Ms King said the planned rolling back of the JobKeeper payment for childcare from the middle of July was a blow to the sector, particularly when much of the country can expect JobKeeper to remain until the end of September.

Visiting the Sebastopol Early Learning Centre on Monday morning, Ms King said subsidy arrangements put in place by the federal government did not work for smaller centres.

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"What normally happens is a government pays a rebate and the parents pay a fee," Ms King said.

"So what's happened is the government has paid a rebate to the childcare centres, but what it's meant is the fees the parents usually pay has not been paid and the centre has missed out on that income.

"The government hasn't given the centre the income it has lost, instead it has said 'you can go and get JobKeeper', presuming that people had lots of money in the bank, but for a smaller centre like this, it doesn't have a big buffer or a lot of money in the bank to be able to do that.

"It's alright if you're a big corporate centre, as you'll be able to cross subsidise from other businesses or across but for this centre and others like it, it hasn't been viable to do it."

Federal education minister Dan Tehan said JobKeeper payments would cease for the sector in July.

Instead, the government will pay childcare services a "transition payment" of 25 per cent of their usual fee revenue.

This payment will be made from July 13 to September 27 as it transitions back to the childcare subsidy system.

Minister Tehan said demand for childcare had risen back to 75 per cent of pre-crisis levels.

Sebastopol Early Learning Centre director Jo Corliss said coronavirus had hit particularly hard, but some relief would come with the new transitional payment which has been announced by the federal government

"A lot of our children are at-risk or vulnerable children which means we get 100 per cent of the daily rate paid from the government, so we're missing out on 50 per cent of that," she said.

"The JobKeeper is not meant for us. We haven't received any JobKeeper at all. We have qualified for the new transitional payment, it's 25 per cent of our usual subsidy which will help in some way, but we will be chasing out tail for the rest of the year."

Ms King said she would be pressuring the federal government to reverse its decision. "The Prime Minister said that JobKeeper will be here until September, the fact that childcare is the first sector to have that promise broken says a fair bit about the way the government has approached this."

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