Australia’s parliament is set to consider an extension of taxpayer-funded pay rises for childcare workers, with the government seeking to keep the scheme in place beyond its scheduled expiry in November.
The wage support was introduced in 2024 for about 200,000 early childhood educators after the Fair Work Commission ordered increases across female-dominated industries. The Commonwealth stepped in after concerns that childcare providers would otherwise have to raise fees sharply to cover higher salaries.
Under the proposed legislation, the government would commit a further $3.65 billion to the worker retention payment across the 2026-27 to 2028-29 financial years. The legislation would remain in force until 31 December 2029, allowing grant agreements and associated funding arrangements to continue.
The existing payment is equivalent to a 15 per cent wage increase for eligible early childhood education and care workers. It is currently due to run until 30 November 2026.
The Coalition has questioned the temporary nature of the multibillion-dollar programme, warning that providers could face renewed uncertainty — and families potentially higher childcare costs — when government support eventually ends.
Childcare wage subsidy faces scrutiny
Parliamentary scrutiny is also expected to focus on the conditions attached to the funding. The proposed changes would allow the Education Department to require providers receiving grants to meet child health and safety standards, including the relevant quality area under Australia’s National Quality Standard.
The bill follows criticism from some childcare organisations that the short-term nature of the payment has made it difficult to plan staffing and future wage arrangements. An audit of the programme’s implementation is also being considered by the Australian National Audit Office.
Children will feature prominently in the wider parliamentary agenda, with Communications Minister Anika Wells urging MPs to support amendments to strengthen Australia’s under-16 social media restrictions.
Further legislation is expected to require social media companies to offer users an option to avoid algorithm-driven feeds. The measures form part of a broader digital duty of care package, although Coalition MPs have raised concerns about free speech and the Greens have criticised proposed maximum fines of $100 million as insufficient.
The opposition is also expected to promote plans to criminalise flag-burning, while Angus Taylor has backed an 80 per cent reduction in tobacco excise as a way of reducing illegal imports. He has rejected claims that cheaper legal cigarettes would encourage higher smoking rates.
Labor is likely to press the Coalition to publish Parliamentary Budget Office modelling on the tobacco proposal and to clarify whether it would again support allowing first-home buyers to use superannuation for housing deposits.
Mr Taylor has said he remains open to reviving the policy, which the Coalition took to the 2022 and 2025 elections. Treasurer Jim Chalmers has warned that such proposals put the future of compulsory superannuation and workers’ retirement incomes at risk.
