Budget Update – Federal Budget announces significant changes to childcare

Category: Industry News

Budget Update – Federal Budget announces significant changes to childcare

The 2023-2024 Federal Budget announces its commitment to improve affordability and access, providing greater support to families and the early childhood education and care workforce. The changes include adjustments to the childcare subsidy, combining parental leave and dad and partner pay, and increased funding for the skills development of early childhood educators.

Revision of the childcare subsidy

One of the major changes in the budget is the revision of the childcare subsidy. Under the Plan for Cheaper Child Care, the Government will lift the maximum CCS rate to 90% for families earning $80,000 or less and increase CCS rates for around 96% of families with a child in care earning under $530,000. This will come as a relief to many parents who have struggled to afford childcare, particularly those on lower incomes.

Increased skills support to the ECEC workforce

The budget will also provide increased support for the early childhood education and care (ECEC) workforce with a $1.6 billion investment into the sector, which includes funding for professional development and training programs for educators. By supporting the professional development of educators, the government hopes to attract more and retain high-quality staff in the sector and promote better outcomes for children.

Parental Leave Pay

Another considerable change is the combining of parental leave and dad and partner pay into a single payment, called the Parental Leave Pay. This new payment will provide up to 26 weeks of leave at the national minimum wage, which currently sits at $772.60 gross per week. The payment will be available to both parents, who can choose to share the leave between them or take it separately.

The government’s ongoing support for the sector to increase the workforce and make childcare more affordable and accessible is expected to lead to a sharp rise in demand for childcare.

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