Where will the Government be heading on early childhood education?

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The due date for submissions to the Productivity Commission’s Inquiry into Childcare and Early Learning has now passed, and the Commission now begins the process of preparing a draft report for the Federal Government. This draft report will be available in early July.

It is worth discussing the likely paths that the Federal Government will take when the Commission delivers its final report at the end of October.

The National Quality Framework (NQF) was a national push to set baseline standards for children’s education and care. It was a Federal Labor initiative but was signed up to, and continues to be implemented by, State and Territory Governments of both sides of politics.

It set significant new standards for qualification requirements, ratios and supporting children’s learning to be phased in between 2012 and 2020.

Despite some showing some limited support during the 2013 election campaign, the Government has generally attacked the quality reforms as being an unnecessary regulatory burden and described centres as drowning “in a sea of red tape”.

The Assistant Minister for Education Sussan Ley has directly linked the implementation of the NQF to a sharp increase in fees for families.

The biggest political issue in the children’s education and care sector is affordability. Between June 2012 and June 2013 there was a 45c rise in the average hourly fee for children’s services in Australia, on top of similar increases in the preceding years.

When in Opposition, the Coalition used the fee increases to consistently attack the Labor Government.

It is clear from the most recent data that the out-of-pocket spend for families remained at a relatively low level of 8-9% of total income across all income brackets, due to Labor’s increase in the Child Care Rebate from 30% to 50%.

But due in part the byzantine nature of the subsidy system and an effective political campaign of negativity from the Opposition, the narrative on runaway fee increases struck a chord with families.

The Coalition has strived to continue that narrative in Government, firmly placing the current issues of affordability onto the Labor Party.

The Government will surely be aware however that this will only work for a short period of time. Politically, this issue will soon be owned solely by them.

The Government has so far resisted committing to any specifics on changes to the childcare sector, stating that they are waiting for the Productivity Commission to provide their final report.

But when it comes, the Government will need to provide a clear and detailed response to the issues facing the sector.

The key funding lever for the Government is the Child Care Benefit and Child Care Rebate subsidies (both introduced by the Howard Government).

They may seem completely unconnected, but recent refusals by the Government to provide industry assistance to Holden and SPC Ardmona may actually provide us with some insight into their thinking on the CCB/CCR subsidy.

The decision to deny assistance packages to those companies has demonstrated that the Government is prepared to make tough decisions on spending taxpayer money to support businesses.

The childcare sector is currently a majority private enterprise, with private operators making over two-thirds of the sector. The rest are run as not-for-profit community services.

The CCB/CCR subsidy essentially acts as indirect industry assistance to the operators of children’s services. Approximately $5 billion a year is spent on that subsidy – a not insignificant amount of money. Is it possible that the Government would consider lowering that amount of subsidy?

This would come at a huge political cost. In the June quarter 2013 over 742,000 families accessed some form of formal childcare.

Having spent their time drawing attention to the affordability issue as a political weapon, the onus is now on the Government to take steps to address it.

To complicate matters, they have instructed the Productivity Commission that any suggestions they put forward must be within “current funding parameters”. This leaves them with only a few options.

Either the CCB/CCR subsidy is lowered, a politically “courageous” decision as Sir Humphrey might put it, or the quality standards currently being implemented by the National Quality Framework are drastically rolled back.

Given the political considerations, the second option is far more likely. Which puts a lot of the Government’s statements in the media into context.

The focus on “over-regulation” and “red tape” in the media since the implementation on the NQF, and its intense focus over recent weeks, can be seen as laying groundwork for a large-scale downgrading of those reforms.

They can be sold not as a cut on quality outcomes for children, but as a cut on red tape.

This would be a disastrous outcome for Australia’s children. Advocates for quality education and care have stressed the importance of taking early learning seriously as in investment in Australia’s future prosperity.

It would be shame indeed if political expediency hampers a once-in-a-generation opportunity for the Productivity Commission Inquiry to recommend sweeping structural reforms to quality and affordability – without choosing one over the other.

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Eva Cox: Fund ECEC directly

Long-time champion for early childhood education and care has written in Women’s Agenda today with her practical approaches to “fixing” the childcare crisis. Well-worth a read.

The Government needs to completely re-jig the funding system so it set up conditions and costs, as happens with nursing homes. They need to control and fund services that are in appropriate locations, places for different age groups and locally appropriate flexible hours of operating. This should also include some levels of fee control, to allow break even or profit levels but not excessive returns. The market model has shown it cannot meet diverse consumer needs under the current system so this industry should be deemed a market failure in need of more government intervention.

