The week after Australia Day each year, around 260,000 five-year old Australians start school. Of those, almost 60,000 children – 23 per cent – will start school developmentally vulnerable in some way. Children who start school behind often stay behind, and are likely to finish school with skills and competencies that have not equipped them for the workforce or future life. The economic and social costs can be profound and long lasting.
The first five years of a child’s life are when most of their brain development occurs. It is a period when children are most open to learning and when the foundation stones for future learning can be laid. According to Nobel Laureate James Heckman, it is a period when the biggest returns on investment in education can be achieved.
Around the world, nations are investing more in the early years as a means of improving the ongoing learning capacity of their future workforce. As nations increasingly compete on the quality of their human capital, they recognise the vital national public interest in having an ‘all hands on deck’ economy when facing an ageing population and declining levels of workforce participation. In this global race to build human capital, Australia can no longer afford to leave 23 per cent of its future workers behind at the starting block of school entry.
Access to quality early learning has been demonstrated in numerous studies to provide the greatest benefit to the most vulnerable children. Yet these children are the least likely group to access quality early learning, often due to cost barriers.
Quality early learning provides more than mere child minding. Quality early learning involves qualified professionals delivering age-appropriate play-based programs. Quality early learning magnifies children’s development, their social competency and their resilience, and is very much in the public interest. A study of 2000 Australian children found that those who attended a quality preschool with a degree- or diploma-qualified teacher achieved around 30 points higher on their Year 3 NAPLAN tests. A long-running study tracking 3000 English school children, now up to age 16, found that children who had attended more than 2 years of quality preschool finished their GCSE examination (Year 10) with scores on average around 51 points higher than those who did not. This represents the difference between getting 8 GCSE at ‘B’ grades versus 8 GCSE at ‘C’ grades.
Reflecting the overwhelming case for the importance of quality early learning, the commonwealth and all 8 state and territory governments agreed to a landmark National Quality Framework (NQF) to raise the quality of early learning in Australia just five years ago. It is particularly pleasing to note that this support is bipartisan, with both Coalition and Labor governments championing the importance of the early years. Though Australia is playing serious catch-up with much of the rest of the world, the decade-long reform process in the NQF gives us a pathway to get there.
However as any informed shopper will tell you, quality comes at a cost. And government assistance to families, to help meet the rising cost of child care has not kept up. The result has been that too many families have been priced out of access to early learning and childcare. This results in a double negative – for the children who miss access to early learning opportunities, and for their parents who are then unable to re-join the workforce. Both sets of lost opportunities carry big costs for Australia that will accumulate over time.
Price Waterhouse Coopers has produced some modelling of the benefits of investing in quality early learning. They estimated a threefold benefit to the future productivity of the economy over coming decades – $6 billion from increased female workforce participation if childcare costs were made lower, $10 billion in improved productivity from the benefit of raising the quality of early learning, and a whopping $13 billion from increasing the participation of vulnerable children in early learning. Price Waterhouse Coopers’ modelling also found that while there was a short-term fiscal cost to making quality early learning more accessible and affordable, in the medium and long term it more than paid for itself.
Other research suggests that Price Waterhouse Coopers’ estimates could be understated. The Grattan Institute concluded that if Australia’s female workforce participation rate rose to that of Canada, our economy would be $25 billion better off. This is a figure often quoted by federal Treasurer Joe Hockey in making the case for increasing Australia’s low rate of female workforce participation, which ranks as the fourth lowest in the OECD.
Public investment should mirror the public interest, and the public interest case for investing in childcare and quality early learning is very strong. The National Commission of Audit, the Henry Tax Review, the OECD Going for Growth report, and the recent Productivity Commission Inquiry into childcare and early learning have all recognised this.
It is in the public interest for more children to start school ready to learn. This not only gives children the best start, it also saves the public many millions of dollars. It is in the public interest to provide additional support and early intervention for children facing disadvantages, and the first five years provide a crucial short window to redress the development gap. It is in the public interest to remove barriers to women’s workforce participation through the provision of affordable early learning and care for their children. And it is in the public interest to invest now in Australia’s future economic productivity by investing in the learning capacity of our future workforce. Australia invests far less in making quality early learning accessible and affordable than most industrialised countries. That needs to change. As a nation, we should not leave any of our children behind. We cannot afford to.
Julia Davison is CEO of Goodstart Early Learning, Australia’s largest provider of early learning and care, with 644 centres across Australia caring for 73,000 children from 61,000 families. Goodstart employs over 13,000 staff and has an annual turnover of around $800 million. Goodstart was created by a partnership of four of Australia’s leading charities – Mission Australia, Social Ventures Australia, The Brotherhood of St Laurence and The Benevolent Society – which saw the potential to operate the failed ABC Learning Centres, transforming early childhood education in Australia. Goodstart’s vision is for Australia’s children to have the best possible start in life. As one of the biggest social enterprises in Australia, Goodstart works to create social change by giving children access to affordable, high-quality early learning. Julia has a strong interest in public policy having completed a Masters in Public Administration at the Harvard Kennedy School.
This article was first published in Australia 21. It was part of a series entitled ‘Who speaks for and protects the public interest in Australia?’ See www.australia21.org.au.