Child Care in Australia report December quarter 2018

Introduction

This is the second issue of the Child Care in Australia quarterly information report under the new child care system. It presents data for the December quarter 2018 period and provides information on child care across Child Care Usage, Availability, Fees and Entitlements in Australia including states and territories.

Key Highlights

Overall, 1,369,870 children and 974,600 families attended a Child Care Subsidy (CCS) approved child care centre in the December quarter 2018. Of these, 1,316,080 children were eligible for Child Care Subsidy.

Average hours of use across all service types was 24.7 hours.

Total entitlements (Child Care Subsidy and Additional Child Care Subsidy) were $1,961 million for the December quarter 2018.

Average hourly fees (across all care types except In-home care) were $9.55, a 0.5 per cent increase since the September quarter 2018.

Child Care Usage

Children

During the December quarter 2018, 1,316,080 children used approved child care in Australia representing a quarterly marginal decrease of 0.02 per cent and an annual increase of 1.0 per cent (or 13,140 children). Children attending Family Day Care decreased significantly by 24.1 per cent from 167,220 children to 126,930 children over the year to the December quarter 2018. This is largely attributed to compliance measures implemented by the Government to address fraudulent activity.

By service type, Centre Based Day Care (58.6 per cent) had the highest proportion of children followed by Outside School Hours Care (34.5 per cent) and Family Day Care (9.7 per cent). (Note that In-home care has been excluded from all state and service type analyses and child care usage analyses due to privacy considerations.)

By state, New South Wales had the largest share of children attending approved child care (33.1 per cent), followed by Victoria (24.2 per cent) and Queensland (23.0 per cent).

Note: In-home care has been excluded from these percentage calculations due to privacy considerations.

There were 27,180 children accessing Additional Child Care Subsidy in the December quarter 2018.

Indigenous children

During the December quarter 2018, 50,950 Indigenous children used approved child care in Australia up 1.5 per cent from the September quarter 2018. The large number of Indigenous children captured under the new child care system largely reflects Budget Based Funded services being incorporated in mainstream child care, as well as changes to the way Indigenous children are defined. (Please see technical notes.)

By state, New South Wales had largest share of Indigenous children attending approved child care (35.9 per cent), followed by Queensland (35.0 per cent) and Victoria (9.0 per cent). (In-home care has been excluded from these percentage calculations due to privacy considerations.)

In addition, a significant proportion of Indigenous children attended Centre Based Day Care (68.2 per cent). This compares with 58.6 per cent for all children in child care. More than a quarter of Indigenous children (26.0 per cent) attended Outside School Hours Care while 8.5 per cent of all Indigenous children attended Family Day Care.

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Families

Families

During the December quarter 2018, there were 923,390 families accessing child care. This represents a decrease of 0.8 per cent (or 7,640 families) from the previous quarter but a 2.8 per cent increase (or 25,500) in annual terms. The number of families accessing Family Day Care decreased by 18.3 per cent from 104,840 in the December quarter 2017 to 85,610 in the December quarter 2018. This again was due to the compliance measures implemented.

In relation to families in Centre Based Day Care by state, New South Wales had the largest share of families attending (33.7 per cent), followed by Victoria (24.5 per cent) and Queensland (22.7 per cent).

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There were 18,150 families accessing Additional Child Care Subsidy in the December quarter 2018.

Average weekly hours

During the December quarter 2018, average weekly hours of child care use per child (excluding In Home Care) was 24.7 hours. In Centre Based Day Care the average was 29.5 hours per week.

In relation to Centre Based Day Care by state, Northern Territory had the highest average weekly hours (36.2 hours), followed by the Queensland (31.4 hours) and the Australian Capital Territory (30.8 hours). Tasmania had the lowest average weekly hours (23.9 hours).

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Availability

Services

During the December quarter 2018, 12,886 approved child care services operated in Australia. There were 7,826 Centre-Based Day Care services, which accounted for 61.0 per cent of all services and 4,512 Outside School Hours Care services, which accounted for 35.1 per cent of all services. Family Day Care comprised 3.9 per cent of all services. (These percentages exclude In-home Care.) Nationally, there were 49 In-home Care services.

Note: In-home care has been excluded from these percentage calculations due to privacy considerations.

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Fees

Costs of care before Australian Government fee assistance

During the December quarter 2018, the average hourly child care fee for all service types (excluding In Home Care) was $9.55. This represents a 0.5 per cent increase from $9.50 in the September quarter 2018.

Across care types, Outside School Hours Care had the lowest average hourly fee ($7.30 per hour) while Family Day Care ($10.15 per hour) had the highest. Average hourly fees for Centre based Day Care was $9.80.

Data on average hourly fees by Statistical Area Level 3 (SA3) is now available.  It shows that the regions with the highest average hourly fees are in parts of Sydney, Melbourne, Perth, Canberra, Brisbane and in some mining regions. Fees in these areas have changed very little compared to the previous year.  Generally, the highest rates of growth are associated with the areas with lower fees. Many of the regions with the high mean fee growth were in regional Queensland, NSW and other parts of regional Australia.

Note: In-home care has been excluded from these percentage calculations due to privacy considerations.

The hourly rate cap (children below school age) for Centre Based Day Care was $11.77.

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Total Entitlements

Total estimated expenditure

The total estimated expenditure (Child Care Subsidy and Additional Child Care Subsidy) during the quarter was $1,961.2 million up by 0.6 per cent since the September quarter 2018 ($1,948.6) and by 7.3 per cent over the year to the December quarter 2018 ($1,827.2).

The majority of entitlements were paid in relation to families using Centre Based Day Care services ($1,553.2 million or 79.4 per cent). Family Day Care comprised 11.7 per cent of total entitlements in the December quarter 2018 and increased by 2.2 per cent in the quarter but decreased by 26.0 per cent since the December quarter 2017.

