Childcare subsidies drop 30% as more parents lose jobs

The number of families receiving childcare subsidies has fallen by 30 per cent as more parents find themselves at home with their children.

The drop in Work and Income childcare subsidies, from 22,353 at the end of June last year to 15,631 on June 30 this year, provides some of the first hard data on the numbers of parents now at home with children because they have lost their jobs or are working at home.

The data is only for a small proportion of the 199,000 children who attended early childhood education (ECE) in June last year — broadly, affecting families with total income below the average wage for one person, currently $1114 a week before tax.

The Work and Income subsidy of up to $265 a week begins to phase out with family income above $800 and disappears when family income hits $1400 with one child, $1600 with two children or $1800 for three.

But the big drop in the subsidies suggests Covid-19 may have hit overall ECE attendance by even more than a 20 per cent fall estimated by the Early Childhood Council last week. Auckland ECE centre owner Darius Singh, who chairs the council, said extended families were taking over childcare especially in the Asian and Pasifika communities. “All it takes is one relative who can stay home now and suddenly they are the centrepiece for all the children in the extended family,” he said.

“We noticed a 30 per cent hit. The [wage] subsidy was a great injection for May and June, but it was always the recovery for the next six to 12 months that was going to be the big job. We are . . . feeling that now.”

He said many parents were also still afraid to send their children back to childcare because of the virus.

But the pattern is mixed, with many centres saying attendance is back to normal.

Auckland Kindergarten Association general manager of education Bram Kukler said kindy enrolments are back to normal on the North Shore but for “the south, parts of central and West Auckland, we have seen a significant reduction”.