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Anthony Albanese’s cheaper childcare plan to provide a 90% subsidy by NEXT YEAR

Anthony Albanese is facing calls to make good on his promise to make childcare much cheaper for all Australian families early next year.

In one of his key election promises, the Labor leader promised to review a 90 per cent subsidy for all.

The measure could save a family earning $100,000 about $3,900 for a child in care five days a week.

A family with $175,000 could save about $10,400 a year, and people with higher incomes would save even more.

Labor leader Anthony Albanese visits a childcare center in Kalamunda, which is located in Hasluck, the Coalition's headquarters, on May 16.  Labor won the seat in the election.

Labor leader Anthony Albanese visits a childcare center in Kalamunda, which is located in Hasluck, the Coalition’s headquarters, on May 16. Labor won the seat in the election.

Labor has not set a deadline for the universal subsidy but has pledged to increase subsidies to provide more modest savings by July 2023.

Before the 90 per cent subsidy can be implemented, Labor will order a review by the Productivity Commission and the Australian Competition and Consumer Commission to make sure prices are regulated so providers don’t simply raise their rates.

How much could you save with a 90% child care subsidy?

Family income of $75,000: $1,820

$100,000: $3,900

$120,000: $5,720

$150,000: $8,320

$175,000: $10,400

$400,000: $23,400

Calculations based on pre-subsidy cost of $26,000 a year and comparing current subsidy rate to 90 percent

But Elizabeth Death, chief executive of the Early Learning and Care Council of Australia, believes this can be done quickly and wants the 90 per cent subsidy ready by January 2023.

‘We would love to see that high subsidy rate in place as quickly as possible. We know families need support,” he told Daily Mail Australia on Wednesday.

“We want the government to act quickly because unless services are made cheaper and more affordable for families, we are not really going to offer equal opportunities to all children.

‘We have some kids who can’t access early learning because of the cost.

She added: ‘We know that early learning has a huge impact on children’s well-being and is relied on by parents to participate in the workforce.

“So that’s why we strongly support moving it forward as quickly as possible.”

Ms Death said the Coalition showed it was possible to make changes quickly after Scott Morrison quickly made childcare cheaper for second children during Covid.

“We saw the Morrison government enact their policy very quickly around second and subsequent children, which was a great measure of affordability,” he said.

‘We know that legislative and administrative work has to be done, but now we have a track record that departments can do everything and we can do it in a shorter time frame.

“We would be hopeful that it would start in early 2023,” he said, referring to the universal 90 percent subsidy.

Labor has not set a deadline for the universal subsidy but has pledged to increase subsidies to provide more modest savings by July 2023.

Labor has not set a deadline for the universal subsidy but has pledged to increase subsidies to provide more modest savings by July 2023.

‘The productivity query and the ACCC query – will need to be done very quickly, but must work in the background for this to work.

‘I don’t think that’s impossible.’

Under a 90 percent universal subsidy, a family earning $100,000 would see their subsidy increase from the current 75 percent for the first child.

This would save them $3,900 based on the cost of a child before subsidies of $26,000 a year.

A family earning $178,000 would pay only $2,600 a year instead of $13,000, saving $10,400 a year.

Families earning more than $400,000 and not currently receiving subsidies would save $23,400.

Meanwhile, Labor has pledged increase child care subsidy rates for each family earning less than $530,000, which will cost taxpayers $5.4 billion over four years.

Sarah Mawhinney, Executive Director of the McKell Institute, said: ‘The economic and social benefits of lowering childcare costs cannot be underestimated.

‘Reducing the cost of child care will have a real and immediate impact, alleviating the cost of living pressures many families face.

‘Crucial steps to reduce childcare costs could serve to have the additional impact of increasing female participation in the workforce.

‘Affordable child care will allow women previously excluded from the workforce due to prohibitive child care costs greater flexibility when making decisions about re-entering the workforce after maternity leave.’

This table shows the increase in labor subsidies based on income.  It hopes to incorporate them and also perform a productivity review on a 90 percent universal subsidy.

This table shows the increase in labor subsidies based on income. It hopes to incorporate them and also perform a productivity review on a 90 percent universal subsidy.

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