Child care reforms proposed by the Abbott Government could affect a lot of families in Cannington and other Perth suburbs. The simplified version: if your family makes less than $130,000, the reforms will probably help you. If your family makes more than $160,000, they will probably hurt you.
Across Australia, $7.7 billion is allocated as child care subsidies. The newest proposal, which comes from the Productivity Commission’s recent report, would make the means test tougher. The result would be a shift of more money to lower and middle income families while still leaving some assistance for everyone.
The report recommends that all child care subsidies be consolidated into a single, “early care and learning subsidy.” This rate would be paid directly to child care centres and qualified nannies. The rate of subsidy for each child would be determined by a work-hours test and the means test.
The real news here is the proposed allocation rates for various incomes. Families who earn more than $250,000 would receive 20% of the cost of child care, which is down from their current average of approximately 40%. Families who make between $160,000 and $200,000 would have around 40% of their child care costs paid.
Families on the lower end of the spectrum, making between $80,000 and $100,000 would receive 65% of their child care fees, while those who make less than $60,000 would receive about 85% of their child care costs.
Good News for Many Families
Whenever funds are reallocated, someone is going to suffer and someone is going to benefit. While our hearts go out to those who are going to have to find more money to fund child care, the net effect is as intended: it should enable more women to enter the workforce and it should remove some of the burden of child care from families on the lower end of the income spectrum.
To learn more, contact your closest Cuddles Childcare Centre in the Perth area.