Free childcare to end next month
The federal Coalition will stop partially subsidising child care on July 12 and also stop JobKeeper payments to the childcare services sector from July 20, saying its relief package had “done its job” during the coronavirus pandemic.
The government will return to the usual system and resume paying the Child Care Subsidy (CCS), and there will also be new transition measures to support the sector and parents.
In early April, the Coalition announced its Early Childhood Education and Care Relief Package would spend $1.6 billion over the next six months to pay 50 per cent of the revenue of child care centres up to the existing hourly rate cap, but only if centres remained open and did not charge families for care.
As well as the CCS, the government will replace the JobKeeper payments with a Transition Payment of 25 per cent of a child care centre’s fee revenue during the relief package reference period (February 17 to March 1) from July 13 until September 27, with the last two payments scheduled for September to be brought forward.
During the transition, child care fees will be capped at the level of the reference period, and child care centres will need to guarantee employment levels to protect staff who will move off the JobKeeper payment.
The government will also ease the activity test until October 4 to support eligible families whose employment has been affected as a result of COVID-19, with these families to receive up to 100 hours per fortnight of subsidised care.
“Nearly 80 per cent of providers in the child care sector operate a single child care service, and our child care transition package is designed to support businesses to remain viable while they provide care to children as we ease restrictions further and get more people back to work,” Education Minister Dan Tehan said.
“Our government introduced the Early Childhood Education and Care Relief Package because Australia’s child care centres were experiencing mass withdrawals, which threatened their ability to provide care and continuity of education, particularly to the children of essential workers.
“A review of the package found it had succeeded in its objective of keeping services open and viable, with 99 per cent of around 13,400 services operational as of May 27.”