Inadequate childcare relief package leaves MCM early learning centres out in the cold

MCM is facing the possibility of closing its two Early Learning Centres due to a flaw in the design of the Commonwealth Government’s Early Childhood and Care Relief Package, announced last week.

MCM runs two Early Learning Centres, located in Brunswick and Doreen supporting over 350 families. Of those, 33 percent work in essential services including public healthcare and hospitals. MCM also supports a number of vulnerable families including those engaged with child protection and children with disabilities who have high needs. 

While MCM welcomes the intention of the Early Childhood package, with its focus on sustaining childcare centres during the COVID-19 pandemic and providing families with free childcare, it hasn’t adequately considered the impact on diverse not-for-profits like MCM for whom childcare is only one component of the community services it provides.  

Crucial to the design of the package is the assumption that childcare operators can offset a 50 percent loss in childcare revenue, caused by halving the Commonwealth subsidy and suspending family gap payments, through access to a Job Keeper wage subsidy to offset centre wage costs. 

Despite significant drops in turnover at our centres, as a large and diverse NFP MCM cannot meet the threshold test at the entity level of 15 percent turnover drop to access the Job Keeper subsidy. 

As a result, MCM is faced with losses of $1.5 million for the estimated six month COVID-19 period across its two centres.

MCM Chief Executive Officer Vicki Sutton says, “MCM needs the Job Keeper wage subsidy legislation to test the 15% reduction in turnover at our Early Learning portfolio level or we need to be able to access another funding source.   

“MCM has many programs supporting vulnerable Victorians including across homelessness, disability and community palliative care.  

“We cannot use those funding sources to subsidise losses in our childcare centres caused by this funding change and therefore the Job Keeper turnover test at our whole of organisation level isn’t appropriate.

“We are calling for additional funding, or access to Job Keeper, to keep our centres open, so that we can keep our valued staff employed and care for our families through this unprecedented health crisis. 

“If a sustainable solution is not found, the losses we are faced with leave us no choice but to close our two centres.” Ms Sutton said.