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Chapter 3 - Use of Child Care in Australia
3.1 This Chapter provides a broad overview of the child care industry
and those who use it. The problems of data collection, discussed below,
combined with the changes that the sector has undergone since mid 1997
mean that analysis of the data provided may not reflect fully the sector
as it stands today.
Data sources
3.2 As noted in the introductory Chapter, sources of data on children's
services include the Australian Bureau of Statistics (ABS) which conducts
a child care survey every three years. The last survey was conducted in
March 1996. The Department of Family and Community Services (DFCS) administers
two data collections – the Child Care System and the Census of Child
Care Services. The Child Care System provides administrative data about
agencies which receive payments from DFCS to provide child care services
under the Children's Services Program (CSP). The Census of Child Care
Services collects information from CSP-funded service providers on their
staff, children and parents using services and various aspects of service
provision. Between 1993 and 1996 two groups of service types were surveyed
every other year. The results of the 1995 Census were published in 1997.
The Health Insurance Commission also has limited information about families
claiming the Childcare Cash Rebate.
3.3 The Australian Institute of Health and Welfare (AIHW) has noted that
`there is currently no children's services data collection and data on
children's services are highly fragmented'. [1]
Difficulties also arise because data classifications, scope and coverage
of collection and definitions used vary between data sources. Further,
some results are now out of date. DFCS acknowledged that its current data
sources were insufficient to provide information for some areas and that
there was a need to enhance the Department's current internal data sources
to improve the information they provide. To this end, the Department was
now conducting the census of child care for all Commonwealth funded child
care services on an annual basis. The Department is also working towards
conducting the census electronically in order to improve collection, storage
and access to data and to speed publication of results. [2]
Recommendation: The Committee recommends that the Department of Family
and Community Services, in conjunction with the other major collectors
of data on children's services, adopt a more coordinated approach to data
collection to ensure that overlap and deficiencies in the current data
collection are overcome.
Recommendation: The Committee recommends that the Department of Family
and Community Services expedite the processing of results from future
surveys and census collections so that up-to-date information is available
for policy development and planning purposes.
Population data on children
3.4 Children for whom child care is provided are usually defined as those
up to the age of 12 years. As at 30 June 1997, there were an estimated
3.4 million children in Australia aged 0-12 years with 1.3 million in
the 0-4 group. [3] While Australia's population
continues to grow in the age group 0-4 years the percentage increase has
declined from 5.4 per cent in 1987-92 to 0.58 per cent in 1992-97. The
overall percentage increase in the 0-12 age group was 5.3 per cent for
1987-92 and 2.2 per cent for 1992-97.
Table 3.1: Number of children, age of child by year, 1987, 1992 and
1997
| Age group |
1987 |
1992 |
1997* |
| 0-4 |
1,218,684 |
1,284,689 |
1,292,230 |
| 5-9 |
1,196,138 |
1,279,862 |
1,315,609 |
| 10-12 |
737,318 |
755,026 |
783,618 |
| Total |
3,152,140 |
3,319,577 |
3,391,457 |
*Preliminary figures
Source: ABS, Population by Age and Sex 1997, pp.17,
47; AIHW, Australia's Welfare 1993, p.127.
3.5 Annual growth rates published by the Australian Bureau of Statistics
(ABS) further demonstrate the trends in this age group.
Table 3.2: Growth rate# in estimated resident population
| Age group |
1981-86 |
1986-91 |
1991-96 |
1996-97* |
| 0-4 |
1.18 |
1.03 |
0.40 |
-0.37 |
| 5-9 |
-1.46 |
1.52 |
0.53 |
0.73 |
| 10-14 |
-0.07 |
-1.09 |
1.05 |
0.33 |
# Annual average compound rate of growth
* Preliminary
Source: ABS, Population by Age and Sex 1997, p.8
3.6 The Department noted that although the decline in the numbers of
children in the age group 0-4 years was small, it was a trend that would
impact on the demand for child care services. [4]
The need for child care services
3.7 The number of children in the age group 0-12 years gives an upper
limit for the number of children who may require care. However, a proportion
of these will not require paid child care as they may be cared for by
a parent who is not working.
