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Childcare Savings Eaten Up As Fees Rise (Read 440 times)
whiteknight
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Childcare Savings Eaten Up As Fees Rise
Jan 10th, 2021 at 9:13am
 
Childcare savings eaten up as fees rise faster than subsidies   Sad

January 9, 2021
WA Today.

Parents who reaped big savings when the Coalition's new childcare system began have found that rising fees are gobbling up the benefits.

Education Department documents show daycare fees are projected to rise 4.1 per cent a year for the next four years, far outstripping inflation. Labor predicts all the savings from the new system will be wiped out within a year, despite $9 billion in annual subsidies.

Davina Borrow-Jones, with son Lucas, 3, has a legal practice specialising in  advice for mothers who start small businesses and has found that childcare fees are a big barrier for women.   Sad


Childcare centre fees rose 6.1 per cent on average between mid-2018, when the new system began, and the March quarter of 2020, the most recent quarter for which data is available. Family daycare fees rose 5 per cent over the same period.

But the benchmark hourly fee that subsidies are based on grows in line with the consumer price index; and since the system began, the CPI has increased just 2.7 per cent.



After the new childcare subsidy had been in place for three months, former education minister Dan Tehan issued a statement noting that out-of-pocket costs for parents were an average 11.8 per cent lower than under the old rebates.

By October 2020, out-of-pocket costs were just 3.2 per cent lower.

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Opposition early childhood education spokeswoman Amanda Rishworth said the rising cost of childcare combined with the $10,560 annual cap on subsidies for higher income families meant cost was a “very big barrier” for many parents.

“This type of data just shows that out-of-pocket costs are growing incredibly fast and are very difficult for families to cover,” she said. “I think certainly in the next six to 12 months we will see really the reforms come to nothing [in terms of savings].”

A department spokesperson said nine in 10 families using childcare were able to receive subsidies for between 50 and 85 per cent of fees, and the way that indexation worked meant the proportion of fees covered remained the same.

“Childcare affordability has substantially improved since the introduction of the Child Care Subsidy [CCS] in July 2018,” the spokesperson said.

Education Minister Alan Tudge, who took over the portfolio just before Christmas, is on leave. Mr Tehan has previously said 71 per cent of parents pay $5 or less an hour, equivalent to $50 a day for daycare centres.

The most expensive childcare in the nation is clustered around Sydney's north shore and eastern suburbs and Melbourne's inner suburbs.

Davina Borrow-Jones, a solicitor from Newport on Sydney's northern beaches, said her son Lucas, 3, goes to daycare three days a week and that will soon increase to four days.

Ms Borrow-Jones, 43, and her partner pay $130 a day – $60 out of pocket – for childcare in a nearby suburb.

Her legal practice specialises in advice for mothers who start small businesses and she said that among her circle of friends and client base, childcare fees were a big barrier for women.

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“I've made it work for me, but I have many friends in different situations where they haven't gone back to work because of the fact that their salaries are not sufficient to cover their childcare,” Ms Borrow-Jones said. “It discourages women from going back to work and it also discourages women from having more children.”

The government made childcare temporarily free at the height of the pandemic to encourage parents to keep their children enrolled even if they weren't able to attend the services. The change drove a record drop in the June quarter CPI and tipped Australia into annual deflation for only the third time on record.

Labor wants to increase the top level of subsidy to 90 per cent and offer fee assistance to more families. Government MPs are working on a proposal to expand childcare assistance to families on the top and bottom margins via tax deductions.
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #1 - Jan 10th, 2021 at 9:36am
 
Australian childcare is absurdly expensive, thanks to government intervention, red tape, absurd legal requirements and subsidies. As a result, childcare is turning into an industry dominated by big corporations and small thieves.
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #2 - Jan 10th, 2021 at 9:37am
 
This is capitalism at its best. Prices are set to achieve optimum earnings of those providing services subsidized by the government.

If you don't like it migrate to China.
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Please don't thank me. Effusive fawning and obeisance of disciples, mendicants, and foot-kissers embarrass me.
 
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #3 - Jan 10th, 2021 at 9:45am
 
Laugh till you cry wrote on Jan 10th, 2021 at 9:37am:
This is capitalism at its best. Prices are set to achieve optimum earnings of those providing services subsidized by the government.

If you don't like it migrate to China.