My only point of disagreement with Eva would be that her plan doesn’t go far enough. The Early Years needs to be fully integrated in to the education system, entirely free-to-access and entirely funded by Government.

Election 2013 – ECEC

We’re now into week three of the 2013 Election campaign. Early childhood education and care issues have bubbled into  few announcements and press releases, but as usual has not been a key priority for any of the major parties.

Labor has committed to continuing the work of the National Quality Framework reforms, but has not announced any measures to support the sector to meet the unrealistic qualification requirements due to commence in 2014. Labor will also continue to support the pay equity case at Fair Work Australia, and money from the Early Years Quality Fund has already begun to roll out.

The Coalition will instigate a Productivity Commission into childcare affordability. Beyond that, no idea.

The Greens have announced $200 million “expanding and upgrading existing community childcare facilities”. The Greens have also committed to the NQF.

All in all, a disappointment. Politically, we are miles and miles away from where we should be as a sector.

At the moment I’m reading “Children’s Chances: How Countries Can Move from Surviving to Thriving” by Jody Heymann. It’s a great, recently-published and up-to-date analysis of data from almost every country in the world. It looks at a variety of metrics on children’s chances to survive and thrive, and has a couple of great chapters on education.

It highlights to importance of early childhood education on long-term outcomes for children. In Australia, the policy debate is still stubbornly framed around waiting lists, fees and council zoning issues.

As I have been saying despairingly to my colleagues over the last few weeks, the real driver of policies for children in this country is workplace flexibility. Ponder that and become depressed.

Until we can get the conversation back to children, and the potential benefits of investment on the early years, nothing is going to change.

Greens to push for new inquiry into ECEC

Ms Hanson-Young said the government could no longer ignore child care, which is shaping up to become a key election issue.

”The Labor government can’t continue to pretend that nothing needs to be done,” she said. ”The sector needs proper funding reform if it is to lift quality standards and meet the needs of families.”

A national survey of 230 child-care centres conducted by the Greens in January found that fees were increasing while availability was declining in a number of areas.

Rachel Browne, SMH (12/3/2013)

An inquiry into the funding of ECEC could potentially be very positive for the sector and for children. The current funding model is heavily weighted in favour of profiteering private operators and makes raising quality standards very difficult.

But history tells us that the inquiry would likely focus on waiting lists, fees and workforce participation rather than the best interests of children.

Goodstart Early Learning: Government must pay for the reforms they have introduced

Ms Davison’s [Goodstart Early Learning CEO] intervention is significant because Goodstart is a strong supporter of the quality reforms, but she is speaking out to highlight their impact on its operating costs.

She said the debate over the reforms must now be over and the government needs to instead concede that fees will go up and be passed on to parents unless it pays for them as a matter of urgency.

“A full review of the funding model and an increase in levels of funding available to providers and families is the only way to fully realise the benefits that can be achieved through a holistic approach to a child’s education beginning from birth,” she said.

Patricia Karvelas, The Australian (27/2/13)

Fantastic to see Goodstart Early Learning continuing their positive advocacy for children and families with Government. Other not-for-profit providers around Australia should follow their example.

Early childhood education is not just about families

The Opposition Leader Tony Abbott and Shadow Minister for Childcare and Early Childhood Learning Sussan Ley this weekannounced the terms of reference for a Productivity Commission inquiry into Australia’s early education and care sector.

As expected, the focus is entirely on affordability, flexibility and workforce participation. In the two-page document, there is one reference to early learning outcomes for the 992,520 identified children in an early education and care centre.

I’m not exactly sure why the Shadow Minister bothers to have “Early Childhood Learning” in her title, as it is clearly of little or no interest to her or the Coalition.

The Coalition is barking up the same tree that governments (including the current Labor Government) have continued to bark up for the entire history of the sector.

“What is the impact on families? What is the impact on the economy? What is the impact on workforce participation?”

With nearly one million children accessing early education and care, we should ask a seemingly obvious question: what is the impact on children?

The Labor Government has at least put forward a National Quality Agenda to provide a focus of educational outcomes for children. But without addressing the structural problems of the sector, these will struggle to be anything more than token gestures.

Both sides of politics have failed to reach for an early education vision beyond fees, waiting lists and productivity.

The Coalition would roll back regulations at the first opportunity, creating the environment for more disturbing incidents in services, such as a case of alleged torturein Queensland.

