Childcare costs to rise for vulnerable Indigenous families under proposed changes, report says

By Julie Doyle for the ABC.

New modelling shows the Government’s proposed changes to the childcare sector will hurt vulnerable Indigenous families, childcare providers say.

The Government wants to move Indigenous services from their own funding program into the mainstream system — a move Deloitte Access Economics says will reduce families access to subsidised care and drive up costs.

Geraldine Atkinson from the Secretariat of National Aboriginal and Islander Child Care said the move to the mainstream model would not work.

She urged the Senate to amend the package to ensure Indigenous services could keep operating and children stay in the early childhood system.

“Think about the poor, think about Aboriginal communities that are in that category, that have vulnerable children, that do need to access early education and care programs,” she said.

The child care changes are currently before a Senate inquiry, due to report next month.

The so-called Budget Based Funding program (BBF), which provides federal grants for hundreds of Indigenous services across the country, will be abolished in July 2017 as part of the overhaul of child care.

The Deloitte research shows 40 per cent of families using the BBF services would receive fewer hours of subsidised care.

It also shows 54 per cent of families using BBF services would have higher out-of-pocket costs and the biggest impact would be felt by families earning less than $65,000.

Two-thirds of service providers would also receive less government funding.

But Education Minister Simon Birmingham said the Deloitte research did not take into account all the measures featured in the childcare package.

He said that included extra support for disadvantaged or at-risk children through an additional subsidy and more funding for service providers in rural and remote areas.

“While I welcome all consultation and feedback, unfortunately this report looks at only one element of a comprehensive package and ignores the elements specifically designed to address concerns of disadvantage,” he said.

“Budget Based Funding is clearly not working in a fair or transparent way when the current system offers some child care centres $35 per child in support and others get $54,000 per child.”

Co-chair of Federal Parliament’s Early Childhood Friendship Group Liberal backbencher Andrew Laming has also criticised the Deloitte Access Economics modelling.

“The findings are completely inaccurate and bear no resemblance to reality but I appreciate a political point needs to be made.”

Labor’s early childhood spokeswoman Kate Ellis said the modelling confirmed the Opposition’s fears about the impact of the Government’s plan.

“The Government’s child care changes will drive vulnerable Indigenous children out of care and force many services to charge fees for the first time, fees that parents will simply not be able to pay,” she said.

“In every state Indigenous children have a below-average participation rate in early education. If we are going to close the gap we need more places, not higher fees and rules that push children out.”

This post originally appeared on the ABC.