Implementing Albo’s vision: Universal Early Childhood Education and Care in Australia

I was driving when I heard the Prime Minister, Anthony Albanese, say on the radio that a priority for his government’s second term would be delivering universal Early Childhood Education and Care (ECEC). My heart and head diverged. My heart had me shouting ‘you bewdy’ and ‘yahoo!!!!’ at the top of my voice at the car radio. I have long been an advocate for improved access to ECEC, particularly for children from disadvantaged backgrounds. But my head was telling me that this was going to be a lot harder than Albo thinks.

As a veteran of the last full frontal charge Australia made on early childhood policy with the introduction of the National Quality Framework in 2010, my head knew what it would take to develop a truly universal system. In 2010, I was the senior early childhood bureaucrat for the only liberal government in Australia (Western Australia) when the COAG ‘Ruddernought’ ploughed its way through the existing and understood roles and responsibilities of the Commonwealth, state and territory governments to create the National Quality Framework, and the ECEC system that we have today.

That experience taught me a whole set of acronyms – NQA, NQF, UANP, PTSD (COAG – Coalition of Australian Governments, NQF – National Quality Framework, UANP – Universal Access National Partnership, PTSD – Post Traumatic Stress Disorder). It left me with an unhealthy and certifiable hate for the Australian Federation’s founding fathers, who, in the year 1900 had allocated workplace relations (think childcare) to the Commonwealth and education (think preschool) to the states when drawing up the constitution. (I found relief by thinking that I wasn’t that badly off – the founding fathers had done a worse job with health.)

Fast forward 110 years to 2010, and I am in a room full of bureaucrats trying to unpick the patchwork of Commonwealth state and territory roles in the funding, regulation and delivery of ECEC, and then stitch it back together as a coherent National Quality Framework whole. Panadol all round. We did it, but the outcome wasn’t perfect, and no one was contemplating universal entitlement to ECEC for everyone under 4 years old.

Fast forward another 15 years to 2025 and I am sitting at the traffic lights, semi-retired, shouting at the radio. I know that my singly focused mind won’t be letting go of the machinations of how to deliver universal ECEC anytime soon. I think to myself, at least the Australian Competition and Consumer Commission (ACCC) and Productivity Commission reports, not to mention the South Australian Royal Commission Report, all of which have provided recommendations to the government on universal ECEC, will give me some bedtime reading to cure my insomnia. There has been no lack of focus on ECEC in recent years.

As with all things complex in the ‘Federated States of Australia’, meaningful policy change requires either a top-down locomotive (as early childhood had in the Rudd years) or a crisis, to provide necessary impetus for governments to get things done. Early Childhood reform in 2025 seems to have both. We have a determined Prime Minister at the top with a vision of universal ECEC, and a desert and quality crisis in ECEC’s grassroots. Meaningful early childhood reform will never again be this ripe for the picking. The window is open, and it’s our time in the sun.

So, what concrete actions need to be implemented to achieve universal ECEC? There is no shortage of advice – the three meaty government reports mentioned above are a starting point. All made recommendations on what needs to be done. However, collectively, they provide little practical guidance on how to do it. I had found this to be a common problem in my time working in government; reports that make ‘high-level’ or ‘idealistic’ recommendations without offering concrete public policy steps to enact them. Everyone is left furiously agreeing with the ideal, with no one knowing what to do next.

This article outlines pragmatic steps for implementing universal ECEC in Australia. I am doing this because I believe that, as early childhood stakeholders, we need to provide the government with concrete advice on what to do. To do this, we need to have the debate on ‘what to do’ ourselves. Hopefully, this commentary will stimulate some discussion.

Readers should note that the focus of this article is ECEC, and it does not encapsulate other (important) areas of early childhood development, such as child health, safety and parenting (nor does it seek to comment on the current issues surrounding ‘Thriving Kids’). Integrating these areas with ECEC is critical, but not the focus of this article.

