What startup founders with kids need to know about the New Child Care Package

- March 20, 2018 3 MIN READ
new child care package

For all parents trying to start, run or grow their small to medium business or startup, there are several distinct commonalities that unite them all: an infallible work ethic, unwavering dedication and sometimes a sense that there simply isn’t enough time in the day to get things done.

Combined with concerns regarding a consistent cash flow and peaks and troughs in billable work, arranging child care for the little ones can often seem like an insurmountable task, with all things considered.

Parents who are small to medium business owners or running a startup have unique needs and circumstances when it comes to navigating child care, and the current child care system is falling short when it comes to catering for this very important portion of workers.

But come 2 July 2018, the Government is introducing a New Child Care Package that will offer better support to parents who work outside the normal 9-5. This how-to article will help you better understand these changes and what to do to access the new Child Care Subsidy as someone who owns a small t0 medium business or startup.

A brief overview

Families who own and operate their own business or startup need greater support in accessing vital child care services. That’s why on 2 July 2018, the Government are introducing a New Child Care Package that will bring more support to more families across Australia.

Under the New Child Care Package, the current Child Care Rebate and Child Care Benefit will be replaced by a single Child Care Subsidy.

There are three key factors that will determine how much Child Care Subsidy families may receive:

– Your combined family income – how much your family earns will determine the percentage of subsidy you are eligible for.

– Your activity level  – parents must undertake a recognised activity to be eligible for the subsidy, and

– The type of child care service your family uses – the new subsidy will be calculated by an hourly rate cap, which will vary depending on whether you use centre-based care, family day care or outside school hours care.

How to access your Child Care Subsidy as a small to medium business or startup owner:

As noted above, parents must be undertaking a recognised activity to qualify for the new Child Care Subsidy. The more hours of activity you do per fortnight, the more hours of subsidised care you can access per child. However, this can sometimes be difficult to predict, with small-medium business owners often adjusting their schedule to accommodate changes in workflow.

Fortunately, the Child Care Subsidy will be calculated over a three-month period. Families will be able to estimate their level of activity over this time period to work out how many hours of subsidised care they might receive. A good tip for calculating your hours of activity, if you don’t always work predictable hours, is to look at your previous three months of work to see how many hours you worked in total over that period. Even if you forecast your hours incorrectly, you can update your details at any point throughout the year to ensure that your level of subsidy is accurate.

The Child Care Subsidy in practice:

There are also several measures in place as part of the New Child Care Package to help support small-medium business and startup owners in more practical terms. Firstly, the subsidy will be paid directly to your chosen service provider and parents will only be required to pay the difference. This is somewhat of a relief for those concerned with irregular cash flows.

Another great aspect of the New Child Care Package is that workers don’t have to use their subsidised hours on the same day that they work. So if like many small business owners and startup champions you work all hours of the night and on the weekend, you can still count these hours as ‘activity’ to use for subsidised child care during the week.

Also, to help ensure child care services provide flexible and cost-effective child care, the Government will be reducing regulatory requirements including the hours per day and days per week a service must open. This means services will have the flexibility to offer, for example, shorter sessions of care.

Families should head to www.education.gov.au/ChildCare to get an estimate of how much Child Care Subsidy you may be able to receive under the Government’s changes to offer more support for more families. Keep checking in on that website to ensure you know what you need to do to transition to the new system.

Simon Birmingham has served as a Liberal Party Senator for South Australia since May 2007 and in September 2015 was appointed as Minister for Education and Training. He has two young daughters and his family have been part of the child care system.