Minister for Human Services and Digital Transformation

Media release: Make the switch to new child care and early learning system

8 April 2018

Senator the Hon Simon Birmingham MP

Minister for Education and Training

The Hon Michael Keenan MP

Minister for Human Services and Digital Transformation

Australian families are being urged to sign on and start their changeover to the Turnbull Government’s new child care and early learning system which kicks off in less than three months.

Minister for Education and Training Simon Birmingham said it was time for families to “make the switch” to the overhauled system starting on 2 July.

“The online transition portal we’ve set up is live and it’s time for people to take action,” Minister Birmingham said.

“With more support for more families just around the corner, families need to make the switch to benefit from the new child care and early learning system.

“The Turnbull Government’s overhaul of child care and early learning subsidies and extra $2.5 billion investment in the system will target support towards families earning the least and families working the most, introduce hourly rate caps to put downward pressure on fee increases and abolish the annual rebate cap for most families.

“Overall it will mean around one million families benefit and it’s estimated the package will encourage more than 230,000 families to increase their workforce participation.

“The biggest winners will be families working, studying or volunteering that earn less than $250,000 a year and even if your family has a higher income, you’ll still stand to gain from our change to lift the annual rebate cap to around $10,000.

“Families should visit www.education.gov.au/childcare and make the switchover as soon as they can so they’re ready for the new system from day one.”

Minister for Human Services Michael Keenan said over coming weeks his Department would contact all 1.2 million families currently receiving subsidies for child care and early learning to encourage them to transition to the new system.

“The switchover to the new child care and early learning system is not automatic as we need families to update their details and in some cases provide new information,” Minister Keenan said.

“We’ll be contacting families over the next fortnight outlining what they need to do to help us get them ready for 2 July.

“Our Transition Portal has been set up with the details of the new arrangements so at the end we’ll send families an assessment of what it means for their budget.

“This will include details on how families can update information such as their estimated work activity and income so we can give them a detailed assessment of their fee assistance entitlements.”

Recent changes to the Consumer Price Index have also seen hourly rate caps and annual caps increase and will mean under the Turnbull Government’s child care and early learning package:

  • More than 370,000 families earning around $66 958 or less a year will have their base subsidy increase from 72% to 85%
  • Families earning up to $186 958, will no longer be limited by an annual $7,613 cap on the amount of child care they can access – that’s more than 85% of families using child care and early learning and means families won’t run out of subsidy mid-year as happens now.
  • Families earning between $186,958 and $351,248 will benefit from an increased annual rebate cap of $10,190 per child.
  • Hourly rate caps will rise from $11.55 to $11.77 for Centre Based Day Care, $10.70 to $10.90 for Family Day Care, whilst families with children in Outside School Hours Care will also see their hourly rate cap rise from $10.10 to $10.29.

Examples of how families are set to benefit:

  • a family on $50,000 - both parent/s working, with two children aged under 6 in long day care two days a week at $100 a day will be around $2,000 better off a year
  • a family on $80,000 - both parent/s working, with two children aged under 6 in long day care three days a week at $100 a day will be over $3,000 better off a year
  • a family on $150,000 – both parent/s working, with two children aged 6 and under in long day care three days a week at $100 a day will be more than $1000 better off a year

Page last updated: 19 April 2018