Step 1. The Commonwealth Government sets a clear vision for universal Early Childhood Education and Care

Before setting a vision for universal ECEC, it is helpful to define it. The Productivity Commission’s definition of universal ECEC was that all children, regardless of their background or circumstances, have access to high-quality, affordable and inclusive early learning and care services for 3 days a week. This appears to have been widely accepted by both the government and early childhood stakeholders.

I am a literal person. What it means to me is that, regardless of where you live, every child can access early childhood education and care for 3 days a week if they want to. This implies that in every suburb, rural town or remote community, there will be sufficient ECEC services (places) to cater to all children aged 1–4 years who want to access ECEC, either free of charge or at a low cost. When you describe it like this, it’s a big vision!

The age range of 1–4 years in my literal description above is worthy of discussion. What entitlement should families receive for children from birth to age 1 year? I think the entitlement should be for Paid Parental Leave (PPL), and not a universal entitlement to ECEC. The primary reason for this is that we know that attachment to parents in the first years of life is critically important for a child’s development and later learning. A secondary reason is that providing ECEC for babies is expensive due to the need for high staff ratios. In addition to the expense, we currently face workforce shortages that are unlikely to be resolved anytime soon.

Even better, increasing flexibility so that the PPL can be taken over a more extended period than the first 12 months if desired (at no additional cost to the government) and providing incentives for it to be shared between parents would enhance the benefit to families and children. A novel idea would be to give parents a choice between PPL and 3 days a week of ECEC in the first year of a child’s life, but not both at the same time.

A further consideration is what the entitlement should be for 3- and 4-year-old children – ‘childcare’ (unstructured, with no requirement for a qualified teacher to be present in the room) or ‘preschool’ (an intentional learning program, with a qualified teacher in the room).

Three-year-old preschool provision across the country is a dog’s breakfast. Some states and territories are moving towards free access for all children for a set number of hours, while others offer it to some children (generally vulnerable groups) for varying lengths of time. I would offer 1 day (7 hours) of a preschool program within the 3-day ECEC entitlement for all children, with additional days of preschool available for those who need them.

Four-year-old preschool provision varies widely across Australia, and is a further example of a dog’s first meal of the day. All children are entitled to 15 hours of preschool (generally 2.5 days) in the year before formal school. This is provided and funded by some state and territory governments as part of the school system and, in others, it is funded by the Commonwealth and delivered in the ECEC system. Some states are moving to provide 30 hours (5 days) a week. I would increase the entitlement to 3 days of preschool (22 hours), but it should maintain its voluntary status (2–3 days a week of preschool is plenty for little children).

So, after a much longer preamble than readers deserve (even definitions in early childhood policy are complex), the Commonwealth Government should set (or clarify) a clear vision for universal early childhood education and care. I think it should state that universal ECEC is defined as:

• 3 days a week, free or low-cost ECEC for all 1–4-year olds;
• An entitlement to 7 hours of preschool as part of a 3-day offering of ECEC for 3-year olds;
• An entitlement to 21 hours of preschool as part of a 3-day offering of ECEC for 4-year olds; and
• Parents of children from birth to 1 year of age are entitled to 12 months of paid parental leave, which can be shared.

Step 2. The Australian Government signs a multilateral agreement with states and territories to implement universal Early Childhood Education and Care and establish an Early Childhood Development Commission

The Commonwealth Government should negotiate an Agreement (effectively a ‘Heads of Agreement’) with states and territories to implement universal ECEC. The key points of the Agreement should be:

• The Commonwealth will provide operational funding for all children to access free or low-cost ECEC for all 1–4-year olds for 3 days a week;
• The Commonwealth, states and territories agree to a long-term funding arrangement for 4-year-old preschool, with Commonwealth funding being equitably distributed between jurisdictions;
• States and territories agree to audit the current ECEC provision in their jurisdiction and prepare a plan for the rollout of Universal ECEC. The plan would include new infrastructure needing to be built over the next 10–15 years, focusing on communities that currently have no or low current ECEC provision;
• The Commonwealth will enhance the Building Early Education Fund to provide infrastructure costs for new ECEC provision in childcare deserts where this is required; and
• States and territories agree to take responsibility for building new infrastructure (and/or re-fit infrastructure such as schools) in areas with an undersupply or no ECEC using funds from the Commonwealth. The current Building Early Education Fund (BEEF) would be repurposed and expanded in the future to support states and territories achieve this.

