In the four financial years between 2018 and 2022,an average Australian family with two children under three was spending 16 per cent of its net household annual income on centre-based full-time daycare,the report found.
The competition watchdog said this made childcare “less affordable for households than in most other OECD countries”,where the average was 9 per cent,putting Australia 26th out of 32 countries in the Organisation for Economic Co-operation and Development.
But the ACCC findings do not take into account the federal government’s cheaper childcare changes,which came into effect in July and gave hundreds of thousands of families expanded access to subsidies.
Nonetheless,the ACCC found that current policies,including the Child Care Subsidy and the hourly rate cap,were failing to drive down costs.
“The operation of the Child Care Subsidy – and its inherent complexity – can make it very difficult for parents and guardians to accurately estimate their subsidy entitlement. This makes it challenging to accurately compare the out-of-pocket expenses they will face with different services,” the report found.
Among its draft recommendations,the ACCC proposed the activity test that determines the number of hours of subsidised childcare a family is entitled to should be removed or substantially reconfigured as “it may be acting as a barrier to more vulnerable children accessing care and creating a barrier to workforce entry or return for some groups”.