Note: In-home care has been excluded from these percentage calculations due to privacy considerations.

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Additional Information

Technical Notes

The introduction of the new child care package on 2 July 2018 changed major components of the child care system resulting in a break in series for some child care metrics. Points to note include:

• The population of children that are included in child care data reports from 2 July 2018 onwards covers those children who have been allocated a Customer Reference Number (CRN) by Centrelink.
• Changes to child care service approvals and service types has resulted in a reduced number of service approvals. For example, prior to 2 July 2018, a provider delivering vacation care, before school care and after school care would have been counted in child care data as three different services rather than the one Outside School Hours Care service as is the case from 2 July 2018 onwards. Accordingly, it is typically not possible to compare the number of services before and after the introduction of the new child care system.
• Prior to July 2018, approved child care types included Long day care (LDC), Family day care (FDC), In home care (IHC), Occasional care (OCC), Before school care (BSC), After school care (ASC) and Vacation care (VAC) (with BSC, ASC and VAC aggregated to form Outside School Hours Care). From 2 July 2018 onwards, approved child care types are Centre Based Day Care, Family Day Care, In Home Care and Outside School Hours Care. Only Family Day Care and In Home Care remain unchanged to compare service counts over time. Comparisons using pseudo service types may be undertaken to make broad comparisons (children, families, services) across the two child care systems by service type e.g. Combining LDC and OCC may provide a pseudo comparison group for Centre Based Long Day services in some instances with appropriate caveats.
• In Home Care subsidies became family based on 2 July 2018 and prior to this date they were child based. For this reason In Home Care is excluded from some tables in this report that are child based metrics (e.g. average hourly fee per child, average hours per week per child etc).
• Many services that were Budget Based Funded services prior to July 2018 have now been included in mainstream child care within Centre Based Day Care services.
• Due to the inclusion of many of the Budget Based Funded services into mainstream child care, the number of Indigenous children and families has increased compared to the counts under the previous child care system. In addition, changes have been made to the way Indigenous children and families are defined. Previously children associated with an Indigenous customer were counted as Indigenous, however, children are now also counted as Indigenous if the customer's partner is Indigenous. Similarly, Indigenous families are now counted when either the customer or the customer's partner is Indigenous. Previously, only customers who were Indigenous were counted as Indigenous families.

General counting rules

All analysis broken down by state in this report corresponds to the state of the service rather than the state where the child/family lives.

Use of child care services is counted for each individual child, who has been allocated a Customer Reference Number by the Department of Human Services (DHS), using approved child care services. An instance of child care usage is defined as at least one child care attendance per child care service for the quarter irrespective of duration or frequency. For example, a single hour at an In Home Care service or 40 hours per week throughout the quarter at a Centre Based Day Care, are both counted as an instance of child care usage.

Children and families are recorded for each of the service types that they use during the quarter. Children and families using more than one service type during the quarter or financial year are counted only once within each applicable service type category and only once within the 'Total' category for the relevant time period. Note that as children and families may use more than one service type in any particular timeframe the sum of the component parts may not equal the 'Total' category.

With the introduction of the new child care system, on 2 July 2018, counts of approved child care services reflect the number of services operating the four types of approved care; Centre Based Day Care; Family Day Care In Home Care; and Outside School Hours Care. A service is counted as 'active' only if it had at least one child attending at some time during the quarter, thus aligning the counting rules for children, families and services.

Child Care Subsidy estimation

The Child Care Subsidy (CCS) estimation method used in this report:

• CCS is likely to be under-estimated as only CCS payments made during the quarter are reported and not the amounts customers were actually entitled to but did not receive (for example because of families over-estimating income to avoid debts).
• Doesn't take into account reconciliation which will adjust the customers' CCS actual entitlements based on their actual rather than estimated incomes. There is a considerable time lag for the reconciliation process to be complete.

Data sources

Data included in this report comes from the following sources:

• The data is extracted from the Department of Human Services Enterprise Data Warehouse.

Revisions:  Due to changes in the administrative system, data may be revised to ensure the most accurate, up-to-date figures are published.

Definitions

Additional Child Care Subsidy: A payment that provides targeted additional fee assistance to families and children facing barriers in accessing affordable child care.

Approved care:  Care provided by Centre Based Day Care, Family Day Care, In Home Care and Outside School Hours Care services approved by the Australian Government to receive Child Care Subsidy on behalf of families.

Child Care Subsidy (CCS):  A payment made by the Australian Government to families to assist with the cost of child care.

Child Care Subsidy System (CCSS):  The technical platform through which providers and families interact with government in relation to child care subsidies.

Customer Reference Number (CRN):  An individual reference number allocated by Centrelink for each child and one for each parent or guardian who is claiming Child Care Subsidy.

Family Day Care:  A type of child care that is usually provided in the home of an educator.

In-Home Care: A flexible form of early childhood education and care where an educator provides care in the child's home. It is restricted to families who are unable to access other forms of early childhood education.

Centre Based Day Care:  Child care that is provided in licenced or registered centres. It can include any pattern or arranged of care provided in this setting.

Outside School Hours Care:  Outside School Hours Care provides care before and after school hours and during school vacations for children who normally attend school.

Region:  Regions of Australia are classified according to the Australian Bureau of Statistics Australian Statistical Geography Standard (ASGS), July 2011. This classification divides each state and territory into several regions on the basis of their relative access to services.

Service:  Child care services are approved by the Australian Government to receive CCS on behalf of families. Most Centre Based Day Care, Family Day Care, Before and After School Hours Care services and some In Home Care services are approved child care services. The total number of services refers to the number of services that were active during the quarter, that is, they had at least one record of child care attendance in the quarter.