ON THE RISE: Childcare fees have risen more than 10 per cent in one year in the Clarence Valley.
ON THE RISE: Childcare fees have risen more than 10 per cent in one year in the Clarence Valley.

PM planning to scrap free childcare

Scott Morrison has warned parents he plans to scrap "free childcare" as soon as practicable describing the current COVID-19 arrangements as not sustainable.

The current free childcare pandemic pledge was designed in the early days of the coronavirus, when attendance rates plummeted and childcare operators warned they faced collapse are due to expire on June 28.

But the Morrison Government now considering whether or not to extend the "free" care for another three months, as was foreshadowed in the legislation.

While the Prime Minister said today that "no final decision" has been made, he stressed that parents should not expect the arrangements to remain in place indefinitely.

"Well, the Education Minister is currently considering the program beyond its current expiry," the Prime Minister said.

"And it was put in place as a temporary measure. And, as you'll recall, it was effectively suspending the normal payment arrangements and subsidy arrangements that have been in place, and moved to that different model for a period of time to give certainty of income to those facilities, to enable them to operate, which combined with the JobKeeper payment, enabled them to do just that.

"But that is not a sustainable model for how the childcare sector should work, and nor was it intended to be."

Early Childhood Australia's CEO Sam Page told news.com.au this week that the Prime Minister's "free" COVID-19 childcare plan, announced on April 2, had reset the debate.

"By giving free childcare to families, that has really opened the debate on why isn't childcare free all the time,'' she said.

"If we are to make an economic recovery, perhaps free childcare is a part of that?"

Early Childhood Australia has called on the Prime Minister to offer all parents two days a week of "free" childcare going forward.

Under the current arrangements, childcare operators' income from government rebates has been frozen at 50 per cent of normal fees.

The Morrison Government is also providing the wage subsidy JobKeeper to subsidise the wages of thousands of childcare workers.

This arrangement is working well for childcare centres that have hardly any enrolments and low attendance rates. While their income has halved they are caring for fewer children and their wage costs are much lower.

However, as parents return to work, childcare operators have warned they cannot fun a business where they are back caring for the same number of children while the government has frozen their income at 50 per cent of normal fees.

Already, parents have been turned away from booking new places by childcare operators for this reason. Childcare centres can apply for exceptional circumstances funding for new bookings but the process is complex.

Privately, big childcare operators have also complained that casuals who are suddenly securing $1500 a fortnight from JobKeeper are refusing to come to work citing coronavirus fears.

Mr Morrison said the Education Minister will have more to say about the problem in coming weeks.

"And so at this point, no final decisions has been made on those issues. But the intention was always to return to the payment arrangements and subsidy arrangements that had been put in place prior to those things coming into effect," he said.

The Prime Minister also poured cold water of reports that the JobKeeeper program could be extended describing the speculation as "premature".

However, he again flagged that a review will be undertaken by the Treasury and there would be "things to sort out".

"So far, the things that have required sorting out have been relatively modest and those changes have been able to be made," he said.

Minister for Health Natasha Fyles at the Nightcliff Family Centre. Picture: Che Chorley
Minister for Health Natasha Fyles at the Nightcliff Family Centre. Picture: Che Chorley

Asked if the Government could consider adjusting the rate of JobKeeper rather than changing the eligibility rules, Mr Morrison said the speculation was premature.

"Well, the eligibility rules, we have been very clear about from the beginning. And they're important," he said.

"We've got 6.1 million Australians, and more, who will be benefiting from the JobKeeper program. And right now we have some - just about 1.6 million Australians who are being supported by JobSeeker.

"Now, we're only seven weeks now into a 6-month program. And it is very premature, I think, to be making judgments about what possible changes might be made.

"And so, of course, there will be some things to sort out. But so far, the things that have required sorting out have been relatively modest."

Originally published as PM planning to scrap 'free' childcare



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