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Cheaper childcare could boost economy by $11b a year: Grattan Institute

“A major [political] barrier is the cost to the budget. But our spending on the sector is low by international standards,” Ms Wood said.

“The double dividend is real, in terms of the benefit for children and women’s workforce participation.”

The female workforce participation rate in Australia is above the OECD average, but she said women were more likely to work part-time if they are mothers, with the typical Australian woman with pre-teen children working 2.5 days a week.


Grattan’s report found childcare costs, along with welfare policies and tax settings, currently mean the fourth and fifth day of work in a week often meant little or no extra pay for more work for parents providing the bulk of care. As a result, women who are typically the primary caregivers are more likely to work part-time.

Sydney University associate professor Elizabeth Hill said reduced childcare costs were the “first piece of the puzzle” and the federal government should consider gender as a factor when creating policies to help the economic recovery.

“ECEC [early childhood education and care] can help prevent the long-term implications of this disruption to children’s learning and development outcomes,” Dr Hill said.

“We’ve got a system at the moment that was built in a time of relatively low unemployment and we’ve shifted to a situation of very high unemployment and underemployment and it’s going to be there for a long time.

“The pandemic provides the government with an opportunity to review and reconstruct public funding to deliver long-term participation and productivity benefits that will support the recovery,” she said.

Parent lobby group The Parenthood executive director Georgie Dent warned that without “radical and intentional interventions” women’s progress over the past three decades could be at risk.

“Even before this pandemic, Australian women have been in a precarious situation … and the reason for that is the instability and insecurity of their employment over the course of their lives,” Ms Dent said.

“This is underpinned by our lack of infrastructure like paid parental leave and adequate affordable childcare and workplaces that value workers’ responsibilities outside of the home,” she said. A major federal stimulus program focused on childcare could also help boost the industry, which is female-dominated, providing more jobs.

“We know that in this recession so far women are losing jobs at a higher rate but women’s unpaid responsibilities have also skyrocketed at a faster rate than men’s have.”

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