But a lot of work needs to be done for Australia’s early childhood sector to live up to the promises being made by governments.
How does the current system work?
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 price and charge parents a fee.
The federal government supports the cost through a subsidy, based on family income and paid directly to the childcare service.
A major part of the NSW and Victorian government announcements is an expansion of preschool programs.
Whereas childcare can cater for children aged 0 to 5 years, preschool is more focused on the year or two years before school. Preschool involves structured play-based learning in a range of settings. These include schools, standalone centres and, increasingly, alongside childcare services in centre-based day care.
By expanding access to preschools, the state governments are offering to create more places, particularly for children aged 3 to 5.
Like the school sector, they will use a direct funding model. This is where governments pay a pre-determined amount directly to a centre based on enrolments.
The NSW and Victorian government also announced measures focusing on the supply-side of childcare.
What are the problems with the system?
The current early childhood system has strengths, but many weaknesses too.
The total amount of subsidies provided is large – about A$8.5 billion per year. But so is the cost to parents. suggest the current average out-of-pocket cost for the first child in centre-based day care is A$5,000 per year.
About 35% of Australians live in a childcare desert. And 1.1 million Australians do not have access to a childcare centre at all.
Unlike the school system, governments do not have an obligation to provide access to 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 be encouraged to go where there is more demand and where they can charge more.
What’s driving the need for change?
Behind the flurry of announcements 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 a subsidised service in the . Nearly were enrolled in a preschool program in the year before they started school.
If home is where we start from, some form of early learning is where most children will end up next.
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 announcements made by the federal, NSW and Victorian governments set the scene for the next stage of reform in 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 than what has just been announced.