Budget 2015 – Child Care Impacts

Budget 2015: Childcare system receives shake-up under new Government plan to support low income families

The changes explained:

• A new single means-tested Child Care Subsidy set to begin on July 1, 2017 to replace the Child Care Benefit, Child Care Rebate and Jobs, Education and Training Child Care Fee Assistance programs
• Families earning up to $65,000 will receive 85 per cent of the childcare cost per child, or a designated benchmark price, whichever is lower. That will reduce to 50 per cent for families with incomes of $170,000 and above
• Hourly benchmark prices will be $11.55 (long day care), $10.70 (family day care), $10.10 (out-of-school hours care) and $7.00 (in-home care nanny pilot program due to begin in January 2016)
• There will be no cap on subsidies for families with an income below $185,000, while those who earn beyond that will receive an increased cap of $10,000 per child, up from $7,500
• Subsidy is subject to new activity test for up to 100 hours of subsidised care per child, per fortnight, paid directly to providers
• Up to 24 hours help will also be offered to families with incomes less than $65,000 who do not meet activity test requirements
• The ‘no jab, no play’ policy remains with all childcare subsidies linked to immunisation requirements
• Policy to cost $3.5 billion over four years, funded by cuts to Families Tax Benefit payments stuck in the Senate