The Albanese government's mandated 15% pay rise for early childhood educators marks a big change in the childcare landscape. While this increase recognises the important work of educators, it also presents real challenges for centre owner-operators who are navigating rising costs and tightening margins.

With the final 5% tranche rolling out at the end of 2025, many owners are feeling the pressure. Although the government provides funding based on the number of children attending and hours of care provided, some providers report a concerning gap between what they receive and actual staff wage costs. This shortfall means owner-operators must absorb the difference themselves, placing significant strain on their operations.

The financial impact on your centre

Rising staff costs don't just increase operational expenses; they create immediate cash flow pressure that can affect every aspect of your business.  

Some centres have reported they simply can’t absorb the increases, telling 9 News in December 2025 that they have already reduced staff or adjusted rosters. Others are reworking budgets and delaying non-essential spending.

Higher wages can also affect longer-term plans. Funds that might have gone toward renovations, capacity increases or new sites may instead be redirected to day-to-day expenses.  

Where specialised finance can help

During times of financial pressure, strategic financing solutions can provide the breathing room your business needs.    

Refinancing or consolidating existing facilities may free up working capital, helping you manage day-to-day cash flow without compromising service quality or staffing levels.

Funding is equally important for those still looking to grow. Specialised childcare finance can provide access to capital for purchasing or building new centres without further draining cash flow from your existing operations. This allows you to grow your business while maintaining financial stability across your portfolio.

No matter the goals you have for your childcare centre, the key is to stay on top of your options. Owners who regularly review their loan structures and forward plans are often in a stronger position. And, a broker like Ligo Finance who understands the childcare sector can help you assess what’s available and structure finance that fits your growth and cashflow needs.

Higher wages don’t have to stall your plans. Ligo Finance can help you structure finance to support your childcare centre.