Australia: New Child Care Benefit Program Effective in 2017

This complete global solution for HR professionals combines custom research, strategic white papers, country primers, webinars, and the expert guidance you’ve come to expect from...

By Rick Vollmar

May 11—Effective July 1, 2017, Australia's Child Care Benefit, Child Care Rebate, and Jobs, Education and Training Child Care Fee Assistance programs will be replaced by the new Child Care Subsidy, the Prime Minister's office and the Department of Social Services announced in identical press releases May 10. According to the Prime Minister's office, a study by the Productivity Commission found that the current child care system is unnecessarily complex, inflationary and fails to target support where it will have the biggest impact, especially for mothers.

Under the new plan, families with incomes of between $65,000 and $170,000 (U.S. $51,000 to $146,000) will be eligible for up to 100 hours of subsidized care per child every two weeks paid directly to approved care service providers.

Families with incomes of up to approximately $65,000 will qualify for an 85 percent subsidy to cover their day care providers fees, those with incomes over $170,000 for a 50-percent subsidy. Benefits to families with incomes under $185,000 (U.S. $146,000) will no longer be capped, those to families with incomes above $185,000 capped at $10,000 per child.

“Having two parents in paid employment has become a necessity for most families because of changes that have taken place in our society and economy over many years,” the Prime Minister's office said. “All mothers work hard, and many are also in paid employment. Changing the way we make child care more accessible and affordable is necessary to help families adjust to these changes and set them up for the future. . . . The quality of child care and early childhood learning today means that where parents can access these services, they can go to work and be confident about their children’s care and development. ”

In research conducted by the Department of Social Services, 24 percent of families with children under 12 (roughly 240,000 families) indicated they would be encouraged to work more as a result of the new child care policies.

To contact the reporter on this story: Rick Vollmar at rvollmar@bna.com

The Prime Minister's office release is available at http://www.pm.gov.au/media/2015-05-10/jobs-families-child-care-package-delivers-choice-families, the Department of Social Services release at http://scottmorrison.dss.gov.au/media-releases/20150510-jobs-for-families.

For more information on Australian HR law and regulation, see the Australia primer.