The Labor Government failed to take the opportunity presented by the collapse of ABCLearning in 2008 to fundamentally repudiate the for-profit model of providing education and care to young children and take overall responsibility for the sector.

Research from around the world has repeatedly proven the importance of giving children access to quality, play-based learning and educational experiences in the first five years of their life — and not just 15 to 20 hours of preschool a week. Over 90 per cent of a child’s brain is developed in the first five years, before they even set foot in a school. If the Prime Minister is serious in her challenge of placing Australia’s education system being in the world’s top five, early education cannot continue to be ignored.

The Longitudinal Study of Australian Children has also revealed the exponential benefits of early learning in educational and social outcomes in later life. The investment we make in early intervention and equity for all children right at their start of their lives can be repaid many, many times over in their futures.

And yet as a community, we cannot make up our minds about what we want the sector to be.

Early learning advocates have a vision for the sector as a free-to-access, universal model that can be accessed by all children in our community. The possibilities of lifting children out of inequality and vulnerability are limitless.

The other side is those entirely see the sector as just “care”, essentially organised babysitting. This view is one of individualism, that the education and care of children is the responsibility of the child’s parents. In this model, centres can be all-but-unregulated, no qualifications are required and private operators can make as much money as they want.

This is the choice that Australia, as a community, needs to make. It cannot work both ways, but the Labor Government is currently attempting to do both.

Labor speaks of educational outcomes and quality environments for children, but will not undertake the sweeping structural reforms necessary to actually achieve that. Simply adding new requirements on to already strained, underpaid and undervalued early childhood teachers and educators simply will not work.

With the released terms of reference for their planned inquiry, the Coalition is clearly signaling that they have no interest in early education and are purely focused on the short-term economic and political goals.

So much for the nearly one million children in an early education and care service today.

The early childhood education and care sector in Australia is being pulled in two vastly different directions right now, and it cannot continue. A simple choice needs to be made.

Remove all educational requirements from the sector, and just be basic “childcare”. No qualifications required, limited regulation, minimum-wage for the workers and available only to those who can afford the fees.

Or, reform the entire sector so that educational, learning and social outcomes can be effectively set and met. This would require a large investment, but the benefits are far beyond that initial investment. The Government is already committing large amounts of money to the sector, but indirectly (through rebates to families) in a way that gives them no control over where the sector is heading.

Individuals will always complain about their taxes going to things they don’t like, but the community as whole benefits when we support individuals to achieve their potential.

Both sides of politics need to lay their cards on the table. Trying to do both will not work.

But it must address the question that no-one wants to answer in these inquiries. What is in the best interests of the nearly one million children that this will affect?

This article was originally published on the New Matilda website.

Have we learned our ABCs?

This past week marked the fourth anniversary of the appointment of voluntary administrators Ferrier Hodgson to childcare company ABC Learning, after its stunning public collapse in 2008.

With structural changes aiming to improve the quality of early childhood education and care (the National Quality Framework) beginning to roll out this year and a campaign to improve the wages of early childhood educators making news, it’s a timely anniversary.

ABC Learning was at one time the largest publicly traded childcare operator in the world, at its peak worth $4.1 billion.

It was regularly held up as a shining example of the “free-market” approach to providing early education and care. Its more than 1200 centres (including centres in New Zealand) were used as evidence of the success of John Howard’s changes to the sector — removing the subsidy from service operators and channeling it directly to families.

It was, as we now know, all an incredible sham. The business was in financial turmoil and its founder Eddy Groves is still under economic and legal scrutiny.

In 2008 Labor Government was returned to power, and in 2010 would describe the collapse of ABC Learning as “the greatest ever shock the Australian child care market has experienced”. A Department of Education report, “The State of Childcare in Australia”, identified that “unfettered growth in the provision of corporate child care created an unacceptable risk of serious disruption in the market”.

Crikey’s Bernard Keane wrote in 2008 that the collapse of ABC Learning was not just a business failure, but a serious government policy failure. Keane recommended that “Julia Gillard (then minister for education) should be undertaking a fundamental reconsideration of child care support in Australia,” perhaps including a takeover of ABC’s centres. The Labor Government was continuing the lack of long-term strategic thinking about the goals and growth of the sector, despite investing billions of dollars through subsidies.

Lindsay Tanner, then finance minister, quickly dismissed any notion of a government takeover of ABC. This didn’t come as a shock; if the government became involved in the provision of early education and care to that extent they would have had to take responsibility for the systemic and structural problems that are facing the sector, as well as ABC’s debt.

