More than 90,000 Australian parents, including almost 21,000 Victorians, stayed out of the workforce last year because the cost of childcare was too high.
The figures, contained in the Productivity Commission’s latest report on government services, reveal a sharp 21.7 per cent rise in the number of parents and carers in Australia who didn’t work because of the associated childcare costs in 2020, compared with the previous 12 months.
Emily Hovette, 33, with her two-year-old daughter Margaux. Credit:Justin McManus
Victoria was one of the few states that bucked the trend, with the number of adults who stayed out of work due to excessive childcare costs dropping last year to 20,600 from 23,900 in 2019, according to data released on Tuesday.
Even so, cost was listed as the reason 29 per cent of Victorian parents whose children were not in childcare did not make use of these services last year. Victorian childcare costs are the second-highest in Australia.
Frankston South mother Emily Hovette, 33, works full-time and has her two-year-old daughter, Margaux, in care five days a week, with out-of-pocket expenses of $350.
She and her husband, who also works full-time, plan to have a second child and Ms Hovett would like to continue working full-time when they do, even though this will put the family under financial strain.
“It would cost $700 a week, which is a hell of a lot of money and it’s going to be really tough, but we are prepared to do it because there are no other options,” Ms Hovette said.
She said mothers should be supported financially to work rather than being penalised.
“I just think it’s a bit of a broken system personally. I’m trying to work to set up a future for my family and also show my daughter that women can be successful in the workplace.”
Median childcare costs for Victorian families rose to $546 a week last year at an accredited centre, the highest of all Australian states and second only to the ACT, where the median weekly cost was $595.
Nationally, the median cost of 50 hours of childcare at an approved childcare centre was $523 last year, up $20, or 3.95 per cent, a week from 2019.
In Victoria the rise was $17, or 3.21 per cent.
Victoria’s higher costs also translated to lower attendance rates, the report shows.
The proportion of Victorian children aged five and under attending a childcare centre was just below the national average, at 43.6 per cent, compared with 45.1 per cent Australia-wide.
Federal opposition early childhood education spokeswoman Amanda Rishworth said Victorian parents “know childcare costs are out of control”.
“This data confirms that the cost of childcare is prohibiting Australian parents from working the hours they want,” she said.
Labor has already targeted childcare as a federal election issue, promising to scrap the annual subsidy cap for high-earning families and increase the maximum subsidy rate to 90 per cent for families earning up to $80,000 a year.
Education Minister Alan Tudge said families on more than $350,000 would benefit most from Labor’s proposed overhaul. He also said families in Victoria were paying an average $4.12 an hour for childcare.
“The number of people not in the labour force due to caring for children has come down by more than 14 per cent since we first came to office,” Mr Tudge said.
“There are more than 280,000 more children in childcare now than when we came to office.”
Georgie Dent, executive director of advocacy group The Parenthood, said Australia’s childcare costs were the fourth highest in the OECD, while its tax system penalised secondary income earners in a family, usually women.
This caused more children to miss out on early learning, putting them at greater risk of starting school behind their peers.
“Children who don’t attend early education are twice as likely to arrive at school developmentally vulnerable and, at the moment, one in five Australian children arrive at school developmentally vulnerable,” Ms Dent said.
She said this unequal start could have a lifetime impact on learning.
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