3.8 A major reason for seeking child care is to enable parents to participate
in the labour force, either to undertake or look for paid employment or
to participate in education or training. As at June 1997, there were 2,129,400
families with the youngest child below 14 years of age, including 475,800
families where the youngest child was below five years old, and where
all adults were in the labour force. Almost half of couple families with
the youngest child 0-4 years of age participated in the labour force,
while in two-fifths of sole parent families the parent participated in
the labour force. Labour force participation is influenced by the age
of the youngest child with a higher proportion of families, both couple
and sole parent, with the youngest children aged five or more participating
in the labour force.
Table 3.3: Families with both parents (or a sole parent) in the labour
force, by age of youngest child, June 1997
| Age of youngest child |
Both parents (or a sole parent) in labour
force
(`000)
|
Percentage of total families |
Total families
(`000)
|
| Couple families with youngest child
aged: |
| 0-4 |
406.8 |
48.0 |
847.4 |
| 5-9 |
313.4 |
69.6 |
450.5 |
| 10-14 |
282.1 |
69.8 |
404.4 |
| One-parent families with youngest child
aged: |
| 0-4 |
69.0 |
40.5 |
170.5 |
| 5-9 |
75.8 |
56.5 |
134.2 |
| 10-14 |
76.6 |
63.1 |
121.4 |
| Total number of families with youngest
child 0-14 |
1,223.7 |
|
2,129.4 |
Source: ABS, Labour Force Status and Other Characteristics
of Families 1997, pp.22, 26.
3.9 In March 1996, the total number of children 12 years and under with
both parents or a sole parent in the labour force was estimated to be
1.6 million. [5] Not all these children were
in need of child care. For example, in families where both parents work,
the working hours may be arranged so that a parent is available to care
for children at home.
Types and use of child care services
3.10 For children who do use child care, the care is categorised as informal
or formal care. Informal care is non-regulated care and may be provided
in the child's home or the carer's home. Informal care covers sibling
care, other relative care and other person care. It may be provided on
a no-fee basis.
3.11 Formal child care is regulated and normally involves a fee. Formal
child care services include the following service types:
- Long day care centres: these are open for at least eight hours per
day during normal working days and operate for at least 48 weeks of
the year. These services provide care mostly for children under school
age although some centres do not provide services for the whole age
range, 0-4 years. Some centres also provide care before and after school
for primary aged children. Long day care centres may be established
as community-based services which are non-profit services incorporating
parents onto their management committees; private-for-profit services;
employer-sponsored services; and other non-profit services such as child
care centres at educational facilities.
- Family day care: these services consist of networks of caregivers
supported by a central co-ordination unit. Care is provided for children
aged 0-12 by carers in the carer's own home.
- Outside school hours care (OSHC): OSHC services provide before and/or
after school care for primary school-aged children. Often these services
also provide vacation care.
- Other formal care services: these include occasional care which caters
mainly to the needs of families requiring care for a short period of
time; Multifunctional Children's Services which offer a range of services
in one centre for children 0-12 years of age in rural and remote areas;
and Multifunctional Aboriginal Children's Services which provide services
to Aboriginal communities which are appropriate to the children's cultural
and developmental needs.
3.12 The ABS Child Care survey estimated that as at March 1996, 1,501,800
children aged less than 12 years used some type of formal (including preschool)
and/or informal care. This represents 48 per cent of children in this
age group.
3.13 Of the children using some form of care, there were 624,400 children
who used formal care, i.e. 20 per cent of children under the age of 12.
Informal care was used by 1,128,300 children, which represented 36 per
cent of all children under 12 years of age. Some children use both formal
and informal care. The ABS found that the main providers of informal care
were relatives other than brothers or sisters. Nearly two-thirds of children
using informal care received care of this type. [6]
Table 3.4: Children under 12 years using formal and informal care,
by type of care, November 1990, June 1993 and March 1996
| Type of care |
November 1990 |
June 1993 |
March 1996 |
|
(`000) |
% |
(`000) |
% |
(`000) |
% |
| Formal care
Before/after school
|
44.0
|
1.5
|
85.8
|
2.8
|
111.7
|
Xx
3.6
|
| Long day care centres |
113.1 |
3.8 |
146.7 |
4.8 |
177.7 |
5.7 |
| Family day care |
78.1 |
2.6 |
80.7 |
2.6 |
96.2 |
3.1 |
| Occasional care |
* |
* |
50.0 |
1.6 |
52.4 |
1.7 |
| Other formal care |
57.4 |
1.9 |
30.0 |
1.0 |
22.2 |
0.7 |
| Preschool |
267.2 |
8.9 |
236.9 |
7.7 |
200.6 |
6.5 |
| Total children using formal care |
530.4 |
17.7 |
596.2 |
19.3 |
624.4 |
20.1 |
| Informal care
Sibling
|
196.5
|
6.5
|
159.1
|
5.2
|
165.1
|
Xx
5.3
|
| Other relative |
781.0 |
26.0 |
707.1 |
22.9 |
726.0 |
23.4 |
| Non-relative |
412.2 |
13.7 |
389.1 |
12.6 |
318.0 |
10.2 |
| Total children using informal care |
1,270.5 |
42.3 |
1.166.2 |
37.8 |
1,128.3 |
36.4 |
| Total children using care |
1,548.5 |
51.6 |
1,504.9 |
48.8 |
1,501.8 |
48.4 |
| Total children using neither formal
or informal care# |
1,455.2 |
48.4 |
1,581.0 |
51.2 |
1,601.0 |
51.6 |
| Total children under 12 |
3,003.7 |
|
3,085.9 |
|
3,102.8 |
|
*Occasional care included as `other formal care' prior to 1993.
