WIMMERA Uniting Care believes the region's lower-income families would benefit from a major overhaul of the childcare and early learning system.
The organisation has backed a draft Productivity Commission report, released yesterday, which suggests families earning less than $60,000 a year could receive a 90 per cent rebate on childcare costs.
Under the report's preferred option, all families with a combined income of less than $160,000 will receive more support for childcare.
Families earning more than $160,000 will pay more, with the wealthiest families to have their subsidy cut from 50 per cent to 30 per cent of the total cost of care.
Wimmera Uniting Care chief executive Barrie Elvish said the recommendations could help lower-income families in the region.
"When you've got any limited available funding for any community service there has to be some equity in payments," he said.
"At the moment a family earning $50,000 gets the same as a family on $150,000.
"Under the recommendations it's a more equitable situation and I certainly support that."
The report recommends the Federal Government commits to funding kindergarten to ensure it remains at 15 hours per week. The State Government has committed to funding 10 hours, but the Federal Government is yet to announce whether it will fund the other five hours after this year.
Mr Elvish said funding 15 hours of kindergarten was commonsense.
"I was very surprised to even hear it was an issue," he said. "A myriad number of researchers have documented the benefit of early childhood education.
"I would be very surprised and quite disappointed if the Federal Government withdrew its 15-hour funding commitment."
Horsham Rural City Council community services director Angela Murphy said it would be disappointing if the Federal Government failed to provide funding.
"Council and the Horsham District Kindergarten Association have spent considerable time renovating our kinder facilities to allow for 15 hours and improve access," she said.
Federal kindergarten funding remains under review.
The Productivity Commission report also recommends childcare subsidies should be simplified into one payment.
Mr Elvish said this would provide parents with more clarity.
"From my experience talking to parents they can get very confused," he said. "Anything that can simplify it is an advantage."
Mr Elvish said an encouraging element of the draft report was a recommendation that families who faced barriers such as location, cultural background or income should receive additional support.
The report also proposes nannies and grandparents receiving government payments to provide childcare if they are qualified.
The commission's final report will be released in October.