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Parents deserve to know the facts on child care

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23 June 2011

Parents deserve to know the facts on child care

Minister for Child Care Kate Ellis today encouraged parents to make themselves aware of the facts about child care.

“Last night Channel 9 News aired a so-called investigative piece about the Australian Government’s child care policies, which contained incorrect claims and was full of opposition spin,” Ms Ellis said.

“Our Government recognises the critical importance of affordable and quality child care to Australian families, which is why we are providing more direct financial assistance to parents to help meet the costs of child care than ever before.”

“Last night’s report was misleading and inaccurate - Australian parents deserve to have the record set straight.”

CLAIM 1: The Government is pursuing new policy, which would cut the child care benefit for families.

FACT: The Child Care Benefit provides critical assistance for low and middle income families with the cost of care. The Government is making no changes to the Child Care Benefit and will provide $9.2 billion in direct financial assistance to families through this payment over the next four years.

CLAIM 2: Child care costs will be increasing from 1 July 2011 because of new Australian Government rules.

FACT: The Australian Government is working hand in hand with State and Territory Governments to implement critical reforms to improve the quality of early childhood education and care. These reforms are being rolled out gradually from 1 January 2012 to ensure that the child care sector has adequate time to adjust. There are no changes under these reforms, which are commencing on 1 July 2011.

CLAIM 3: New Government rules will cause child care costs to increase by up to $2500 a year.

FACT: Independent economic modelling from Access Economics shows that COAG’s reforms will only have a minimal impact on costs. A family on $80

000 a year would expect to pay additional out of pocket costs of $8.67 in 2014-15 for one child who attends full times care.

CLAIM 4: Families will receive less assistance from the Government in the future because the Government plans to cut the child care rebate.

FACT: In 2007 Labor was elected to Government with a commitment to increase the Child Care Rebate from 30 to 50 per cent of parents out of pocket costs up to an annual cap of $7500. The Government has delivered on this commitment. Changes currently before the Parliament will not affect 90 per cent of families because the average child care rebate claim is around $2000, far below the maximum cap of $7500 per child per year.

“The 800,000 Australian families who place their children in care each week deserve to know that when they drop their children off in the morning, that they will be safe and well looked after,” Ms Ellis said.

“When we see disturbing statistics, which show that around 25 per cent of child care centres are failing basic hygiene and safety standards - then it is only responsible for governments to take action to improve quality.”

“We know that the cost of child care puts pressure on the family budget, which is why our Government is providing a record $16.4 billion in direct child care assistance to families over the next four years.”

This massive boost in funding is a direct result of the Australian Government’s decision to increase the Child Care Rebate from 30 to 50% of parents’ out-of-pocket expenses and to increase the annual cap by more than $4000 per child per year.

This 72 per cent increase in the Rebate has assisted more than 735,000 Australian families pay for their child care since July 2008. It has also meant that the proportion of the family income being spent on child care out-of-pocket costs has almost halved since 2004, dropping from 13 per cent to just 7 per cent in 2010 for families with one child in care and earning $75,000 per year.

From next month families will also have a new option to receive the Child Care Rebate payment fortnightly and in some cases weekly. This means parents will have access to this important assistance at the time that their child care bills are due, making it easier to balance the family budget.

“This Government is providing more financial assistance and more options for families using child care than ever before” Ms Ellis said.

Minister’s Media Adviser: Jamila Rizvi 0438 644 603