#Includes children cared for by a parent or other organisation or looking
after themselves.
Note: Components do not add to totals as children could use both formal
and informal care.
Source: ABS, Child Care Australia 1996 p.12 and AIHW,
Australia's Welfare 1997, p.114.
3.14 The 1996 ABS Child Care survey found that the proportion of children
using child care varied with the age of the child, particularly with the
use of formal care. In 1996, only 8 per cent of very young children, ie
those under the age of one year, were in formal care, while 34 per cent
were in informal care. The use of formal care increased rapidly from age
one (22 per cent) up to the age of four with 62 per cent of children
in formal care (this includes children aged 3-4 attending preschool).
With the commencement of school attendance, the number of children using
formal care fell, 12 per cent of five year olds, and continued to decrease
as children moved through school with only 6 per cent of the age group
9-11 attending formal care. In the same period, the proportion of children
using informal care was also higher for children below school age, than
for older children. [7]
Graph 3.1: Use of formal and informal care, March 1996.
Source: ABS, Child Care Australia 1996, pp.5,13.
3.15 Within the formal care sector, there were also differences in distribution
based on age: 21 per cent of children under two years of age used
family day care while only 10 per cent of the same age group used
private-for-profit long day care. Only 5 per cent of children attending
long day care attended school. The AIHW noted that some of the differences
reflected the purpose for which the service was established: long day
care centres and family day care were predominantly used by children under
school age. [8]
Table 3.5: Ages of children in CSP-funded child care services, by
type of service, 1994 or 1995 (%)
|
Age of children (years) |
|
| Type of service |
Under 1 |
1 |
2 |
3-4 |
5 |
6 and older |
Total |
Total number of children |
| Long day care centres |
|
|
|
|
|
|
|
| Community-based |
3 |
13 |
22 |
54 |
6 |
<1 |
100 |
76,857 |
| Private-for-profit |
2 |
8 |
18 |
58 |
9 |
4 |
100 |
142,513 |
| Employer and other non-profit |
5 |
15 |
21 |
50 |
7 |
2 |
100 |
16,655 |
| Family day care |
5 |
16 |
19 |
31 |
8 |
21 |
100 |
84,211 |
| Occasional/ other care(a) |
5 |
15 |
27 |
49 |
3 |
1 |
100 |
15,590 |
| Outside school hours care(b) |
– |
– |
– |
<1 |
10 |
90 |
100 |
74,772 |
- Includes occasional care centres, MACS and other multifunctional services.
- Does not include children in vacation care.
Notes
- The CSP census in 1995 covered only long day care centres and family
day care services. The most recent year for which data on occasional
care and outside school hours care services are available in 1994.
- Rows may not total to 100% due to rounding.
Source: AIHW, Australia's Welfare 1997, p.115 quoting DHFS
Factsheets & 1995 Census of Child Care Services
3.16 The ABS survey also found that type of carer for children in informal
care varied with age of the child, with children in the care of a sibling
likely to be older than children in other informal care arrangements.
At March 1996, 86 per cent of children cared for by siblings were
5 years or older. Other relatives were more likely to care for very
young children. [9]
3.17 The 1996 ABS survey results identify the main reasons for the use
of non-parental care. Work related reasons were given as the main reason
for use of formal care by children aged 0-4 who used long day care and
family day care (60 per cent and 72 per cent respectively).