This is a situation designed to validate the old saying, ‘easier said than done’. Effectively, the Commonwealth Government is asking the governments of the states and territories to be active partners in its vision for universal ECEC, and to share the burdens of implementation (if not some of the costs).

However, there are a couple of things in the Commonwealth’s favour. Currently, most state and territory governments are Labor, and are politically aligned with the Commonwealth Government. This makes negotiation easier. Secondly, state and territory governments are likely to incur a political backlash with their own voters if it is deemed that they are preventing or delaying the provision of universal ECEC in their jurisdiction by being unduly difficult in their negotiations.

And a final thought – the current ECEC system in Australia is inequitable (or regressive, as economists like to say). The Commonwealth Government spends approximately $14 billion annually on subsidies for parents to enable their children to participate in ECEC. As the balance of providers is concentrated in middle- or high-income areas (where private providers tend to cluster because families have a greater capacity to pay), Commonwealth funding disproportionately flows to better-off families. The Commonwealth Government could appeal to the states and territories’ sense of justice and ask them to collaborate in addressing the current inequities in the ECEC system.

My point here is that an agreement is possible, and I don’t think the Commonwealth can achieve universal ECEC without the active cooperation of the state and territory governments. There has to be an agreement.

Step 3. Establish an Early Childhood Commission – A joint body between the Commonwealth and states/territories

In accordance with the multilateral agreement described in Step 2, the Commonwealth, state and territory governments should establish an Early Childhood Commission, or a similar body, that combines and aligns the roles of the Commonwealth and the state and territory governments (which you might call a Watchdog, given the current quality crisis in the sector). The Commission should not be permanent; instead, it should be established for a specific period to oversee the rollout of universal ECEC (initially for 5 years). Its role should be to oversee the implementation of universal ECEC.

The initial focus of the Commission would be:  

• Providing advice to the Australian and state and territory governments on the rollout of universal ECEC;
• Develop a new funding model to enable the supply-side funding model in childcare deserts (including small rural and remote communities);
• Resolve differences between the Commonwealth, states and territories in the funding of 15 hours of 4-year-old preschool;
• Implement new regulations that control where new ECEC centres can be established; and
• Work with ACECQA (Australian Children’s Education and Care Quality Authority) to improve the Quality and Regulation of ECEC (address the current crisis).

To understand why a Commission (or similar body) is needed, it is worth revisiting the basics: who is currently responsible for funding, regulating and delivering ECEC (as I describe with some pain in the introduction). Then again, you might not bother to try to understand it unless you want your head to hurt. Due to the differing constitutional arrangements (for care and education), the responsibility is divided between the two (and sometimes three) levels of government – Commonwealth and state/territory. Table 1 provides an overview of the current state of play regarding who is responsible for what in ECEC.

With overlaps in two of three key areas of ECEC policy, you understand why early childhood pundits have called for a ‘Commission’, or a ‘New National Agreement’, to sort out who does what when it comes to ECEC. A ‘Commission’ would combine the powers of the Commonwealth and the states/territories into a single point of authority, utilising the combined and aligned authority of both levels of government to provide the much-needed leadership for the ECEC sector.

Another option to establish a Commission would be to enhance the role and responsibilities of ACECQA, the current national regulatory body for ECEC. This is possible but would be slow to enact (it would involve passing legislation through each of the Commonwealth, state and territory parliaments), which may prove problematic in the short term, and may act as a disruptor to current regulatory arrangements precisely at a time when you don’t want to do this. Having another body, such as a Commission, work alongside ACECQA in the short term seems a more pragmatic option.

