‘Game changer’: Albanese Goverment ‘big’ reforms to childcare subsidies set to help thousands of families

All families will have access to at least three days of subsidised childcare from Monday, regardless of their parents’ occupation, as the Albanese Government’s new reforms come into effect.

The changes, which make all Australian children eligible for three days of childcare per week, will be a “game changer” for Australian families, according to advocates, who say is in important move towards a universal childcare system.

Previously, parents could get higher than the minimum subsidies for a certain number of hours of care each fortnight based on how much they worked or studied. They will no longer be subject to the Coalition’s previous activity test.

Minderoo Foundation communities director Penny Dakin said the evidence had piled up about the importance of exposing children to high-quality early education to give them a solid grounding and set them up well for life.

“It’s huge for all families, but particularly for those families, for kids and families who’ve probably not been in a position to access any early education and care up until now, it’s a game changer,” she told The West Australian.

The policy, established under the Coalition government and called the 3-Day Guarantee, was intended to make sure childcare subsidies were improving workforce participation.

But in reality, it meant that parents trying to get back into the workforce or increase their work hours often couldn’t afford to access the care they needed to do so.

The Government estimates 100,000 families will now be able to access childcare who couldn’t before, and that almost 40,000 parents will be able to return to or increase their hours of work.

Early Childhood Education Minister Jess Walsh said that too many children had been locked out of the system.

“Every child deserves access to quality early learning – no matter their postcode, or what their parents do for work,” she said.

Education Minister Jason Clare wants to shift early education towards the same status as school.

“No one blinks when you say every child has a right to go to school and government has a responsibility to help fund it,” he said.

Prime Minister Anthony Albanese wants his Government to aim to leave a universal childcare system as a legacy policy.

Scrapping the activity test follows moves to address other pressure points in the childcare sector, such as improving workforce retention by lifting wages, including early childhood education among fee-free TAFE courses, and a promised $1 billion fund to build new centres in childcare deserts.

Ms Dakin said people’s experiences trying to access childcare places would likely be mixed because there were still areas without enough supply, but the three-day guarantee should be seen as part of that broader suite of policies.

“I don’t think it’s going to be amazing overnight – nothing is amazing overnight – but I think over time, we’re definitely taking important steps to making access universal and also making that access available to the families who need it most,” she said.

Childcare overtook aged care as the sixth largest pressure on the budget in December’s mid-year update of the Federal Government’s books.

Treasury forecast subsidies would cost $2b more over the next four years than it thought at the time of the pre-election Budget, in part because of higher take-up than estimated.

Treasurer Jim Chalmers said the changes were “an investment in our country’s future and will provide working families with more choice immediately”.

“Whether it’s cheaper childcare, cheaper medicines, or increased payments for students and carers, we are delivering more help for those who need it most from the start of 2026,” he said.

“We promised the Australian people we would deliver on the commitments we took to the election, and that’s exactly what we’re doing.”