Address to McKell Institute

Thursday, 17 May 2018

Melbourne, Victoria


I would like to start by acknowledging the traditional owners of the land in which we meet and pay respect to elders past and present.

Good afternoon and thank you to PwC and to McKell for inviting me here today.

I’ve been in the Early Education portfolio now for almost six months. When McKell and PwC invited me to lunch today I thought it would be a good opportunity to share my early impressions, and my priorities as I start to develop Labor’s early education policy for the next election.

Since being appointed I’ve made it a priority to get out and about and talk to early educators, providers and parents about what is, and isn’t working out in the child care centres, preschools and kindies of Australia. In recent weeks I’ve visited early learning centres and kindies in Nowra, Wollongong, Warnervale and Mount Gravatt.

The Liberals Budget

Last week I was in Canberra for Budget week.

One of the often quoted phrases in politics is that a budget is an expression of a government’s values. I think it’s spot on.

And what we saw last week was very disappointing. The Government confirmed once and for all it does not value early education or childhood development.

They’ve locked into their changes to the system from July which will make it harder for the most vulnerable families to access early education.

Their activity test is viewing early education as predominantly child minding. They believe if you aren’t working, your child shouldn’t get early education.

The budget is silent on out of school hours care – which parents tell me is in seriously short supply.

It says nothing on the early education workforce – which we know is seriously underpaid and undervalued.

It has no further funding commitments for preschools and pushes the cost of regulating the National Quality Framework to the states and territories – undermining one of the pillars of our early education system.

So what can we conclude after the budget? This is a government that simply does not think making widely accessible early education is a priority.

I, of course, completely disagree.

And, I might add, it is personal. I’ve got skin in the game.

I am mother to a 3 year old. I want him to have the best possible start in life. I know that doesn’t make me unique – but I want our early education system to be set up to succeed for our children – to put our children at the centre of our early education system.

I want to make the most of the opportunity I have to shape the future direction of early education for many years to come.

The importance of early childhood education

We know that quality early education leads to a range of better education, social and health outcomes for children later in life. It literally lays down solid foundations for life.

In recent years there has been a stack of new research released that build this case:

  • Studies from the UK and United States, for example, have shown that children who had attended preschool had significantly better reading and maths scores in primary school and better results at age 16;
  • Local data shows that pre-schoolers have higher language and cognition NAPLAN scores in Year 3;
  • Children who attended early learning are 8 per cent less likely to be in special education, and are 11 per cent more likely to graduate high school;
  • Kids in early learning have lower rates of drug use, smoking, imprisonment, and better body mass index.

I could go on – that’s just the highlights.

Critically, the research confirms the benefits are higher for vulnerable children.

Those are all worthy social outcomes. In the economic language of Treasury and Finance, the cost-benefit analyses show a conservative return of 2 to 4 dollars for every dollar invested. PwC analysis from 2014 found a return of 2.69 in Australia.

Governments get more than double the return on investment from improved productivity as a result of increased female workforce participation, increased education outcomes, and decreased spending on social and health programs.

That’s a smart investment of scarce taxpayer dollars.

The Government’s looming changes

But Australia is not doing well enough to unlock these benefits.

It could have been so different. The Government had a real opportunity when it commissioned the Childcare and Early Childhood Learning review in 2013.

But I think from the get-go the government got it wrong with its narrow Terms of Reference. The Commission was tasked with preparing recommendations to boost workforce participation. I don’t for a moment suggest that accessible and affordable early education isn’t a critical workforce participation enabler – it absolutely is, and the government is probably right that their changes will increase the number of hours worked. It is also a key lever for reducing the gender gap in labour force participation.

However, the government declared its ideological hand – child care is only about promoting economic participation. Absent was any focus on how important early education is for children.

The government’s changes are labelled Jobs For Families – making it clear it is all about the labour market. It seems clear their changes will have a disastrous impact on access to early education for those kids who need it most.

The government’s own figures show this. We know 279,000 families will be worse off – most of them in vulnerable families.

As many of you would know, families will now have to meet a set of complex activity and income tests in order to quality for various levels of child care subsidy.

Children in families where the parents aren’t working will have their child care access cut in half to only 12 hours subsidy per week.

Children in families earning over $65,710 where one parent is at home caring will have no access to subsidies. Parental home care is now worth nothing under a conservative government.