For all children 0-11 years of age in formal care, this was the reason
for 87 per cent of children using OSHC services, 60 per cent
for long day care and 74 per cent for family day care. In contrast,
81 per cent of children attending preschool did so because their
parents considered it was beneficial for the child, for example by preparing
the child for school.
3.18 Parents' work was also the main reason given for the use of informal
care, with 47 per cent using informal care for this reason. However,
parent's personal reasons was an important reason for the use of informal
care as this reason was given for 41 per cent of children using this
type of care. [10]
3.19 The AIHW's analysis of CSP-funded places for 1994 and 1995 found
that 93 per cent of children attending before and/or after school
hours care did so because of parents' work-related reasons, while the
proportion in private-for-profit long day care centres was 69 per
cent, 81 per cent in community-based services and 91 per cent
in family day care. The AIHW noted that this was consistent with priority
access guidelines for CSP-funded places. [11]
3.20 The ABS survey also estimated use of child care related to labour
force participation. It was estimated that while 53 per cent of children
under the age of 12 years had both parents (or a sole parent) in
the labour force, 91 per cent of children using before and/or after
school care, 80 per cent in family day care, 68 per cent in
long day care centres, 55 per cent in occasional care and 69 per
cent in informal care had parents or a sole parent participating in the
labour force. [12]
Provision of child care services
3.21 Governments, private operators, employers and community groups provide
formal care services. For example, many family day care services are operated
and administered by local governments. Outside school hours care has traditionally
been operated by school-affiliated organisations, although recently other
service types such as long day care centres and family day care are including
OSHC services. Some long day care centres are now providing for preschool
education through specific programs run by qualified teachers, while other
preschools now operate for extended hours and a greater number of weeks
in order to qualify for Childcare Assistance.
Table 3.6: Agencies providing CSP-funded child care services, by type
of sponsorship, 30 June 1996 (%)
|
Long day care centres |
|
|
|
| Type of sponsorship |
Communitybased |
Private- for-profit |
Employer and other non-profit |
Family day care(a) |
Occasional/ other care(b) |
Outside school hours care(c) |
| Local government |
37.7 |
.. |
4.5 |
42.4 |
17.8 |
13.3 |
| Non-profit |
49.3 |
.. |
56.2 |
34.6 |
68.6 |
64.9 |
| Religious/ charitable |
12.2 |
.. |
9.7 |
15.8 |
4.8 |
12.7 |
| Privately owned |
.. |
100.0 |
15.5 |
.. |
.. |
0.3 |
| State/Territory Government |
0.5 |
.. |
13.4 |
7.2 |
4.9 |
7.8 |
| Commonwealth Government |
0.3 |
.. |
0.7 |
– |
3.6 |
– |
| Total(d) |
100.0 |
100.0 |
100.0 |
100.0 |
100.0 |
100.0 |
| Total number of agencies |
1,112 |
2,456 |
292 |
366 |
651 |
3,055 |
- Family day care coordination units.
- Includes occasional care centres and neighbourhood model services,
MACS and other multifunctional services.
- Includes vacation care funded under the year round care model.
- Totals do not always add to 100% since sponsorship is unknown in 0.3%
of agencies providing occasional/other care, and 1% of agencies providing
outside school hours care.
Source: AIHW, Australia's Welfare 1997, p.108, quoting
DHFS 1996 Factsheets.
3.22 The majority of child care services are funded through the Commonwealth's
Children's Services Program which is administered by the Department Family
and Community Services. State and Territory Governments also contribute
funding through joint agreements with the Commonwealth. While the Department
administers most CSP funding, States and Territories may also administer
CSP funding for specific child care services. It should be noted that
there are also places provided through State-only funded and unfunded
places.
