The Federal Government’s free childcare scheme, introduced because of the COVID-19 pandemic, will end on July 12 the Education Minister has announced.
JobKeeper payments for the sector will also end on July 20.
The childcare package was announced in April in a bid to keep centres afloat during the crisis as thousands of parents were forced to take their kids out of childcare.
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Education Minister Dan Tehan says with people returning to work, demand for childcare has increased and now was an appropriate time to end the scheme.
“We are saying that there is a need to transition and what we are seeing is the demand increasing has increased and at the last survey, over 40 per cent of providers showed that demand is at 75 per cent,” Mr Tehan said,
“So a package which was there as a temporary relief package which was there for when demand is falling now needs to transition and that is exactly what we are doing.”
The transition will see the government pay childcare operators 25 per cent of their March fee revenue.
The government will also ease the activity test which sets out the minimum number of hours a parent must be working, studying or volunteering in order to qualify for the childcare subsidy.
Families will now receive up to 100 hours of subsidised care until October.
“This will assist families to return to the level of work, study or training they were undertaking before COVID-19,” Mr Tehan said.
Mr Tehan says the package had done the job that it was designed for.
“We need to put together in a package which is sustainable into the future and what we have seen is demand grow and grow over the last few weeks so that we needed to change the system.
“This system was designed for when demand was falling, now we are seeing demand increasing and we think that we have the balance right to support families.”
More to come.