Childcare and after-school care workers will receive a 10 per cent pay raise by the end of the year with another increase to come in a $3.6 billion bid by the federal government to give families assurances about the quality of care received by their children.
But the more than 200,000 workers in the sector will receive the combined 15 per cent pay rise, worth about $100 a week, only if the centres they work for promise to limit fee increases to 4.4 per cent over the next 12 months.
Prime Minister Anthony Albanese said it was essential to give children the best start in life.Credit: Rhett Wyman
Prime Minister Anthony Albanese said early educators could change people’s lives and they deserved to be properly valued and fairly paid.
“Knowing your child is safe, happy and learning alongside their friends is priceless. Giving the next generation the best start in life is essential,” he said.
The policy to lift childcare workers’ wages, to be announced on Thursday, follows another substantial outlay by the federal government to increase the pay of aged care workers. Last year the government committed to wage rises of 15 per cent for 250,000 workers in that area, a decision that will cost $11 billion over four years.
The decision to link the latest pay rise to capped fee rises will allow the government to argue the measure won’t lead to an increase in the cost of care for parents. It will say the measure will help address the gender pay gap, help childcare centres retain existing staff and attract new workers, a critical issue for the sector.
Low wages have been a constant problem for the childcare industry; the average worker currently earns an average of $1032 a week. The first instalment of the government’s wage rise will take that to $1135 a week, a rise of $103.
The second instalment, to come at the end of 2025, will be a 5 per cent increase bumping up weekly pay by $52 to $1187 per week.
The pay raise for childcare workers follows the federal government’s increases in the subsidies paid to parents who have children in childcare, a key election promise during the 2022 federal election campaign which came into effect in 2023.
Credit: Matt Golding
The announcement on wages will increase the expectation within the sector that the government will adopt universal childcare as one of its major election promises for the upcoming election campaign.
The federal government directed the Productivity Commission to investigate how the government could chart a course towards universal, affordable early childhood education and care. That report now sits with the government.
A draft report released last year recommended childcare should be fully subsidised for three days a week for lower-income families and the activity test should be relaxed for everyone.
The report canvassed several scenarios for universal access to childcare, including a flat $10-a-day fee similar to the Canadian model, but concluded any reform would need a staged rollout as there simply were not enough childcare workers or centres.
Education Minister Jason Clare said the claim that childcare was effectively a babysitting service was “over” and that early childhood education was critical to preparing kids for school.
“They lift our kids up and now we are lifting their pay. This is the cost-of-living double whammy – wages up for workers and keeping prices down for families,” Clare said.
“A pay rise for every early childhood educator is good for our workforce, good for families and good our economy.”
Cut through the noise of federal politics with news, views and expert analysis. Subscribers can sign up to our weekly Inside Politics newsletter.