A Shorten Labor Government will deliver massive cost of living relief for nearly one million families struggling with the costs of child care.
From July next year, Labor will put more money back in working parents’ pockets for 887,000 Australian families – slashing up to $2,100 per child off their annual child care bill.
Every single family in Australia earning up to $174,000 will get cheaper child care with Labor.
This is a $4 billion investment in early education, in working parents and in helping families with the rising cost of living.
Labor can pay for cheaper child care for working families because unlike Scott Morrison and the Liberals, we aren’t giving bigger handouts to the top end of town.
With Labor’s plan for cheaper child care:
- Families with kids under five years old on incomes of up to $174,000 will, on average, be $26 a week – $1,200 a year – better off per child.
- The vast majority of families earning up to $69,000 will get their child care completely free – saving them up to $2,100 per child per year.
Families with kids under 12 are also big winners. Parents with kids attending before school, after school and holiday care will also have more of their own money back in their pockets.
Under the Liberals, the costs of child care has gone up 28 per cent, costing families using long day care $3,000 more a year.
Labor will increase the subsidy families receive, we will kick start the process to limit out-of-control child care price increases, and we will review the impact of the system on vulnerable and very low-income families.
Families on incomes above $174,000 will continue to receive the same support with Labor’s plan.
Labor’s plan for cheaper child care includes:
More child care fee support: increasing the subsidy rate from 85 per cent to
100 per cent up to the hourly fee cap (currently $11.77 per hour for long day care) for families earning up to $69,000 who meet the activity test requirements, making child care free, or almost free, for up to 372,000 families. The current tapered reduction will be updated to reflect this new, higher subsidy rate.
Families earning between $69,000 and $100,000 will receive a subsidy rate between 100 per cent and 85 per cent up to the hourly fee cap, and families earning between $100,000 and $174,000 will receive a subsidy rate between 85 per cent and 60 per cent up to the fee cap – delivering an effective increase of 10 per cent.
Families accessing approved Centre Based Child Care, Family Day Care and Outside School Hours Care, including holiday care, will all benefit from the more generous subsidy.
- Cracking down on excessive fee increases: We will task the ACCC with a new role of investigating excessive fee increases and unscrupulous providers, and we will make those findings public through https://www.childcarefinder.gov.au/. The ACCC will also be tasked with investigating mechanisms for ensuring greater controls on child care fee increases to keep child care affordable.
- Reviewing the system for vulnerable children: In the nine months that the current child care subsidy system has been operating, there has been a decline in the number of vulnerable and very low-income families accessing the system. Reports suggest the numbers accessing the Childcare Safety Net have fallen by almost half, from 35,000 to 21,000. Labor will urgently review the new system to make sure that vulnerable and low-income families and children aren’t falling through the cracks.
This is on top of Labor’s National Preschool and Kindy Program – 15 hours preschool in the two years before school. For the first time, every three-year-old in Australia will be able to access 15 hours of subsidised world class preschool, so they can get the best start to learning. Labor will also extend the current arrangement for four-year-olds accessing preschool – creating a two-year program to support the most important years of a child’s development and ensuring our kids don’t fall behind the rest of the world. For many Aussie kids this will be free, or close to free.
Under the Liberals, child care is more expensive, access has been reduced, red tape has increased and access to two days of free preschool will be cut next year.
With 90 per cent of a child’s brain development occurring before the age of five, investing in quality early education is one of the smartest investments our nation can make.
Labor is choosing cost-of-living relief and early education investment, while the Liberals choose bigger tax handouts for the top end of town – paid for by cuts to schools and hospitals.
After six years of the Liberals’ cuts and chaos, our united Labor team is ready to deliver a fair go for all Australians, not just the top end of town.