The 2024-25 Federal Budget has paved the way for positive change and reform in the childcare sector, with a heartfelt focus on building universal education and care. The budget introduces a series of improvements designed to foster a supportive and fulfilling environment for children, families, service providers, and educators to thrive. Key improvements include increasing financial and practical support for educators, enhancing accessibility and inclusivity for all children, and strengthening the Child Care Subsidy. In this blog, we’ll explore what the new Federal Budget means for the childcare sector and how it will benefit our community.
Supporting Careers in Early Childhood Education and Care
Passionate educators are the backbone of any early childhood service! To further support childcare workers, the government has announced a number of changes that promote a fulfilling career in childcare. These include an increase in wages as well as initiatives that support the professional development of those working in the ECEC sector.
In the 2024-25 Federal Budget, the government recognises that award rates have been a limiting factor in attracting and maintaining quality staff. In response to this, award rates for deserving educators have been increased as follows:
- A Certificate III-qualified educator will earn at least $27.14 an hour. This is up from $26.16 last financial year.
- A Diploma-qualified educator will earn at least $32.00 an hour. This is up from $30.84 last financial year.
These increases provide more than just extra pay; they also recognise the hard work of childcare workers everywhere as the social, emotional, and educational building blocks of our future generations.
In addition to this increase in award wages, $650 million will be allocated to workforce qualification and training in the childcare sector over the next four years. This funding will support initiatives that promote a rewarding and successful career in childcare, including:
- A new Commonwealth Prac Payment: The government has extended and boosted the existing Commonwealth Prac Payment. This supports future educators undertaking work placements and reduces any financial-related stress. From 1 July 2025, eligible students will be able to access a payment of $319.50 per week for their hard work and commitment during placement.
- Subsidised and fee-free training: The government will continue to fund courses and training related to the ECEC sector. At TAFE, students can study a Certificate III in Early Childhood Education and Care or a Diploma of Early Childhood Education and Care without paying tuition fees.
- Financial support for trainee educators and their employers: Payments that support ECEC trainees and their employers will be increased from $3,000 to $5,000 for the 2024-25 financial year. Employers can also access an additional $5,000 payment for any hiring needs.
Improving Inclusivity and Accessibility For All
The government has shared its vision of building universal early childhood education and care services for all children. In the past, specific barriers and challenges have prevented some children from accessing quality education and care, including where they live or how much their parents earn. To make childcare more inclusive and accessible in Australia, the following will be a focus for this financial year:
- Boosting inclusion support for service providers: The Inclusion Support Program will receive increased funding to promote inclusion for all children. This program assists childcare services in supporting children with any additional or special needs.
- Supporting better education outcomes for First Nations people: Initiatives targeted towards new policy developments and programs will aim to close the gap for First Nations children, families, and educators.
- Continuing investment in the Early Years Strategy: Nearly $15 million has been allocated to improve learning outcomes for children in line with the current Early Years Strategy.
The above aims to promote inclusivity and accessibility, enabling all children experiencing any disadvantage to access quality education and care throughout Australia.
Strengthening the Child Care Subsidy (CCS)
The government is dedicating nearly $100 million to enhance compliance with the CCS and ensure more accurate payments. New initiatives are on the way to address underperforming services and prevent fraudulent activities related to the CCS. These efforts include more frequent audits of ECEC service providers, centralising the collection of CCS gap fees, fostering collaboration with the Australian Taxation Office, and investigating individuals with significant unexplained wealth connected to the ECEC sector.
The CCS family income thresholds have also increased, which is good news for families! The new thresholds are as follows:
Family income | Subsidy rate |
Up to $83,280 | 90% |
$83,280 to $533,280 | Decreasing from 90% The percentage decreases by 1% for every $5,000 of income a family earns |
$533,280 or more | 0% |
For families with two or more children in ECEC, the government will still offer a subsidy rate of up to 95% for a second child and younger children. Last financial year, you had to earn $138,118 or less as a family to attract the 95% subsidy rate, but for the 2024-25 financial year, this income threshold will rise to $141,321.
These increased thresholds make a real difference to the out-of-pocket fees families pay – you can earn a little bit more and still access a high subsidy rate. If you would like an estimate of how much CCS you can expect to receive, check out our Child Care Subsidy Calculator.
The government’s plan to enhance the quality of education and care for all supports the future of Australian children and the dedicated people who nurture them. By supporting careers in childcare, improving accessibility, promoting inclusivity, and strengthening the CCS, the ECEC sector is supported to work towards a better future for Australian children. Reggio Emilia Early Learning Centres welcome these investments, and we hope that our families, children, and team will experience the benefits of this extra support very soon! To learn more, reach out to us on 02 9891 2222 or via email at mail@reggioemilia.com.au.