Read The Times Australia

Daily Bulletin

The Productivity Commission wants all Australian kids to get 3 days a week of childcare – but it won’t be until 2036

  • Written by: Melissa Tham, Research fellow at the Mitchell Institute, Victoria University

The federal government has released a highly anticipated report into Australia’s childcare system. The report, by the Productivity Commission, says addressing affordability should be a priority. It recommends fully subsidised childcare for families earning under A$80,000 from 2026.

The report, which was commissioned by the government, was completed at the end of June.

It sets out crucial steps to achieve a “universal” childcare system in Australia. This is where all families with children under five can get three days a week of high-quality early education and care. The Productivity Commission says this should be up and running by 2036.

Read more: Productivity Commission charts the costly path to universal early childhood education

What’s in the report?

The final report has 56 recommendations to “remove barriers” to access early childhood education and care. This includes centre-based care (such as long daycare), preschools, family day care and outside school hours care (often called before and after school care).

Key recommendations include:

  • raising the maximum rate of the childcare subsidy from 90% to 100% of the hourly rate cap for families on incomes up to $80,000. The Productivity Commission recommends this is implemented in 2026 to make childcare more affordable for about 30% of all families with children aged 0–12 years.

  • for families with multiple children under five earning under $140,000, it recommends raising subsidies to 100%, up from the current 95%.

  • the proposed changes to the subsidy would not only mean more affordable childcare for low-income families. All families earning under $580,000 per year would receive a higher subsidy rate, “making nearly all [early childhood education and care] users better off”. This follows a boost to childcare subsidies in 2023.

Children play in a sandpit area at a daycare centre.
The Productivity Commission sent its childcare report to the government on June 28 this year. Mick Tsikas/AAP

The activity test should go

Significantly, the report recommends removing the much-criticised activity test from next year. This requires parents to be working or studying at least eight hours a fortnight to receive child care subsidies.

The Productivity Commission says removing it would see more children from low income families in early education and care.

What else is in the report?

Recognising care needs do not stop when children start school, the Productivity Commission wants to see state governments make sure there is outside school hours care for children aged five to 12 in all public schools.

It also recognises remote and very remote areas face extra challenges. Some sparsely populated areas are “thin markets” – they do not have enough demand to support the provision of services. The Productivity Commission recommends targeted funding to help.

The report also highlights how supporting early childhood educators is key to quality care and good outcomes for all children. It calls for accelerated qualifications and consistent registration requirements. This follows a recent 15% pay rise for chronically low paid early childhood educators.

Equity is key to proposed reforms

The report focuses on how to achieve greater equity in early childhood education and care – a key part of the federal government’s Early Years Strategy.

Australia currently has as market-driven model for childcare provision. Our research shows this approach tends to see providers located in more affluent areas, where they can charge families more per hour.

Importantly, the Productivity Commission recognises the need for increased funding for remote and very remote areas. Our research shows although the supply of childcare places in Australia has increased over the past two years, the distribution of these places is not equitable. Families in remote areas are more likely to miss out.

Another proposed change is to enable access to child care subsidy for “wrap-around care” in dedicated preschools by 2025. This could see services provide more flexibility, such as more hours and different types of care (such as preschool or kinder learning for some of the day and then daycare around that). If implemented, it should mean greater support for working families.

Education Minister Jason Clare sits at a desk with young children at a childcare centre.
Education Minister Jason Clare visited a childcare centre in Brisbane in October 2023. Darren England/ AAP

Will it be enough?

As some commentators – such as independent federal MP Zoe Daniel – have been quick to point out, some changes are still a long way off. Daniel says the “timeline isn’t nearly ambitious enough”.

However, it will not necessarily be quick to provide universal access to childcare. While families need more places and cheaper costs right now, the report explains it will require “long-term commitment and investment”. It also says:

Sequencing reforms will be critical to avoid crowding out children and families experiencing disadvantage.

The Productivity Commission says overall, these measures would increase childcare subsidy costs by 37%, to $17.4 billion a year. While this is a significant amount, it is in line with other governments around the world, such as England and France, who are also increasing the amount they spend on the early years.

What next?

The government says it will consider this report alongside a separate report by the Australian Competition and Consumer Commission (ACCC), finalised last year. This report looked at pricing across the sector.

