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Home >  News & advice > February 2017 > Estimator says families would be better off under reform

Estimator says families would be better off under reform

Estimator says families would be better off under reform

More than 70 per cent of families would be financially better off under the Child Care Subsidy reform, according to Goodstart Early Learning’s child care subsidy estimator.

More than 11,000 families have entered their details into the estimator on the Goodstart website, with 77 per cent finding they would be better off under the Federal Government’s proposed Child Care Subsidy which, if passed by Parliament, would start in July 2018.

The survey found the families most likely to be better off were working families with both parents spending more than two days a week at work (94 per cent better off) and middle income families with incomes between $130,000 and $290,000 (88 per cent better off).

Families with two incomes, those using services with a median fee ($95-125 per day) and families using three days of care were also found to be better off.

Those families who earn more than $300,000[1], who fail the activity test[2], who do not work, or are single income families registered as being worse off under the child care package.

Of particular concern was that 40 per cent of low income families would be worse off, reflecting the impact of the cut in the basic entitlement to access to childcare from 24 to 12 hours a week.

Goodstart and other early learning advocates have called for the base entitlement to be increased to ensure children from low income families can access at least two days of early learning each week.

Government data shows that while childcare fees rose by an annual average of 5.4 per cent per year since 2013, families’ out of pocket expenses rose by 8.3 per cent because subsidies have not kept up.

Earlier this week, Prime Minister Malcolm Turnbull committed to making improving childcare assistance a priority.

Goodstart Early Learning advocacy manager John Cherry said the Goodstart Child Care Subsidy Estimator report reinforced the importance of urgent action.

“Because more than 11,000 families took part in the estimator, this is a statistically significant report, and it provides similar characteristics to public data on families released by the ABS and the Federal Government,” Mr Cherry said.

“The data shows that three in every four  families would be better off under Government child care reforms.

“But we need to increase  the base entitlement for Child Care Subsidy from 12 to 15 hours a week for low income families to ensure that many more of these families are not worse off, and access of their children to early learning is made more affordable not less affordable,” Mr Cherry said.

“Children from low income families  are twice as likely as children from high income families to start school developmentally behind

“Access to at least 15 hours of early learning a week can help address that.”
[1] The subsidy for high income families (those earning more than $340,000) will be cut from 50% to 20% of fees, phased on incomes more than $250,000.
[2] These families would see their entitlement for childcare assistance cut from 24 to 12 hours a week.


Posted by Goodstart
09 February 2017

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