As of 2 July 2018, the government has transitioned from the Child Care Benefit (CCB) and the Child Care Rebate (CCR) to a single Child Care Subsidy (and additional Child Care Subsidy if needed). This new Child Care subsidy will be a single means and activity tested subsidy that will be paid directly to the child care service providers, thereby getting rid of the old multi-payment model.
The new system will have various metrics to determine how much of your child care costs will be subsidised.
A new grading system has also been created to help determine what percentage of fees you are eligible to receive based on your annual income.
The activity test will determine how many hours of child care per fortnight will be subsidised. Subsidies can only be granted to families with both parents working, studying or volunteering for a minimum of 8 hours per fortnight.
Travel time from the child’s child care centre to the parent’s work place is also a factor when it comes to activity time. For instance, if our Narellan Vale daycare centre is a good amount of time away from your workplace (e.g. an hour’s drive away), that will also entitle you to receiving a larger subsidy for your child’s child care.
Subsidies are also subject to an hourly fee cap. Families may only receive a percentage of the following hourly rates:
Any amount above these rates will be paid out of pocket.
Families with an annual income of $185,710 and under will not be subjected to an annual cap on their total yearly subsidy. Any annual income exceeding this will receive a $10,000 cap per year.
An additional subsidy may be granted for disadvantaged families. These include families who have children at risk of abuse or neglect, those experiencing temporary financial hardship and grandparent carers who are on welfare. The Additional Child Care Subsidy subsidies 100% of the actual fee charged (up to a max of 120 percent of the hourly fee cap) with up to 100 hours a fortnight.
It is possible for your payment to change as well as your eligibility for a subsidy. The new Child Care Subsidy aims to make child care more affordable and accessible for all families, so this change will be a good thing! The new streamlined system is not only easier to understand but quicker to implement and benefit from in the long run. It will also be better at providing assistance for low and middle income families.
If you want to know more about your eligibility, you can use this calculator!
Little Zak’s Academy is dedicated to helping you give your child their best start in life. We are committed to working closely with the Australian government so that you can get the most out of your Child Care Subsidy. Find out more about how we can help you by contacting our various child care centres in Sydney.