LDC new centre growth rate falls again whilst other settings spike higher according to latest NQF Snapshot

The annual growth rate of long day care (LDC) services in Australia has fallen to just 2.8 per cent, a level not seen since 2016 and materially lower than the high point recorded prior to COVID-19, according to the latest release of the Australian Children’s Education & Care Quality Authority’s (ACECQA) latest quarterly NQF Snapshot. 

A total of 8,506 LDC service approvals were in issuance across Australia as at 31 March 2022, up 65 from December 2021 and 229 from 31 March 2021. 

The fall marks the third consecutive quarterly growth rate reduction in the last nine months and most likely represents the impact that COVID-19 related disruptions as well as supply chain related challenges have had on the completion rates of existing stock and the initiation of new projects. 

Across the states and territories the largest annual growth rates were experienced in Western Australia and Victoria  at 4.2 per cent and 4.8 power cent respectively, although notably, the trend in WA seems to be suggesting an acceleration in supply, the key stand out across Australia, whereas Victoria’s performance albeit high is still meaningfully below their 5 year average figures. 

New South Wales and Queensland, the largest and third largest states when it comes to LDC, continue to display quite muted supply growth relative to their longer term averages with South Australia exhibiting similar trends. 

FDC sees ends extended streak of contraction with fist annual growth since 2016

The number of schemes operating in the family day care (FDC) setting grew by seven compared to last year and when combined with the increase recorded in the last quarter of 2021 contributed to an overall scheme increase of 1.4 per cent.

The key driver of the increase was VIC, the largest provider of FDC in the country, which saw a jump of 16 new schemes licenced this quarter, and increase of 12.3 per cent compared to last year with NSW, the second largest player flat year on year. 

Although the number of children attending FDC is substantially lower than LDC, the Department of Education, Skills and Employment’s (DESE) Child Care Report for Q2 2021 noted 90,800 compared to LDC’s 782,760, a move back to positive growth rates after so long in decline, could herald, at the margin the return of FDC as a competitive peer to the LDC setting. 

Outside school hours care sees large increase in new services with VIC leading

The outside school hours care (OSHC) setting saw a substantial increase in new service approvals granted in the three months to March 2022. Growth of 5.0 per cent was recorded across Australia with a total of 4,796 services currently operating. 

The increase is substantial in nature and marks an acceleration of the rate of growth the setting has experienced since the second quarter of last year and well above the troughs recorded at the peak of COVID-19 in 2020. 

Similar to FDC VIC was the second largest provider of OSHC services after NSW, and each state recorded quarterly and annual increases substantially above peers. 

It is unclear what is driving this outsized increase during the quarter but it is clear that the very challenging operating environment OSHC had to endure when COVID-19 restrictions were at their peak has passed and this is supporting a jump in activity in the setting. 

And finally the kindergarten and preschool setting saw moderate growth in the period of 0.6 per cent year on year. 

To read the latest Snapshot please click here.