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It happened a few weeks ago for us and initially I thought it was an error. Wishful thinking.
The childcare fees for our four-year old daughter doubled: rather than the usual $398 we pay a fortnight for her to attend preschool three days a week, an eye-watering $800 was deducted via direct debit.
A quick email to the director of the centre confirmed it was no administrative error: we have reached the government’s cap of $7,500 for this financial year. Gulp.
It’s this predicament – that an estimated 120,000 other families are also facing – that is being fought in Canberra this week.
News yesterday that childcare fees have risen at five times the rate of inflation over the course of a single year, had the education minister Simon Birmingham incensed.
The data released by the Department of Education shows families are paying an average of $700 more each year for childcare than they did in 2013.
Birmingham wants to alleviate this financial stress for many families by delivering childcare reform, which has been on the table for over a year. Alas, it remains policy not legislation.
Under the government’s proposal the cap would be removed for 85% of families earning less than $185,000 and increased to $10,000 for families on higher incomes.
It would make a significant difference to many households. It would mean families like mine and 120,000 others could escape paying double fees for the 14 weeks until July.
The fact this fiscal dilemma is familiar territory for us makes it no easier.
This is the fifth year we have paid childcare fees and it is fifth year we have hit the threshold a good three months before the financial year ends.
At least this time we are only paying double fees for one child, because our eldest is at school and our youngest isn’t yet in formal care.
There was a time when we paid double for two children and outlaying $1600 every fortnight for three months was precariously close to prohibitive.
And we are not alone.
A Goodstart survey of more than 1500 families has found 60 per cent of households describe childcare as unaffordable.
Many of those surveyed said they were expecting to spend more on childcare this year than they have done in the past, with the majority of childcare users paying between $90 and $119 per child per day for care.
The government currently subsidies 50 per cent of childcare fees, per child per year, up until $7,500 via the Child Care Rebate. The trouble is, that was based on a daily fee of closer to $70 a day and it’s been frozen since 2008.
Of the 1500 families surveyed by Goodstart, 36% hit the current $7500 CCR cap last year and 46% expect to do so this year.
“The current rebate only supports three days of child care over a year at average fees, and even fewer days for families paying above average fees,” Goodstart CEO Julia Davison says.
The trouble is the childcare reforms, which are widely supported with a few amendments, have been linked to an omnibus bill which contains welfare cuts the senate cross-benchers are determined to block. As it stands it is doomed to fail.
If Birmingham and the government are truly committed to childcare reform, why not attempt to pass it on its own?
There would be a long line of families ready to thank them for it.
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