Why Australia should provide free and universal childcare

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During the height of the coronavirus pandemic in April, Australian Prime Minister, Scott Morrison, announced that families could access free childcare. This temporary crisis measure was designed to protect livelihoods. “This virus is going to take enough from Australians without putting Australian parents in that position of having to choose between the economic wellbeing of their family or the care and support and education of their children,” Mr Morrison said.

The PM essentially nationalised the childcare system making it an “essential service”, but the relief package only covered the period to 12 July. Many believe that the emergency arrangements should have been made permanent. I join the chorus of voices calling for continued government funding of childcare and believe that it should be considered an essential service, both in good and bad times. Parents rely on dependable childcare so that they can work.

The arguments for early childcare are well-known and universal. Infants and toddlers everywhere are naturally curious and observant and can take in vast amounts of information. Children learn more quickly during their early years than at any other time in their lives. From birth to age six, a child’s brain is like a sponge, continuously absorbing everything around them.

Enrolling a child in a daycare centre or preschool facility enhances this cognitive absorption process. Early education and care exposes children to numbers, letters and shapes. It also helps them develop social and emotional skills such as getting along with other children, sharing and contributing. Early learning settings assist children develop the skills they’ll use for the rest of their lives.

But childcare is not cheap and Australia does not provide free and universal daycare and preschooling and this places a financial burden on working families. Many Aussie households struggle to pay the fees, while for others it is completely out of reach. Childcare affordability and accessibility are significant issues in Australia.

In contrast, Scandinavian nations have the most family-friendly childcare policies in the world. The Swedes and the Danes enjoy heavily subsidised access to daycare facilities regardless of income. The French benefit from similar arrangements with the government providing inexpensive municipal daycare, tax breaks for families employing in-home childcare workers and free universal preschool beginning at age three.

Childcare options in Britain changed in 2017 with the introduction of free and universal early education for children three and four years of age. According to government data, 94 per cent of British parents have taken the government up on its offer of free education. The offer provides a guaranteed 15 hours a week of free childcare or preschool for 38 weeks a year.

More and more nations are discovering that early childhood education is one of the best investments a country can make to prepare children for learning and give them a chance to thrive later in life. It lays the foundation for a child’s future and has long-term impacts on health, education, job prospects and well-being.

Experts agree that supporting early childhood education is a win-win for everyone. One such expert is Nobel prize-winning economist James Heckman, from the University of Chicago. Professor Heckman argues that the best way to reduce deficits and strengthen the economy is to invest in quality early childhood development. This creates better education, health, social and economic outcomes which increase revenue and reduce the need for costly social spending.

He developed the “Heckman Equation” which is based on the notion that spending on education and training has its biggest impact early in life. The science of brain development reveals that the first few years of life play a critical role in shaping future emotional, cognitive and intellectual skills. Kids who get consistent nurturing care are more likely to succeed in school, stay clear of trouble with the law and have productive lives in the workforce.

Another academic who has weighed in on the early education debate is Edward Melhuish. He is a professor at the University of Oxford, a visiting professor at the University College London and a visiting professor at the University of Wollongong’s Early Start Research Institute. In an article Professor Melhuish wrote for The Guardian, he stated:

Those countries that are planning for long-term economic growth are investing in early childhood education and care, because the jobs of the future will be for those with the most skills, and the foundations are laid in early life. China is an example of a country that has greatly increased its investment in this area.

In the same article, Professor Melhuish noted that there is a powerful economic case for state funding:

Using taxpayer money to help parents into work is not necessarily a drain on the treasury, rather it can lead to more revenue. A UK think tank has published a report suggesting that a 5% increase in maternal employment in the UK could be worth £750m (AU$1.6bn) annually in increased tax revenue and reduced benefit spending.

Professor Melhuish believes that a high-quality early childhood education and care system should be considered as part of the infrastructure for a country’s long-term economic and social development, to be developed in much the same way as, say, roads. This view is increasingly holding sway among OECD countries. An OECD report, Starting Strong III, begins:

A growing body of research recognises that early childhood education and care (ECEC) brings a wide range of benefits, for example, better child wellbeing and learning outcomes as a foundation for lifelong learning; more equitable child outcomes and reduction of poverty; increased intergenerational social mobility; more female labour market participation; increased fertility rates; and better social and economic development for the society at large.

Professor Melhuish believes that Australia should follow the research and provide free universal childcare and I concur. Early childhood education will improve educational and whole-of-life outcomes for Australian children, as well as increased workforce participation. This provides a double dividend for the Australian government’s investment.

Still, some child-free individuals, together with parents who elect to stay-at-home, will object to their tax dollars being used on childcare for other people’s offspring. Yet these same people are seemingly comfortable with state funding of primary and high schools. This, I believe, is because childcare is viewed as “preschool babysitting” whereas it should be seen as “preschool education”.

By relabelling early childcare, the notion of public money being spent on the very young should be more palatable. State subsidies for childcare facilities are a common good and, in my opinion, are no different from the principle behind free state schools. Childcare provides a healthy return on investment, so undervaluing childcare is a false economy.

All revolutions take time and childcare is no exception. It is my hope that sooner rather than later Australia will have the political appetite for more spending on preschool care and education. The approach by Scandinavian countries to universal childcare is a source of policy inspiration and a sensible policy tool for Australia to adopt. It’s also a smart investment.

Our children deserve the best possible start in life.


Paul J. Thomas
Chief Executive Officer
Ductus Consulting

5 Replies to “Why Australia should provide free and universal childcare”

  1. One of my employees would definitely work longer and be paying more personal income tax IF she could find a place available at her local child care center !!! Which at the very least indicates we need more child care centers.

  2. Paul
    A very thought provoking blog.
    This is a matter that needs more consideration, attention and action.
    One issue for me is what is it that we should teaching our kids at an early age for example, is it how to interact, how to communicate, music, art values, wellness or is it something else?

  3. Great article Paul. The affordability of child care for working parents is something that troubles me. My son is nearly 3 years old and has greatly benefited from attending an early learning centre/child care. He is exposed to a range of activities which have really aided his development particularly his interpersonal skills and vocabulary.

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