NQF Annual Report 2025: Quality gains continue, but sector faces compliance pressures and persistent equity gaps

The Australian Children’s Education and Care Quality Authority (ACECQA) has released its ninth Annual Performance Report on the National Quality Framework (NQF), confirming the sector’s steady upward trajectory in quality while highlighting rising compliance pressures, persistent equity gaps, and a renewed national focus on safety and workforce development.

 

The ACECQA Chair Annette Whitehead, outlines key sector priorities and reflections on the year’s progress.

 

Ms Whitehead emphasises the importance of being responsive to emerging issues, identifying three strategic priorities that guide the sector’s work in 2025 including strengthening the NQF to address all risks of harm, supporting a professional workforce, and providing families with more accessible and meaningful information about high-quality services.

 

The report reinforces the shared responsibility of ACECQA and regulatory authorities in monitoring the NQF’s effectiveness and ensuring it continues to deliver on its objectives. It acknowledges steady progress in service quality, highlights improved support for educators through the Shaping Our Future workforce strategy, and reaffirms the sector’s commitment to evolving the NQF, keeping child safety and wellbeing at the centre of all decisions.

 

The 2025 NQF Annual Performance Report confirms the sector’s steady upward trajectory in overall service quality, while also highlighting ongoing regulatory scrutiny, rising incident reporting, and persistent equity gaps between advantaged and disadvantaged communities.

 

Now more than a decade since the introduction of the National Quality Framework (NQF), services continue to show strong commitment to quality, with 91 per cent rated Meeting National Quality Standard (NQS) or above, up from 90 per cent in 2024.

 

However, this year’s data paints a more complex picture, as the sector continues to navigate post-pandemic workforce challenges, increased regulatory requirements, and rising community expectations around child safety and quality education.

 

There are around 18,000 National Quality Framework (NQF) approved education and care services in Australia. These include long day care services (53 per cent), outside school hours care (28 per cent), family day care (2 per cent), and most preschools and kindergartens (17 per cent).

 

The high quality standards and robust legislated requirements set by the NQF provide a strong framework of quality assurance for families, offering confidence in the safety, learning and wellbeing outcomes delivered by approved services.

 

While the proportion of services achieving Meeting NQS or above reached an all-time high, fewer services are achieving the highest quality tiers. The percentage of services rated Exceeding NQS or above fell slightly from 22 per cent in 2024 to 21 per cent in 2025, a continuing trend since the introduction of the streamlined NQS in 2018.

 

Encouragingly, the number of services rated Working Towards NQS decreased from approximately 1,600 in 2024 to 1,500 in 2025. Notably, more than half of these services missed only one to four of the 40 quality elements. Among those reassessed in 2025, 69 per cent improved their overall rating.

 

Improvements were recorded across all seven quality areas, with the proportion of services rated Meeting NQS or above ranging from 94 to 99 per cent.

 

• QA1 Educational Program and Practice: 94 per cent (highest since 2012)
• QA2 Children’s Health and Safety: 95 per cent (highest since 2012)
• QA4 Staffing Arrangements: 98 per cent (highest since 2012)

 

Particularly strong progress was seen in Family Day Care (FDC) and Outside School Hours Care (OSHC):

 

• FDC: Up from 72 per cent in 2024 to 76 per cent in 2025
• OSHC: Up from 88 per cent to 89 per cent over the same period

 

While quality ratings improved, there was a significant increase in both serious incident reports and confirmed breaches:

 

• Serious incidents: Increased from 148 per 100 approved services (2023/24) to 160 (2024/25)
• Confirmed breaches: Rose from 201 per 100 services to 222

Most commonly breached requirements included:

• Protection from harm and hazards (Section 167)
• Adequate supervision (Section 165)
• Emergency and evacuation procedures (Regulation 97)
• Upkeep of premises and equipment (Regulation 103)

 

Importantly, for the first time, there was no significant difference in reporting rates across services rated Working Towards, Meeting or Exceeding NQS, highlighting the universality of risk and the need for ongoing vigilance across all settings.

 

There were promising signs in workforce stability:

 

• Staffing waivers: Decreased from 9.2 per cent in 2024 to 7.4 per cent in 2025
• Long Day Care waivers: Fell from 15.6 to 12.4 per cent

 

The majority of waivers continued to relate to early childhood teacher shortages, particularly in regional and remote areas.

 

In vocational training, enrolments in the Diploma of Early Childhood Education and Care reversed a downward trend, increasing to over 31,000 in 2024, up from less than 25,000 in 2023.

 

Despite system-wide gains, the gap between services in the most advantaged and most disadvantaged areas widened:

 

• 89 per cent of services in the most disadvantaged areas met or exceeded the NQS, compared to 94 per cent in the most advantaged areas
• Only 19 per cent of services in the most disadvantaged areas achieved an Exceeding rating, compared to 26 per cent in more advantaged locations

 

This inequity remains especially concerning in light of the latest Australian Early Development Census (AEDC) data, which shows 23.5 per cent of children are now developmentally vulnerable on one or more domains, up from 22 per cent in 2021.

 

Family awareness of the NQF Quality Rating System has reached its highest level:

 

• 59 per cent of families surveyed in 2025 were aware of the system (up 19 percentage points since 2017)
• 64 per cent knew the rating of their service, also a record high

 

However, only 43 per cent knew they could access their service’s compliance history under the National Law and Regulations, indicating a need for better communication around families’ rights to transparency and accountability.

 

To access the full 2025 NQF Annual Performance Report, including national and jurisdictional data, visit the ACECQA website.