Making ECEC free: Matt Grudnoff (Economist, The Australia Institute)
There is a clear role for Early Childhood Education and Care (ECEC) to support the economic recovery from the COVID-19 induced recession.
The pandemic revealed the critical link between workforce productivity and childcare when the schools shut down and parents had to juggle working from home with childcare. At the time, PM Scott Morrison urged the States to re-open the schools and his main argument was that it was costing 300,000 jobs due to parents not being able to work and care for children. That same argument applies to ECEC.
Free ECEC would increase workforce participation for Australian women which currently peaks in the late 20s age group and then declines from the early 30s and never returns. By contrast, the Nordics (Denmark, Finland, Iceland, Norway and Sweden) see peak female workforce participation in the late 40s. There is no baby-related drop in the early 30s, rather it steadily increases. The Nordics have free or near free ECEC and similar male workforce participation rates to Australia but much higher female rates.
This extra workforce participation means more GDP. If Australia could achieve the average female workforce participation as the Nordics, this would earn an extra $60bn per annum in GDP. If we could achieve Iceland’s best-in-class figures, it’s worth an extra $140bn per annum. This would more than earn back the entire loss of GDP from the recession inside one year.
“Free ECEC makes economic sense. Those who say Australia cannot afford free ECEC are wrong.”
Discussion Details
Early childhood education and care: What if we make it free for everyone?
It’s time to make quality early childhood education and care (ECEC) universally accessible and free for every Australian family. Let's consider the positives for families, businesses and the economy. We need your contributions to help advocate for change with the Federal Government.
Brief
Australian families pay some of the highest out-of-pocket costs for early childhood education and care (ECEC) in the world. Even before the pandemic hit, 48% of parents with children under 5 years were struggling to afford ECEC. Now we are in a recession, it will only get worse.
This issue has needed to be addressed for years, but the unprecedented, turbulent times presented by pandemic have exacerbated the urgent need for reform.
To make sure families, children and women are included at the next Federal Budget, we need to take the temperature of what is happening for Australian families and ramp up our advocacy efforts.
We invite parents, employers and business owners to share their experiences and comment on the availability, cost and quality of early childhood education and care.
Three key questions to start the discussion:
How does the cost of childcare impact your decisions about your work, your family, and your future?
What did the 3-month period of free care mean to your household and/or business?
What would your business and/or paid work look like if you didn’t have to pay for quality ECEC?
We welcome comments addressing issues of inclusion, equity and diversity (e.g. children with special needs, families in remote locations, blended families, small business owners, self-employed, gig economy workers, and shift workers).
Whilst we are focused on understanding the issues in Australia, we are also interested to learn from experiences overseas.
We’re going to let the Federal Government know what you say so they can’t ignore families.
Background
This is time-sensitive.
The Coronavirus pandemic has opened the eyes to the importance of early education and care for families - and the economy. Many Australians have recognised just how crucial it is for our society, for women’s economic security as well as the wellbeing and development of children.
For the first time in history, families in Australia had access to fee-free ECEC and the difference it made in households right around the country was profound.
Regrettably, this issue was not addressed in the historic October budget by the Morrison government. Families, women and children were largely forgotten in the biggest spending budget in Australia’s history. That cannot happen again.
Ahead of the May budget, we want to raise the issue of universal access to ECEC with the federal government. We’re having this conversation now so we can let the government know how this is impacting you and your family. The more voices, perspectives and experiences shared, the better.
We are also inviting educators in early education and care services to join the discussion. They are woefully underpaid and under-appreciated and deserve to be paid professional wages for the important work they do.
This pandemic has potentially created an accelerated path towards reform. If we seize this moment to capture the attention of decision-makers around the importance of these policies and the existence of viable alternatives, change is possible and parents and children will thrive.
We believe that universally accessible quality ECEC is the most compelling, valuable policy the federal government could pursue to ensure Australia’s recovery from the Coronavirus pandemic leading to a healthier, more equitable and more sustainable future.
Eliminating the high cost of early education and investing in a high-quality ECEC system that is accessible to all children will boost the economy. It will also increase women’s participation in the paid workforce, alleviating significant financial pressure in households and giving children the best possible start to life.
We are striving to make Australia the best place in the world to be a parent. The time for change is now!
We are a community of parents motivated to create positive change in the Australian ECEC sector.