Supporting the independent education community

Policy and funding vacuum remains for early learning


On Monday 8 June, in a public holiday surprise announcement, the government declared their intention to snap back to the old Child Care Subsidy (CCS) system. This decision potentially leaves the entire sector - families, providers and skilled early childhood education and care professionals – in a policy and funding vacuum.

The decision to remove the free childcare package and revert back to the previous CCS system, at a time when many parents and families are still struggling immensely financially due to the economic effects of the pandemic, will add undue and unnecessary pressure on the household finances of Australian families.

Members give inside information
There is a very real danger, as IEU members have advised the union, that many families will have to come to the conclusion that sending their children to child care is no longer financially viable if there were a return to full fees.

The union has advocated for and welcomes the continued suspension of the activity test, as an important step to ensure people on JobKeeper and JobSeeker are able to still access subsidised care.

Review of Child Care Subsidy overdue
When the government announced the ‘free childcare’ scheme, they described the pre-pandemic funding system as overly complex and not fit for purpose. Reviewing the Child Care Subsidy would allow all stakeholders – providers, parents and the federal government – time to re-think the CCS to ensure all Australian children have the best start in life. 

To this end, the IEU believes that the Federal Government should provide at least two days of free early education and care in early learning services for every child. Additional early childhood education and care should be available to vulnerable families and children at no cost. If parents request more than two days per week the usual CCS formula based on parental income should apply to any additional days.

Without this additional support there is a real concern being expressed by many that the system will fail to do its job to make early childhood education and care accessible for those families.

In his statement, Federal Minister Tehan claimed the temporary relief package had done its job in assisting services remain open in the face of mass withdrawals of children as a result of the pandemic. However, the capped rate of government support at 50 per cent of pre-pandemic enrolments has left much to be desired, with reports that the policy left many families unable to access care, providers struggling to stay afloat and many staff without jobs. Concerning reports also indicate the policy had significantly impacted quality of care, with some providers struggling to meet staff ratios or maintain cleaning and hygiene practices. However, to simply revert back to the old flawed system because the replacement fell short of the mark is not the answer. It is taking one step forward and two steps back.

IEU supports specific recommendations
The IEU supports the Grattan Institute recommendation that the Federal Government subsidises 95% of childcare costs for low income and vulnerable family with the subsidy tapering as family income increases. This would assist parents wanting to increase their hours of work to do so, support post-crisis economic recovery and boost GDP through higher workforce participation.
As requests for enrolments in individual services increase, the childcare relief subsidy payment should be increased from the current 50% cap to 80% of the maximum hourly rate for the period that parents are not charged fees. This will enable providers to accept new enrolments on a financially viable basis.

Of additional concern is the government’s announced intention to cease JobKeeper payments for early childhood education and care workers, in lieu of a reduced transitional payment. This flies in the face of the Prime Minister’s own earlier guarantees to keep JobKeeper going through until September. These workers showed extraordinary
commitment throughout this stressful and uncertain period by turning up to work, especially in the early days of the pandemic when much was scary and unknown, to ensure our health workers and other essential services workers could continue in their roles looking after our community. The already underpaid and undervalued sector is comprised 95% of women. The Minister and Prime Minister themselves described their work as vital, and as playing a valuable role in our workforce and education systems. They are deserving of our respect and continued support, not of broken promises. This decision is a deeply disturbing development, and unions are rightly concerned this is an unwelcome and destructive foreshadowing of things to come for JobKeeper recipients in other sectors.

Union calls on federal government – step up
We are calling on the government to step up and do the necessary work of finally developing an equitable and modern early childhood education and care system befitting of one of the wealthiest countries in the world; one that ensures ongoing and guaranteed access to high quality early learning for children and families.