Emergency payments for childcare centres as VIC moves to permit-only care

Childcare in Melbourne will be available on a permit-only basis as the Victorian government seeks to further restrict movement under a stage four COVID-19 lockdown across the city.

Victorian Premier Daniel Andrews announced the permit system on Wednesday, saying only essential workers who can attest there is no one in their household who can look after their children will be able to access care.

Reporting 725 new coronavirus cases on Wednesday, Andrews said he could not allow an estimated 250,000 children to move to and from childcare centres every day amid a second wave of coronavirus infections across the state.

“There will be many, many families who will not be able to access childcare as they normally would and that is essential to driving down movement, it is essential to driving down these numbers,” Andrews said.

“If you are a permitted worker, regardless of whether you are working in person or from home, and you attest that there is no one else in your household that can look after your children, you will be able, with that very simple permit, to access childcare.”

The new rules, which will be introduced without a grace period, will amount to a significant reduction in childcare attendance across Melbourne, raising fears childcare centres and kindergartens could struggle to stay open through the stage four lockdown.

The permits will be made available by the Victorian government this afternoon. Andrews has clarified there will be two permits, one for each parent, in which both will be asked to confirm no one in their household is available to look after their children.

There will be penalties upwards of $1,600 for parents who make false statements on these permits, Andrews said, but authorities will not begin fining people “tomorrow morning”.

“I either make these tough calls or we don’t drive these numbers down,” Andrews said.

Emergency payments for childcare centres

The announcement came less than an hour after federal Education Minister Dan Tehan unveiled emergency support measures for Victoria’s childcare sector, with top-up payments made available to businesses and parents given extra allowable absences.

However, there is no guarantee parents won’t be forced to pay fees for keeping their children at home over the next six weeks, as the federal government stops short of re-introducing free childcare for Victorian families.

Melbourne-based childcare centres will receive a 5% top-up payment in addition to the $708 million transition package outlaid for the sector to replace JobKeeper in June.

A larger top-up of between 10% and 25% of the existing transition payment will be given to centres which see their attendance levels reduce below 30% over the next six weeks, in a bid to ensure revenue remains about 80-85% of pre-COVID levels, on average, across the sector.

Tehan said parents will also receive an extra 30 days of allowable absences to ensure they maintain their enrollments if they keep their children at home, but clarified the government will not force centres to waive fees.

These fees amount to the difference between existing federal government subsidies and what centres actually charge.

“Ultimately, the decision to waive the gap fee is up to the provider themselves. But what this package does is incentivise providers to waive the gap fee,” he told reporters.

The top-up funding is not provisional on centres waiving gap fees, but Tehan nevertheless said the federal government was doing “everything we can” to encourage services to waive fees where parents are required to stay at home by the Victorian government.

“All the consultation we’ve had with the sector indicates that the sector is committed to ensuring that services and providers are waiving the gap fee,” Tehan said.

The initial transition payment is valued at 25% of an individual centre’s revenue between February 17 and March 1 — the period before COVID-19 saw industry revenue start to fall earlier this year.

Under the changes announced Wednesday, Melbourne-based centres will see their federal government contributions increase to 30% of that revenue, increasing to 50% for centres which experience a particularly sharp drop off in attendance.

Centres in regional Victoria, which are now subject to a stage three stay-at-home order, will not receive the top-up payments.

Morrison stops short of free childcare

The support falls short of calls from some advocates, including small business ombudsman Kate Carnell, for free childcare to be brought back for parents in Melbourne and across the country.

“Nobody can afford to pay childcare at this point in time. People will withdraw their children, which means these facilities will die,” Carnell tells SmartCompany.

“The reality is there is no choice on this, the approach that was put in place previously needs to be put back in place.”

The federal government stepped in to ensure childcare was free during the first round of stay-at-home restrictions in March, but reinitiated the less expensive Child Care Subsidy (CCS) scheme in July.

That decision has drawn widespread criticism, particularly as childcare workers, which were originally eligible for JobKeeper wage subsidies, where thrown off the scheme in July alongside the introduction of the transition payments.

In Victoria, Andrews said the state’s chief health officer was still examining whether in-home childcare such as babysitting services will be allowed to continue.

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