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New Child Care Interim Report

December 19, 2023

Updated: Dec 20, 2023

Key Points:

  • Three Days of Early Learning and Care for All: The report suggests a groundbreaking policy shift, proposing that every child up to five years old should have access to quality early learning and care three days a week. This would mark Australia’s first explicit policy aim for such an entitlement.
  • 100% Child Care Subsidy for Lower-Income Families: Lower-income families earning less than A$80,000 would receive a 100% childcare subsidy for these three days. This subsidy aims to make early childhood education more accessible for families experiencing financial constraints.
  • Removal of Work or Study Requirements: To enhance accessibility, the report recommends removing some work or study requirements for families, challenging the notion that a child’s entitlement to early childhood education should be tied to parental work levels.
  • Focus on Disadvantaged Groups: Recognising that those in need often miss out, the report calls for relaxing the activity test and increasing subsidies for low-income families. It aims to make early learning more accessible to disadvantaged children by addressing financial barriers.

The Productivity Commission has unveiled an interim report recommending significant transformations in Australia’s early childhood education and care sector. The report proposes a bold entitlement: three days a week of “high-quality” early learning and care for every Australian child under the age of five. This potential overhaul could reshape the landscape, emphasising inclusivity, quality, and accessibility. HCPA is dedicated to assisting providers in delivering the highest standards of care and compliance with the complex regulatory landscape in the childcare sector.

Current Challenges:

Australia’s early learning and care system is complex, costly, and unevenly distributed, with inadequate support for vulnerable groups. There is no national guarantee for early education, creating a patchwork of entitlements that vary by state. The report addresses these challenges and recommends a more active federal government role to ensure equitable access. 

HCPA provides child care providers with the tools and strategies to address these challenges head-on; and ensures providers are well-prepared for the changing landscape, from workforce management solutions to policy compliance guidance.

Subsidy Structure:

The report suggests a nuanced approach to subsidies. For families earning between $80,000 and $530,000, the current subsidy model of up to 90% would remain. For families earning up to $80,000, the subsidy would increase to 100%, effectively making up to 30 hours of childcare per week free for 30% of families with children under five.

The commission believes these changes would remove barriers for lower-income families and encourage more children experiencing disadvantage to benefit from high-quality early learning.

As the report says:

Affordability should not be a barrier to […] access.

The commission will explore further recommendations in their final report for subsidy rates to families not covered by the 100% subsidy recommendation.

A line graph from an interim report displays Child Care Subsidy rates by family income, highlighting pre- and post-July 2023 periods, with a notable increase in subsidies for low and middle-income families.

The proposed reforms draw inspiration from international models, such as Quebec’s entitlement to childcare at a fixed rate regardless of income and the UK’s expansion of childcare entitlements.

Implementation Challenges:

Acknowledging the enormity of the proposed changes, the report emphasises careful sequencing and implementation. It calls for increased government involvement in areas where families struggle to find suitable education and care.

Next Steps:

While the report outlines a vision for expansive reform, details are yet to be worked out. Public hearings are scheduled for the next year, with the final information due to the government on June 30, 2024.

Australia stands at the cusp of a revolution in early childhood education. The Productivity Commission’s recommendations envision a future where quality early learning is a right for every child, irrespective of socio-economic background. HCPA is offering vital assistance to childcare providers. As the nation awaits further details and implementation plans, the potential for positive change and increased inclusivity in early childhood education is palpable.

HCPA is an all-in-one solution for Child Care providers, supporting them with registration, growth and consulting. Contact us here or call 03 9084 7472 to learn how we can help you succeed.

SOURCES | The Conversation ‘The Productivity Commission wants all Australian kids to have access to 3 days of early learning and care a week’ |

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