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A path to universal early childhood education and care: Draft report

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Productivity Commission
Publication Date: 
23 Nov 2023

Executive summary excerpts

Early childhood education and care (ECEC) services are places where children play, form relationships, use their imagination and learn. For many young children and their families, ECEC is a part of everyday life. Nearly half of one-year-olds attend some form of ECEC, and about 90% of four-year-olds are enrolled in ECEC. For many children – especially those experiencing disadvantage and vulnerability – attending ECEC can have positive effects on their achievements at school and later in life. But children who would likely benefit the most from ECEC are attending less than average or not at all.


The terms of reference for this inquiry require the Commission to consider a ‘universal’ ECEC system. Reflecting on those children who are unable to access ECEC, the Commission considers a universal system would enable all children to access services that support their development by addressing current availability gaps. In the Commission’s assessment, such a system would enable all children to access three days, up to 30 hours, a week of affordable, high quality ECEC regardless of their parents’ activity status. This would also continue to support mothers’ (or secondary income earners’ within a couple) choices about paid or unpaid work, study or volunteering. Children and families who require additional hours would continue to be able to access them.

Universal access will require further expansion of services, with a commensurate increase in the availability of a qualified, appropriately remunerated and supported educator and teacher workforce. Universal, however, does not mean uniform. In a universal system, some form of ECEC would be available to all children regardless of where they live, but the mode of provision could differ depending on location and the needs of children. Nor does universal access mean compulsory, full-time or fully subsidised access. 

Achieving universal access will take time. As a priority, governments should address affordability and availability gaps for those least able to afford ECEC or who can only access few, if any, services. Governments should also improve support for services to ensure a system that is inclusive, flexible and well-coordinated. The draft recommendations in this report span: 

• availability – considering ways to make services available in areas of low supply, while ensuring that services offered exceed or at least meet quality standards. Governments are already investing in boosting the supply of ECEC but need to do more to ensure universal access. The regulatory system needs sufficient resources to monitor and enhance quality across ECEC services

• affordability – addressing concerns about inequities and lack of flexibility in the current subsidy structure, relaxing the activity test embedded in the Child Care Subsidy (CCS) to support universal access to ECEC, and increasing subsidy rates to low income families, so that ECEC is free or very low cost for those eligible

• inclusivity – ensuring that services are truly inclusive for all children. The programs intended to support inclusion reach only a fraction of the children who need them, and this needs to be addressed

• flexibility – supporting services to be more responsive to the needs of families, including investigating ways to reduce the proportion of hours that families (and taxpayers) are required to pay for even if children do not attend; removing restrictions around the provision of extended care in preschool; and ensuring that primary schools enable the provision of outside school hours care, wherever this is necessary.


The Commission invites feedback from sector participants and the broader community on the policy options included in this draft report. We are also undertaking separate processes to hear directly from children about what they value in ECEC services and what changes they would like to see. Their views, alongside submissions and public hearings, will inform the Commission’s final report, which will be handed to the Australian Government in June 2024.