FUNDING ANNOUNCEMENT: Federal Member for Hinkler Keith Pitt announces $1.9 million funding for new facilities at St Patrick's Catholic School in Bundaberg.
Photo: Max Fleet / NewsMail
FUNDING ANNOUNCEMENT: Federal Member for Hinkler Keith Pitt announces $1.9 million funding for new facilities at St Patrick's Catholic School in Bundaberg. Photo: Max Fleet / NewsMail Max Fleet BUN131115PITT3

Pitt: the most significant child care reforms in 40 years

HINKLER MP Keith Pitt describes it as the most significant reforms to child care and early learning in 40 years.

Thousands of families across Hinkler are set for child care cost relief and their children will benefit from more early learning opportunities as part of the Coalition Government's reforms to the system that passed Parliament on Thursday night.

The reforms, which come into effect from July 1, will include subsidies based on income, rebate cap relief and an hourly rate cap.

Mr Pitt said it would offer relief for families who find that fees and expenses put "access to child care and early learning increasingly out of reach".

"We know the cost pressures that families face so we've taken action to overhaul a broken system to deliver more affordable, accessible and flexible services for families and children," Mr Pitt said.

"Our changes will inject $1.6 billion of additional investment into the system - with around one million families across the country to be better off - including many of the 6,790 families in Hinkler that use child care and early learning services.

"We're targeting support to people working the most and earning the least and it's estimated our reforms will encourage more than 230,000 families to return to the workforce or increase their involvement in paid employment."

Three key features according to Mr Pitt:

Better support for people working the most and earning the least

The changes simplify the current complicated rebate system by replacing payments with a single, means-tested Child Care Subsidy that boosts the current flat 50 per cent rebate rate to 85 per cent for hardworking families earning up to $65,710 and then tapers down to 20 per cent for families earning more than $250,000 and cuts out for families earning more than $350,000.

Our reforms also introduce a three-step activity test with an entry point of four hours a week that gives families eligibility for 18 hours a week of subsidised child care.

This will align hours of care with the combined amount of work, training, study, volunteering or other recognised activity being undertaken by parents.

Relief from the rebate cap

We will abolish the $7,500 rebate cap to ensure families on incomes of $185,710 or less aren't limited by a cap on the amount of child care they can access and the cap will be increased to $10,000 for families earning more than $185,710, overall offering relief to the approximately 100,000 families that hit the current $7,500 rebate cap.

Downward pressure on incessant fee increases

Our reforms introduce an 'hourly rate cap' on the subsidies the Government will pay that will set a benchmark price so Australians have a reference point to hold providers accountable and from which they can expect prices shouldn't dramatically exceed.

We will also slash red tape so services can be more flexible in the hours they deliver instead of the current system where families who routinely need and use only four, six or eight hours of care, are charged for 10 or 12 hours.

"Our reforms also include measures to encourage workforce participation, stronger compliance powers to further stamp out rorting, more flexibility for the hours child care centres open and additional investment for services to support children from disadvantaged backgrounds or with additional needs such as disability," Mr Pitt said.



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