Around 105,000 drought and flood affected families will be exempted from the new child care system’s activity test for 2018-19.
Minister for Education Dan Tehan said removing activity debt from the Child Care Subsidy balancing process would help families affected by the recent floods or drought.
Under the new Child Care Subsidy, families must undertake at least four hours a week of activity, such as working, training, studying or volunteering, to claim 12 hours of subsidised care. The more work, training, studying or volunteering families undertake, the more subsidised hours they can receive, up to a maximum of 50 hours per week.
"Our Government understands that some families affected by flooding or drought are doing it tough and that meeting the activity test requirements at this time is not a priority because they’re dealing with bigger issues," Mr Tehan said.
"The Morrison Government is supporting families in communities impacted by flooding and drought by exempting them from the activity test. We already have a generous child care safety net built in to our reforms to deliver extra support for families who need it most and this exemption takes that even further."
The reconciliation process occurs at the end of the financial year to ensure families received their correct Child Care Subsidy entitlement. If a family undertook more activity or earnt less than they estimated, they may be eligible for a top-up payment. Families that earnt more or undertook less activity than they estimated will be notified of an overpayment, and will need to repay that amount.
The Morrison Government has paid more than $7 billion in subsidies to more than 1.1 million families to support the child care needs of 1.6 million children since the Child Care Subsidy was introduced on 2 July 2018. The exemption is only for the repayment of activity debt and does not cover other debts to the Government, for example where families have earnt more than they declared. Families can find more information about the Child Care Subsidy online at https://www.education.gov.au/early-childhood-and-child-care-0.