Reforms blamed for childcare fees hike

A government-led transformation of early-education care is behind a sharp increase in childcare fees for Illawarra families in recent years.

Illawarra childcare providers are among thousands nationally who have adjusted their fees to compensate for government reforms, which call for increased staff-to-children ratios and a greater emphasis on staff qualifications.

Yesterday, the Productivity Commission's 2014 report on government services revealed that childcare costs had risen at almost double the rate of inflation over the past year, with parents now forking out an average $364 a week.

This is a direct result of national reforms implemented by the government two years ago, according to Bill Feld, chief executive of Illawarra non-profit childcare organisation Big Fat Smile.

"A fact that isn't well known within the community is that major regulatory reform has occurred in early education care over the last couple of years," he said.

"National regulations were brought into place to deliver a nationally consistent standard for delivery of care and ... the staffing of centres, particularly the numbers of staff and the qualification levels of staff."

Two years ago providers required one carer for every five infants. Under new reforms, it's one carer for four infants, reflecting a 20 per cent increase in staffing costs.

There are also provisions for mandating how much staff time must be filled by degree-qualified teachers.

"It's these things in combination - the additional staff numbers and the increasing obligation for staff qualifications - that are creating cost pressure for providers and are directly reflected in the above-CPI increases over the last couple of years in the price of care," Mr Feld said.

More than 1000 children attend the 20 Big Fat Smile long day care centres in the greater Illawarra region.

The Productivity Commission report revealed the median cost of centre-based long daycare jumped 5 per cent to $364 for 50 hours of care per week across the country. For family daycare, the cost of a 50-hour week jumped 3 per cent to $339.

Mr Feld said the trend was likely to continue when stricter ratios for the care of toddlers (two to three years old) were introduced in 2016.


 1.03 million children aged under 12 in childcare in March quarter 2013 (up 6.3per cent)

 $364 median cost for 50 hours a week centre-based long daycare in 2013

 $339 median cost for 50 hours a week family daycare in 2013

 ACT most expensive, Queensland and South Australia cheapest

 Out-of-pocket costs for long day care up to 9.7per cent of household income for one child, up to 17.3per cent for two children

 Out-of-pocket costs for family day care up to 9.2 per cent for one child, up to 16.4 per cent for two children

 44per cent of centres rated still working towards national quality standards

 33 per cent of centres rated meet quality standards

 23 per cent of centres rated exceed quality standards

  46per cent of kids at preschool did more than 15 hours a week

 $6.8billion spent by all governments on early childhood education and care in 2012-13 (up 10.5per cent) 

 Source: Productivity Commission report on government services


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