ABC AM - Childcare subsidies

  • Assistant Minister for Education

PRESENTER: Australia’s maze of childcare subsidies is a mess that baffles even those who work in it. Now a report calls for sweeping changes to the childcare benefit and childcare rebate schemes. The report, commissioned by the advocacy organisation Early Childhood Australia and the country’s largest not-for-profit childcare provider, says a single payment would make things much simpler. Social Affairs Correspondent Norman Hermant reports.

NORMAN HERMANT: It may sound like chaos, but the playroom in your average childcare centre is downright orderly compared to the system of subsidies that’s been cobbled together to help parents pay for childcare. There’s a childcare rebate that’s not means tested, there’s a childcare benefit that is and there are other subsidies. Deb Brennan of the Social Policy Research Centre at the University of New South Wales says that’s one reason a new report she co-authored is recommending big changes.

DEB BRENNAN: So it is an extremely complicated system and very few people that I know in the field would be able to give you a clear an accurate account of how childcare benefit works.

NORMAN HERMANT: The report recommends replacing both the childcare benefit and the childcare rebate with one single early-learning subsidy and immediate advantage, it says, would be more simple and childcare centre managers like Andrea Martin in Melbourne’s east say anything would be better than the subsidies maze families now have to find their way through.

ANDREA MARTIN: It is very confusing to parents. They really find it hard to understand that there’s two payments and some parents never realise that there’s two payments [inaudible].

NORMAN HERMANT: The Productivity Commission is now considering submissions on childcare reform and the Assistant Minister responsible for childcare Susan Ley says she’s sympathetic to concerns about the current system.

SUSSAN LEY: Look, there’s no doubt that the childcare benefit and rebate and the combination of how they apply to you are your family circumstances are confusing. We will always have an overriding message of simplification and removing red tape.

NORMAN HERMANT: The Social Policy Research Centre says its new single subsidy would also cover more childcare expenses, but Deb Brennan concedes it will cost Canberra more.

DEB BRENNAN: We planned out in our report that Australia is below the OECD average in what it’s investing in early childhood education and care and I think that’s something that we should be paying attention to.

NORMAN HERMANT: Federal spending on the childcare benefit and rebate is more than $5 billion a year. One thing Susan Ley is clear about; there won’t be anymore.

SUSSAN LEY: Solving problems is not about adding more money, particularly not in the current budgetary climate. It’s about doing much better with the money that we have and there’s a lot of it inside the sector at the moment.

PRESENTER: Assistant Minister responsible for childcare Susan Ley ending that report from Norman Hermant.


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