An Australian think tank has called on the Labor government to implement a childcare reform that would see low-income families pay as little as $10 (US$6.60) a day or no fee for the service to fix the current “failing system.”
However, evidence from Canada suggested that such a reform might not bring about the intended results
The study was built upon a report by the Productivity Commission that called for the implementation of a universal childcare system in Australia.
The CPD said the current system, in which families with young children receive a subsidy of up to 90 percent for childcare services, had many significant shortcomings.
These included complex subsidy and funding arrangements, a lack of accessibility for many families experiencing disadvantage, a shortage of educators and services, and high costs for parents and families.
The think tank also pointed out that while Australian families paid some of the highest childcare fees among the OECD (Organisation for Economic Co-operation and Development) countries, 22 percent of Australian children started school with development issues.
In addition, around 126,000 children missed out on early learning due to activity test rules and other reasons.
The activity test is a test that determines the number of subsidised hours of childcare per fortnight that a family can receive based on the number of working hours of the parents.
Meanwhile, Prime Minister Anthony Albanese welcomed the CPD’s study, saying the Labor government had the ambition of delivering universal childcare.
“Universal child care provision, as it is in a range of other countries, is something that is a valued national asset,” he told reporters.
Proposed Reforms
Under its proposal, the CPD recommended that all young children be entitled to at least three days a week of childcare services at low or no fee.For disadvantaged children, the think tank suggested providing them with five days a week of free care.
At the same time, the CPD emphasised the need to replace the childcare subsidy system with a “child-centred” model, which provided direct, base-level funding for all service providers.
The think tank also suggested setting up clear roles and responsibilities between federal and state governments in relation to the new childcare model.
“The Commonwealth takes responsibility for the national entitlement, and states and territories take on the role of system managers–working directly with services on issues such as quality, access and inclusion, and connecting services with other service systems,” the report said.
Other recommendations included providing support for childcare services in small communities and providing incentives and support for employees to maintain a sustainable workforce.
“By adopting these reforms, we can ensure that every child has access to the quality education and care they deserve,” CPD program director Katherine Oborne said.
The CPD did not provide an estimate of how much its proposal would cost Australian taxpayers.
Lessons From Canada
While there is a growing push for a universal childcare system and low-cost childcare in Australia, some education experts have pointed out that such a system may not work as intended and could create serious problems.A major issue with the policy was childcare shortages, as service providers were unable to meet a hike in demand from parents.
It was reported that major Canadian cities, including Vancouver and Ontario, fell short of tens of thousands of daycare spaces.
Rising demand also added a considerable cost burden to many service providers, causing them to be at risk of closing down due to a lack of funding from the government.
Amid the severe childcare shortages, there was a sharp fall in the number of children accessing childcare services.
Data from Statistics Canada showed that the number of children aged zero to five years in childcare across Canada plunged by approximately 118,000 from 2019 to 2023.
