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What's Happening to the Cost of Childcare / ECE

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Over the past 5 years the relative cost to households of ECE has gone up by 8.1%. But kindergartens account for almost all of the increase.

There has been a big increase in the cost of kindergarten fees relative to household earnings over the past 5 years of 64.4% or almost 13% per annum (between the June '08 and June '13 quarters). However this may be slowing down as over the past year the increase has been just 5%. Possible explanations for this are that:

  • during this period of time we saw substantial numbers of kindergartens that had offered sessional / part-day preschool and asking for a parent donation being re-licensed as all-day services with ability to charge fees for childcare outside of 20 Hours ECE.
  • kindergarten fee increases started from a traditionally very low base so even a small increase in terms of cents and dollars has seen a large increase in terms of percent figures.

Childcare centres have had a 2% increase in average fees relative to household earnings in the past 5 years - so only a very marginal increase on average for parents using a childcare centre. However, childcare fees have always been substantially higher than kindergarten and home-based fees so a tiny increase can still represent quite a few extra dollars for households.

Interestingly, home-based ECE has seen a decrease of 0.8% of average fees relative to household earnings over the past year, suggesting some room for negotiation by parents in fees!

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