One in three families worse off under planned childcare changes, modelling predicts

One in three families will be worse off because of the Federal Government’s planned changes to child care, according to Australian National University (ANU) research.

The research was commissioned by Early Childhood Australia and will be presented this morning at a Senate inquiry into the Jobs for Families package.

The Senate’s education committee is examining the Government’s proposal to streamline childcare subsidies and introduce a new activity test.

The ANU modelling used Australian Bureau of Statistics data to compare the existing scheme with the Government's proposed changes.

It found, overall, more than 700,000 families would be better off or maintain the same level of Government support.

But the report's author, Ben Phillips, said he found 330,000 families would be worse off.

"Of those, about 150,000 would lose as a result of the tighter activity test, so parents would now need to be working at least eight hours a fortnight to receive any subsidies, and many families don't," Mr Phillips said.

Early Childhood Australia CEO Samantha Page said the findings in relation to the activity test were concerning.

"We are pleased that the majority of working families will be better off under this package but we are concerned about the high number of children that potentially will miss out altogether," she said.

"The children that we are particularly concerned about, and the reason we commissioned this work in the first place, are the ones that are potentially pushed out of early learning because their families, for one reason or another, won't meet the activity test.

"It's really important that very young children, if they're going to attend early learning services, have a continuity of access and aren't in one minute and out the next."

Early Childhood Australia wants the Government package amended to guarantee families receive two days of subsidised care a week before the activity test is applied.

Education Minister Simon Birmingham said the report had acknowledged the Government had been able to collect better data in its modelling process.

"The report says, 'Commonwealth will have a superior data base with the full population of formal childcare families and exact price and hours information for child care use'," he said.

"And also points out 'the data in the survey however does not necessarily line up exactly with the legislated policy, as some people will be undertaking training or charity work that is not covered by the surveys'," Minister Birmingham said.

"However our analysis can absolutely be trusted and is based on a 'complete picture' and actual outcomes that take all factors of the Jobs for Families package in calculation."

Minister Birmingham said that after comprehensive analysis of the data the government had received, including exact hours and prices of all child care usage per child and family with work activity, almost one million families would be better off.

"Our objective is to better help parents who want or need to work, or who want to work more, while still supporting early childhood education. More affordable access to quality child care puts the opportunity of work within reach for more families."

The Senate Inquiry is due to report its findings later this month.

This post originally appeared on the ABC.