3.23 CSP funding has been directed mainly towards places in long day
care centres, family day care and outside school hours care. The number
of operational child care places funded through the CSP has increased
from 114,391 in June 1989 to 331,200 in June 1997 and to 399,400 in June
1998. [13]
3.24 Places in long day care centres increased nearly threefold between
1991 and 1997. As a result of the extension of eligibility for Childcare
Assistance to private for profit centres from 1991, the number of places
in private centres (including employer sponsored) has grown about 20,000
new places every year since then, from 43,000 to around 140,000. This
greatly exceeded the original forecast of 28,000 places over the first
four years. Places in community-based centres grew by around 15 per cent,
from 39,700 to 46,400, between 1991 and 1997. The Department noted that
`the extension of Childcare Assistance to the private sector was not accompanied
by any planning controls, and had no restriction on the total number,
or distribution of places. Instead, it was assumed that private sector
growth would meet deficits in demand and would correspond to areas of
need'. [14] AIHW also noted that:
One of the main reasons for this disparity in growth is that community-based
long day care centres (unlike the other types of long day care centres)
have been subject to strict planning requirements in the form of a `needs-based
planning' process. Under this process, decisions allocating new child
care places to particular areas are made on the basis of demonstrated
need in the area for work-related care. [15]
3.25 During the same period, 1991-97, family day care places grew by
45 per cent, from 43,078 to 62,714. AIHW noted that the Commonwealth
has focused on increasing family day care places as they provide a high
proportion of long day care for babies, are considered to be a more flexible
form of care especially for parents who do not work standard hours and
have lower establishment costs in terms of expenditure on building and
equipment.
3.26 Between 1989 and 1996, outside school hours places have more than
doubled. The AIHW noted that OSHC places `accounted for the majority of
places promised under the 1988 and 1992-96 National Child Care Strategies
(50,000 out of 80,000 places), and almost all of the places had been established
by 30 June 1996. These places were promised in response to the high
demand for care for children of primary school age, particularly care
that children could access throughout the year.' [16]
Table 3.7 Growth in the Number of Long Day Care Based Places from
31 December 1991 to 30 June 1997
| Years |
Community Based Long Day Care |
Family Day Care |
Private/Employer and Non-profit |
Total Long Day Care |
| 1991 |
39,674 |
43,078 |
42,771 |
125,523 |
| 1992 |
40,262 |
45,454 |
53,210 |
138,926 |
| 1993 |
42,777 |
47,855 |
61,375 |
152,007 |
| 1994 |
43,399 |
51,651 |
80,374 |
175,424 |
| 1995 |
44,566 |
54,041 |
99,909 |
198,516 |
| 1996 |
45,601 |
60,091 |
122,462 |
228,154 |
| 1997 |
46,294 |
62,714 |
136,571 |
245,579 |
| 1998 |
51,700 |
63,700 |
142,900 |
258,300 |
Source: Submission No.894, Revised Appendix 3 (DHFS), DHFS
Annual Report 1997-98, p.138.
Table 3.8: Growth in the Number of Operational Places in OSHC and
Other Services for Australia from June 1994 to June 1997
|
Occasional care |
Multifunctional |
Multifunctional Aboriginal child care
services |
Outside school hours care |
| 1994 |
4,600 |
500 |
1,100 |
59,800 |
| 1995 |
4,700 |
500 |
1,100 |
64,100 |
| 1996 |
4,900 |
500 |
1,100 |
71,800 |
| 1997 |
4,900 |
600 |
1,100 |
79,000 |
| 1998* |
5,000 |
600 |
1,100 |
134,400 |
* OHSC for 1998 includes previously block granted vacation care places
& reflects consistent counting methodology.
Source: DHFS, Annual Report 1996-97, p.140, Annual Report
1997-98, p.138.
3.27 CSP-funded places are distributed throughout Australia. The proportion
of growth of long day centres has varied among the States and Territories,
with Queensland experiencing the greatest growth in long day care places
between 1991 and 1997.
Table 3.9: Proportion of Growth of Long Day Care Places By State and
Territories from 31 December 1991 to 31 December 1997
| Year |
NSW |
VIC |
QLD |
SA |
WA |
TAS |
NT |
ACT |
AUST |
| 1991 |
12,822 |
12,120 |
11,658 |
1,460 |
2,861 |
187 |
397 |
1,266 |
42,771 |
| 1997 |
42,603 |
30,109 |
46,380 |
5,361 |
11,401 |
767 |
774 |
2,546 |
139,941 |
| Difference |
29,781 |
17,989 |
34,722 |
3,901 |
8,540 |
580 |
377 |
1,280 |
97,170 |
| Proportion of Growth |
31% |
19% |
36% |
4% |
9% |
1% |
0% |
1% |
100% |
Source: Submission No.894, Revised Appendix 4 (DHFS).
3.28 There is also variation in the distribution by service type. For
example, in Queensland, the vast majority of long day care places are
located in private-for-profit centres, as this sector has expanded significantly
since 1991. The proportion of centre-based long day care services to family
day care places also varies between States and Territories. At December
1997, the ACT had 30 per cent more centre-based long day care places
than family day care places while in Queensland there was nearly five
times as many places in long day care than in family day care.
