This option would provide families with either the Child Care Subsidy (CCS) rates as set out in the table below, or the existing baseline CCS rates, depending on the subsidy calculation which is most generous to the family. The revised CCS rates would apply from 1 July 2023 to 30 June 2026, at which point the program would revert to existing policy settings.
Second (or subsequent) children of families with more than one child under six in child care would receive:
| Family income | Current Child Care Subsidy rate (%) | Proposed Child Care Subsidy rate (%) |
|---|---|---|
| Up to $72,466 | 95 | 95 |
| Between $72,467 and $80,000 | ||
| Between $80,001 and $132,466 | ||
| Between $132,467 and $177,466 |
Tapered reduction from 95 to 80. (The percentage goes down by 1% for every $3,000 increase in family income.) |
Tapered reduction from 95 to 80. (The percentage goes down by 1% for every $3,000 increase in family income.) |
| Between $177,467 and $256,756 | 80 | 80 |
| Between $256,757 and $346,756 |
Tapered reduction from 80 to 50. (The percentage goes down by 1% for every $3,000 increase in family income.) |
Tapered reduction from 80 to 50. (The percentage goes down by 1% for every $3,000 increase in family income.) |
| Between $346,757 and $356,756 | 50 | 50 |
| Between $356,757 and $532,000 | 0 |
Tapered reduction from 35 to 0. (The percentage goes down by 1% for every $3,000 increase in family income) |
Other children would receive:
| Family income | Current Child Care Subsidy rate (%) | Proposed Child Care Subsidy rate (%) |
|---|---|---|
| Up to $72,466 | 85 | 90 |
| Between $72,467 and $80,000 |
Tapered reduction from 85 to 90. (The percentage goes down by 1% for every $3,000 increase in family income.) |
90 |
| Between $80,001 and $177,466 |
Tapered reduction from 90 to 0. (The percentage goes down by 0.2% for every $1,000 increase in family income.) |
|
| Between $177,467 and $256,756 | 50 | |
| Between $256,757 and $346,756 |
Tapered reduction from 50 to 20. (The percentage goes down by 1% for every $3,000 increase in family income.) |
|
| Between $346,757 and $356,756 | 20 | |
| Above $356,756 | 0 |
The Productivity Commission would be provided $1 million in 2022-23 to conduct a comprehensive review of the sector with the aim of implementing a universal 90 per cent subsidy for all families and the Australian Competition and Consumer Commission would be tasked with designing a price regulation mechanism to reduce out of pocket costs.