Labor under fire as childcare fees soar

Labor has been accused of “cherry picking” data as childcare fees continue to rise for struggling Aussie families. See how it affects your household.

Exclusive: Childcare fee increases are rapidly eroding Labor’s subsidy boost with families’ out-of-pocket expenses jumping by more than 12 per cent since the additional help came into effect.

The benefit delivered to households through the subsidy increase has almost disappeared a little over a year since the changes, with households now only 6.7 per cent better off than before the subsidy was increased in September 2023.

Since that time, out-of-pocket costs have grown by 12.7 per cent as of December, according to the latest Australian Bureau of Statistics data.

Higher input costs for centres and staff wage increases have also contributed to a 22.3 per cent increase in the average hourly fee for childcare since Labor took office.

The average hourly fees for a centre based care day went from $11.20 in March 2022 to $13.70 in September last year, according to Coalition analysis of Department of Education data.

Labor this week argued families have saved up to $2,768 since its cheaper childcare policy took effect in 2023, but Opposition childcare spokeswoman Angie Bell has accused the government of “cherry picking” data to suit its narrative on early education.

“No matter how you look at it, the publicly available data shows us that child care is

more expensive under Labor,” she said.

“These extraordinary price rises come at a time when families are struggling under

Labor’s cost of living crisis.”

The Prime Minister, Anthony Albanese visits a childcare centre in Brisbane. Picture: Dan Peled / NewsWire

Ms Bell said there had also been an increase in childcare services charging above the hourly rate cap as providers “struggle to keep up with soaring costs”.

“In the March 2022 quarter, the proportion of centre based care days charging above the fee cap was 19 per cent,” she said.

“In the latest data, that has jumped to around one in three services.”

Early Childhood Education Minister Dr Anne Aly has hit back saying the government was putting in place the “building blocks for a universal early childhood education and care system” through “improving affordability, boosting supply, increasing accessibility and securing the vital workforce families rely on”.

Early Childhood Education Minister Dr Anne Aly at Parliament House in Canberra. Picture: NewsWire / Martin Ollman

“Our cheaper childcare reforms cut the cost of early childhood education and care for more than one million families.

“While many early childhood education services have increased their fees, average out-of-pocket costs remain 6.7 per cent lower than before our cheaper childcare reform were introduced.”

Dr Aly said Labor’s 15 per cent wage rise for early childhood workers over the next two years was retaining the workforce and attracting people to the sector, while also keeping “costs low for families” due to a required fee cap.

“But we know there is more to do which is why we’re replacing the current activity test with a three day guarantee – a guarantee that all children will be able to access the transformative benefits of early childhood education and care three days a week,” she said.

“And if re-elected, our $1 billion Building Early Education Fund will help make sure that children no matter their background or where they live are able to access the transformational benefits of early education and care.”

Originally published as Labor under fire as childcare fees soar