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Out-of-pocket costs of child care (after subsidies) as a proportion of weekly disposable income, for families with one child in full time centre-based Long Day Care, by gross annual family incomes, NSW, 1999–2006

Out-of-pocket costs of child care (after subsidies) as a proportion of weekly disposable income, for families with two children in full time centre-based Long Day Care, by gross annual family incomes, NSW, 1999–2006

Notes: Disposable income calculations are based on such things as social security rates, Child Care Benefit and taxation parameters. Calculations are modelled on dual income couple families (60:40 income split) with one or two dependent children aged under 5 years. 

Average weekly amount paid assumes full-time (50 hours per week) child care used by each child. 

The Australian Government Census of Child Care Services has been conducted regularly since 1986, with the last three censuses held in 2002, 2004 and 2006.  A sample survey was used for 2003. There was no data collection of any kind in 2005. The estimates collected from sample data will be subject to sampling error, which can affect comparisons between them and the census results.

Sources: Report on Government Services 2008, Steering Committee for the Review of Commonwealth/State Service Provision, Report on Government  Services 2005, Productivity Commission, Canberra; Report on Government Services 2004, AusInfo, Canberra; Report on Government Services 2003, AusInfo, Canberra; Report on Government Services 2002, AusInfo, Canberra; Report on Government Services 2001, AusInfo, Canberra; Report on Government Services 2000, AusInfo, Canberra.

Comment

Benefits appear to have made an impact on the affordability of child care immediately following their introduction in 2000. In 2004 the effect of the benefits seemed to have eroded with child care costs increasing at a rate greater than changes to those benefits. 2004 saw a dramatic increase in the out-of-pocket expense of long day care, and this was true throughout Australia.  However, in 2006, out-of-pocket expenses decreased to below 2000 levels.

Between 2004 and 2006 there was a dramatic reduction in child care expenses of approximately 30%.   The impact of that decrease was felt differentially by families depending on their household income levels.  Out-of-pocket child care expenses are at their lowest since 1999 for all but the lowest income group (<$27,000).  For that group there has been little change since 2002.