The union representing Tasmanian child care centres has fears over the ongoing employment of workers and viability of centres once the federal government withdraws temporary support after July.
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Education Minister Dan Tehan on Monday announced free child care would cease from July 13 and JobKeeper payments to child care workers would stop from July 20.
He said the government would pay child care services a transition payment of 25 per cent of their fee revenue until September 27.
Centres will be prevented from raising fees until March 1.
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Mr Tehan said the child care services would need to guarantee employment levels to protect staff who will move off the JobKeeper payment.
He said the temporary measures introduced in April were designed to increase demand when the sector was on the brink of collapse.
Mr Tehan said it was now time to deal with increased demand.
United Workers Union early education spokeswoman Helen Gibbons it was uncertain how much of the recent demand for positions in centres would fall away once parents made financial decisions over care arrangements.
"We could well see a spiral of lost enrolments again once parents have to start paying which just creates financial chaos in centres," she said.
Ms Gibbons said early educators had been at the frontline to care for children during the pandemic at considerable personal risk to their health and were now the first workers have JobKeeper removed from them.
She said it was uncertain whether the job guarantee would protect the number of hours worked by child care service employees.
Ms Gibbons said the government had missed an opportunity to reform the child care sector, from variable levels of quality to its expensive access and workers on low wages.
"Early education workers and parents in general were hoping that out of this terrible there was some hope to reinvent what was a messy, confusing system that wasn't really delivering," she said.
Labor's education spokeswoman Michelle O'Byrne said the government's decision would impact women's employment, in part because the sector mainly employed women and because women's employment was regularly dependent on child care arrangements.
She said the federal government needed to conduct a review of the child care sector to ensure it was affordable and accessible.
"If we make (child care) unaffordable for women to go back to work, then we impact on their ability to participate in the workforce," Ms O'Byrne said.
"If we make in unviable for smaller community centres to survive, then we make it impossible for regional employment."
Deputy Premier Jeremy Rockliff said the government had offered rent relief for child care centres on state school sites.
"We don't intend at this stage to offer free child care," he said.
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