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NSW families struggling with Labor’s legacy of skyrocketing child care costs

A growing number of New South Wales families are paying the price for Labor’s legacy of skyrocketing child care costs, with a new report released today (Monday Feb 3) confirming fees rose an average of 50 per cent* during their six years in Government.

Assistant Minister for Education Sussan Ley said today was also the last day NSW families could make a submission to the Productivity Commission’s Inquiry into Child Care and Early Learning.

The Federal Government’s June Quarter 2013 Child Care and Early Learning in Summary report reveals the number of NSW families using child care increased 6 per cent to 246,030 since the June 2012 quarter.

Other key figures from the report relating to NSW for the period include:

  • The number of children in approved day care jumped 7.5 per cent, an increase of 23,630
  • The number of families using out of school hours care increased 12 per cent, bringing the total to 72,390
  • The number of children in family day care and in home care increased 14.5 per cent from 38,140 to 43,670
  • The number of children in long day care increased by 3.8 per cent, an increase of 7,530 bringing the total to 203,230
  • The number of approved child care services increased by 204, an increase of 4 per cent bringing the total to 5,343
  • The number of long day care centres grew 3.1%, compared to family day care services, which grew 23.8%
  • NSW parents claimed a total of about $388 million in child care benefits in June 2013 quarter – $52 million extra than the June 2012 quarter

However Ms Ley said she was concerned child care was becoming unaffordable for NSW families.

“On average, child care now costs over $3000 a year more than it did before Labor came to power and I’m very concerned about the impact this is having on the budgets of New South Wales families,” she said.

“This is particularly worrying given the 24/7 world we now live in is forcing more and more parents to try and find affordable child care options in order to meet the growing demands of their jobs.

“Labor has basically put many New South Wales parents looking to return to work in a lose-lose situation where skyrocketing child care fees mean it’s going to cost them as much as staying at home.

“This report hammers home the importance of our decision to task the Productivity Commission to look at ways to deliver more affordable, accessible and flexible child care for all Australians.

“It’s therefore more important than ever New South Wales have their say on the future of child care before it’s too late.”

Ms Ley said the quarterly report also confirmed long day care (LDC) hourly fees continued to grow an average of about 7 per cent per year under the previous Federal Labor Government.

This takes the total increase in LDC hourly fees since Labor took office in 2007 to 50 per cent*, with the September 2013 quarter (Labor’s final quarter in power) still to come, she said.                       

Ms Ley said the report also found the average number of hours parents used LDC services nationally did not increase at all during the period.

“This suggests that while more parents need child care, they’re only able to use it to cover the bare minimum they can afford, which means fewer opportunities to take on more paid hours at work,” she said.

“It’s becoming clearer Labor’s adhoc attempts at reform have created a messy concoction of red tape and band-aid solutions costing child care services, and ultimately parents, more.”

The figures are the most up-to-date available from the Department of Education and represent the period between 1 April 2013 and 30 June 2013 – while Labor was still in Government.

The report will be available in full at www.education.gov.au on Monday February 3.

In October last year the Coalition tasked the Productivity Commission to undertake a holistic Inquiry into the Child Care and Early Learning sector looking at issues affecting affordability, accessibility, flexibility, women’s participation in the workforce, regional and remote communities and vulnerable children.

Submissions to the PC Inquiry close on Monday February 3. To make a submission, visit: http://www.pc.gov.au/projects/inquiry/childcare. The final PC Inquiry report is expected October 2013.

*Average Cost of Long Day Care (LDC) Hourly Fees:

  • September Quarter 2007 – $5.00
  • June Quarter 2013 – $7.50
  • = $2.50 average increase per hour in almost six years of Labor (50%)
  • x Average of 27.2 hours children spent in LDC per week = $68 extra per week
  • x 48 weeks per year (giving four weeks grace per year)  = $3264 per year