Impact of Worker Retention Payment Ending on Fees and Providers

Question

Senator HODGINS-MAY: We've established that the worker retention payment ends on 30 November this year. There is currently no ongoing funding commitment beyond that date. So can the department confirm that, unless further action is taken, the Commonwealth subsidy ceases and responsibility for funding those higher wages will shift to providers? I know that Senator O'Sullivan interrogated some of this, but is that currently- Mr Reed: We've confirmed that, if the worker retention payment does end on 30 November, providers will need to make a decision how they fund either that full wage increase or the amount legislated under the Fair Work Commission decision. It will be ultimately up to the provider how they absorb those costs. But if they are high fees it'll be through increased CCF outlays and increased fees out of pocket. Senator HODGINS-MAY: One of the original apprehensions about signing up for this in the first place was that uncertainty. Just to confirm your answers to Senator O'Sullivan, the department has not undertaken any modelling of the impact on the providers and it hasn't modelled the likely impact on childcare fees; is that correct? Mr Reed: We have modelled the impact of the wage increases through the Fair Work Commission's decision. The higher CCF outlays as a result of those have been modelled and are in the budget papers. I did take on notice whether I can get the assumptions underpinning the increased case outlays because I don't have that with me. We have done some modelling. What I took on notice was whether we've modelled the impact of out-of-pocket costs on families. I'm not certain about that. But we have modelled the impact of the decision and the higher wages on fees. Senator HODGINS-MAY: I'm sure families will be quite keen to see if there is any modelling on fees and out-of-pocket costs. Mr Reed: I'll take that on notice.

Answer

Please see the attached PDF.

Documents

• Question with answer (PDF) (opens in a new tab)
• SQ26-000698.pdf (opens in a new tab)