Anthony Albanese‘s childcare centre splurge to cost taxpayers $1bn

Taxpayers will bankroll Labor’s $1bn pledge to build 160 new childcare centres, in a re-election vow that echoes Kevin Rudd’s 17-year-old broken promise to construct 260 daycare centres at schools.

Prime Minister Anthony Albanese holds baby Maise after delivering a speech at the Morningside Panthers AFL club in Brisbane. Picture: NewsWire / Glenn Campbell

Taxpayers will bankroll Labor’s $1bn pledge to build 160 new childcare centres, in a re-election vow that echoes Kevin Rudd’s 17-year-old broken promise to construct 260 daycare centres at schools.

Anthony Albanese has announced a new Building Early Education Fund to provide 160 centres in poorly serviced neighbourhoods from July next year, if voters re-elect his government.

Half the money will be spent on grants for childcare operators to build centres in areas of unmet demand, with a focus on schools.

Childcare centres will be linked to maternal health services and other health and welfare hubs.

The federal government will spend the rest of the money building its own centres, which it will lease back to childcare operators.

“We’re building more childcare centres,’’ the Prime Minister said in Brisbane at the launch of Labor’s “universal childcare’’ policy to guarantee three days a week of subsidised childcare to every child from birth to preschool age.

“There are simply not enough childcare centres in the regions or in outer suburbs that are growing fast. Too often that’s because large corporate providers don’t see an opportunity to profit in these places. Early childhood education isn’t about making money, it is about changing lives, and childcare isn’t a luxury, it’s an essential service for modern families.’’

Kicking off Labor’s re-election campaign, Mr Albanese spruiked his government’s taxpayer-funded 10 per cent pay rise for 200,000 childcare workers. But The Australian can reveal most staff will miss out on the promised pay rise before Christmas.

Mr Albanese said his government had legislated a 15 per cent pay increase for educators, worth an extra $150 a week for carers earning the minimum wage.

“That’s 10 per cent from this month – I’m sure you’ve noticed it in your paypackets,’’ he said.

But federal Education Department data shows that just 15 per cent of childcare operators have applied for grants totalling $3.6bn.

Only 941 of the nation’s 6227 providers have applied for the ­salary subsidies, leaving tens of thousands of staff without the pre-Christmas pay rise promised to them by the government.

Australian Childcare Alliance president Paul Mondo said centres could collect the grants next year and back-pay the wage rise to staff.

“One of the criteria of applying is you need to be part of the multi-employer agreement, or via individual flexibility arrangements,’’ he said. “No provider has had the opportunity to adopt the multi-employer agreement yet because it was only registered with the Fair Work Commission yesterday (Tuesday).

“We would expect it would take a number of months before those processes can play out. It does take time to adopt the agreement everywhere when it’s not an award change that happens overnight.’’

Mr Albanese said that if re-elected, his government would guarantee three days a week of subsidised childcare for every child by abolishing the “activity test’’ that requires both parents to work or study to be eligible for ­rebates. “These are the building blocks of a world class universal early education system – getting fees down for families, getting wages up for workers, getting more places for children, more centres and services in our regions and suburbs, and a new three-day guarantee of early education,’’ the Prime Minister said.

“Under a re-elected Labor government every family earning up to $530,000 will have access to the childcare subsidy for three days a week, guaranteed.’’

Mr Albanese said the activity test had “locked out’’ nearly 70,000 children whose families were unemployed or could not work for health or disability reasons. “Too often the children missing out on early education are the ones for whom it would make the biggest difference,’’ he said.

“Parents should not need to go through bureaucracy, or work a certain number hours.’’

Federal Early Childhood Education Minister Anne Aly said some regional councils had told her a lack of childcare was preventing nurses, doctors and teachers from working in country towns and remote communities.

“That’s why we’re stepping in,’’ she said.

Dr Aly said the building fund was “very different’’ to the broken promise by former Mr Rudd in 2007 to build 260 childcare centres in school grounds to end the “double drop-off’’ for working parents.

She said the Rudd promise had coincided with the collapse of ABC Learning Centres – the biggest for-profit provider, which was transformed into the not-for-profit Goodstart Early Learning through a federal government financial bailout.

“We’re in a different context now and in a different time,’’ Dr Aly said. “I’ve already started some of the conversations with states about building on school sites.

“It makes sense to have early childhood learning centres on school sites so children can have that smooth transition into school. The fact is not-for-profits don’t have the capital to grow their centres.’’

Dr Aly refused to rule out making childcare free for families earning less than $80,000 year, in line with Productivity Commission recommendations. Low-income families now receive a 90 per cent subsidy, but may struggle to afford out-of-pocket “gap fees’’ of up to $20 per day.

“We’ll be working through all of those recommendations,’’ Dr Aly said. She defended the right of stay-at-home parents to access subsidised childcare even if the family earns $530,000 a year.

“When people say is this welfare for the wealthy, is public schooling welfare for the wealthy? It’s not,’’ she said. “Education is a basic right for every child.’’

Opposition early education spokeswoman Angie Bell said Labor’s move to scrap the activity test for three days for families earning up to $530,000 was unnecessary. “Various activity test exemptions are already in place, including for vulnerable children,“ she said.