As federal Education Minister Jason Clare told an early childhood conference on Wednesday,

We are closely looking at this report, along with the ACCC’s recent report and I want your feedback.

With another federal election on the horizon, we can reasonably expect the government’s response to form part of its re-election plans.

Authors: Melissa Tham, Research fellow at the Mitchell Institute, Victoria University

Read more https://theconversation.com/the-productivity-commission-wants-all-australian-kids-to-get-3-days-a-week-of-childcare-but-it-wont-be-until-2036-239293

Business News

Inside the Icon: The BridgeMuseum Officially Opens at the Sydney Harbour Bridge

A bold new way to experience one of Australia’s most recognisable landmarks has arrived, with BridgeClimb Sydney officially opening the all-new BridgeMuseum.  Located inside the Sydney Harbour Brid...

Daily Bulletin - avatar Daily Bulletin

Is Your Brand Showing Up in AI Search? Most Melbourne Brands Aren't.

The New Front Door Nobody Told You About Something changed. Quietly. Without a press release. The way buyers find businesses in Australia has been rewired. Not replaced, rewired. Google isn't dead...

Daily Bulletin - avatar Daily Bulletin

How Australian Businesses Can Measure SEO ROI

SEO can feel vague when you are staring at a dashboard full of numbers that do not clearly connect to revenue. The key is to measure the right signals in the right order, then tie them back to outcome...

Daily Bulletin - avatar Daily Bulletin

How Commercial Roller Shutters Improve Site Security Without Slowing Operations

Security upgrades can be frustrating when they make everyday work harder. A door that takes too long to open, creates bottlenecks at shift change, or fails at the worst time can turn “better protectio...

Daily Bulletin - avatar Daily Bulletin

Why a Document Destruction Service Still Matters for Modern Businesses

Businesses generate large volumes of information every day, from staff records and contracts to invoices, reports and customer files. While attention often focuses on how documents are stored, the way...

Daily Bulletin - avatar Daily Bulletin

Bicycle Rack Safety and Space-Smart Storage

Bike storage problems usually show up as small annoyances first: tangled handlebars, scratched frames, and bikes that topple when you pull one out. Over time, those issues become safety risks, especia...

Daily Bulletin - avatar Daily Bulletin

How to Tell if a Childcare Centre Is a Good Fit for Your Child

Choosing childcare can feel like you’re making a huge decision with limited information. Tours are short, centres are often on their best behaviour, and your child might act differently in a new space...

Daily Bulletin - avatar Daily Bulletin

Car Import Timeline: What Usually Happens at Each Stage

Importing a car into Australia can feel confusing because multiple agencies and checkpoints are involved, and the timeline is shaped as much by paperwork quality as it is by shipping speed. The most u...

Daily Bulletin - avatar Daily Bulletin

Portable Toilet Hygiene Standards Explained: Clean vs Sanitised vs Disinfected

In portable toilet servicing, the words clean, sanitised, and disinfected often get used as if they mean the same thing. They don’t. And that difference matters because a unit can look tidy and still ...

Daily Bulletin - avatar Daily Bulletin

The Daily Magazine

Gold Migration Lawyers in Liquidation: How the Closure Affects Your ART Appeal

If your appeal was with Gold Migration Lawyers, a recent change to how the Tribunal decides cases ...

The pressure cooker: life in urban Australia in 2026

Australian cities have always been demanding. Long commutes, rising housing costs, busy schedules a...

What Actually Makes a Good Criminal Lawyer in Melbourne

Most people only think about this question once. That is usually too late. Most people charged wi...

Why Working With A Chatswood Tutor Can Improve Academic Performance

Academic expectations continue increasing for students across primary school, high school, and senio...

Is It Worth Getting Solar Panels in Melbourne?

The real question is not whether solar works in Melbourne. It works. The question is what it is co...

How A Diploma Of Project Management Builds Practical Skills For Modern Work Environments

Developing the ability to plan, execute, and deliver outcomes efficiently is a key requirement in to...

How to Choose the Right Football for Every Level

Choosing a football may seem straightforward, but the right option depends on who will be using it a...

What to Ask a Wedding Photographer Before You Book

Booking a wedding photographer can feel deceptively simple: you like the photos, you like the vibe...

Why Stress Relief For Dogs Is Essential For Emotional Balance And Long-Term Wellbeing

Managing emotional health is just as important as physical care when it comes to pets, which is why ...