Budget 2024 references ECEC wage increases but actual financial commitment deferred

Federal Treasurer Jim Chalmers has handed down the 2024/25 Federal Budget in which he acknowledged a commitment to fund educator wage increases but deferred any decision on the amount of funding to be allocated until after Fair Work Commission processes that are currently ongoing are completed. 

 

“The Government is also getting wages moving again through supporting award wage increases for aged care workers and committing to providing funding towards a wage increase for early childhood education and care workers, with details to be settled following Fair Work Commission processes,” the Budget Overview noted on Page 31. 

 

The Fair Work processes include the annual wage review which is currently ongoing but also the Gender Pay Equity Research exercise currently being undertaken by the Commission which is likely to be a protracted project that takes time to complete. 

 

In light of these developments, and despite progress made in the enterprise bargaining forum between employer and employee representatives, a firm commitment from Government on the details around the funded wage increases have now been deferred for the foreseeable future. 

 

That being said, the commitment to fund educator wage increases is now on the record and has been supported by an investment of $30.0 million over two years in IT and payment services to ensure that payment infrastructure to facilitate funding towards wage increases is in place going forward. 

 

Elsewhere, the Government has followed through on its “prac payment” policy, provided an extension and boost to the existing apprentice subsidy program, increased inclusion support funding materially and a new notable initiative that would see family day care and in home care “gap” fees centrally collected. 

 

The key ECEC relevant highlights from the 2024/25 Federal Budget are as follows:

 

Educator wage related measures:

 

• The Government will invest $30.0 million over two years from 2024–25 in IT and payment services to deliver on its commitment to provide funding towards a wage increase for the Early Childhood Education and Care sector. 

 

Workforce qualification and training related measures:

 

• $427.4 million over four years from 2024–25 to establish a new Commonwealth Prac Payment of $319.5 per week from 1 July 2025 for tertiary students undertaking supervised mandatory placements as part of their studies
• The Government will provide $265.1 million over four years from 2024–25 to adjust previously scheduled Phase Two Incentive System payments to provide further support for apprentices, trainees and their employers in priority occupations from $3,000 to $5,000 and hiring incentives for priority occupation employers from $4,000 to $5,000 for 12 months from 1 July 2024. 

 

Inclusions support related measures:

 

• The Government will provide $98.4 million in 2024–25 to help child care services increase their capacity to support inclusion of children with additional needs, through tailored support and funding to services.

 

First nations related measures:

 

• $110.0 million over four years to accelerate action against the National Agreement on Closing the Gap Priority Reforms in the Education portfolio and extend programs supporting education outcomes.
• $29.1 million over four years to support National Aboriginal and Torres Strait Islander Education Corporation and SNAICC – National Voice for our Children to partner with the Government on matters affecting First Nations children.
• $2.4 million over three years to finalise and implement the First Nations Teacher Strategy to improve the attraction and retention of First Nations teachers.

 

Integrity related measures: 

 

• $84.2 million over four years to the Department of Education to increase audits of providers in the child care sector and manage the centralised collection of child care gap fees in the Family Day Care and In Home Care sectors
• $8.3 million over four years from 2024–25 to Services Australia to upgrade the Child Care Subsidy system to support new compliance measures
• $4.8 million over four years from 2024–25 to the ATO to ensure satisfactory engagement with the Australian tax system regarding fitness and propriety requirements of existing and new child care providers
• $1.3 million over four years from 2024–25 to the Australian Transaction Reports and Analysis Centre to assist the Department of Education in identifying individuals of high, unexplained wealth with connections to the child care sector
• The Government will achieve net savings of $410.7 million over four years through additional activities to strengthen the payment and accuracy of the CCS program

 

Early Years Strategy investment measures: 

 

• The Government will provide $14.3 million over five years from 2024–25 to extend and expand existing community support for parents and caregivers to improve child outcomes in line with the Early Years Strategy.

 

Visit the Budget 2024/25 website to review documents and to read the Treasurer’s address to Parliament click here.