New childcare subsidy: What it means for you
THERE are about 1.2 million families eligible for childcare subsidies in Australia.
But come July 2, 489,000 will miss out on the funding based on current figures on people registered with the government database, unless they take action and switch to the new system.
The Turnbull Government is combining existing subsidies for childcare into a single means- and activity-tested payment.
To be eligible families must update their Centrelink account details through myGov.
Education Minister Simon Birmingham said the switch from July 2 wasn't automatic and those who didn't update their details could miss out.
Required information includes estimated income for 2018/19 and approximate work hours for both parents.
Under the new system, both parents must be working, studying, volunteering or searching for work at least eight hours a fortnight to be eligible for the subsidies.
Households with a total annual income under $186,958 will no longer face a cap on the amount of rebate paid by to them each year.
For those earning more than this, the annual cap will lift from $7500 to just over $10,000 per child.
"We know many families are time-poor but this is about giving them the support they need and deserve to pay their childcare bills," Mr Birmingham said.
"And it's worth the 10 minutes or so it might take to update your details because ultimately you'll be hundreds or possibly thousands of dollars a year better off."
Mr Birmingham said although arrangements were in place to ensure families who failed to meet the deadline didn't miss out, it would take time to repay withheld money once they had signed up.
Labor early childhood education spokeswoman Amanda Rishworth said the government should have worked with childcare centres at the coalface to educate families and not focus on a "slick advertising campaign".
Labor claims one in four families will be worse off under the changes and the majority of those missing out are in the lowest two income brackets.
Parents can use an online calculator to estimate the amount of money they can get back from their childcare fees.
SO WHAT ARE THE CHANGES AND HOW WILL THEY AFFECT YOU?
We've provided an overview here but Mr Birmingham will also host a session on Facebook Live at news.com.au's headquarters next Thursday afternoon, June 7.
Mr Birmingham will be able to answer questions live and discuss any other issues.
Make sure you like our Facebook page to be involved, or send any questions through on the email below.
THESE ARE THE BASICS
It can be a bunch of confusing acronyms and a sliding scale of rebates, but in a nutshell the current Child Care Rebate (which covers 50 per cent of childcare fees up to an annual cap of $7500) and the means-tested Child Care Benefit will be replaced with the new subsidy.
THIS IS HOW IT WORKS
• Families earning $66,958 or less will receive a payment equivalent to 85 per cent of their fees
• Families with a total income of $66,958-$171,958 will receive a payment that is tapered down from 85 per cent to 50 per cent
• Families on $171,958-$251,248 will receive a payment equivalent to 50 per cent of their fees
• Families on $251,248-$341,248 will receive a payment that is tapered down from 50 per cent to 20 per cent
• Families on $341,248-$351,248 will receive a payment equivalent to 20 per cent of their fees
• Families earning more than $351,248 will receive no subsidy
HOW MUCH YOU COULD GET
• 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 $2000 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 more than $3000 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
SO HOW MUCH ACTIVITY WILL YOU HAVE TO DO?
• Families working 8-16 hours per fortnight are eligible to receive 36 hours per fortnight of subsidised care
• Families working 16-48 hours per fortnight are eligible to receive 72 hours per fortnight of subsidised care
• Families working more than 48 hours per fortnight are eligible to receive 100 hours per fortnight of subsidised care
WHAT'S AN ACTIVITY ANYWAY?
• Paid work including leave and maternity leave
• Study and training
• Unpaid work in the family business
• Looking for work
• Others on a case-by-case basis
IT ALSO DEPENDS WHERE YOUR KIDS GET CARED FOR
Calculated by the hour using these hourly rate caps:
• Centre-based day care - $11.77 per hour
• Family day care - $10.90 per hour
• Outside school hours care - $10.29 per hour
• In home care - $25.48 per hour (per family)
SO WHAT ELSE?
• There are exemptions for parents who legitimately cannot meet activity test requirements
• The parent or guardian with the lowest hours of activity per fortnight will determine the hours of subsidised care
• The package includes a $1.2 billion safety net for vulnerable and disadvantaged children, as well as those from regional and remote communities
• There are additional subsidies for families who need practical help, grandparents who are primary carers, families experiencing temporary financial hardship and families transitioning from income support to work
• Those additional subsidies replace a number of existing payments including the Special Child Care Benefit and the Jobs, Education and Training Child Care Fee Assistance
• It is estimated the reforms will encourage more than 230,000 families to increase their involvement in the workforce
DON'T FORGET - NO JAB, NO PAY
• Children must be immunised in accordance with the National Immunisation Program schedule or be on a recognised catch-up schedule
• If children aren't immunised they must have a valid immunisation exemption recorded on the register.
• Parents can check what vaccinations their child needs here or speak with their doctor
WHAT YOU NEED TO DO BEFORE JULY 2
• Provide new information and confirm current details using your Centrelink online account through myGov
• Provide your combined family income estimate for 2018-19, recognised activity hours and type of childcare your family uses