More help for families:
(2) balancing work and family

Further help for those balancing work and family responsibilities is provided through a new maternity payment, extra child care places and better rewards from work.

Maternity Payment

To help families at the crucial period around the birth of a child, a new Maternity Payment of $3,000 for each new born child will be introduced from July 2004. This will increase to $4,000 in July 2006 and $5,000 in July 2008.

This will be available to all families. It will incorporate the existing Maternity Allowance and the Baby Bonus, with existing recipients of the Baby Bonus maintaining their entitlement.

Extra child care places

An additional 40,000 outside school hours child care places and an extra 4,000 family day care places are provided in the Budget.

Since 1996, the Government has increased child care places in child care centres, family day care and outside school hours care by 266,000 places — an increase of 85 per cent.

Income tests for FTB (A) and FTB (B)

From 1 July 2004, the withdrawal rate between the maximum and base rates of FTB (A) will be reduced from 30 per cent to 20 per cent. This will increase rewards from work for lower and middle income families by reducing effective marginal tax rates. It builds on the earlier reduction in the withdrawal rate from 50 per cent to 30 per cent in The New Tax System.

There will be a reduction in the FTB (B) income test withdrawal rate for the second earner from 30 per cent to 20 per cent. The income threshold will increase to $4,000 a year from $1,825.

This will improve rewards from work for families where a second earner is in part time or casual work, providing additional assistance for women returning to work after having children.