Childcare Review & Strike Require Systemic Solutions: Research Report

As early childhood educators prepare to strike and with Government poised to release terms of reference for a Productivity Commission review into the struggling system, new research has recommended Australia look at successful overseas policy options to deliver affordable, quality Early Childhood Education & Care.

New research has recommended the terms of reference for the federal review include childcare price caps, reduced reliance on subsidised for-profit providers, and targeted salary measures to attract and retain quality staff.

Childcare workers are preparing to strike on September 7 and Minister Jason Clare is expected to announce terms of reference for the Productivity Commission review any day now.

Key Findings:

  • Australian families currently spend 20% of household income on childcare, far more than in most OECD nations.
  • Swedish households spend just 5% of household income on childcare, Norway spends 8%, and Denmark 10%.
  • Australia has the 3rd highest proportion of private childcare providers receiving government subsidies: 77% compared to 13% in Iceland, 17% in Sweden & Denmark.
  • Australia’s pre-primary education enrolment rate for under 4-year-olds lags at 15% compared to 69% across the OECD, 84% in Britain, 87% New Zealand, 91% Denmark, 93% Sweden, 95% Norway

Report recommends:

  • Childcare price caps as a proportion of family income, similar to Nordic countries, should be considered
  • Rebalancing the proportion of private providers who receive subsidies via investment in government and not-for-profit services
  • Targeted salary support similar to Sweden’s ‘Teacher Salary Boost’ to attract and retain staff

“With Childcare workers preparing to strike and the Government committed to review the struggling system, we need to look for new policy solutions from across the OECD to fix the system,” said Andrew Scott, Convenor of the Australia Institute’s Nordic Policy Centre.

“The early childhood education and care workforce is currently in crisis following the former national government’s failure for five years to plan for it.

“Australian families pay more for childcare than most OECD countries, yet we receive a worse service with lower enrolments, poorly paid staff, and a lack of availability.

“Children’s education and care cannot become an essential service like Medicare unless it is now delivered nationally, more on a basis of public need than private profit. We need all credible options on the table for the Government’s forthcoming review.

“Subsidies to for-profit operators evaporate into the wealth of commercial beneficiaries, instead of sufficiently supporting wages and conditions for quality early childhood educators and carers. Australia needs to look at how Nordic countries cap childcare fees and curtail the presence of for-profit providers, so as to keep services affordable for parents.

“A modest portion of new money already announced should be brought forward early to attract the staff we need as the system expands. Sweden’s successful ‘Teacher Salary Boost’ programme can inform how to do this.

“These measures will encourage the other states and territories to join NSW and Victoria in a new national cabinet partnership to invest in achieving greater provision of high-quality, early years learning, for all Australian children.”

The report Securing Children’s Future: Nordic-style investment needed in early years learning is published by Professor Andrew Scott of Deakin University, Convenor of the Australia Institute’s Nordic Policy Centre.

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