Child Care Subsidy (CCS) is changing from July 2023. For the average family on about $120,000 with a child in care three days a week, the changes will cut costs by about $1,700 a year.
Most families using early childhood education and care will get more subsidy. Some families previously not eligible for CCS will become eligible.
CCS is the main way the Australian Government helps families with child care fees. The subsidy is paid to child care providers who pass it on to families as a fee reduction.
The amount of CCS a family can get depends on their circumstances, including their family income.
From July, the family income limit to get CCS is increasing from $356,756 to $530,000. Subsidy rates are also going up.
Families earning up to $80,000 will get an increased maximum subsidy, from 85% to 90%. Families earning over $80,000 will get a subsidy that tapers down from 90%, depending on their income. The subsidy will go down 1% for each $5,000 earned.
Families with more than one child aged 5 or under in care can also get a higher subsidy rate for their second and younger children, if they earn below $362,408.
Families already getting CCS don’t need to do anything. Families that may become eligible when the changes occur should lodge a Child Care Subsidy claim.
The changes are part of the Australian Government’s $4.6 billion commitment to reduce child care costs for Australian families.
The changes will:
- support parents’ and carers’ choice to increase their workforce participation, particularly women
- make early childhood education and care more affordable for more families
- extend to more children the benefits early childhood education and care brings to children’s school-readiness and long-term outcomes.
Under the changes, out-of-pocket costs will reduce for around 96% of families currently using child care. No families will be worse off.
Families can use the CCS Calculator at StartingBlocks.gov.au to find out what their future rates may be.