Children in families where one parent doesn’t work sufficient hours will lose access to the subsidy – this could be a family that does seasonal work, irregular hours, contract work or casual work.

They’ve also moved to a system that assesses family activity on a fortnightly basis, requiring update of reporting every three months and then adjusts the subsidy accordingly. This system totally ignores how families and centres plan their early education arrangements, staff rosters, and enrolments.

Furthermore, comments by the Minister in the media recently criticising centres for charging parents on public holidays and when children are only in care for half the day demonstrates a lack of understanding about the practicalities on the ground of delivering early education and care.

At a time when we should be looking at how to best expand access to early education, this government is making changes that will restrict access, and that means kids will start dropping out of the system – most likely those vulnerable kids who need early education the most. This has been reflected in updated budget figures which show less payment in the child care subsidy over the forward estimates.

It is deeply concerning the Ministers response to criticism that vulnerable children are missing out on early education and care has been to say their parents should basically go get a job and stop bludging off the taxpayer.

One other missing element from the governments’ changes is any kind of response to increasing access to out of school hours care. Just letting the market take care of it is not a good enough response. We know that in some places in the country parents can easily access afterhours school care but in other places it is a struggle. A recent survey by the Parenthood found that while almost 60 per cent of families plan to use afterhours school care this year, over 22 per cent missed out on a place.

If we are serious about tacking workforce participation, then access to afterhours school care has to be part of the solution


We see the same indifference from the government to early education in the government’s preschool policy.

I use the word policy a bit too loosely here because the government simply doesn’t have a preschool policy.

Co-operation between federal and state levels of government when it comes to preschools is one of the public policy success stories of the last decade. Since the first agreement was signed by Labor in 2008, preschool enrolment has increased from 77 per cent to almost 93 per cent.

There is no doubt that access to four year old preschool gives our children the best head start for school and for life.

Labor doesn’t need any convincing. It should be bipartisan.

But since being elected in 2013, the government has refused to commit long term funding certainty from preschools. It has begrudgingly rolled over one year of stop-gap funding to preschools, creating massive uncertainty for families, staff, and the sector.

Why? They either don’t believe in it, or they are trying to be sneaky and keep their budget deficit lower.

A few weeks ago I started a campaign calling on the government to properly fund preschools in the budget. I did it out of hope more than expectation. And sadly I was not the least bit surprised last week’s budget was silent on any new preschools funding.

That says it all about their priorities.

And 350,000 4 year olds could have their hours reduced, if that funding is not secured.

This is not good enough for the future of our children.

To rub salt into the wound, there was no funding in the budget to extend the national partnership funding for the National Quality Framework. The government has decided to shift the cost of implementing and regulating the quality framework wholly onto the states and territories.

The quality framework is a success story – 57 per cent of services have improved their quality rating when reassessed – and 75 per cent of services are now meeting or exceeding the National Quality Standard.

This budget cut is also a signal from the federal government that the days of cooperative federalism in early childhood education are over. It is essential that the states and federal government work together to deliver improved outcomes for our children.

Another signal comes in their sneaky cut to the National Partnership Agreement on Occasional Care. This agreement funds predominately rural and regional services to provide care before and after the formal preschool program and allows these services to offer a full day service to families where there is no viable long day care. With this cut from the government many of these services will have to reduce services or close – meaning vulnerable children from regional Australia will miss out.

Federal Labor’s priorities

So while I have been critical of this Government, in a year or so from now I hope to be the Minister for Early Childhood Education and Development.

Over the next year I will be developing Labor’s policies for the next election – and I will be working with many of you here in the room today on that.

So whilst I don’t have any special announcements for you today, I would like to share what my guiding principles will be as we work up policy.

I’m disturbed that Australia sits below the OECD average for investment in early childhood education. The literature shows early education directly leads to better outcomes at school. It shows that vulnerable and disadvantaged children do even better and catch up to their peers.

The workforce participation benefits are also well known – which is a good thing economically of course, but also a critical lever for progressing gender equality.

When investment in early education provides benefits between 2 to 4 times the costs, it is literally a no-brainer to focus limited taxpayer resources on early education.

Therefore my primary goal and motivation will be to begin to increase access to early education for Australian children.

When all the evidence tells us that early education contributes to improved educational and social outcomes for Australian children, I think it is a step backwards that government is tightening access to early education for some families.

I don’t want Australian kids to start missing out on access to early education because the government in Canberra doesn’t think their parents are working enough.

