Federal Budget 2019 outcome underwhelming for ECEC sector

In a highly anticipated 2019 Federal Budget the key takeaway for the early childhood education and care (ECEC) sector is an extension of the National Partnership on Universal Access to Early Childhood Education for a further 12 months for children attending a preschool program in the year before school.

The failure to guarantee funding beyond twelve months and commit to three year old preschool has come as a disappointment to advocacy groups who have been actively lobbying the Federal Government to broaden their pre-school commitment to include 3 year olds and provide long term certainty regarding preschool funding going forward and is in stark contrast to commitments made by the Australian Labor Party in their pre-election campaigning.

A total of $449.6 million has been allocated to the Universal Access preschool program until the end of 2020. This compares to $441.6 million in last years budget.

In addition, the Government has allocated $3.5 million to fund collection and improvement of the preschool data gathered by the National Early Childhood Education and Care Collection program, an agency established to provide comparable jurisdictional statistics and key performance indicators to measure progress of the National Partnership on Early Childhood Education.

A further $1.4 million will be invested to fund work by The Smith Family to partner with States and Territories to develop and implement strategies to increase preschool attendance rates among disadvantaged and Indigenous children.

Allocation to improve CCS and Inclusion Support Portal included

A $4 million commitment has been made to improve the operation of the Child Care Subsidy (CCS) system administered by the Department of Human Services and the Inclusion Support Portal administered by the Department of Social Services.

The commitment will be funded by savings made on the cancellation of a project to test the feasibility of automated attendance reporting in lieu of third party software providers developing their own systems, and will focus on reducing administrative burdens for providers and streamlining payment processes.

Since launching in July 2018, some processes involved in operating the CCS system have been called into question, with particular concerns around debt recovery and administrative burdens raised.

Child Care Subsidy budget for 2019/20 materially lower than prior year estimates

The Government has allocated $8.3 billion to fund the CCS for the 2019-20 period and estimated $8.6 billion for 2020-21 and $9.1 billion for 2012-22.

Although still sizeable commitments, they are materially lower than what had been budgeted and forecast last year.

The estimate for spending on the CCS in 2018-19 in last years budget was $8.0 billion. This compares to an estimated actual 2018-19 spend of $7.7 billion reported in this year’s budget.

The estimate for 2019-20 in last years budget was $8.6 billion. This compares to the 2019-20 budget of $8.3 billion handed down in this years budget.

In both cases, the updated numbers have reflected a $300m reduction in spend, and looking ahead the forward estimates are showing even larger reductions with 2020-21 down by $383 million and 2021-22 down by 426 million from last year’s Budget.

It is unclear at this juncture what has been driving these estimates, budget and forecast reductions although it is possibly connected to the contraction in family day care service provision reducing enrolments, moderating operator fee increases and / or plateauing of overall ECEC attendance levels.

Greater clarity on these matters will be provided in upcoming releases of the Department of Education and Training’s Early Childhood and Child Care in Summary Reports.

ELLA language app funded for another year with long term AEDC commitment in place

In addition to the main budget allocations, funding for the Early Learning Languages of Australia app has been extended for another year with $5 million allocated for 2019-20 and $1.4 million for 2020-21.

The Australian Early Development Census remains funded until 2022-23 and a small allocation of $0.6 million has been made to an administered expense category of “attendance strategies for early learning.” It is unclear if this relates to the Smith Family project.  

To review the Budget in its entirety, click here.