New data released today illustrate a broken early education and care system that is not working for Australian families who in the annual June 2016 quarter faced a fee spike of almost eight per cent.

Minister for Education and Training Simon Birmingham said the data showed that, while the Turnbull Government had reduced fee increases when compared with the 10 year average of 6.9 per cent, “temporary stop-gap” measures were not enough to stem the pain for Australian families and action must be taken urgently.

Minister Birmingham said the 7.6 per cent increase in child care fees – including a 6.3 per cent increase in Long Day Care fees – painted a “disturbing picture” that hit both hard working families and taxpayers.

“It’s a double whammy. In a climate of slow wage growth to have fees increasing at three times the speed of the economy demonstrates that Australia’s child care system needs to be reformed,” Minister Birmingham said.

 “Through a range of compliance measures, the Turnbull Government has reduced fee increases from the 13 per cent spikes under the Labor Government and by as much as possible within the current system, but we need to go further.

“We need to fix this broken system with a complete overhaul. That is why our legislation before the Parliament brings in hourly rate caps to drive downward pressure on price increases.”
Minister Birmingham said he noted media reports today about continued early education and care fee growth and said they highlighted the need for the measures outlined in the Turnbull Government’s child care reform package to not only put downward pressure on fee increases but to provide additional support to those families who are working the most and earning the least.
“The Turnbull Government has comprehensive child care reforms to address problems many hardworking families face. The current system isn’t working for them now and won’t in the future unless we achieve significant reform,” Minister Birmingham said.

“We have put in the time to consult with parents, families and child care providers and listened to input from the Productivity Commission and three Senate inquiries to lay out a package to make child care more affordable and accessible for those who need it most.

“The introduction of the hourly rate cap is firstly a necessary measure to arrest incessant child care fee increases and secondly will provide Australian families with a benchmark price so they have a reference point to hold providers accountable and from which they can expect prices shouldn’t dramatically exceed.
“While some parents will choose to pay above the cap for a variety of reasons, it will force most providers to manage their fee increases based on the support families will receive or face them moving to other child care providers that are.

“Families facing fee increases that results in hitting the current $7500 limit of the child care rebate faster would further benefit from our plans to remove that limit for all families earning less than $185,000.”
Minister Birmingham said Labor and the crossbench had an opportunity over the next fortnight to support the savings needed to pass the Turnbull Government’s child care reform package when it was introduced into the Senate. 

“Enough is enough. Over the next two weeks Parliament has the opportunity to step up to the plate and provide the support that Australian families are crying out for.

“Bill Shorten must stop speaking with a forked tongue on child care and instead of crying crocodile tears for families but blocking the solutions, he should back our reforms to provide low to middle income Australian families with child care relief.
“Getting support for the savings needed to fund our child care package will be one of the Turnbull Government’s top priorities when Parliament resumes and if Bill Shorten was really interested in helping Australian families Labor would stop the politicking and pass these savings.
“That’s why the Turnbull Government’s early education and care reforms represent increased investment that will make the system more accessible, affordable and fairer for around one million Australians, with low and middle income families the greatest beneficiaries from the package.

“Our reforms will also give more support to those hardworking families who most need it, which will not only help those families but create a better environment for Australian parents who want to work or work more.
“We currently have before the Parliament the most significant reform of the child care system in 40 years and I encourage Labor to stop the political games, listen to the Australian people and get on board by passing the savings needed to fund our child care reforms.”

The Early Childhood and Child Care in Summary June quarter 2016 report can be found at: