20 hours free childcare policy saves us just 49 cents per hour

Our daughter has just turned three and is eligible for 20 hours free childcare. We were earning enough hours between us to get the $60.00 In Work Payment. We were previously paying for childcare at provider A and it cost us $2.19 per hour. That's because our daughter had childcare for just 16.5 hours a week and we were getting a child care subsidy through Work and Income due to our low income.

So, now that Miss just-turned-three has just turned three, we can have 20 hours free childcare and we`d save heaps.

Wrong.

Our combined hours have dropped due to my partner taking another job and we are now now under the 30 hours, so we miss out on the In Work Payment, even though our income is the same due to her increased hourly rate in her new job.

So while she is working we thought we`d get Miss just-turned-three into child care for three days a week at provider B. We are starting with 18 hours a week. We have to pay a top up "fee" because the Government is not funding its policy. This top up fee is $1.70 per hour. So we only save 49c per hour by going for 20 hours free. That' hourly saving is less than the increased tax we`re paying on a block of cheese compared with the cheese price last year.

But we can't claim the child care subsidy from WINZ for the top up "fee" we don't have to pay, but we won't get the childcare if we refuse to pay.

Interestingly enough, 49 cents is less than the amount we`d get back as a rebate from IRD for each hour of childcare "donations".

No wonder unemployment is so low.The beauracracy is filling itself up with processors of subsidies - while others process the rebate for the top-ups we can't get subsidies for. Is the 20 hours free just another job machine to save families like ours .49c an hour, while rebating us .56c per hour of childcare at the end of the tax year?