Table 3.10: Child Care Places By State and Territories as at December
1997
|
NSW |
VIC |
QLD |
SA |
WA |
TAS |
NT |
ACT |
AUST |
| Community-based long day care |
16550 |
11,260 |
7,510 |
4,120 |
3,480 |
1,520 |
850 |
1,090 |
46,380 |
| Private long day care |
37,850 |
25,180 |
44,420 |
4,070 |
10,240 |
490 |
520 |
1,440 |
124,210 |
| Non-profit employer sponsored |
4,750 |
4,930 |
1,960 |
1,290 |
1,160 |
280 |
260 |
1,110 |
15,740 |
| Family day care |
20,370 |
16,830 |
11,230 |
5,260 |
3,980 |
1,920 |
860 |
2,570 |
63,020 |
| Total long day care |
79,520 |
58,200 |
65,120 |
14,740 |
18,860 |
4,210 |
2,490 |
6,210 |
249,350 |
Source: Submission No.894, Revised Appendix 7 (DHFS).
3.29 AIHW indicated that between 1989 and 1996 the number of children
using these CSP-funded places had increased more than threefold, from
153,100 to 570,300. Children in family day care services doubled in this
period (from 51,800 to 102,400) while those using long day care centres
increased around fivefold (60,800 to 311,000). AIHW noted that there were
many more children using services than there were places indicating that
some children were in care part-time. [17]
For example, there were 60,100 operational family day care places in Australia
at June 1996. [18]
Table 3.11: Children in CSP-funded services, by type of service, 30 June
1989, 1991, 1994, 1995 and 1996
| Type of service |
1989 |
1991 |
1994 |
1995 |
1996 |
| Long day care centres |
60,800 |
135,400 |
227,300 |
266,900 |
311,000 |
| Family day care |
51,800 |
61,000 |
88,700 |
91,800 |
102,400 |
| Outside school hours care* |
29,900 |
46,800 |
63,900 |
99,300 |
112,600 |
| Other formal care |
10,600 |
19,000 |
16,800 |
39,100 |
44,300 |
| Total children |
153,100 |
262,200 |
396,700 |
497,100 |
570,300 |
*For 1996, there were an estimated 26,600 children in vacation care.
CSP statistics do not include these children in total in as it is considered
that they may be attending before/after school care.
Data are estimates only and rounded to nearest 100. Children using more
than one service type are included in each service type.
Source: AIHW, Australia's Welfare 1997, p.112
3.30 Evidence from the Department indicated similar figures for children
in Commonwealth funded long day care services (including family day care):
that numbers had grown from around 183,000 at 30 June 1991 to over
432,000 at December 1997. [19] The Department
also noted that the number of children using family day care schemes had
decreased by around 11 per cent between 1995-1997. [20]
3.31 The Department also indicated that in long day care centres, 71,000
families used community-based centres, while 206,000 used private centres,
24 per cent and 76 per cent respectively. [21]
Preliminary results from the 1997 Census of Child Care Services, estimated
to include non-respondents, indicated that 82,800 children used community-based
long day care centres and 211,900 used private long day care centres.
[22]
Government expenditure on child care
3.32 The Commonwealth and State and Territory Governments fund child
care. In 1996-97 State and Territory expenditure amounted to approximately
$400 million. Commonwealth expenditure on child care includes payments
for Childcare Assistance, Childcare Rebate, operational subsidies, capital
and other payments.
3.33 Over the last eight years the Commonwealth's expenditure on child
care has increased from $215 million in 1989-90 to $1.1 billion in 1996-97
with expenditure expected to increase to an estimated $1.3 billion in
2000-2001. This represents an average real growth of 3 per cent per annum.
