A new research report from Victoria University’s Mitchell Institute called  Counting the cost to families: assessing childcare affordability in Australia found early childhood education and care ECEC is unaffordable for more than 385,000 Australian families.

Although Australia has affordability measures for other common household expenses, we don’t have an accepted way to measure the affordability of ECEC. Nearly 40% of Australian families using ECEC services exceed the international benchmark of no more than 7% of disposable income spent on ECEC.   The Australian government’s recently announced childcare subsidy  takes effect in July 2022. These changes will help families with 2 or more children under 6 in ECEC services, but they still leave ECEC unaffordable for about 336,000 families and will not provide fee relief for about 1 million families.

The research used HILDA data to compare the cost of ECEC to other common household expenses, and found that such expenses often exceeded utility, transport and sometimes grocery costs. 

Making ECEC more affordable will improve workforce participation, but importantly it will ensure more children receive the developmental benefits of formal early learning.