Childcare subsidies are seen as one of the big ways governments can support greater gender equality, by helping women return to work when they want to.

But the nature of the current system works as a disincentive for a lot of women as the cost outstrips how much they could earn if they went back to work part-time.

Because of the fact that it's still mostly women who take time off to be the primary carers of their children, childcare subsidies are, understandably, viewed as a social policy designed to help women.

While that may be true, it's important to remember that — just like other government support — childcare subsidies can have a much broader economic impact that experts say should make them a no-brainer funding decision.

Let's start with workforce participation.

More women working = more taxes

At a very basic level, increasing the number of primary carers that can up their hours at work without being penalised means you have more people paying income tax.

That means more money in the federal government's coffers to pump back into the economy by spending on services and infrastructure, or to put toward our pandemic debt.

Alison Kitchen, the national chair of KPMG, who also sits on the Business Council of Australia, pointed out the benefits were beyond just immediate cash boosts.

"The benefits of this greater participation, of course, don't just start during the years when childcare takes place," she said.

"They have a shorter period out of the workforce and seamlessly rejoin … that benefit is for the whole of the rest of parents' careers."

For some, it might seem counterintuitive to look at taxes as a plus, because isn't the government paying for the subsidies? Doesn't the income tax just cancel out the money spent on child care in the first place?

Well, according to modelling done by Treasury, its $1.7 billion increase to subsidies over the next three years will boost the economy by $1.5 billion a year. 

In a nutshell, the return on investment is a good one.

Job creation in childcare centres

While we're on the topic of income tax, a by-product of increasing demand for child care would be that centres would need to, and be able to, hire more staff.

You guessed it, more staff working more hours also equals more tax being paid to the government.

The other benefit is that given it's still a female-dominated industry, the jobs or extra hours being created in child care would likely be filled by women, which is not only important for improving gender equality now but also for women later in their lives (we'll get to that in a moment).

Ms Kitchen also noted thanks to the pandemic and a pause on immigration, Australia was facing a skills shortage across all industries, including childcare.

"We've got this massive pool of women currently at home that tell us that they work part-time and they'd actually like access to more hours," she said.

Increase in disposable incomes

It's also not just the government that gets extra cash when primary carers increase their work hours and aren't being penalised for it.

Currently, families can lose more than 80 per cent — and sometimes all — of their take-home pay to childcare fees.

"At its worst, you can pay more than 100 cents in the dollar for the privilege of working extra hours," Ms Kitchen said.

If that money ends up back in their pockets, there's a greater chance it'll be spent on goods and services or local businesses — another big plus for the economy.

Less pension pressure

Another important economic benefit of the subsidies is a longer-term one and has to do with women and their super.

The superannuation gap between men and women is getting narrower, but women are still retiring with considerably less.

Women In Super estimates that one in three women retire into poverty because of their low superannuation.

Why the gap? Partly it's because of the gender pay gap (which thankfully is also narrowing) but a big reason is that when women take years out of the workforce to look after their children, they lose valuable years of superannuation as well.

So, if you can increase the number of women working more hours, it means they're paying more into their super and are going to be less likely to have to rely on the government pension or other forms of welfare support when they retire.