What is Cheaper Child Care?
Cheaper Child Care is the informal name given to the Family Assistance Legislation Amendment (Cheaper Child Care) Bill 2022. The changes come into effect from July 2023, with the Australian Government increasing Child Care Subsidy (CCS) rates for families.
This is incredible news, with the changes going some way towards making childcare more affordable and inclusive for Australian families.
Some of the key changes include:
- Lifting the maximum CCS rate to 90% for families earning $80,000 or less
- Increasing CCS rates for around 96% of families with a child in care earning under $530,000
- Investing $33.7 million to increase subsidised ECEC to a minimum of 36 hours per fortnight for families with First Nations children
These changes are in addition to the increased Higher Sibling Subsidy the government introduced in early 2022.
What should I know about the Child Care Subsidy?
There are three key factors that determine how much Child Care Subsidy families may receive:
- The combined family income – how much families earn
- Your fortnightly family activity level – how much families work, train, study or volunteer
- The fees charged by the child care service
Key facts about the Child Care Subsidy
- In two parent families, both parents must engage in recognised activity to receive the subsidy (unless exempt).
- Recognised activities include but are not limited to: paid work (including leave), approved study or training, actively seeking work, volunteering and self-employment.
- Families can access up to a maximum of 100 hours of subsidised care per fortnight
- In most cases, the subsidy will be paid directly to child care providers, in which case you only pay the difference between the fee charged by your service and the amount subsidised by the Government.
- 5 per cent of your weekly Child Care Subsidy entitlement will be withheld by the government. Following reconciliation of your tax return at the end of the financial year, any amount owing to you will be paid as a lump sum by the government. If you have been paid too much Child Care Subsidy, you will have a debt to repay.
- Additional Child Care Subsidy (ACCS) provides a higher level of subsidy than the regular Child Care Subsidy, in recognition of the circumstances the child and/or family is facing. You need to meet extra criteria to be eligible for Additional Child Care Subsidy.
For further information, visit the Australian Government’s website here or contact Goodstart’s Family Services Team on 1800 222 543