Coalition urged to cut delays for struggling parents as childcare fees reintroduced

Nearly a quarter of applications for extra help with childcare fees took more than four weeks to process even before the Covid-19 pandemic unleashed a wave of economic pain in Australia, government data have revealed.

The pre-pandemic delays have fuelled fears that the scheme – which the government has urged families to access after it reintroduced childcare fees this week – will struggle to cope with a surge in families requiring help during the Covid-19 recession.

Labor says it “defies belief” that the scheme, known as the additional childcare subsidy (ACCS), will be able to cope with extra demand and is calling on the government to cut barriers to accessing prompt support.

The education minister, Dan Tehan, has acknowledged parents have suffered financially as a result of the pandemic, but argued “our system copes with that” because “if you get a reduction in hours, the amount of out-of-pocket expenses that you pay comes down, and for those parents in real financial hardship, we have the additional childcare subsidy”.

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In an interview with ABC TV this week, Tehan urged any parents who had lost work or who had seen reduced hours to “get in touch with your provider to see what assistance is there for you”.

But out of the 116,402 applications for ACCS in the 12 months to June 2019, about 23% – or 26,525 – took more than 28 days to process. Services Australia provided the figures in response to a question on notice from a supplementary budget estimates hearing late last year.

The most recent available data from the education department shows that in the December 2019 quarter, 22,710 families accessed support under ACCS.

This figure included only 970 families accessing the ACCS stream that is linked directly to temporary financial hardship. Applicants for this support must show they experienced temporary financial hardship due to an event that happened in the last six months and have a substantially reduced ability to pay childcare fees.

In the same period, a further 6,320 families accessed the ACCS “transition to work” stream – which is based on conditions including that they are receiving an income support payment and are engaged in a recognised work, study or training activity.

Labor’s spokesperson for early childhood education and development, Amanda Rishworth, said the ACCS scheme was “wrapped up in red tape and requires families to brave the Centrelink queues” and ill-suited to the current conditions.

“It defies belief that a program that supported so few families pre-pandemic will be able to cope with the millions of families who are doing it tough right now,” she told Guardian Australia.

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Rishworth called on the government to make the program easier for families to access. “The government likes to brag about cutting red tape. The minister should be making sure that families who need this help get the support they need urgently.”

Goodstart Early Learning – one of Australia’s biggest childcare operators – has warned families worried about the reintroduction of fees that applying for the government’s temporary financial hardship support “can take a while so apply as soon as you can”.

A Goodstart spokesperson told Guardian Australia the group was “very relieved when the government assured us that Centrelink staff have been briefed to process temporary financial hardship in an equitable and consistent way”.

“We’ve been concerned that too many eligible families have too much difficulty assessing the child are safety net and the additional childcare subsidy,” the spokesperson said on Tuesday.

“There is currently a bill before the parliament which, we expect, will further streamline the process for children at risk, but unfortunately it won’t take effect until next year.”

Services Australia said the processing time figures included any time the agency was waiting for families or childcare providers to supply the required information.

When asked on Monday whether he would be prepared to make more funds available for childcare if the reintroduction of fees triggered a big drop in demand, the treasurer, Josh Frydenberg, said the government would “continue to assess the situation”. Frydenberg said the government had also eased the activity test as part of the “transition” back to regular childcare arrangements.