Australian Childcare Alliance calls for long-term certainty for wages funding for the early learning sector

The Australian Childcare Alliance (ACA) is concerned about the lack of certainty regarding wage funding for the early learning workforce in the Federal Government’s 2026–27 Budget. The absence of any funding commitment raises serious concerns about workforce stability across the sector.

As the peak body for early learning (childcare) services, whose educators support more than 360,000 families across Australia, ACA has consistently advocated for government support to attract and retain educators amid ongoing workforce shortages.

ACA President Paul Mondo said that the current Worker Retention Payment (WRP), which is due to conclude on the 30th of November 2026 and of the government-funded wage in this year’s budget, means the sector faces ongoing uncertainty amid a cost-of-living crisis.  

The workforce and families desperately need to be able to plan for the realities of what comes next. The WRP is essential to supporting the Early Childhood Education and Care workforce and their services to continue delivering high-quality outcomes for children

“We recognise the significant investment the Federal Government has made since the commencement of the WRP in December 2024. However, with the current program set to end in less than six months, we need a firm answer from the government on any extension. Or alternatively, if the decision is to conclude funding at this time,” Mr Mondo said

With changes to the Children’s Services Award, determined by the Fair Work Commission as a result of the gender-based undervaluation decision, award rates will increase by 10 per cent by July 2026; however, this falls short of the current 15 per cent funded as part of the WRP. The gender-based undervaluation decision will meet the 15 per cent threshold on 30 June 2027.

“The next six months are critically important to ensure the stability of our workforce in implementing the substantial regulatory reform aimed at improving child safety outcomes. In addition, with the current multi-employer agreement for the early learning sector due to end on 30 November 2026, government funding will be critical to ensure its re-negotiation can proceed smoothly,” he said.

“Service viability is a real concern for many services across the country, as evidenced by the closure of 40 G8 services. The reasons for closures are complex, but this reflects the challenging environment many providers face, including fluctuating occupancy levels, workforce pressures, shifting family demand and rising operating costs.” 

“Whilst the WRP has been broadly successful, it is clear that in some cases, the conditions of funding have impacted service viability. Future funding does not necessarily mean an extension of the current arrangements, but should any funding be made available, we urge the government to ensure the settings are sustainable for services, support educators effectively, and deliver certainty for families.”

“Certainty beyond the immediate funding period will be critical to giving providers the confidence they need to plan, invest in their workforce and continue delivering for their communities,” Mr Mondo said.

The ACA will continue to review the full budget papers in the coming days and engage with the government on the impact of other budget commitments and on broader sector priorities.

“The ACA welcomes a slight increase in funding for the Inclusion Support Program (ISP) but urges the government to work with the sector on recalibrating the settings for the program to ensure they work efficiently for children, families services and the workforce providing the additional support. True inclusion requires a funding program that works together with children and services, not against it” Mr Mondo said.

“Our shared focus remains ensuring every child in Australia has access to high-quality, affordable early learning and the best start in life.”