The Government’s “earn or learn” ethos is expected to be extended to childcare subsidies in the upcoming budget, forcing parents on welfare to show they are working or studying before they get benefits.
Daycare providers say a proposed “activity test” could cost 100,000 lower income families benefits and are urging the Government to guarantee all families can access at least two days subsidised care, regardless of their circumstances.
The Elliott family of Blacktown in western Sydney are one family whose benefits face the chop.
Father Rodney works five hours a week unloading a delivery truck.
However, most of the family’s income comes from welfare, which he and his wife use to support their three children.
Middle child Kellinda, 2, goes to the local childcare centre two days a week, for which the family gets a Government subsidy.
To continue getting it under the activity test, Mr Elliott would need to show he works 24 hours a fortnight, more than twice his current hours.
He said getting his hours to that level would be tough.
“Around this area it is tough for employment,” Mr Elliott said.
“I’ve canvassed areas, handing out resume and stuff like that and still had no jobs.”
Without the subsidy for Kellinda, it is likely Mr Elliott will be forced to pull her out of day care and in turn, that would make it harder for him to look for more work.
“They cut off the rebate, what chance has a parent got of getting 24 hours?” he said.
“If they got to take their kids to job interviews, or take them in to hand in resumes? It’s just a catch 22.”
However that is not how Social Services Minister Scott Morrison sees it.
“We want to encourage families, where they can work, where they’re able to study, where they are able to look for work to do exactly that,” Mr Morrison said.
“And in return for that then we can provide greater access to child care and early learning support.”
Access to child care impacts job prospects
Early Childhood Australia (ECA) estimates 100,000 families could lose benefits because of the change, all of them earning an income of less than $55,000.
The Government said there is no data to support that and accused the childcare sector of jumping to an “extreme” conclusion.
The Productivity Commission, which proposed the activity test in a report last year, also suggested some exemptions, particularly for families which, like the Elliotts, get the parenting payment.
However there would be a trade-off – instead of the current two days subsidised day care, the Federal Government would only offer one.