And a word of note

Table 1 also illustrates why a Commission, or enhanced ACECQA with more authority and resources, is necessary to address the current child safety crisis in the ECEC sector. Both the Commonwealth and the states/territories are responsible for regulating ECEC, and neither can do it effectively without the cooperation of the other (see row three of the table). The current arrangement is that the Commonwealth funds the National Regulatory Body (ACECQA), which maintains, monitors and reports on the national standards. At the same time, the states and territories are responsible for funding the regulatory units that visit ECEC centres to check their quality (against standards) and assign ratings. Arguably, the states and territories are at least equally accountable for the current quality crisis, as I contend they have underfunded regulatory units, resulting in some ECEC services reportedly being assessed every few years (or longer) in some states and territories.

Step 4. The Commonwealth Government signs a bilateral agreement (to underpin the multilateral agreement) with each state and territory to roll out universal ECEC

The next step would be for the Commonwealth to negotiate bilateral agreements with each state and territory to implement universal ECEC in their respective jurisdictions (as outlined in the multilateral agreement described above). The process I would use is for the Commonwealth to ask each state and territory to present an implementation plan for universal ECEC. The implementation plan would identify the following:

• Areas where there is an undersupply or no supply of ECEC (Childcare Deserts);
• Locations that would be suitable for new ECEC supply-side funded centres (see step 5 below);
• Preferred delivery model for small rural and remote communities (e.g. delivered by not for protits (NFPs), including Aboriginal Controlled Community Organisations (ACCOs) and/or delivered by schools); and
• The cost, including infrastructure costs (for example, refitting or extending existing facilities such as schools).

Once agreed upon and the funding amount determined, the Commonwealth and each state and territory would then sign the bilateral agreement, and rollout would commence. The Commonwealth would provide the majority of the funding (I would give an efficiency reward payment to the states and territories to make sure they don’t ‘guild the Lilly’ on what it might cost); in return for the states and territories agreeing to manage the rollout and oversee ECEC provision.

The big sticking point with this step is money. Bilateral negotiations between the Commonwealth and the states and territories regarding funding have been notoriously difficult over the years (e.g. the Gonski Schools Funding Agreement). I can imagine that the Commonwealth would be reluctant to engage in any negotiation that would likely result in a substantial cost to itself. Still, it is the Commonwealth’s (Albo’s) commitment to fund, either solely, or through agreement with the states and territories.

However, the Commonwealth does have some leverage. The states and territories are responsible for funding preschool (if preschool is redefined as part of each child’s education, as it is in practice in some states and territories), and the Commonwealth could legitimately ask them to contribute some funding for the preschool component of universal ECEC (as many jurisdictions are already doing).

Another point to note is that the Commonwealth can determine the timeframe for the rollout (5, 10, 15 20 years), which helps manage the cost, and which communities should be prioritised (e.g. those in low-income communities, outer metropolitan) in any rollout.

Step 5. Introduce a new supply-side funded ECEC model in childcare deserts

The introduction of a supply-side funded model (where the government provides funding directly to the provider, rather than a market model where funding is provided to the parent to ‘purchase’ ECEC off the provider) is to address the twin issues of affordability and access to ECEC in areas of current undersupply and no supply (childcare deserts). This step is a significant reform – it introduces a new funding model into the Australian ECEC system.

My assumption (and also the assumptions of the Productivity Commission and the ACCC) is that the current market (demand side) model of ECEC will not provide ECEC services in childcare deserts, no matter how much you tweak it. For-profit providers, by definition, will not choose to operate in low-income communities that return lower profits when they can earn higher profits in more affluent communities. Without explicitly stating so, the Commonwealth Government has already acknowledged the need for a new supply-side funding model for ECEC by commissioning work to determine an ‘efficient price’ for ECEC, which is the necessary first step in determining the ‘price’ that providers should be paid in supply-side contracts.

