Rebate should be extended to nannies in a bid to help shift workers.
Rebate should be extended to nannies in a bid to help shift workers.

Means-test changes and subsidised nannies recommended

A SINGLE means-tested subsidy to help parents pay for their child-care and allowing subsidies to go to accredited nannies were two key recommendations, released on Friday, to overhaul the childcare system.

After a lengthy inquiry into child-care, the Productivity Commission's report found the $5.7 billion in taxpayer funds spent on subsidies needed to be better targeted and simplified.

It recommended wide-ranging changes to the system, including replacing the current two-payment rebate and subsidies with a single means-tested payment.

The commission recommended the rebate should be extended to nannies in a bid to help shift workers and remote Australians overcome barriers to work.

It also urged removing caps on occasional care and "additional temporary assistance" to child-care services in rural and remote areas to ensure families could still access child-care where "services experience fluctuating populations of children".

The report also recommended that parents had to do at least 24 hours of work, training or study every week to access the new payment.

As the Abbott government considers the findings, and prepares a new "families package" for the May budget, Social Services Minister Scott Morrison said the report showed the "different sets of needs" of families across the nation.

He told ABC Radio the package would focus on making it easier for women to return to work after having children, but he was yet to formally respond to the report.

While the report focussed on recommendations that would reform the system without a massive outlay of more taxpayer funds, social services groups were concerned more funds were still needed.

The Australian Council of Social Services backed the proposal for a single means-tested subsidy, but was worried the commission recommended reducing existing subsidies from 90% to 85%.

ACOSS chief executive Dr Cassandra Goldie said the council opposed the call to limit availability of the payment to those working 24 hours a week, arguing it would hit lower income households more than those on middle or high incomes.