Budget Review 2021–22 Index
Dr Shannon Clark
In the 2021–22 Budget, the Australian Government has committed
to a continuing funding contribution for preschool (known as kindergarten in
Victoria, Queensland, Western Australia and Tasmania).
Measures: Budget Paper No. 2: 2021–22
allocates $1.6 billion over four years from 2021–22 to be delivered to the
states and territories through a new four-year funding agreement, with ongoing
funding of $589.0 million per year (indexed) from 2025–26 (p. 91; see also, Federal
Financial Relations: Budget Paper No. 3:
2021–22, p. 41). The new agreement will support universal access to
preschool for children in the year before school for at least 15 hours per week
(600 hours per year).
The new four-year Preschool
Reform Funding Agreement will make funding contingent on state and
territory governments agreeing to a ‘robust reform timeline’ (Budget
Paper No. 2, p. 91), aimed at increasing children’s attendance and
school-readiness. Funding is to be tied to preschool attendance targets from
2024 and a preschool outcomes measure is to be developed and trialled for
introduction in 2025.
measure also provides funding to improve data collection and a new
performance framework to underpin the reforms, including $33.6 million over
five years (and $2.0 million per year ongoing) for the continuation and
expansion of the annual National Early Childhood Education and Care Collection
(NECECC) and the development and trialling of a method for testing whether
preschools are achieving the outcome of getting children school-ready (p. 91).
Although not stated in the description, this measure addresses
recommendations from a recent
review by the Nous Group of the National
Partnership on Universal Access to Early Childhood Education (UANP),
delivered to the former Council
of Australian Governments (COAG) Education Council in March 2020. In line
with the review’s recommendations, this measure represents a shift in emphasis
from access and availability towards attendance and quality as well as a shift towards
more enduring arrangements for preschool funding.
Background and universal access
In Australia, state and territory governments are
responsible for the provision of preschool. Arrangements differ across
jurisdictions with preschool programs delivered in a range of different contexts,
for example, school-based settings, stand-alone services, and centre-based day
care; and by a range of organisations, including governments, not-for-profit
and for-profit providers (see Chapter 2 of the Nous Group review).
For families in financial need, states and territories offer free or subsidised
services (p. 10). Some states and territories provide free preschool in
government preschools and/or subsidise programs delivered by eligible
non-government services (p. 27).
Since 2009, the Australian Government has contributed to
preschool education via national partnerships. Federal, and state and
territory government leaders signed the first National
Partnership Agreement on Early Childhood Education in December 2008. It
committed governments to providing every child with access to a high-quality
preschool program in the year before full-time schooling (YBFS) by 2013.
Preschool programs were to be delivered by a four-year university qualified
teacher, in accordance with a national early years learning framework, for 15
hours a week, 40 weeks a year. Programs were to be accessible across diverse
settings and ‘in a manner that ensures cost does not present a barrier to
access’ (p. 5).
In 2013, government leaders agreed to the second national
partnership, the National
Partnership Agreement on Universal Access to Early Childhood Education,
which covered preschool services until the end of 2014. Under the second
agreement, and furthering the National Early
Childhood Development Strategy’s vision that ‘by 2020 all children have the
best start in life to create a better future for themselves and for the nation’
(p. 4), the agreement committed governments:
to maintain Universal Access to quality early childhood
education program(s), with a focus on improved participation of vulnerable and
disadvantaged children, and in a manner that meets the needs of children,
parents and communities and ensures that cost is not a barrier to participation
One of the performance benchmarks set in the second
agreement was for 95% of children to be enrolled in a quality early childhood
education program in the year before school for 600 hours a year, including 95%
of Indigenous children and vulnerable and disadvantaged children. Annual
attendance targets would be agreed in jurisdictions’ implementation plans,
moving to 90% over time (p. 7).
Subsequent national partnership agreements extended the UANP
on a shorter-term basis. Since 2015, there have been six extensions of the UANP
2016 and 2017; 2018; 2018 and 2019; 2020;
and 2021). The extension for the current UANP, which runs for the 2021
calendar year, was announced
in April 2020.
Table 1 shows Australian Government contributions to the
UANP since 2009 in real dollars. The $1.6 billion allocated under the Guaranteeing
Universal Access to Preschool budget measure is in addition to the amounts for
Australian Government payments for universal access national partnerships,
2009–10 to 2021–22 (real, 2021–22 dollars)
Note: real funding has been calculated by the Parliamentary
Library by deflating the nominal expenditure figure by the June quarter CPI and
CPI forecasts from the 2021–22 Budget;
this methodology may differ to that presented in the Budget papers.
Source: Australian Government,
Final budget outcome, multiple years; Australian Government, Federal financial relations: budget paper no. 3:
2021-22, p. 37.
Impact of the National Partnership
on Universal Access on Early Childhood Education
The Nous Group’s UANP
Review found that the UANP had had a significant impact on the
provision of and participation in affordable, quality preschool, and was a
‘significant national accomplishment’ (p. 13).
Since 2015, all States and Territories have consistently met
the top benchmark of achieving 95 per cent or above for the proportion of
children enrolled in a quality preschool program in the YBFS (p. 49).
