Is $10 a Day Childcare Coming?

Finance
 12 Jun 2024

The Centre for Policy Development has released its Growing Together report, and they’re suggesting super cheap childcare fees (among other things) to improve our early childhood education and care system for everyone.    

BY HEJIRA CONVERY, KINDICARE

JUNE 12, 2024

You might not be too familiar with the Centre for Policy Development (CPD), but if you’re using (or wanting to use) childcare, then their Early Childhood Initiative definitely relates to you! 

For several years, the CPD has been putting a lot of thought into how our early childhood system can be improved to make Australia the best place to be a child and raise a family. 

And because the CPD has a ‘Create-Connect-Convince’ way of doing things, their new Growing Together report is a dynamic document that calls for reform of our early childhood system, and provides a roadmap for our leaders to read with interest.  

The Growing Together report envisages a truly universal early childhood education and care (ECEC) system in Australia – one that’s high-quality, affordable, accessible and equitable for all children and families.  

And while the Australian government shares this vision, there’s definitely work to be done! 

Under our current ECEC system, childcare isn’t something that’s easy for every family to take advantage of; quality varies between different socio-economic areas, the Child Care Subsidy can be tricky to navigate; and educator shortages are impacting the supply and cost of childcare.  

So, what does the CPD propose? 

Well, their Growing Together report contains 10 transformative reforms to enhance the quality, accessibility and affordability of ECEC in this country.  

And although the CPD is calling for several great improvements, including more ECEC workforce support, and investment to set up new childcare services in unserved and underserved areas, the following three reforms are key – and they’re definitely family-friendly: 

For starters, the Growing Together report calls for a legislated entitlement so that every child can access three days of ECEC per week at a low set fee.  

In practice, these three days could be low cost (such as $10 per day) or totally free, and the CPD says a set, per-child fee would be preferable to the Child Care Subsidy because: 

  • The set fee would be affordable.  

Currently, some providers charge above the price cap and there’s a lack of price regulation in Australia, which means that childcare can be very costly, or downright unaffordable. However, a flat rate of $10 or $0 would definitely take cost out of equation.  

  • The set fee would be simple. 

The CPD says, ‘Complex interactions with the tax and transfer system can discourage workforce participation or engagement with ECEC,’ but a single price per child would simplify matters for working families and help with that, “Do I go back for three days or five?” budgetary conundrum. 

  • The set fee would be predictable.  

At the moment, there’s always the chance that a childcare fee increase might affect the family budget, or a wage change could impact a family’s Child Care Subsidy rate, but with a set fee, parents could be sure of their daily fee, no matter where life took them.  

  • The set fee would be fair and inclusive.  

A legislated entitlement to three days of ECEC per week would ensure that every single early learner could have the benefit of great learning programs in their all-important first five years.  
 
It’s well known that 90% of a child’s brain develops in these crucial years, and with around 22% of children currently starting school developmentally vulnerable, access to quality ECEC beforehand is absolutely critical.  

And we're pleased to report that Prime Minister, Anthony Albanese, isn't adverse to the idea of $10-a-day childcare.

He's responded to this suggestion in favourable terms, and says universal childcare would be a 'national asset', just like Medicare and superannuation.   

The Growing Together report also calls for a move to a child-centred funding model.  

Although quality ECEC is child-centred when it comes to early learning programs, this funding model shift would mean that the Child Care Subsidy was replaced with base funding for all ECEC providers, and additional needs and service-based funding to cover specific costs.  

The CPD says the base funding would cover the ‘ordinary, reasonable costs’ of providing high-quality ECEC, based on the age of the children and how many days of ECEC is being provided. 

While the additional funding would cover ‘child-based differences’ (e.g. where children are socially disadvantaged or have a disability) and ‘cost-driven differences' (e.g. higher operating costs in some areas or access to a preschool program).  

The Growing Together report also highlights a need for additional support to ensure that the ECEC system is inclusive and equitable.  

At the moment, around 126,000 children are missing out on ECEC because of ‘complex subsidy arrangements and activity tests,’ and the CPD is calling for more support and funding, based on children’s and families’ needs, to ensure that every child has access to affordable and great-quality ECEC.  

The additional needs-based funding talked about above would help to embed inclusion and equity, but the CPD says system improvements (e.g. extra educators or tailored support for children with higher needs) and access to additional services (e.g. speech therapists or health services) would also do a world of good.  

The Australian government will read the Growing Together report with interest, and there’s definitely a concerted effort to better our current ECEC system.  

The Australian Competition & Consumer Commission has conducted its inquiry into childcare services; the Productivity Commission will hand down its final ECEC inquiry report in a matter of weeks; and the Australian government will consider all their recommendations carefully when deciding what the next steps are when it comes to ECEC reform.  

Back when the Productivity Commission inquiry was announced, the government confirmed that it was, ‘Committed to identifying solutions that will chart the course for universal, affordable early childhood education and care in the great tradition of universal Medicare and universal superannuation,’ and we’re definitely keen to see the calls for reform being translated into action. 

Stay tuned!