Assistance payments are reducing the financial burden of childcare in spite of rising costs, study says.

Assistance payments are reducing the financial burden of childcare in spite of rising costs, study says.

Families are spending less on childcare as a percentage of their household budget than they were almost a decade ago because the increase in government assistance has outstripped price rises, modelling shows.

The figures bolster the case for the Federal Government's expenditure on childcare assistance payments, which will reach a record high of $22.3 billion over the next four years.

Women on low to average incomes are more likely to return to work if given financial assistance with the cost of childcare 

"Helping families is not only fair but makes good economic sense, particularly for those on low incomes," the Treasurer, Wayne Swan, said.

The analysis, by the Department of Employment, Education and Workplace Relations, found women on low to average incomes were more likely to return to work if given financial assistance with the cost of childcare.

Mr Swan said the tripling of the tax-free threshold had also been of particular benefit to "mums picking up some part-time work".

The figures come despite increased attention on the rising annual cost of childcare, which, in some states, is being blamed on the Federal Government's attempt to improve the standard and quality of care.

The department's modelling shows a family on a combined income of about $100,000 spent less on out-of-pocket childcare costs in 2011 than it did in 2004.

Last year, a two-parent family with one child in full-time childcare spent an average of 7.5 per cent of its disposable income on care costs. But in 2004, it was 13.4 per cent.

Despite yearly hikes in the cost of childcare, a family with a combined income of $135,000 spent 8.3 per cent of its income on care for its children last year compared to 10 per cent in 2004. The difference is due to a boost in the childcare rebate from 30 to 50 per cent of out-of-pocket costs, introduced by the Labor government in 2007.