Recent Victorian and New South Wales government announcements may signal a first step in a profound change to Australia’s early childhood sector.
And it’s been a long time coming. Over the past 30 years there has been a big increase in the use of early learning. There are more parents in the workforce and more children in formal care than ever before.
And our current system is struggling to cope. Access to childcare can depend on where you live.
Low-paid and poor conditions have led to major problems with attracting and retaining the skilled workforce we need to deliver early learning and care services.
The state governments’ promises are significant. They follow the new federal labor government’s promise to introduce universal high-quality childcare.
But a lot of work needs to be done by governments who have made the most of Australia’s early childhood sector.
How does the current system work?
Australia’s Early Childhood Sector is a Single National Quality Framework Under the Best of Thought Systems.
Services funded by the Child Care Subsidy (CCS) are the largest part of the system. These include what is traditionally thought of as “childcare”.
These services use a subsidy-based funding model where providers set their prices and charge parents a fee.
The federal government supports the cost of a subsidy, based on family income and paid directly to the childcare service.
A major part of the NSW and Victorian government announcements are an expansion of preschool programs.
Whereas childcare can be cater for children aged 0 to 5 years, preschool is more focused on the year or two years before school. A range of settings in preschool-structured play-based learning. These include schools, standalone centers and, in addition, center-based day care in childcare services.
By expanding access to preschools, the state governments are offering more and more places for children aged 3 to 5.
Like the school sector, they will use a direct funding model. This is where companies pay a pre-determined amount directly to a center-based enrollment.
The NSW and Victorian government are also focusing on measures that supply-side childcare.
The Victorian government is promoting the establishment of 50 government-operated childcare centers, delivering childcare to non-government providers on the relying of a trend.
NSW will create a fund to support an increase of 47,000 childcare places at non-government providers.
What are the problems with the system?
The current early childhood system has strengths, but not many weaknesses.
The total amount of subsidies provided is large – about A $ 8.5 billion per year. But so is the cost to parents. Estimates-based federal government data suggest that the average child out-of-pocket cost is the first child-centered day care in A $ 5,000 per year.
Access is another big issue. Recent Mitchell Institute research highlights the “childcare deserts” of the problem. These are areas where there are more than three children vying for every available place.
About 35% of Australians live in a childcare desert. And 1.1 million Australians don’t have access to a childcare center at all.
Unlike the school system, governments do not have an obligation to provide childcare. Instead, providers choose where to operate. Price plays a central role in the system’s design, and weak or unstable demand means it can be too risky to operate in certain locations.
Providers can afford to go where they need more and where they can charge more.
Finding the Workforce Enables Increased Supply to Be a Further Challenge The proposed expansion. The sector is experiencing record workforce shortages.
A high-quality workforce is a quality component of a major component. Attracting skilled workers and retaining them is very important.
What’s driving the need for change?
The announcements of Behind the Flurry are long-term demographic shifts. The proportion of children in formal childcare has increased by 75% since 1996. About 66% of three-year-olds were in subsidized service in the July 2021 quarter. Nearly 90% of eligible children were enrolled in a preschool program the year before they started school.
If home is where we start, some form of early learning is where most children will end up.
Making sure that families are supported in a way that meets their needs and matches a child’s stage of development is vitally important.
The early childhood sector is the only part of the response. Meeting the needs of families and children, including reform of parental leave, maternal and child health services, and other wraparound services.
The announcements made by the federal, NSW and Victorian governments set the stage for a reform of the early childhood sector.
Designing a system that delivers affordable, accessible, high-quality early childhood education and care will require a lot more work, and a lot more resources.
This article is part of The Conversation’s Breaking the Cycle series, which is supported by a philanthropic grant from the Paul Ramsay Foundation.
Peter Hurley, Policy Fellow, Mitchell Institute, University of Victoria
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