The Turnbull government's new childcare package has been slammed by Labor which says thousands of families will be worse off under the reforms.
The new childcare package, which comes into effect from July 2, means low income families will be paying more for childcare than they were four years ago, deputy opposition leader Tanya Plibersek told reporters in Sydney on Sunday.
"I was surprised to see the government boasting about their new childcare policy that will take effect in the middle of the year that will see 280,000 families worse off including 88,000 families on the lowest income," she said.
"Childcare costs have gone up almost 20 per cent in the last four years - that means the average family is paying about $2000 a year more than they were four years ago for their childcare."
Education Minister Simon Birmingham insists the coalition's action has helped slow fee growth to 3.9 per cent and says the July reforms will help families even more.
"We're re-targeting subsidies to families earning the least and to families working the most," Mr Birmingham said in a statement on Sunday.
"Our overhaul includes an extra $2.5 billion investment and nearly one million families are set to benefit."