I will be looking at how I can start restoring access to the system, starting with lower income families as a priority.

I think the government has pushed the system back too far towards a policy that is only designed to support the workforce – it is much, much more important than that.

While the new system has its problems I recognise the sector is expending considerable time and resources rolling it out and the last thing they need is for a new Labor Government to come in and throw it all out.

I have heard from the sector on this so I intend to allow the new system to have time to bed down before I look at a proper review.

However, one thing I want to look at in advance of a review is how the activity test is impacting on access to early education for vulnerable families. As I said, I am deeply concerned these children will start to drop out of the system, and that is unacceptable.

Preschool funding as you all know is a key issue. In government we will look at providing more certainty to our nation’s preschools and kindies. As I said earlier, preschools and kindies don’t have any funding commitment from the federal government after the 2019 school year.

We are jeopardising the gains made in the last decade:

  • The increase in enrolment of 4 year olds to 93 per cent, and the increase in attendance for 600 hours up from 12 per cent to 91 per cent;
  • The implementation of the National Quality Standard, including the Quality Framework and minimum educator qualifications and staff ratios; and
  • The Early Years Learning Framework, which staff and providers all value.

What I won’t do, as Minister Birmingham has done, is blame patchy data as a reason to stop talking to the states and territories. I will make it a priority to sit down with my state and territory colleagues in a constructive and productive manner – I won’t play the tired old ‘blame the states’ game. Early education and care is just too important for that.

It has been almost a decade since the first national partnership agreement was signed, and the first National Early Childhood Development Strategy was endorsed. It is well and truly time to have these conversations again.

As Minister, funding for our preschools and kindies will be one of my highest priorities.

I know I can’t escape talking about preschools without saying something about my thoughts on three year olds.

I don’t need any convincing on the evidence or merits for extending preschool to three year olds. Recent papers, including the Mitchell Institute’s Two Years Are Better than One and the Lifting our Game report, have made the case convincingly.

It is well and truly on my radar. I am keen to look at how the Commonwealth can support access for 3 year olds and how it can be funded and delivered, along with states, providers and stakeholders. Those discussions aren’t trivial as I am sure you understand.

Another part of the sector that has been ignored for 5 years is the early learning workforce.

Labor recognises that quality early education and care can only be provided by a skilled, professional and well paid workforce.

The early learning quality agenda Labor introduced means our early childhood educators are more qualified and skilled than ever. Indeed, there was a 48 per cent increase in the number of early childhood teachers between 2011 and 2016.

But they are not being adequately supported by the government, which has:

  • Let the Early Years Workforce Strategy expire in 2016;
  • Abolished the Long Day Care Professional Development Program; and
  • Ended funding for Professional Support Coordinators.

If we are going to have an excellent early education system the educators and teachers are the key.

It is not right that those who educate our youngest minds earn less than half the average national wage.

As skilled professionals, it is right that those educators who we trust shape our youngest citizens are paid a wage which is in line with the quality we expect from them.

Along with Brendan O’Connor I will sit down with our early educators and work on a plan.

Then there are other trouble spots through the portfolio that have been ignored under the government.

Parents are telling me there is a serious shortage of outside of school hours care places in areas of high demand. The current system, where schools are left to decide on whether they will offer OOSH services or not, is not working, and the regulations on space requirements appear to be too restrictive.

I am also concerned that rural and regional services are being left behind with the changes to the Budget Based Funding program. Although the impact of this is yet to be fully understood, some services have already made the decision to close their doors.

Neither of these issues will be resolved without the involvement of government.


So that’s a quick helicopter view of the key issues as I see them and what my emerging policy priorities are.

It has been a very enjoyable first six months. I am passionate about Early Childhood Education and Development. There are few other policy areas where the decisions and funding can have such an outsized positive impact on social and economic outcomes. The policy levers in this portfolio affect the entire community.

I am determined to make the most of that fact to implement positive changes that benefit all children and ensure our early education and child care system is built around their needs – not the needs of government.

I’ll keep moving about the country and talking to parents, providers and early educators to get the front line feedback. And talking to peak bodies and experts such as yourselves of course.

Thanks again to PwC and McKell for having me here today.

If you have any questions, please fire away.


More News

Wednesday, 09 May 2018
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Sunday, 06 May 2018
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Friday, 04 May 2018
Preschool funding under threat, low income families to suffer