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The government to increase payments of Family Tax Benefits, abolish the $7500 rebate cap on childcare and increase paid parental leave scheme.
Mosiqi Acharya

8 Feb 2017 - 1:11 PM  UPDATED 8 Mar 2017 - 11:10 AM

The Australian government on Wednesday will introduce a bill into Parliament containing its childcare reforms, changes to paid parental leave and family tax benefits expected to benefit 1 million Australian families.

'What we're proposing is reforms that will make child care more affordable and more available, especially for families on lower incomes,' Prime Minister Malcolm Turnbull told reporters at a childcare centre in Canberra on Wednesday.


Fairfax reports the government plans to combine the current Child Care Benefit and Child Care Rebate into one means-tested payment and abolish the annual $7500 rebate cap.

AFR reports the $7500 annual cap on rebates will be lifted to $10,000 but only for families earning over $185,000. Families under that income level will have more generous rebates.

Prime Minister Malcolm Turnbull said the changes were a "very big social reform".

"What we're proposing - and we're seeking the support of the Senate - is reforms that will make childcare more affordable and more available, especially for families on lower incomes," he said.

Huffington Post wrote the new bill will give a family on $60,000-a-year, access to $15-a-day childcare.

“For these families, their right of subsidy will go up from 76% to 85% support to cost of accessing  high-quality early learning,” Education and Training Minister Simon Birmingham told reporters in Canberra.


The parental leave scheme will be extended from 18 weeks to 20 weeks which will provide an extra two weeks leave to around 100,000 families.

Parents who receive paid parental leave from their employer will be able to top up those payments with government-funded leave to a combined 20 weeks. 


The government has decided against removing Family Tax Benefit B payments for families when their youngest child turns 13. Parents will now be eligible for the payments until their child turns 17.

They have also decided to increase fortnightly payments for those on Family Tax Benefit A by up to a $20 a fortnight per child up to 19 years of age.

However the government will abolish family tax benefit end-of-the-year supplements worth up to $726 a year per child.  This will be phased out by 2018.

The savings from social security payments are worth around $5.5 billion over four years while the childcare changes will cost $1.3 billion.

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