“It’s not just a matter of going right, from tomorrow, the childcare subsidy has increased to 90 per cent for families earning $80,000 or less. There is a lot more to it,” says new minister Anne Aly. | katinacurtis
More than a million families are expected to benefit from Labor’s proposed multibillion-dollar changes to childcare subsidies, saving about $1200 on average, but they’ll have to wait another year to see that relief.
Previous overhauls of the subsidy system have required months of implementation time so the government and childcare centres and providers can upgrade their IT systems. The existing system subsidises between 85 per cent and 20 per cent of fees, depending on a family’s income.The highest subsidies go to families earning below about $70,000 a year. The rate steps down so families earning between $175,000 and $254,300 receive a 50 per cent subsidy and then steps further so those earning between $344,300 and $354,300 get a 20 per cent subsidy. Above this income threshold, there is no subsidy.
Aly will task the Productivity Commission before year’s end with examining the entire sector, with an aim of a universal subsidy of 90 per cent. She’ll also ask the Australian Competition and Consumer Commission to design a price regulation mechanism to make sure higher subsidies don’t translate into higher fees.
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