Early childhood educators say they feel unfairly targeted by government policy changes brought in during the COVID-19 pandemic.
Meanwhile, there are fears children could miss out on services when the sector goes from being fee-free back to the Child Care Subsidy scheme on July 13.
Natalie Colbert, who owns three Canberra childcare services, said the government was meddling too far in private business in a sector that was run predominantly by women.
"We've been treated like an errant, naughty child.
"We were open [during the pandemic], while everyone else was safe at home. We were there hugging snotty children.
"Essential workers are being mistreated so badly by the government."
Mrs Colbert said her centres in Torrens, Majura Park and Kambah were running at a loss since the free childcare package came into effect.
She said smaller centres benefited from the scheme, which gave providers a subsidy of 50 per cent of their usual fee revenue on the condition they didn't charge parents. However, centres with higher enrolments were losing money as operating costs remained steady and fewer staff qualified for the JobKeeper payment.
Mrs Colbert said the Majura Park centre alone lost $90,000 in operational costs. The 50 per cent fee subsidy arrived on time but she's still waiting for $280,000 in JobKeeper payments.
Mrs Colbert welcomed the announcement that centres would soon be able to charge fees but said there were too many strings attached to the transition payment of 25 per cent of fee revenue.
She said it was also incredibly disappointing to lose the JobKeeper payments from July 20.
"This has happened to our sector and it's unprecedented in industrial relations. The government is meddling in private business."
Under the transition scheme, providers must maintain fees at the same rate as the two weeks leading to March 2.
This poses a problem for director of Manuka Childcare Centre Rowena Muir as the centre will not be able to implement the annual fee increase on July 1.
While the centre managed to tread water during the fee-free period, Mrs Muir said staff felt disrespected by the government's handling of early childhood education.
"One thing our team certainly experienced was a feeling of disillusionment and not feeling respected in the sector," she said.
"And now for our educators to be the first ones to lose JobKeeper, it's another disappointment."
She said the Child Care Subsidy system was very complicated and did not reach the most vulnerable people in the community.
The system gives subsidies to families based on their income, but they are also required to meet an activity test to show they are undertaking study, work, jobseeking or volunteer work. The activity test has been relaxed during the transition period, however some of the most vulnerable families will never be able to meet that requirement.
"A one-size-fits-all approach is never going to work. It never has worked and it never will work," Mrs Muir said.
Labor leader Anthony Albanese said going back to the system could lead to the closure of some childcare centres while parents would struggle to pay fees.
"Here [early childhood educators] are being treated with disdain. They are being left behind. And what it will mean as well it will particularly impact on women wanting to return to the workforce as the economy recovers."
Education minister Dan Tehan did not respond to questions but told ABC he was confident the transition arrangements would work.
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