Ai Group welcomed the opportunity to provide a written submission to the Productivity Commission’s Early Childhood Education & Care Inquiry.

Our vision is for thriving industries and a prosperous community. High quality, affordable, accessible and fiscally sustainable early childhood education and care (ECEC) is important for childhood development and essential for the economy.

We believe childcare policy should:

• Provide the best possible early learning foundation for children, in order to improve future education, training and skill levels; and
• Maximize participation in the workforce, including participation by women and other primary carers.

Ai Group acknowledges that ECEC reforms arising from the Family Assistance (Cheaper Childcare) Amendment Act 2022 (Cth) will shortly commence in July 2023 (ECEC Reforms). The ECEC Reforms will mean that the maximum Child Care Subsidy (CCS) rate increases to 90% for families earning up to $80,000 and for families earnings over over $80,000 a sliding scale in subsidy rates for every family earning less than $530,000.

While it is intended that the ECEC Reforms address ECEC affordability for households, it is important that consideration of any further change to the CCS, including any consideration that the 90% CCS apply universally, must ensure:

• The need for ECEC to be accessible to households, including through an incremental expansion of the current In-Home Care program;
• A sustainable supply of a skilled and trained ECEC workforce; and
• ECEC affordability for households and ECEC operator viability against potentially large increases to wages and conditions for ECEC workers arising from recent Federal Government amendments to the Fair Work Act 2009 (Cth) (FW Act).