Out of pocket child care costs reach record highs

Wednesday, 28 April 2021

Australian families are paying more out of pocket for child care than ever before under the Morrison Government.

Today’s ABS data confirms Scott Morrison’s child care system has completely failed in less than three years.

The cost of child care is now higher than it was under the previous child care system (0.3 per cent increase) and is the highest it has ever been.

The data shows child care costs are out of control, soaring by 2.2 per cent in the past quarter alone, more than three times CPI (0.6 per cent).

Over the past twelve months, child care costs soared by 3.7 per cent, compared to a CPI increase of 1.1 per cent.

This shows child care costs are eating a bigger and bigger hole in household budgets and are putting more financial strain on Australian families.

The Prime Minister designed the current system, dubbed it a “once in a generation reform” and promised it would make child care more affordable.

Yet in less than three years, the benefit to families has been entirely eroded.

As usual with Scott Morrison, the announcement has not been matched by reality.

This data makes it clear – the Coalition’s child care system is broken. That is why Labor has a plan to bring down the cost of child care and keep it down.

An Albanese Labor Government will introduce the Cheaper Child Care for Working Families, which will:

  • Scrap the $10,560 child care subsidy cap which often sees women losing money from an extra day’s work;
  • Lift the maximum child care subsidy rate to 90 per cent; and
  • Increase child care subsidy rates and taper them for every family earning less than $530,000.

Importantly, the ACCC will design a price regulation mechanism to shed light on costs and fees and drive them down for good.

The Productivity Commission will also conduct a comprehensive review of the sector, with the aim of implementing a universal 90 per cent subsidy for all families.

Labor’s plan for cheaper child care will reward working families and allow more second income earners, usually women, to work more and contribute to our economic recovery.

Only Labor has a plan to fix the Coalition’s broken child care system.

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