It's pretty much the opposite of capitalism.
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #4 - Jan 10th, 2021 at 12:17pm
 
freediver wrote on Jan 10th, 2021 at 9:45am:
Laugh till you cry wrote on Jan 10th, 2021 at 9:37am:
This is capitalism at its best. Prices are set to achieve optimum earnings of those providing services subsidized by the government.

If you don't like it migrate to China.


It's pretty much the opposite of capitalism.


A flea in your ear.

How so? Please explain?

Finite resource + surge in demand from subsidy = higher price.

Prices are sticky and don't come down if resources increase to meet demand.
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Please don't thank me. Effusive fawning and obeisance of disciples, mendicants, and foot-kissers embarrass me.
 
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #5 - Jan 10th, 2021 at 1:13pm
 
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #6 - Jan 10th, 2021 at 6:10pm
 
Laugh till you cry wrote on Jan 10th, 2021 at 12:17pm:
freediver wrote on Jan 10th, 2021 at 9:45am:
Laugh till you cry wrote on Jan 10th, 2021 at 9:37am:
This is capitalism at its best. Prices are set to achieve optimum earnings of those providing services subsidized by the government.

If you don't like it migrate to China.


It's pretty much the opposite of capitalism.


A flea in your ear.

How so? Please explain?

Finite resource + surge in demand from subsidy = higher price.

Prices are sticky and don't come down if resources increase to meet demand.


Subsidised and micromanaged by the government.
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Mix_Master
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #7 - Jan 10th, 2021 at 6:29pm
 
How cool is that?

Get stung in your kids' early lives for childcare, stung for Private Health Insurance "all the way through" your working life, and then retire and go into a nursing home, where they feed you on $6 a day, and the owners take selfies with their Maseratis.

Good times!
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #8 - Jan 10th, 2021 at 6:35pm
 
The Lakemba family day care services at the centre of the alleged scam have collected more than $27 million in Commonwealth childcare benefits and rebates since 2012.

The New South Wales Opposition says the Government has failed to properly regulate the state's childcare system, after a multi-million-dollar counter-terrorism and fraud investigation into daycare businesses in Sydney's south-west.

https://www.abc.net.au/news/2016-08-14/nsw-opposition-says-child-care-fraud-prov...
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #9 - Jan 10th, 2021 at 6:37pm
 
Single mother is accused of running a 'fake' family day care centre that 'raked in $500,000 in taxpayer subsidies'
https://www.dailymail.co.uk/news/article-8866313/Alleged-family-day-care-scam-ru...
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #10 - Jan 10th, 2021 at 6:41pm
 
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #11 - Jan 10th, 2021 at 7:10pm
 
freediver wrote on Jan 10th, 2021 at 9:36am:
Australian childcare is absurdly expensive, thanks to government intervention, red tape, absurd legal requirements and subsidies. As a result, childcare is turning into an industry dominated by big corporations and small thieves.


You are so right....
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“Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passion, they cannot alter the state of facts and evidence.”
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #12 - Jan 10th, 2021 at 7:30pm
 
Look after your own damned kids and form a relationship with them as a family. You shouldn't outsource this job.

But if you want it all and you want it now, be prepared to pay for it.
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #13 - Jan 10th, 2021 at 8:06pm
 
Setanta wrote on Jan 10th, 2021 at 7:30pm:
Look after your own damned kids and form a relationship with them as a family. You shouldn't outsource this job.

But if you want it all and you want it now, be prepared to pay for it.


Exactly.

If you want kids, stay at home and bring them up yourselves.

No wonder the latest generations are so self absorbed and woke stupid

.
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Re: Childcare Savings Eaten Up As Fees Rise
Reply #14 - Jan 11th, 2021 at 12:16am
 
Setanta wrote on Jan 10th, 2021 at 7:30pm:
Look after your own damned kids and form a relationship with them as a family. You shouldn't outsource this job.

But if you want it all and you want it now, be prepared to pay for it.


There speaks the voice of truth. 

Childcare subsidy is genuine 'welfare', unlike social security.  Different system.... and as freediver said, many a politician's family members, among others, gained massively from the billions spent on it.... a clear case of insider trading and getting your own family in on a fine money maker you are going to be voting on....

Federal ICAC with retrospective powers anyone?
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“Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passion, they cannot alter the state of facts and evidence.”
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