Some childcare centres say they could lose half their revenue at the hands of a new government initiative to keep children in care during the COVID-19 pandemic.
Some childcare centres say they could lose half their revenue at the hands of a new government initiative to keep children in care during the COVID-19 pandemic.

Childcare centres’ new crisis in face of free care scheme

DAYCARE centres have been left struggling to pay their staff as they prepare to slash their revenue by half as the government imposes free day care measures in the face of COVID-19.

The Australian Government announced the Early Childhood Education and Care Relief Package on April 2 to help support struggling families and to keep childcare centres open however managing director of Alexandra Hills I AM Montessori childcare centre Rebecca Grugan said a large number of centres would be worse off.

The initiative will from April 6 pay a single payment to childcare facilities, valued at about half its usual fees, in lieu of the usual Child Care Subsidy paid by the government and fee gap paid by parents.

Childcare has been made free for most families during the COVID-19 pandemic.
Childcare has been made free for most families during the COVID-19 pandemic.

"We have no choice but to lose 50 per cent of our revenue," Ms Grugan said of the new plan.

"It makes no sense and many high quality centres are worse off under the new package.

"I am yet to find one it works for."

Ms Grugan said her centre had lost just two per cent of occupancy during the pandemic, meaning the centre was maintaining most of its usual income.

"Many families (were) staying at home but most were happy to pay the fee to keep us going so they could come back.

"I have two centres in Brisbane. One was 96 per cent full and the other was 60 per cent.

"With the COVID-19 crisis I had calculated we could survive based on the amount of families who may withdraw between them and be able to carry the losses from one with the other and still survive with all staff in tact.

"I had calculated a maximum of about 25 per cent revenue loss over the next six months... I now have no choice but to lose 50 per cent.

"I actually have to work out if I can stay open and I definitely cannot run at full occupancy if all families wanted to return, so children will actually miss out on care who have been coming here for years.

"This was not a prospect before Thursday."

She said wages for some staff could be supported by the new Jobkeeper initiative, but not all.

Childcare has been made free for most families during the COVID-19 pandemic. Picture: Giulio/Saggin
Childcare has been made free for most families during the COVID-19 pandemic. Picture: Giulio/Saggin

"Some of them are not eligible so I will have to stand them down as we no longer have the revenue to sustain their employment."

Ms Grugan said four staff had already lost their positions.

"I need to disrupt consistency for children because staff need to do shorter days or can't work five days because we don't have the money.

"I have parents wanting to start a GoFundMe page, to work out a way to still be able to pay us legally, they think its unfair as they still have their jobs and income and its part of their normal budget.

"Only two out of 113 families were excited about saving money and not seeing the impact."

She said some centres may benefit from package if they had lower occupancy however she had not heard of one yet.

She said high quality centres with high occupancy would lose out.

"We have to do the extra things to be seen as 'exceeding' and it is now those centres being penalised.

"I (will) have to pull all of the things we do that make it amazing for children - better ratios with more staff, highly qualified staff, training, food, nappies, forest school, excursions - literally everything that makes us great.

"The thing is - I still charge under $100 a day for care in our centres."



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