Federal Budget commits $4.5 billion for more affordable child care

This content was published on Wednesday 26 October 2022. There may be more recent updates available.

Early childhood education and care (ECEC) was at the centre of last night’s Federal Budget with the Australian Government committing $4.5 billion* to deliver more affordable child care.

In his Budget address, the Treasurer announced the Government will spend:

  • $4.5 billion* to improve affordability and access, including increasing Child Care Subsidy (CCS) rates from July 2023, protecting CCS against fraud and non-compliance, and providing a minimum of 36 hours of subsidised early learning for First Nations children.
  • $10.2 million to establish a partnership between Australian governments and First Nations representatives to develop community-led policies and programs.
  • $10.8 million to fund the Australian Competition and Consumer Commission to investigate the drivers of early childhood education and care costs. The findings will feed into the Productivity Commission’s review into the ECEC sector.

Under the Plan for Cheaper Child Care, the Government will:

  • lift the maximum CCS rate to 90% for families earning $80,000 or less
  • increase CCS rates for around 96% of families with a child in care earning under $530,000
  • increase transparency in the sector by requiring large providers to report revenue and profits, and commercial leasing information
  • crack down on fraud and non-compliance
  • invest $33.7 million to increase subsidised ECEC to a minimum of 36 hours per fortnight for families with First Nations children.

The measures will take effect from July 2023, subject to legislation passing through the Australian Parliament.

Read the media release from Education Minister Jason Clare and Early Childhood Education Minister Dr Anne Aly.

Learn more about the new child care measures.

*This figure is the net cost of the measures in the Cheaper Child Care Bill. The Budget Papers refer to an investment of $4.7 billion, which includes all new spending measures on early childhood education and care. It does not include savings from measures to increase integrity.