Budget has heart but more needed on ECEC reforms
The Sector > Policy > Politics > Budget has heart but more needed on ECEC reforms

Budget has heart but more needed on ECEC reforms

by Megan O’Connell - ELAA Acting CEO

May 10, 2023

Treasurer Chalmers has delivered his second budget, a budget that sees Australia head back into a small $4.2b surplus.


Last year’s budget, which was brought down post-election in October 2022, delivered a massive
investment to fund the Government’s Cheaper Child Care Policy.


This budget, by contrast, has little direct spending to benefit Early Childhood Education and Care


The 9 May budget, delivered during a time of tighter financial controls, falls short of the fulsome
changes advocated for across the sector. There has unfortunately been no movement on the activity
test to ensure more children can access early childhood education. The budget is also silent on
educator wages, despite the urgent need for a wage boost to stabilise the workforce and support
delivery of the Government’s Cheaper Child Care initiative.


There’s also no new funding announced to address childcare deserts and expand access, bar the
modest $18 million grant program announced last week.


Within this slim budget there are, however, a range of measures, that increase equity and support
children and families, and a small number of initiatives that might support ECEC services to operate.


Direct investments in Early Childhood Education and Care


The budget includes the recently announced $72.4 million for professional learning.


This is welcome funding that will subsidise services to backfill for educators undertaking training,
and fund allowances for out-of-hours training.


Funding is also allocated for staff to undertake a paid practicum. We know the cost of undertaking
practicum and foregoing wages can be prohibitive – this initiative is aimed at easing the cost burden
for 6000 students.


Another 2000 workers can undertake a practicum in a different service including funding for a living
allowance which is crucial to enable students to undertake experiences in rural and remote


Streamlining the process for Additional Child Care Subsidy (child wellbeing) applications is also
welcomed while savings measures, such as payment integrity activities (including fraud prevention
activities to curb things like false Child Care Subsidy claims), are aimed at delivering net savings of
$139.4 million over four years from 2023–24.


Increasing equity and supporting families


Other Budget announcements will also have a positive impact on families. The extension of the
Single Parenting Payment (single) will support 57,000 single parents and carers to remain on
increased payments until their youngest child turns fourteen.


A $40 per fortnight increase on government benefits, including Youth Allowance and Job Seeker, will
support families, including students in ECEC courses, and ease poverty in jobless families. The 15%
increase in rent assistance is welcome, albeit coming in the face of major rent increases. The cost of housing is a key barrier to finding ECEC staff in some regions, and this modest increase is helpful but
likely insufficient.


The $326.7m investment in a raft of women’s safety initiatives, under the National Plan to End
Violence Against Women and Children 2022–32, including place-based, early intervention and
recovery services will support highly vulnerable children and families. ‘Circuit breaker’ safety
initiatives like these could potentially be delivered as part of wrap around services at ECEC services
along with other supports such as counselling and speech therapy if future funding is provided.


A range of health prevention and early intervention initiatives was also included, including
supporting children at risk of deafness, funding for Foetal Alcohol Spectrum Disorder prevention,
diagnosis and support activities, early intervention for infants with early signs of autism, and
activities to address declines in childhood immunisation rates.


The trebling of bulk billing incentives should make accessing a doctor cheaper for families.


Supporting workforce growth


A number of initiatives in the Budget are aimed at supporting workforce growth. These include
foundation skills training and mentoring for apprentices and trainees and supporting community-
based and culturally safe pathways to training. These initiatives may support more culturally diverse
students to undertake studies in Early Childhood Education and Care.


There is also improved skills recognition to provide fast-tracked skills assessments, and a mechanism
for mutual recognition of qualifications between India and Australia which could help to expand the
pipeline of ECEC workers.


The government has indicated it is again recommending the Fair Work Commission ensure real
wages are maintained. The recently announced $11.3 billion in aged care funding for wage growth
also features in this Budget, giving hope that early childhood education could be next. ELAA,
alongside other peaks, have been actively advocating for increased ECEC wages.


Other initiatives worth a look


The Budget includes a range of other initiatives that may reduce the cost of operating an ECEC
service. There is a $1.5b Energy Bill Relief fund that both supports low-income households and small
business retail customers. There is also an additional deduction allowed under the Small Business
Energy Incentive.


And an interesting initiative, with the Government partnering with leading philanthropic
organisations through an Investment Dialogue for Australia’s Children to enable better-coordinated
investments and data sharing and enable co-investment in place-based initiatives that support early
childhood education and development.


This will continue to help build the evidence base about what works, particularly to engage, educate and empower vulnerable children and communities.


The budget is low in direct investment in Early Childhood Education and Care. However, the range of
equity initiatives in this cost-of-living-focused Budget should help children and families.


Whilst acknowledging the cost pressures on the government, there remains a need to invest in the
infrastructure needed to deliver on the promise of supporting parents to access to affordable early
childhood education – both physical infrastructure and our more important asset, our workforce. This budget focused on a range of early intervention measures – a further measure would be to
expand access to early childhood education to all children, noting what a game changer it can be.


Megan O’Connell is Acting CEO at Early Learning Association Australia (ELAA).

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