Providers raise concerns about Federal Government’s ‘free’ Early Childhood and Care Relief Package

Childcare providers in the Narrabri Shire have expressed concerns that they could be financially worse off under the Federal Government’s Early Childhood and Care Relief Package, announced as part its economic response to COVID-19.

On April 2, Prime Minister Scott Morrison announced that about one million families would receive free childcare as part of a $1.6 billion plan that aimed to “deliver hip pocket relief and help the early childhood education and care sector make it through to the other side of this crisis”.

“Under the plan, the Government will pay 50 per cent of the sector’s fee revenue up to the existing hourly rate cap based on a point in time before parents started withdrawing their children in large numbers, but only so long as services remain open and do not charge families for care,” read a statement released by the Prime Minister’s office.

“The funding will apply from April 6 based on the number of children who were in care during the fortnight leading into March 2, whether or not they are attending services,” read the statement.

Mr Morrison said the scheme would ensure essential workers could keep going to work as their children would continue to be provided with care and education.

Education Minister Dan Tehan later clarified that all parents would qualify for the package not just essential workers.

“We want as many people being able to work as we possibly can, and we want them to be able to access childcare as they need,” Mr Tehan told the ABC.

“While this is great news for families and a real relief to family finances the implications for our services are worrying,” said Prue Jamieson, managing director of Nurruby Children’s services in Narrabri and Wee Waa.

“The Government won’t be paying family fees to the service, only 50 per cent of our daily fees based on enrolments in the last two weeks of February.

“For non-profit services like Nurruby we rely on fees to cover staffing and working costs,” said Mrs Jamieson.

“We have applied for the JobKeeper payment, and while this is a huge help it is not enough to cover costs.”

Mrs Jamieson said she is grateful that the Government is looking to help the childcare sector but thinks the relief package is a ‘one-size-fits-all’ approach and she hopes it’s reviewed.

The package was a response to help the struggling sector as many families, especially in city areas, were making the decision to pull their children out of care due to COVID-19.

“What they have been through in Sydney is catastrophic but we still have parents here that are working and willing to pay fees, but we are not allowed to charge or accept fees,” said Mrs Jamieson.

Mrs Jamieson said that if the centre was to ‘opt-out’ of the relief scheme it would not get access to any of the Child Care Subsidy and all families would be expected to pay full fees.

Mrs Jamieson said Nurruby is trying to cut costs and has reduced staffing hours and food services.

“If this ‘free childcare’ continues for any length of time, we will need to look at our hours of operation and what we can offer our community,” said Mrs Jamieson.

“Our focus is to still continue to provide high quality education and care for Narrabri and Wee Waa and to ensure that we have operational services after this is all over,” added Mrs Jamieson.

Owner and director of the privately run childcare service Jungle Babies in Narrabri, Sophee Wilkins is worried about taking a financial hit due to the plan.

“It’s definitely an unfortunate situation to have been put in,” said Mrs Wilkins.

“As a small start-up business that is only three-and-a-half years old there isn’t much profit to start with let alone when the Government decides to take half your weekly income,” said Mrs Wilkins.

“This makes it impossible to pay wages, rent, power, water, rates, phone, insurances and anything else that pops up without trying to gain a bank loan to bridge the current gap.

“And to think this could possibly go on for six months.”

Mrs Wilkins said that initially, concerns about COVID-19 meant some parents weren’t sending their children to care but she said this has been progressively changing every week since April, with more and more children now returning to Jungle Babies.

“This also has meant that staff hours were cut to accommodate less children and obviously less income, but now with the return of these children we will need to restructure rosters again which really isn’t affordable based off half our usual income.”

Member for Barwon Roy Butler has also criticised the package and is worried about the impact it will have on childcare operators as well as family day care providers.

Mr Butler has written to Federal Member for Parkes Mark Coulton about the issue.

“This package helps parents at the expense of childcare operators, the Government needs to step up and help the provider and the parents,” said Mr Butler.

“It is essential for parents that these businesses are viable and still running when the COVID-19 crisis abates.

“The Government’s $1.6 billion COVID-19 childcare package has the potential to decimate family day care providers across the State.

“The package has been advertised by the Federal Government as ‘free childcare’ however, family day care operators and some childcare centres will have to make ends meet with a 50 per cent loss, in some cases that is as little as $6 per hour,” said Mr Butler.

The Courier and Wee Waa News raised the concerns of providers with Federal Member for Parkes Mark Coulton and he said the aim of the free childcare plan was to help both providers and families – “not harm” anyone, and the plan is now under review.

“The Government continues to engage with peak bodies across the childcare sector, as it did in the design of the relief package, to resolve issues as they arise,” said Mr Coulton.

“A review of the package is currently being undertaken and will consider the extent to which the objectives of the package are being achieved and whether policy adjustments are required.

“The Government’s Early Childhood Education and Care Relief Package was introduced because childcare centres were experiencing mass withdrawals which threatened their ability to provide care and continuity of education, particularly to the children of essential workers.”

Mr Coulton said his office had contacted the offices of his colleagues – Minister for Education Dan Tehan and Minister for Regional Education Andrew Gee to ensure “concerns are being considered”.

“I encourage childcare providers in my electorate to apply for exceptional circumstances funding if they have experienced increased demand.

“If a service has more children attending now than it had during the reference period (February 17 to February 28, 2020) it can apply to receive a higher payment from the Government.

“This package complements the Government’s $130 billion JobKeeper Payment scheme, which supports businesses significantly affected by COVID-19 to help keep more Australians in jobs,” said Mr Coulton.

As well as reviewing the scheme, last Friday the Federal Government also announced it had expanded the eligibility for additional supplementary payments for providers not eligible for JobKeeper Payments.