Labor's Plan for Cheaper Child Care

How Families will Benefit

An Albanese Labor Government will reduce the cost of child care and make it easier for mums, children and working families to get ahead.

Labor will:

  • Lift the maximum child care subsidy rate to 90 per cent for families for the first child in care;

  • Increase child care subsidy rates for every family with one child in care earning less than $530,000 in household income;

  • Keep higher child care subsidy rates for the second and additional children in care;

  • Extend the increased subsidy to outside school hours care.

96 per cent of Australian families will be better off under Labor’s child care reforms – 1.26 million families.

We’ll also require the ACCC to design a price regulation mechanism to drive out of pocket costs down for good, and the Productivity Commission will conduct a comprehensive review of the sector with the aim of implementing a universal 90 per cent subsidy for all families.

Labor will also develop and implement a whole of government Early Years Strategy to create a new integrated approach to the early years and develop of program of action.

Labor will invest approximately $5.4 billion to make child care cheaper, starting from July 2023.

How much your family will benefit with Labor’s plan

Labor’s higher subsidy for the first child in care means all families up to $530,000 in household income will be better off. Families with two or more children will continue to receive a higher subsidy rate for second and subsequent children, or the rates above, whichever is higher.

Why do we need this?

The former Liberal Government's child care system completely failed Australian families.

The cost of child care had never been higher than under the Liberals.

Over the last 12 months or so of Liberal Government child care costs soared by 6.5 per cent – almost double the rate of inflation. Fees increased by 41 per cent under Liberal governments.

Child care costs eat into household budgets and put more financial strain on Australian families.

The cost of early learning is a major cost of living issue for working families and it is locking parents out of the workforce. Under Liberal governments almost 73,000 families were locked out of the child care system because it was unaffordable – meaning their children missed out on important early learning and women were not able to work the hours they wanted.

Related policies

Current at June 2022