Lifestyle

Child care fees set to increase as less eligible for rebate

THE two days a week Kylie Smith's twins spend at daycare are precious.

That's the only time the Rockhampton stay-at-home mum said she could find the time to do housework, groceries and other errands as well as taking a few minutes of quiet time for herself.

But all that could change if child care fees increase in line with government forecasts prepared by the Department of Education.

Sydney newspaper The Sunday Telegraph reported fees were forecast to increase 7% a year on average over the next four years.

The Department of Education figures, presented in Parliament, also showed the increase could see more parents miss out on the 50% Child Care Rebate.

Currently, eligible families can claim up to $7500 a year per child under the Child Care Rebate, which is not means-tested.

By 2017, the Department of Education estimated 114,500 Australian families would hit the rebate limit and be forced to pay full fees.

Ms Smith said her family was like any other, with bills coming in and a mortgage to pay.

She said any increase would force them to reassess their finances, but taking the two-year-old twins out of daycare would be a last resort.

"They love daycare ... and (it's) beneficial for them," Ms Smith said.

"I'd hate for them not to go ... they have to have that stimulation."

While she had considered returning to work, Ms Smith said the increasing cost of full-time child care could rule that option out.

"(An increase) would affect everybody," she said.

"Everything is going up in price and families aren't getting a break."

In a statement released on Sunday, Shadow Early Childhood Minister Kate Ellis said the Government's recent budget update had revealed a "$2.4 billion blow-out in the cost of the child care system", with "higher than expected fees" cited as the major reason.

"Tony Abbott has announced over $1 billion in cuts to child care support, and he still has legislation before the parliament to cut the Child Care Benefit for low and middle income families," Ms Ellis said.

In a statement to The Morning Bulletin, Social Services Minister Scott Morrison said the forecast increases were identical to those under the previous government.

The Child Care and Early Learning summary for the December 2013 quarter confirmed this, showing an average annual increase of 7% from December quarter 2005 to 2013.

"Increased costs are a function of many things including increased regulation in the sector, all of which has to be considered in how we deliver a system which keeps parents in the workforce while at the same time respecting the taxpayers who foot the bill for the rebate and benefit schemes," Mr Morrison said.

Topics:  child care family federal government



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