Not a lot has changed in the four years since ABC’s collapse. Although a large private operator hasn’t emerged to take the place of ABC, around 6000 centres are managed by private, for-profit companies, 71 per cent of the centres in Australia.

The 30 per cent direct rebate to families was increased in 2008 to 50 per cent, and government funding to the sector (mostly indirect, through family subsidies) will reach a projected $22.3 billion over the next four years. Accordingly, the number of children now accessing some form of early education and care has jumped to around 1.3 million.

Yet, despite this significant amount of money, the issues facing the sector have only deepened and become more acute. Workforce retention and turnover is reaching endemic levels and presents a looming disaster as qualification requirements become stricter.

Fees are steadily rising to meet new quality requirements and waiting lists have ballooned, particularly for infants.

But the biggest issue still to face the sector and the community is the one that should have been faced four years ago — the incompatibility of private companies, operating in the sector to make a profit, and quality care.

A recent and timely report from Canada, which has a similar early education subsidy model to Australia, has revealed the inherent contradiction of private operators managing centres while being effectively subsidised by government funding.

Not only does it encourage the kind of financial risk that led to the rise and fall of ABCLearning, the report found, but private operators are effectively paid to push for higher profit margins — which means more children in less space, fewer qualifications and lower wages. All of which can have drastic impacts of the quality of children’s learning and safety.

The same pattern can be seen in Australia. With representation from the Australian Childcare Alliance, which claims to “represent the future of Australian childcare,” the private operators are able to employ a lobbyist to the government to directly advocate for less regulation and caution against raising working conditions for educators.

It should be self-evident that the provision of education and care for Australian children is the responsibility of the community and the government, not private operators. This is not only economically obvious — if the private approach was the best approach government subsidies would be unnecessary — but also ethically obvious.

As was presented to the Government in a submission by Price Waterhouse Coopers in 2011, the only sustainable and equitable model that benefits young children and their families is a government funded and managed model that allows for universal access for all children, regardless of their socio-economic situation.

Community organisations, which currently only provide 26 per cent of early education and care, must work together to present a united front on this issue. Private operators have been effective at coming together and presenting a single voice on issues, which is why the media turn to them for quotes and analysis of early education issues.

The government is currently working with the sector to the implement the National Quality Framework package, which will improve the quality of early education and care services, including lower staff-to-child ratios and higher qualification requirements for early childhood educators.

While the private operators warn of cost increases and burdensome regulation, most experts in the sector actually argue that the changes, although welcome, go only a very small way to creating greater learning outcomes for young children. A lot more needs to be done.

The Gillard Government must face up to the issue that is starting it right in the face. The $22.3 billion it is currently using to subsidise private operators would be far better invested in completely overhauling the sector.

Community organisations are the only operators currently able to fully and ethically represent children and families, but a reluctance to engage in advocacy has been a major failure.

That said, Goodstart Early Learning publicly supported early childhood educators’ union United Voice’s “Big Steps” campaign for government-funded professional wage subsidies for early childhood educators. Ironically, Goodstart Early Learning is the not-for-profit consortium that now manages the majority of centres that ABC Learning mismanaged and left out to dry. There’s a lesson there.

This article was originally published on the New Matilda website.

The rush to open as many new centres as possible ignores the issue of who will staff them

Even if a central waitlisting system could alleviate some of the frustration with finding a childcare place, at the end of the day there are just not enough inner-city spots to go around.

This is due to land availability and zoning issues, according to federal Early Childhood and Child Care Minister Kate Ellis.

A spokeswoman for Ms Ellis said the federal government has no limit on the number of childcare spots it will fund with the childcare rebate, so demand is increasing while supply isn’t keeping pace.

“We are trying to rattle the cage a little and get states and territories moving on this issue because unfortunately the ball is in their court on this. Local governments have crazy regulations in place prohibiting new centres opening up rather than encouraging it,” she said.

“The wearying wait for inner-city childcare”, Clarissa Keil (The Age)

Clover Moore urges council to address shortfall in Sydney ECEC provision

Parents, particularly with children under two, are waiting years to find childcare near their home or work. This is not sustainable for parents, for our city or for our economy.

Providing parents with affordable, quality childcare makes economic sense and ultimately benefits everyone. The old saying, it takes a village to bring up a child, has never been more true.

“Time to stop playing around with childcare”, Clover Moore (Herald Sun)