Approximately 800 families in Australia rely on in-home childcare, a little-known publicly funded program designed for children who cannot access mainstream care. However, nearly one in three providers report being at risk of shutting down due to escalating costs, according to a recent survey.
Rising Costs Strain Families and Providers
Rebecca Mohr Bell, a cattle farmer and business owner living 100km south-west of Katherine in the Northern Territory, has depended on in-home childcare since 2018 for her three young children. She employs a full-time live-in educator, but recent cost increases not covered by government subsidies have placed her family under significant financial pressure. Her out-of-pocket expenses after the childcare subsidy have surged over the past two years, driven by rising accommodation and wage costs.
“It’s just going to mean it becomes unaffordable. I just can’t afford to do it or I’ll have to cut the hours for my educator, which is not really feasible either,” Mohr Bell said. “We’re not asking for anything special. We’re just asking to be treated equitably and ensure that our children have got access to the same quality of childcare that children in metropolitan [areas] have.”
Provider Survey Reveals Widespread Risk
A survey conducted by the peak body, the Australian Home Childcare Association (AHCA), found that 31% of providers are now at risk of closure, with over half operating under significant pressure. The survey, which included 23 providers servicing 810 families, indicated that some services fear that after the next wage increase on 1 July, up to 50% of families could withdraw from the program, placing services on a direct path to closure.
The sector has already experienced a reduction in hours of more than 30%, and nearly three-quarters of providers have seen families reduce hours or withdraw entirely. Workers in the in-home care program have been excluded from the federal government’s childcare worker retention program, which grants wage increases of over 15% staged over two years for mainstream childcare workers. This cost is instead being passed on to families, who are either reducing hours or leaving the system.
Vulnerable Families Left Without Options
AHCA president and in-home care provider Nicole Morgan emphasised the critical nature of the program. “The majority of the families we support come from complex medical, child protection, and high-risk backgrounds. These are not families who can transition into mainstream care,” she said. “Services will close. Families will lose care. Educators will exit the workforce. And children – already identified as vulnerable – will be left in increasingly unsafe and unsupported environments.”
Advocates have previously warned the government that the in-home care program is expensive, difficult to access, and carries high administrative burdens on families. Only a quarter of the program’s 3,200 places are currently filled, down from 37% in 2022 and 59% before 2018. A 2024 report by the productivity commission recommended reviewing the hourly rate cap for in-home care, as it does not adequately account for operating costs. In-home care is more expensive than centre-based care due to higher qualification requirements and lower educator-to-child ratios.
Political Pressure Mounts
Greens senator Steph Hodgins-May reported being contacted by families including nurses and doctors working shifts, parents of children with cancer, and families on cattle stations “hours from the nearest childcare centre, who are all at breaking point.” Some have had to unenroll from care because they cannot afford to stay in the system. “All the red tape just to enrol in in-home care means the program is going underused, and even those who get in are being priced out,” she said. “Instead of expanding to offer real choice to those who need it, the sector is fighting for survival.”
Childcare minister Jess Walsh did not commit to increasing funding for the program, stating that families using in-home care are already supported by the childcare subsidy. “I know that in-home care is important to the around 800 families who use it and who, for a range of reasons, can’t participate in centre-based care,” she said.
