The NSW branch of the Australian Childcare Alliance says parents who work between 16 and 24 hours per week, under the new activity test, could in fact receive less subsidised childcare support under the new system than under the old rebate. “Although many taxpayers may sympathise with the commonwealth that families who earn too much can afford childcare without taxpayer assistance, the new Child Care Subsidy can act as a disincentive for many families who live in high-cost cities like Sydney,” ACA NSW executive officer Chiang Lim said.
“The new subsidy, ironically, can be a somewhat blunt instrument that discourages some parents who live in expensive cities like Sydney to work and earn more, choosing perhaps instead to work less in order to augment their income with the maximum possible government assistance.
“This is putting at risk full workplace participation and not leveraging all available talent and experience.”
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