Payments and how they work

What your payment covers

The worker retention payment helps you:

•    pay staff higher wages 
•    cover related costs.

Your funding will cover:

• the full wage increase you’re required to pass on to workers due to the Fair Work Commission’s gender-based undervaluation – priority awards review
• extra funding (at least 20%) for eligible on-costs.

You can only spend the grant on the full wage increase, and then eligible on-costs.

See the minimum rates that you must pass on to all eligible workers.

Most providers get a standard payment that covers these costs. If your payment does not cover these costs, you can apply for a top up payment.

How we calculate payments

Standard payments are based on the labour costs for the charged hours of care you report through the Child Care Subsidy System each month.

This calculation:

• considers how many children you provide care for
• considers your service characteristics
• balances supporting quality ECEC and standard rostering practices.

Seasonal adjustments

To smooth funding across the year, we apply seasonal adjustments to Centre Based Day Care services.

We apply advances during quieter periods

• December: +10%
• January: +15%
• February: +5%

We then recover the same dollar amounts during peak periods:

• September
• October
• November.

These adjustments help:

• balance funding across the year
• support services during quieter periods.

Managing payments across services

If you operate multiple services, funding may vary between services depending on activity.

You should:

• manage and smooth payments across your services over the year
• consider seasonal changes when distributing any additional funding to workers.

You must maintain appropriate records to ensure compliance with the grant reporting requirements.

Payment caps

We set a payment cap for your grant. This is the maximum amount of funding we will pay you. Your cap:

• is set when your grant is approved
• is based on data from the Child Care Subsidy System
• includes a buffer to for changes
• is outlined in your grant agreement.

The cap is not a guaranteed amount. Your total payments may be less than the cap.

You cannot estimate individual payments by averaging your cap over time. This is because payments vary depending on:

• hours of care provided
• seasonal adjustments
• the wage increase provided at the time.

If you approach your cap, we’ll check your payments and may increase your cap if needed. You don’t need to do anything – we’ll contact you if this happens.

If your service operates outside standard assumptions, you can apply for a funding review. We’ll check your payments and may increase your cap if needed.

When we make payments

Standard payments are paid every 4 weeks in arrears. Top up payments are paid quarterly in arrears.

Your first payment may include backpay from the start of your grant agreement.

Payments are updated each run to reflect any changes or missing data.

How we make payments

We make payments at the service-level through the Child Care Subsidy System.

We send payments to the same bank account as your CCS payments.

Please ensure your bank account details are up to date via the Provider Entry Point (PEP) or your third-party software.

For help, see how to view worker retention payments in the PEP or contact your software provider.

When we backdate payments

Family Day Care and In Home Care

Family Day Care and In Home Care services will be eligible for payments backdated to July 2026. We will provide more information soon.

Centre Based Day Care and Outside School Hours Care

The deadline to apply for backdated worker retention payments has passed. You can still apply for future payments.
Refer to the grant guidelines for information about when we backdated payments.

Funding reviews

If you believe your funding is not sufficient, you may request a funding review.

Before applying, you must show you’ve:

• managed funding across your services, and
• accounted for seasonal fluctuations.

Funding reviews are commonly used by providers who operate services that:

• have a unique staffing profile (for example, by exceeding minimum staffing ratios)
• have stand-alone jurisdiction-funded preschool rooms
• are First Nations, remote or very remote
• get the Community Child Care Fund and have a unique operating model
• cannot be provided consistent, smoothed funding by the provider across a financial year.