Prior to 1996, outlays were growing at an average real growth rate of
9 per cent per annum. [23]
Table 3.12: 1998-99 Budget–Actual growth in expenditure on child
care
| ACTUAL EXPENDITURE - $mill |
| Year |
| Type of Expenditure |
89/90 |
90/91 |
91/92 |
92/93 |
93/94 |
94/95 |
95/96 |
96/97 |
| Childcare assistance |
97 |
143 |
289 |
384 |
497 |
592 |
657 |
711 |
| Operational subsidies |
80 |
65 |
92 |
100 |
112 |
120 |
132 |
143 |
| Capital |
7 |
6 |
10 |
6 |
4 |
4 |
10 |
12 |
| Rebate |
0 |
0 |
0 |
0 |
0 |
87 |
121 |
127 |
| Other |
31 |
30 |
43 |
49 |
59 |
71 |
72 |
73 |
| TOTAL |
215 |
244 |
435 |
538 |
673 |
875 |
991 |
1065 |
| BUDGET/FORWARD ESTIMATES (1998-99 BUDGET) - $mill |
| Year |
| Type of Expenditure |
97/98 |
98/99 |
99/00 |
2000/01 |
2001/02 |
| Childcare Assistance |
639 |
704 |
781 |
831 |
882 |
| Operational Subsidies |
95 |
94 |
94 |
93 |
94 |
| Capital |
13 |
24 |
14 |
6 |
4 |
| Rebate |
123 |
131 |
144 |
143 |
147 |
| Other |
131 |
124 |
127 |
144 |
169 |
| TOTAL |
1001 |
1076 |
1160 |
1217 |
1296 |
Note: The above may be slightly different from Budget Paper 1 due to
different inclusions/exclusions in the Budget Papers (eg payments to Centrelink,
payments to Program 4.2 Family Services).
Source: Submission No.894, Revised Appendix 2 (DHFS).
3.34 The level of growth of expenditure was mainly due to the extension
of eligibility for Childcare Assistance to all long day care centres in
January 1991 and the consequent growth in places in the private-for-profit
sector and to the introduction of the Childcare Cash Rebate on 1 July
1994.
3.35 The Childcare Assistance is the largest single item of expenditure
followed by the Childcare Rebate. Childcare Assistance grew from $97 million
in 1989-90 to $639 million in 1997-98. The fall in expenditure on
operational subsidies reflects the abolition of payment of operational
subsidies to community-based long day care centres from 1 July 1997
and out of school hours services from April 1998. The level of capital
funding declines in line with the completion of the joint National Childcare
Strategy. The `other' category includes programs to cater specifically
for children with special needs, program support and the Accreditation
process.
3.36 AIHW noted that:
Between 1990-91 and 1995-96, there was a shift from expenditure on service
provision to expenditure on measures to reduce the costs of child care
for parents, partly reflecting the relative growth in long day care centre
places attracting only Childcare Assistance. Over the period, the proportion
of CSP expenditure on capital loans, capital grants and operational subsidies
fell from 29% to 14%, while the proportion of expenditure on Childcare
Assistance and the Childcare Cash Rebate increased from 58% to 78%. [24]
3.37 The proportion of Childcare Assistance between 1990-91 and 1995-96
going to non-community based centres (including private-for-profit, employer
sponsored and other non-profit centres) increased from 20 per cent
to 56 per cent. Over the same period, the proportion of Childcare
Assistance going to community-based long day care centres fell from 45 per
cent to 20 per cent, while the proportion for family day care fell
from 31 per cent to 22 per cent. [25]
3.38 In evidence to the Committee, the Department noted that the actual
expenditure of the child care program for 1997-98 was lower than projected
in the previous budget:
That was because of lower than expected growth in places and changed
patterns of demand for child care. It was as a result of lower than
expected growth which, in a number of new child-care places in 1997-98,
is 13,700 lower than we had previously projected.
An accounting adjustment was also made and involved $25 million clawback
child-care assistance which had been advanced in 1996-97. There was also
a decline in the average cost per child place unit due to changed patterns
of demand and changed eligibility conditions. [26]
Future demand for child care
3.39 As noted above, the Department has indicated that there has been
lower than expected growth in places and changed patterns in demand for
child care. Changes to these two factors have a significant impact not
only on government expenditure and planning but also the accessibility
of child care services and the viability of the sector.
