Economics
LDC and OSHC attendance surged according to Dept of Ed release
Jason Roberts
Sep 26, 2019
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The Federal Department of Education and Training (DET) have released the third issue of their quarterly Child Care in Australia report since the implementation of the Child Care Subsidy legislation in July 2018 which shows, amongst other things, that attendance in long day care (LDC) and Outside School Hours Care (OSHC) settings surged in the three months to March 2019. 
The actual number of children attending was 766,790, compared to 694,830 last year. 
The number of children now receiving ACCS is 29,770 up from 22,050 when the CCS legislation was introduced and the stricter rules built into the system that requires documentary evidence to support each application needed, and the introduction of Centrelink as the ultimate arbiter as to whether applications are successful or not. 
Fees rose 4.7 per cent year on year in LDC settings. This was higher than OSHC which was flat relative to last year and FDC which was very materially higher up 15.3 per cent. 
The percentage change in the number of children attending LDC increased by 6.3 per cent compared to the same period last year, the largest yearly increase since 2011 and materially higher than the already high previous quarter.
The actual number of children attending was 766,790, compared to 694,830 last year. LDC was not the only outperformer in the period as the number of children attending Outside School Hours Care (OSHC) services also increased by a large margin, up 11.7 per cent on the same period last year to 478,930 children.
The last time an increase of this magnitude was recorded was in the three months ending June 2011 with an increase of 12.5 per cent.
The acceleration in enrolments in the first quarter of 2019 in both LDC and OSHC suggests that many families deferred their early childhood education and care decisions until the beginning of the new calendar year despite the affordability improvements created by the CCS in the six months previously.
Family Day Care (FDC) attendance, however, continued its slide down 25.8 per cent on the previous year and 45 per cent lower than the peak recorded in 2015.
Strong LDC attendance backed up by continued increase in hours attended per week
The large increase in hours of care used per child per week in LDC settings first noted in the September quarter of 2018, just after the CCS implementation, has continued into the March quarter 2019 with an increase of 3.5 per cent compared to the same period in 2018.
The expansion in hours of LDC attended first jumped after the implementation of the CCS and has managed to sustain growth over and above that experienced in the last five years since and confirms that families continue to increase the number of hours care their children have since the CCS was introduced.
Although similar trends can be seen in OSHC hours attended the magnitude of change, largely due to the nature of the OSHC and session durations, is less strong and where FDC is concerned the overall contraction in enrolments is also evident in hours.
Children accessing ACCS moves higher but still well below peaks recorded prior to CCS
The number of disadvantaged and vulnerable families and their children receiving additional child care subsidy (ACCS) increased for the second quarterly period in a row but still remains well below the numbers recorded under the previous subsidy regime.
The number of children now receiving ACCS is 29,770 up from 22,050 when the CCS legislation was introduced and the stricter rules built into the system that requires documentary evidence to support each application needed, and the introduction of Centrelink as the ultimate arbiter as to whether applications are successful or not. The gradual increase since suggests that operators and families are becoming more familiar with the application process and that Centrelink efficiency is also likely improving.
In terms of the changes within the categories all have increased with the exception of grandparents which have been steady since July 2018.
Overall however, the number of children receiving additional support is still lower than any other March quarter period for the last 4 years.
LDC fees growth steady but %age of services over fee cap creeps higher
Fee increases in LDC settings continue to annualise at a rate lower than experienced in the period 2013 to 2016 with the three months ended March 2019 recording a rate similar to that experienced in the two previous quarters.
Fees rose 4.7 per cent year on year in LDC settings. This was higher than OSHC which was flat relative to last year and FDC which was very materially higher up 15.3 per cent. Notably, the percentage of LDC services reporting fees above the fee cap of $11.77 crept higher to 12 per cent compared to 11 per cent in the three months to December 2018.
The number of OSHC services reporting fees above their fee cap of $10.29 actually fell from 15 per cent in the December quarter 2018 to 12 per cent in the March 2019 more than likely reflecting seasonality impacts.
Total Government subsidy payments in March QTR 13.4% higher than last year
The overall Government subsidy contribution for the period was $1.8 billion up from $1.6 billion in the same period last year, an increase of around 13.4 per cent.
The relative increase in subsidy disbursement will be a function of the strength in LDC enrolment and hours attended where fees are higher than the FDC and OSHC settings and hence have a disproportionate impact on subsidy allocation.
However, a more detailed analysis is not possible due to the DET not reporting on setting entitlement receipts.
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