The review found that jurisdictions had invested
significantly to increase the number of services, the workforce, and to change
community attitudes (p. 48).
The participation of Aboriginal and Torres Strait Islander
children and vulnerable and disadvantaged children had also improved:
- across all states and territories, there had been a steady
increase of the proportion of Aboriginal and Torres Strait Islander children
enrolled and attending preschool programs of 600 hours, rising from 87% in 2013
to 96% in 2018 (p. 51) and
- improvements had also been made for vulnerable and disadvantaged
children; however, the review noted that there is no nationally agreed
definition of ‘vulnerable and disadvantaged’ under the UANP (p. 51). Using the UANP
performance indicator methodology, the review found that, nationally, the
proportion of vulnerable and disadvantaged children enrolled in preschool
programs for 600 hours had risen slightly, from 92% in 2014 to 94% in 2018 (pp.
The review noted that
participation of children in rural and remote areas was a known challenge due
to thin markets for preschool services and early childhood workers (p. 53).
New directions in data collection
and performance-based funding
The budget measure proposes to make Australian Government
funding contingent on reforms which increase participation and school-readiness.
Funding would be tied to attendance targets from 2024, rather than enrolment
targets as it is currently. Again, this reflects the UANP
Review’s findings and recommendations.
The review also emphasised the need for new and robust
measures for measuring attendance before new targets are set, finding: ‘Current
measures of attendance are not suitable for performance reporting or funding
decisions’ (p. 15).
The review also found that the UANP’s current attendance
target was unrealistically high and recommended setting a more realistic target
in the future (p. 15):
The UANP references a goal of achieving an attendance rate of
100 per cent for 90 per cent of eligible children – a higher attendance rate
than in the compulsory full-time school systems. This is unrealistically high
in a non-compulsory and not universally-free system. While this goal is not
tied to funding, it is nevertheless used as a performance indicator (p. 99).
In relation to preschool quality, the budget measure
includes funding for the development and trialling of a preschool outcomes
measure for introduction in 2025. Such a measure would test the degree to which
preschools achieve the outcome of getting children school-ready.
Currently, Australia collects national data on the
developmental health of children at the start of full-time school through the Australian Early Development
Census (AEDC). The AEDC is held every three years and collects data
relating to five key domains of early childhood development:
- physical health and well being
- social competence
- emotional maturity
- language and cognitive skills (school-based) and
- communication skills and general knowledge.
Review recommended that negotiations about future funding agreements
should consider the value and feasibility of child-focussed outcomes measures
and should consider whether AEDC results should be included as a performance
indicator, although it recommended that it should not be tied to funding (p.
Where to next for preschool
The Nous Group’s 2020 UANP
Review recommended a five-year National Partnership to replace the then
current UANP to enable time ‘to work through a range of reform priorities and
to lay the foundation for new, more enduring funding arrangements from 2026’
(p. 15). Although the UANP was again extended on a short-term basis in April
2020 (in the context of the COVID-19 pandemic), the four-year funding agreement
included in the 2021–22 Budget otherwise puts the reform in line with the
recommendations from the review. As such, it may be that governments’ next move
is ‘towards a National Agreement pertaining to preschool in the YBFS,
potentially underpinned by legislation’ (p. 15).
Details of the new Preschool Reform Funding Agreement will
need to be negotiated by education ministers. At the September 2020 meeting of
Council, education ministers tasked officials with developing advice in
relation to the UANP Review to assist with future planning for early
childhood education. The Education Council was due to discuss the advice at its
second meeting in 2021; however, following changes to the federal relations
architecture, education ministers will meet in 2021 as the Education Ministers
Meeting. It is unclear when meetings will be held in 2021.
What about three-year-olds?
As discussed above, the budget measure indicates a shift in
emphasis towards participation in and quality of preschool. Another
consideration for future directions for preschool in Australia, and an element
of the current measure that stakeholders identified as not going far enough, is
support for preschool for three-year-olds.
In response to the 2021–22 Budget, Samantha Page, CEO of
peak body Early
Childhood Australia, welcomed the longer term funding for preschools, but
also stated: ‘Ultimately we want this to be extended to younger children, in
line with international best practice’. Similarly, CEO of Thrive
by Five, Jay Weatherill stated: ‘Locking in four-year-old preschool is also
welcome but the government has missed an opportunity to extend this to
While some states do offer two years of preschool, there
have been increasing calls for universal access to preschool to be expanded to
three-year-olds across Australia. For example, an independent review
commissioned by state and territory education officials in 2017 considered
effective early childhood interventions and how to improve outcomes for
children both at school and in subsequent education and employment. One of the
report’s key recommendations was for universal access to be expanded to all
three-year-olds, with access prioritised for disadvantaged children, families
and communities during roll-out (p. 80). It argued:
In terms of improving school outcomes through early childhood
interventions, the evidence points to this as the single most impactful reform
Australia could undertake, with international comparisons highlighting it as
the biggest gap in the current system. The case for this investment is
compelling (p. 8).
As noted in the Budget Review article
Care Subsidy changes, it remains to be seen how changes to the Child Care
Subsidy (CCS) will interact with preschool programs, and whether the changes to
CCS will create an incentive for families with multiple children under six to
move children into child care services to be eligible for the higher rate.