3.40 In its March 1996 survey of child care, the ABS measured the level
of unmet demand for child care. It found that between June 1993 and March
1996 the proportion of children under 12 years of age for whom parents
reported that they needed either some formal child care or additional
child care halved, falling from 16 per cent to 8 per cent of
children. [27] The Department also noted that
demand for child care places for children aged 0-4 years has been significantly
met, with 89 per cent of parents with below school age children able
to access the care they require to assist them to study, work or look
for work. Demand for school age care was estimated to be 63 per cent
met. [28]
3.41 In 1996 the EPAC Child Care Task Force examined demand for child
care and identified some of the factors influencing future demand:
- cost of child care services is one important factor influencing the
demand for services, with the cost affecting some parents' decision
on workforce participation;
- demographic trends including slowing in the rate of growth in the
number of children in age groups requiring care, changes in the nature
of the family, developments in female labour force participation and
education participation;
- family status including composition of families and decisions to delay
having a family; and
- labour market developments including increased female workforce participation,
home-based employment and technological developments. [29]
3.42 The EPAC Task Force produced some projections of the future demand
for child care. While noting that it was not possible to take into account
all relevant factors influencing demand for child care, by using projected
numbers in the age groups 0-4 years and 5-11 years and female labour force
participation, the Task Force estimated the demand for formal child care
for children in the age group 0-4 could increase from 406,000 to 441,000
children between 1996 and 2001. For this age group, informal care could
increase from 180,000 to 185,000. It was estimated that the demand for
formal care for 5-11 years could increase from 153,000 to 183,000 over
the same period while the demand for informal care could remain the same
at 575,000 children. This estimate assumes a constant fertility rate and
no change in the cost of child care to parents over the period to 2001
and an increase in the female labour force participation rate from 69
to 73 per cent by 2001.
3.43 EPAC also produced a number of illustrative projections examining
how changes in fees, government expenditure per child and female labour
force participation might affect the demand for child care. For example,
it was estimated that a ten per cent increase in fees, without a corresponding
increase in government assistance to parents, would result in a fall in
demand for formal child care for children aged 0-4 years from 406,000
to 369,000 or 16 per cent in the period 1996 to 2001. For children
aged 5-11 a similar increase in fees would reduce demand by 11 per
cent.
3.44 Conversely, a 10 per cent increase in government subsidies, with
no change in fees, will result in projected demand for child care places
for 0-4 year olds increasing 7 per cent and for 5-11 years olds increasing
2 per cent.
3.45 EPAC noted that there were some limitations to its analysis and
`the analysis abstracts from some significant flow-on effects to the type
and nature of care', with costs of formal care influencing demand for
informal care and substitution between higher and lower costs types of
formal care. [30]
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Footnotes
[1] Australian Institute of Health and Welfare,
Australia's Welfare 1997, AGPS, Canberra, p.99.
[2] Committee Hansard, 25.6.98, p.632.
[3] Australian Bureau of Statistics, 1997, Population
by Age and Sex, Cat.No. 3201.0, p.47.
[4] Committee Hansard, 25.6.98, p.641.
[5] AIHW, Australia's Welfare 1997, p.100.
[6] ABS, 1997, Child Care Australia,
March 1996, Cat. No. 4402.0, p.4.
[7] ABS, Child Care Australia, 1996,
pp.5,13.
[8] AIHW, Australia's Welfare 1997, pp.114,115.
[9] AIHW, Australia's Welfare 1997, p.114.
[10] ABS, Child Care Australia, 1996,
pp.5-6, 18-19.
[11] AIHW, Australia's Welfare 1997,
pp.115,116.
[12] ABS, Child Care Australia, 1996,
p.32.
[13] AIHW, Australia's Welfare 1997, p.105.
DHFS, Annual Report 1997-98, p.138.
[14] Submission No.894, pp.5-6, Revised Appendix
3 (DHFS).
[15] AIHW, Australia's Welfare 1997, p.105.
[16] AIHW, Australia's Welfare 1997,
p.106.
[17] AIHW, Australia's Welfare 1997,
p.112.
[18] DHFS, Annual Report 1996-97, p.140.
[19] Submission No.894, p.6 (DHFS).
[20] Committee Hansard, 25.6.98, p.631.
[21] Submission No.894, p.9 (DHFS).
[22] Budget Estimates 1998-99, Community Affairs
Legislation Committee, Answer to Senate Question on Notice, No.1 (DHFS).
[23] Submission No.894, p.5 (DHFS).
[24] AIHW, Australia's Welfare 1997,
p.111.
[25] AIHW, Australia's Welfare 1997,
p.112.
[26] Committee Hansard, 25.6.98, p.631.
[27] ABS, Child Care Australia 1996,
p.7.
[28] Submission No.894, p.6 (DHFS).
[29] Economic Planning and Advisory Committee,
Future Child Care Provision in Australia, Final Report, November
1996, pp.22-4.
[30] EPAC, Final Report, pp.24-7.