.

“Billions of public dollars are invested in CCS each year, but without a fee cap we can’t deliver genuine relief for families because providers can simply raise their fees every time the rate of the subsidy is increased.

“There are also concerning reports of frauds and errors plaguing the CCS system [3].

“What Australian families need is a simple system where providers are funded directly, like schools are, and out-of-pocket fees are capped at $10 a day.

“Such a system will remove the complexities families face and put a firm limit on out-of-pocket fees.

"Fee caps would also ensure that every public dollar invested in early childhood education goes directly to providing quality education and care and reducing costs for families, rather than being absorbed by profit-driven providers.

"Relying on the CCS will mean that families will continue to face unpredictable and unaffordable childcare costs despite billions in government investment," Ms Butler said

[1] More than $7,000 cut in child care costs as cheaper child care delivers cost of living relief – The Hon. Jason Clare MP, Minister for Education and Sen. the Hon. Jess Walsh, Minister for Early Childhood Education and Minister for Youth

[2] PM’s $5b ‘cheaper childcare’ subsidy gobbled up by fee hikes – Australian Financial Review

[3] Childcare subsidy program leaks hundreds of millions of dollars in fraud and errors – ABC News