Accordingly, the government should establish a new funding and delivery model for new ECEC centres in childcare deserts, beginning with low-income communities, and these centres should have supply-side funding arrangements. The Building Early Education Fund (BEEF) and any available funds from philanthropy could be allocated for this purpose. Effectively, the Australian Government would be introducing an alternate funding model for ECEC in thin markets to ensure that ECEC is accessible to all children (particularly for the kids living in rural and remote areas, most of which are childcare deserts), and that these services are of high quality. I say ‘high quality’ deliberately - governments have much more control over quality in supply-side funded contracts.

Variations of supply-side funding models should be explored. For example, existing providers may have some places in their service funded by supply-side funding arrangements (effectively, the government purchasing places from existing providers). At the same time, other children in the same centre continue to be financed from the existing demand-side (child care subsidy (CCS) and parent-funded) model. This would give the government greater leverage to require quality from providers, and providers could choose to ‘opt in’ or ‘out’ of the arrangement. Further, it would allow the government to calibrate more effectively the number of places it needs in any given community to deliver universal ECEC (concept provided by Matthew Cox, Bryan Foundation).

In introducing this new model, I would also pilot a ‘fixed-fee’ approach in some of the new centres, such as $10 a day. Research has shown that fixed-fee models are very popular with the public. This will give the government much-appreciated support (political capital) for its universal early childhood reforms (us advocates should not under-estimate the importance of ‘political capital’ in implementing any major policy reform).

Step 6. Implementation

Once the bilateral agreements are signed, the Early Childhood Commission would be tasked with overseeing implementation. The timeline for implementation would be set by the Commonwealth (5, 10, 15 20 years – largely dependent on the need to manage costs).

The states and territories, rather than the Commonwealth, have to oversee the ‘on-the-ground’ implementation. This is a big statement! There are several reasons for this. First, the states and territories have a much better understanding of current ECEC provision in each community, enabling them to collaborate with local stakeholders and providers to determine the most effective approach for providing universal ECEC that meets the community’s needs. For example, states and territories may already fund local community ECEC and child health services and, through the regulatory units, visit all ECEC services.

Second, they own land and infrastructure that can be used to build new ECEC capacity if required. For example, they operate public schools, many of which have land or existing buildings that can be used to expand ECEC provision. A third reason is not immediately apparent – they have an existing supply of early childhood-qualified teachers who could have part of their role directed towards supporting an ECEC service located on or near a school site, which would greatly alleviate current staffing shortages.

The rollout of the 3-year-old preschool and expansion of 4-year-old preschool from 15 to 30 hours in Victoria and South Australia provides a template for how the states and territories can manage a rollout. Without using too many words to describe the methodology, the Victorian and South Australian Governments complete a local ‘provision’ plan for each region, which considers existing ECEC providers and arrives at the most effective and efficient approach for each area. They then work in concert with local stakeholders to implement the plan.

Summary

And Bob’s your Aunty. Universal ECEC gets rolled out across Australia. It might take 5, 10,15 or even 20 years, depending on funding constraints, but at least there would be a path forward. The significant steps involve the Commonwealth setting a clear vision for universal ECEC, establishing a partnership with the states, and introducing a new supply-side funding model, initially in childcare deserts.

Importantly, it does this without disruptive reform. The existing ECEC ‘demand-side’ funded delivery model for ECEC remains in place, while a new ‘supply-side’ funded model of delivering ECEC is introduced to address access, affordability and quality issues.

The purpose of writing this article was to stimulate discussion on the steps to achieving universal ECEC. The reason it was written was that, despite the widespread support for universal ECEC from early childhood advocates at the recent National Early Years Policy Summit, there was little discussion on the concrete actions that governments need to take to achieve it.

The steps outlined above may not be the final ones implemented if the Prime Minister’s vision of Universal ECEC is to be achieved. However, a vigorous policy discussion must occur among us early childhood advocates to determine what the steps should be. The risk is that, without clear advice, governments will choose inaction.

Therefore, critique of this article is most welcome.