‘FamilyBoost’ up to $75 a week
The Government has confirmed its ‘FamilyBoost’ credit to help pay for early childhood education costs will kick in from July.
Parents will be able to get back a quarter of weekly fees, after the 20 Hours Free and Ministry of Social Development’s Childcare Subsidy are taken into account, up to $75 a week, as promised before the election.
Finance Minister Nicola Willis said the FamilyBoost policy “will make it easier and more worthwhile for families with young children to work by directly assisting them to pay those ECE fees”.
Families earning over $180,000 are not eligible. The rebate would be between $18.75 a week and $75 a week.
“To ensure support goes to families who need it most, the maximum repayment will gradually reduce for families earning more than $140,000,” Willis said.
It will cost $734 million over four years. Of the 100,000 families estimated to be in line for the entitlement, only 21,000 will be entitled to the full payment.
Willis said one of the reasons for that was due to some families not paying up to the level where they would receive the full $75 back.
National originally envisioned parents would be paid back every two weeks.
However, Willis said the system was not set up for that, so the repayments would be every three months. The payments will need to be claimed for every three months.
The rebate will be based on ECE costs per household, rather than per child.
Willis ruled out means testing the first year of Best Start.
Labour’s education spokesperson, Jan Tinetti, said any policy that is a rebate “is making it hard for those families upfront”.
“It’s a shame that we've had to wait so long to see this cost of living support ... But that upfront cost is really, really difficult for families.
“That's why it’s really important that we’re looking more at a universal support to people to help them.”
The previous Labour government’s free 20 hours a week extension to two-year-olds was reversed by the National-led coalition Government at December’s mini-Budget.
The extension was brought in during Budget 2023, estimated by the previous government to save parents up to $133.20 per week from March next year and would have cost $1.2 billion.
In July, Treasury cautioned the Labour government against its $1.2 billion policy, warning of a risk of “significant deadweight cost” and “relatively low value for money” as the increased subsidies were unlikely to be passed fully on to parents.