BY BONNIE LAXTON-BLINKHORN, KINDICARE

JUNE 22, 2022

With the price of everything from iceberg lettuce to electricity going up right now many families are feeling the pinch.  

In an effort to better understand why the cost of childcare is increasing and where your precious pennies are being spent KindiCare spoke to Goodstart’s Head of Advocacy John Cherry. 

Goodstart is Australia’s largest network of early learning providers with 649 centres currently in operation across the country and it is run as a not-for-profit, which means revenue is put right back into the business.     

John Cherry says at Goodstart your childcare fees are used as follows:  

- 68% Employee wages and costs, this is salaries to pay the hardworking and experienced educators who keep Goodstart ship afloat. 

- 19% Rent and property costs, including the ever increasing cost of electricity and water. 

- 5% Centre consumables, all the bits and pieces the services need to keep operating on a daily basis (food, art supplies, loo roll etc.)  

- 6% Other expenses and depreciation, all the other bits and bobs that come up   

- 2% Surplus for reinvestment, money that is invested to keep the business going.  

You’ll notice the Goodstart wages bill is pretty high – the average across all child care providers is around 58%.   

John says that is because Goodstart is a not for profit, so it does not need to pay a profit to its shareholders or owners, and instead invests all fee income back into providing quality early learning. 

“Great educators are crucial to providing quality early learning and Goodstart offers above award wages, and conditions that recognise the crucial role educators play,” he said.  

In addition, John says Goodstart is very mindful of the financial pressures facing families and as an organisation they have managed to keep fee increases below the sector average over the past five years.  

Goodstart also offers extra support to families during times of crisis, such as waiving gap fees for families impacted by the floods in NSW and Queensland earlier this year, and when centres close due to COVID. 

Goodstart families are not billed for public holidays, enjoy multi-day discounts for more days in care and can choose from a range of flexible sessions. 

John said that this year had been the most challenging in Goodstart’s history, with COVID and now influenza pushing up staff absences (and costs) and reducing child attendance rates.  

“COVID and a significant rise in influenza cases this year has seen a significant increase in staff sick leave and we have had to spend more on temporary staff to keep our centres open for families,” he said. 

“At the same time, like many in our sector, we experienced a significant dip in attendances leaving us with a revenue shortfall.” 

John said Goodstart’s fee increase this year was on average less than the current inflation rate of 5.1%.  which means that while you’ll notice the increase, your fees are not going up at the same rate as other things (such as iceberg lettuce!).   

A sector-wide shortage of educators is challenging with vacancies in the early education sector are currently running at twice the pre-pandemic rates.  

“Goodstart is doing everything it can to attract and retain educators in the really difficult market.  

“We offer our educators wage increases pegged at least 4% above award rates as well as increased programming time and paid parental leave,” John said.