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House of Representatives

Family Assistance Legislation Amendment (Jobs for Families Child Care Package) Bill 2016

Explanatory Memorandum

(Circulated by the authority of the Minister for Education and Training, Senator the Hon Simon Birmingham)


The purpose of the Family Assistance Legislation Amendment (Jobs for Families Child Care Package) Bill 2016 (the Bill) is to introduce key aspects of the Jobs for Families Child Care Package, as announced in the 2015 - 16 Budget.

In the 2016 - 17 Budget, it was announced that the commencement of the main amendments in the Bill would be delayed until July 2018.

The Bill will, through the introduction of a new Child Care Subsidy (CCS), and enhancements to the operating requirements of approved child care providers, deliver a simpler, more affordable, more flexible and more accessible child care system for families. The new measures improve access to quality early education and care, support parents as they balance work and family responsibilities, and enable greater engagement with the workforce.

Recognising the needs of vulnerable and disadvantaged families, and the benefits that quality child care and a positive early learning environment can have on children's early development, the Bill also introduces the Additional Child Care Subsidy (ACCS). ACCS will provide improved and targeted support to those families who require it most, such as: families with children at risk of serious abuse or neglect (though "ACCS (child wellbeing)"); families experiencing temporary financial hardship (through "ACCS (temporary financial hardship)"); families on income support transitioning to work (through "ACCS (temporary financial hardship)"); and grandparent carers on income support (through "ACCS (grandparent)").

The Bill comprises four Schedules.

Schedule 1 - Main Amendments

Amendments to the A New Tax System (Family Assistance) Act 1999 will improve the affordability, accessibility and flexibility of child care for families, particularly through:

Establishing eligibility criteria, and the payment calculation process, for a new simpler child care subsidy, the CCS. The CCS will replace the current poorly targeted child care payments (including Child Care Benefit (CCB) and Child Care Rebate (CCR)) with the objective of supporting parents who want to work or work more.
Establishing eligibility for ACCS elements of the Child Care Safety Net which will improve accessibility to child care for disadvantaged or vulnerable families.

Amendments to the A New Tax System (Family Assistance) (Administration) Act 1999 set out further payment and claim rules, as well as rules dealing with: reconciliation of payments following a financial year; debt recovery; compliance powers and other machinery provisions.

Schedule 2 - Consequential amendments

This Schedule contains provisions to ensure that related legislation such as the A New Tax System (Goods and Services Tax) Act 1999, the Fringe Benefits Assessment Act 1986 and the Income Tax Assessment Act 1997 align with the changes to family assistance law through minor consequential amendments.

Schedule 3 - Other amendments

This Schedule contains amendments that commence on Royal Assent (Part 1) or from 1 July 2017 (Part 2). Among other matters, the Schedule enables the Secretary to treat certain new applications for approval as not having been made and to reassess whether existing operators and their services continue to meet conditions of the approval at any time from Royal Assent. Schedule 3 also closes enrolment advance payments and allows for their recovery from 1 July 2017.

Schedule 4 - Application, saving and transitional amendments

This Schedule contains provisions relating to: the cessation of eligibility for CCB and CCR and the transition to the CCS and ACCS payment system; the saving of certain laws in relation to CCB and CCR (to ensure, for example, that debts and reviews can continue to be dealt with); and transitional provisions to enable existing claimants and recipients to be eligible for CCS and for existing approved services to transition to the CCS system from 2 July 2018.


The measures in this Bill form part of the Government's investment of approximately $40 billion in child care support over the forward estimates. This includes more than $3 billion of additional expenditure to support the implementation of the Jobs for Families Child Care Package.

Jobs for Families legislative measure Funding Years
Child Care Subsidy $23.2 billion Over two years from 2018 - 19
Additional Child Care Subsidy $173 million Over two years from 2018 - 19


The Regulation Impact Statement for the Jobs for Families Child Care Package, including measures proposed to be given effect to by this Bill, appears at the end of this Explanatory Memorandum (Attachment A).

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