Parents will have to hope the government and opposition can agree on a new approach to childcare subsidies if they are to get cheaper and more accessible care.
Social Services Minister Scott Morrison and his opposition counterparts will meet next week to discuss Productivity Commission childcare recommendations released on Friday.
He's looking for agreement on what the government should do about childcare costs and how to fund the system.
The commission recommended combining the complex system of payments into a single means-tested subsidy for children whose parents work or study.
It would be paid directly to childcare providers, including approved nannies.
Subsidies would range from 85 per cent of a standard cost for low-income families down to 20 per cent for families on more than $250,000 a year.
But while the commission expects its proposals will encourage people to work more hours, it says government constraints on overall funding mean the changes will only likely lead to an extra 16,400 parents starting work.
The government will reveal a families package, including childcare subsidies, in coming weeks.
"The kitchen table conversation about whether you go back to work, that's the conversation that we need to influence with this package," Mr Morrison said.
That was particularly so for lower income families, many of whom work just to cover childcare fees.
Opposition Leader Bill Shorten promised Labor would be constructive.
"If there are good ideas in the best interests of Australians, it'll get the tick," Mr Shorten said.
"The mums and dads who got the train or drove into work today ... they realise a lot of their pay every hour is going to pay for child care, that's the challenge we want to fix."
The Productivity Commission says families earning under $130,000 should find mainstream care options more affordable than they do now.
However, those with incomes over $160,000 could pay more.
But the commission said if better access to care means high-earning parents can work more they should be better off overall.
Higher earners were concerned about the imposition of means testing, but the commission said there was widespread support for the idea of combining all childcare assistance into one payment.
Now the childcare benefit and some other payments are means tested, but the childcare rebate that covers half the cost of fees up to $7500 is not.
Australian Chamber of Commerce and Industry chief Kate Carnell said the proposed tipping point of $160,000 for family incomes was too high and subsidies should be tapered more sharply.
Parental advocates The Parenthood were worried basing subsidies on benchmark costs rather than actual fees would make it harder for mothers to return to work.
"The reality is, if we're going to see a real difference in workforce participation there needs to be a greater pool of money," director Jo Briskey said.
Childcare workers union United Voice also called for more funding.
WHAT SHOULD BE DONE ABOUT CHILD CARE?
* Combine childcare rebate, childcare benefit, and jobs education and training childcare fee assistance into a single subsidy
* Subsidy would be means-tested, activity-tested, conditional on child immunisation and paid directly to child care service of parents' choice
* Families on $60,000 or less get 85 per cent subsidy. Rate tapers off to 20 per cent for families on $250,000 or more
* Parents must work or study minimum of 24 hours a fortnight
* Subsidies for accredited nannies who meet quality standards
* Simplified working holiday visas to make it easier to employ au pairs for 12 months rather than the current six months
* Extra financial support to rural, regional and remote centres to stay open if child numbers temporarily fall
(Source: Productivity Commission)
