CANBERRA - A new report released on Sunday shows unprecedented growth in Australia's child care sector as record numbers of families take advantage of government fee assistance to return to work.

The Child Care in Australia report also confirms that fee increases have remained stable for nearly a decade.

"Child care is booming in Australia," Early Childhood and Child Care Minister Kate Ellis said.

"The report shows record numbers of children and families in record numbers of child care services across the nation. Of course more needs to be done, but this is a testament to Labor efforts over the past six years."

The report finds that more than 1 million children are in child care and more than 726,000 families are using child care.

There are more than 15,000 child care services in Australia and the average child care fee increase across the sector last year was 7.3 percent, lower than the previous year's 7.4 percent.

It also reports that average families with annual income of 75,000 AU dollars ($66,750) spent 8.4 percent of their disposable income on child care in 2012, compared to 13 percent of their income in 2004.

Ellis said not only were more families using child care than ever before, they were using child care on more days of the week for longer hours.

"Nearly half of all 3 to 5 year-olds in Australia are now in child care, up from 43.5 percent six years ago," she said.

Ellis said while the report was encouraging, challenges remained for the sector, particularly relating to availability.

"While there's been strong growth in the number of places, there are still unacceptable shortages in many highly populated centers, particularly Sydney and Melbourne," she said.

"Our government is tackling these shortages on a number of fronts but it will take partnerships between all levels of government and the private sector."