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Australian families will have access to subsidised childcare from July 2023 as the federal government officially lifts its subsidy.

The House of Representatives passed a new childcare law on Wednesday after the Senate agreed to amendments on Tuesday night.

Education Minister Jason Clare says that both families and the economy will benefit from the increased affordability of childcare as parents, especially mothers, will have more opportunity to get back into the workforce.

“Just like we’ve got universal Medicare … just like we’ve got universal superannuation … we need a universal early education system that gives all children the early education that they deserve,” Clare told reporters in Canberra.

“(To) make sure that all Australian children, whether they’re black or white, get the early education that they deserve.”

The estimated cost cut is expected to be one million for families.

“(It’s) good for children, good for parents, good for our economy,” Clare told parliament on Tuesday.


A 90 per cent childcare subsidy will be given to families that earn up to $80,000. The subsidy will decrease every $5,000 by one per cent until the maximum threshold of $350,000 is reached.

Further subsidies will be in place for second children, children under five years of age, and for how many recognised activities a parent does (i.e., unpaid work, study, and training), despite the Greens’ push back on the latter.

Indigenous children will receive 36 hours of subsidies each fortnight.

Childcare centres will also be required to report all subsidies to ensure that the possibility of fraud is reduced, and laws will be independently reviewed a year from the start date.

However, the new subsidies don’t address the current nationwide workforce shortages. Childcare centres are already at capacity, particularly in regional areas where they are far and few between.

Green’s senator Mehreen Faruqi cited an estimate that predicts approximately 9,000 extra carers will be needed to meet the oncoming demand.

The Labor government stated that the subsidies are just the beginning, with Prime Minister Anthony Albanese stating that that they’re aware “there’s more to do”.

“On election night I spoke about the great mission of Labor governments (to) widen further the doors of opportunity for more Australians and that is precisely what this legislation is aimed at doing,” the Prime Minister told parliament.

“There’s more to do, but this is a great start … the Australian people voted for change and today they have it.”

Around 1.2 million families are set to benefit from the measures when they kick into force in June.