LDC service approvals growth falls for 5th consecutive qtr to reach lowest in 10 years, latest ACCECQA snapshot says

The percentage growth in new long day care service approvals fell to 2.5 per cent in the three months ended June 2026, the lowest growth rate in ten years ACECQA’s latest Snapshot confirms. 

The growth rate is now below that experienced during the COVID-19 pandemic and suggests that a combination of high interest rates and a challenging operating environment are creating disincentives for developers to commence, and complete, new LDC projects. 

A total of 240 centres were opened in the last twelve months, compared to 322 in the twelve months prior to that, and on a quarterly basis just twenty new centres were opened in the June quarter this year. 

It is important to acknowledge that these totals will not only include new centres approved but also instances where services approvals have been cancelled. The latter has seen uptick in recent months associated with federal and state efforts to remove non performing and non compliant centres from operating. 

On a state basis all three of the larger states are seeing falls in service approvals, although growth rates do remain quite diverse. Victoria recorded a 4.5 per cent year on year increase LDC approvals which is falling from recent highs of in excess of 5.0 per cent but still above the post COVID lows of below 4.0 per cent. 

New South Wales and Queensland however, are tracking at substantially lower growth rates with Queensland now very noticeably lower than the 4.0 per cent rates recorded in mid 2023. 

Across the smaller states and territories Western Australia is the stand out as the exceptionally high growth of rates of 8.0 per cent and above recorded in 2024 have been materially cut back to 2.9 per cent recorded last quarter. 

Although the downside momentum in new service approvals is more pronounced in the smaller states and territories at the juncture it is clear that the overall trend in supply is lower for the time being. 

With interest rates remaining elevated, operating conditions challenging, centre closures more common and state Departments of Education still very much compliance focused the supply side of LDC appears to be looking increasingly lower.

Given the uncertainties around demand in the current environment as demographics, affordability and migration trends play out any indications of reduced supply will be deemed a positive by approved providers across the country. 

To read more please click the link to ACECQA’s snapshot here.