Cost of living eased with Three-Day Guarantee

Fiona Alston

Jan 15, 2026

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For many Australians, the Three Day Guarantee launched this week may pass quietly in the background, particularly for those not directly engaged in the early learning system... But for families raising young children today and participating in early learning, the Albanese Government’s decision to provide three days of subsidised child care each week for all children, is a tangible and long-overdue step toward easing household pressures through cost-of-living relief.

For too long, families have had to juggle strict activity test rules tied to the Child Care Subsidy. With that now gone, it means parents who work part-time, casually, or with continually changing hours can now access three days of subsidised care without the added burden of managing the activity test obligations. The Three Day Guarantee is particularly beneficial for low income and vulnerable families, as it means more children can attend early learning regardless of their parents’ work arrangements, and it improves affordability by reducing out-of-pocket costs through guaranteed subsidised hours.

These important changes follow the Productivity Commission’s inquiry into Early Childhood Education and Care (ECEC) in 2024 which recognised that Australia’s most vulnerable children, developmentally, financially, or physically, need more support.

The Australian Childcare Alliance (ACA) believes in a system where every child, every community, and every educator matters, an early education system where quality early learning is provided to every child and where every effort is made to improve inclusivity.

The ACA advocates for affordable ECEC, with a strong focus on ensuring families and communities who need support the most are prioritised. At a time when public spending is tight, funding should be directed where it will have the greatest gain. Equity must remain the guiding principle in government funding decisions.

Through intentional, play-based learning, early childhood educators help children establish a strong sense of identity, confidence, communication skills and curiosity.

Children’s development in the first five years lays the foundation for lifelong learning, health and wellbeing. For those experiencing disadvantages, such as low family income, insecure housing, disability or trauma, high-quality early learning can help offset the impacts of those challenges.

This is why reforms focused on access, affordability and equity, like the Three Day Guarantee, are critical to improving outcomes and a key to achieving the Albanese’s Government's Universal Child Care commitment.

This year's federal election was fought on policies that would relieve the cost-of-living pressures for Australian households.

The ACA has been involved in extensive consultation through the Productivity Commission inquiry into how to achieve universal early learning, and we continue to support the affordability measures the Productivity Commission handed to the government.

This includes a greater focus on supporting access for children with additional needs, and ensuring that families earning $80,000 or less receive a 100% subsidy up to the hourly rate cap. Without targeted support and without applying an equity lens to system funding, the most vulnerable children risk missing out on the proven lifelong benefits of early education, exacerbating inequality and economic disadvantage.

The ECEC sector has experienced an unprecedented level of reform, scrutiny and policy change throughout 2025 and for many, who choose early childhood education as a profession, with life-long dedication and commitment, it has been a very difficult year. Policies that uphold child safety, provide greater wellbeing outcomes and herald inclusive practices, are welcomed. The Three-Day Guarantee supports families that need help the most and is an integral step that delivers universal access to early learning.

The next logical step in achieving universality would be focusing on the very broken system designed to support children with additional needs. We are committed to working with the Government on resolving the well identified problems in the policies that affect these children.

Paul Mondo is the President of the Australian Childcare Alliance (ACA), the national peak body. Paul has deep sector expertise and a strong commitment to equity, inclusion and quality outcomes, and is a leading advocate for sustainable and accessible early childhood education and care across Australia.

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