'Strong rebound': Childcare costs on the rise again   

August 11, 2019
Sydney Morning Herald


Childcare costs are bouncing back around the country, despite the federal government pledging billions of extra dollars to try to improve out-of-pocket costs for families with young children.

An analysis of new economic data shows that even though there was a sharp dip in the third quarter of 2018, childcare costs climbed steadily over the following nine months.


Nicole Wade sends her son William, 3, to daycare in Sydney's Ryde, where fees recently increased to $150 a day.   

Nicole Wade sends her son three-year-old son William to daycare in Sydney's Ryde, where fees recently increased from $145 to $150 a day.

William currently goes two days a week and Ms Wade would like to send him for three but, even with about a 50 per cent government subsidy, the sums don't add up. Even if she worked an extra day, by the time Ms Wade factors in the extra day of fees, plus after school care fees for her six year-old daughter, "it's not viable for our family".


Ms Wade, who is a director at the centre where William attends as well as teaching yoga at nights and on weekends, describes her son's daycare days as "hugely important".

She says it enables her to work and is preparing her son for school with a literacy program, excursions, sensory play and activities such as growing vegetables.

"It's not really an option I think, for children not to have an early education."


Nicole Wade says early education is preparing her son for school.

In July 2018, the Coalition government introduced a new system for funding childcare, which included an extra $2.5 billion over four years in funding, with support targeted towards low and middle income earners.

Education Minister Dan Tehan recently hailed the 12-month anniversary of the program, noting than more than $7.2 billion in subsidies had been paid and costs were down 7.9 per cent since the new system began. But a closer analysis of Australian Bureau of Statistics' consumer price index shows that after an initial drop in prices, out-of-pocket costs having been rising again.


Australia-wide, there was a dramatic 11.8 per cent drop between the June and September 2018 quarters, covering the introduction of the new system. But over the next nine months to June 2019, there was a 4.4 per cent increase.

The CPI for "all groups" monitored by the ABS increased by 1.1 per cent over the same period. Childcare costs for the corresponding nine-month period in 2017-18 saw a 3.7 per cent increase.

In Sydney, there was an initial drop of 7.6 per cent after the childcare changes were introduced last year, but costs have since climbed two per cent between the September 2018 and June 2019 quarters. In Melbourne, there was an initial drop of 19 per cent, with prices since climbing 7.4 per cent.

"We have started to see a strong rebound in childcare prices again," Australian National University economic and social researcher Ben Phillips.

Associate Professor Phillips said it was not known why prices had begun to creep back up, but noted that cost increases were particularly noticeable in some regional areas and in Queensland, where costs had relatively been lower than other parts of the country.

Education specialist and spokesperson for The Parenthood, Megan O'Connell, said the CPI figures could reflect the fact that some centres were charging more to try and take advantage of the extra government funding in the system. She said this could also be due to centres taking on more staff and administrative support to cope with increased demand.

Ms O'Connell also described the rising costs as a concern.   

"Only some parents are finding that childcare is more affordable," she said.

Mr Tehan says the new childcare system is "leaving more dollars in the pockets of Australian families". According to the Education Minister, 75 per cent of parents pay about $50 a day for daycare, after the childcare subsidy is factored in. Mr Tehan added the government's childcare subsidy had an hourly fee cap, which helped "place downward pressure on fees".

... and up go the government taxpayer funded subsidies - inflation follows and upward pressure on incomes, and the welfare bill for REAL welfare blows right out of hand - with the willing assistance of the LNP who love to slag 'welfare' by claiming social security is welfare...

Cut the PPL and the childcare subsidies and the real welfare bill will fall instantly...

Baronvonrort wrote on Aug 11^th, 2019 at 7:47pm:



And the demand went up for higher pay as 'educators', increasing demand for qualifications that automatically impose a pay rise tariff, and insurance and other issues that rise and rise .....

rhino wrote on Aug 11^th, 2019 at 8:45pm:


It should exist if you are willing to pay for it yourself, otherwise look after your own kids or have your family do it as it was in the past. Perhaps grandparents should be paid.

Edit: You'd all know from my previous posts we did not use childcare. We took the hit to our income to do the job that doing the job in the first place caused. Now people that took childcare money and worked rather than looking after their own kids have a lot more super than my wife and myself. Perhaps parents that stay at home and provide childcare should be paid as well as grandparents.

juliar wrote on Aug 11^th, 2019 at 9:10pm:


Really? Why do we still have childcare subsidies? Surely a Lib govt would stop that kind of socialism and wealth redistribution. What are the Young Libs policies on this?

Gordon wrote on Aug 11^th, 2019 at 9:37pm:


How does that gel with the permanent high unemployment rate and under-employment rate and the destruction of society long-term that generates?

Simply adding women to the workforce doesn't actually do anything differently in that workplace - just generates social divides along the lines of couples v single and increases demands for positions/promotions along social scientist lines - all of which work to the detriment of a society as a whole....

The long term effect of adding women to the workforce in an already schit-hole country will inevitably be a deeper schit-hole for the majority - not a more shallow one - and the result for a non-schit-hole country will be a deeper schit-hole for many as well and a lower overall standard of living.

Women bring no 'different' viewpoint to the table that does not already exist - all they bring to the table is demands for things unearned and an absolute sense of entitlement to jobs without merit.

In reality, the only differences between a society where women are included in the workforce and those in which they are not is that the ones in which they are included slowly degenerate due to divisions and pressures, whereas the one without remain static at the least.

I've explained to you previously the inflationary effects of the dual income family and what it has wrought in the West - and you can add to that the never-ceasing demands for more and more over some grievance, usually from the distant past.  In the single income family - a living wage era - all families, including single person families, could prosper... now a single person family is up against the wall of fighting two incomes for the basics of life.  This adversely affects any singles, but especially affected nature's single - the gays - to a greater and longer-lasting extent... though now gays can 'marry'  and suffer the same as everyone else....

Setanta wrote on Aug 11^th, 2019 at 10:46pm:


Australia wasn't a shyte hole - but it could easily become one - and childcare as a component of artificially keeping people at work is part of the cause.  Two people on part-time casual may or may not equal one person on a single living wage - a living wage for a family, that was.  What it will guarantee is a far larger number of poorer people, given the inflationary impact of double incomes, and the demand for a higher single income to compete, which then translates into higher double income, which leads us back to the same spot over and over and causes real inflation of housing and other living costs, which leads us to 'inability to compete ' with peasant wage nations.

It's all of a muchness....