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- The Federal Government fast-forwards an upcoming boost to Child Care Subsidy (CCS) payments by four months for families with two or more kids in daycare
- Families with two or more children under five and in daycare will have their CCS rate bumped up by 30 per cent for their second child and any younger children
- According to the Department of Education, affected families will be able to save over $2200 per year under the increaser support
- Minister for Women’s Economic Security Senator Jane Hume says the support will mean roughly 40,000 parents will be able to work an extra day per week
- The expedited subsidy boost reaffirms a recent notion expressed by larger investment funds that childcare facilities are secure assets
The Federal Government has fast-forwarded an upcoming boost to Child Care Subsidy (CCS) payments by four months for families with two or more kids in daycare.
Under the increased child care support, affected families will be able to save over $2200 per year, according to a media statement from the Department of Education released over the weekend.
Families with two or more children under five and in daycare will have their CCS rate bumped up by 30 per cent for their second child and any younger children, up to a maximum of 95 per cent.
The changes were initially slated to come into effect on July 11, 2022, but this date has been brought forward to March 7, 2022.
According to the Department of Education, more than half of the eligible families will receive the 95 per cent increase to their subsidy.
What’s more, the existing cap on CCS payments of $10,655 will be scrapped from December 10 this year and applied retrospectively for the whole 2022 financial year.
This means any families that have already hit their cap before December 10 will be reimbursed their additional out-of-pocket costs as if the cap was cancelled at the start of the financial year.
Minister for Education and Youth Alan Tudge said the changes to childcare subsidies would ease pressure on working families and encourage more parents to work.
“These changes are good for families and great for the economy, and it’s significant that we are able to deliver them sooner,” Minister Tudge said.
“Removing the cap and increasing subsidies means more parents, particularly mothers, can return to work or take on more hours if they need to.”
He said there are now roughly 280,000 more children in childcare than there were when the Coalition took office, and government support for the sector will top $11 billion a year once the changes come into effect.
Minister for Women’s Economic Security Senator Jane Hume said the support will mean roughly 40,000 parents will be able to work an extra day per week, translating to an economic boost of around $1.5 billion per year.
Attractive security
The expedited subsidy boost reaffirms the notion recently expressed by larger investment funds that childcare facilities are among some of the most secure assets available in a post-COVID world.
A mixture of supply, demand, and government assistance has thrust childcare assets into the spotlight for investment funds, evidenced by a major recent sales campaign for a portfolio of 21 early education assets in Perth and Melbourne marketed by CBRE, Savills and Burgess Rawson.
A Savills Melbourne spokesperson said all 21 properties were under contract, with significant interest across all markets.
He said government funding has played a large role in piquing investor interest for childcare assets, with funds viewing the asset class as secure.
According to data from retail investment firm JLL, sales volumes for childcare assets in 2021 surpassed 2020 levels in less than 10 months.
