TasCOSS welcomes $1.7 billion investment to increase child care subsidy

On Sunday, treasurer Josh Frydenberg announced the additional funding would be included in the 2021/22 budget. It is aimed at low and middle income families earning $130,000 or less.

TasCOSS chief executive Adrienne Picone said the government's childcare package was a welcome addition to funding for early childhood education and for those families with more than one child in child care.

"The announcement of this policy is a step in the right direction with regards to the reform of early childhood education and quality care," she said.

"We know early childhood education has a positive impact on children's development along with future educational outcomes.

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"Research shows that children who attend early childhood education for at least a year before commencing school are half as likely to have development concerns when they do start school, when compared with children who haven't attended early childhood learning services."

The changes will come into effect on July 1 and will remove the $10,560 cap on the subsidy for households earning above $189,390.

It will also increase the subsidies to cover 95 per cent of costs for families earning less than $110,000 with more than one child in child care.

Mr Frydenberg said the investment was in addition to the $10.3 billion it spent on child care this year.

"These changes strengthen our economy and at the same time provide greater choice to parents who want to work an extra day or two a week," he said.

"This is a targeted and proportionate investment that simultaneously makes child care more affordable, increases workforce participation and boosts the Australian economy by up to $1.5 billion per year."

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