Chapter 1: Rethink the national ECEC system
This chapter recommends making the safety, rights and best interests of children the paramount consideration for decision making in ECEC services and a fundamental rethink of the system by governments.
1.1 Child safety needs to underpin the ECEC system
The safety, rights and best interests of children must underpin all decision making in the ECEC system, from staff on the floor in centres right up to the boardrooms of service providers.
Article 3 of the United Nations Convention on the Rights of the Child requires the best interests of the child to be a primary consideration in all actions concerning children undertaken by public or private social welfare organisations. Under the ECEC system’s National Law, the rights and best interests of the child is one of 6 ‘guiding principles of the National Quality Framework’. However, it does not stipulate how this principle must be applied.
While it is clear to the Review that the majority of services across the system care deeply about the children in their care and prioritise their safety, there are tensions in the system that lead some providers to prioritise other things, including profit in some instances. The current mix of legislative and regulatory obligations for providers can create potential conflicts between the best interests of children and other duties.
The Review heard that the rapid expansion of the sector has created perverse incentives for shortcuts in education and training and that some for-profit providers may feel pressure to maximise value to shareholders.
Current legal frameworks are often interpreted as prioritising procedural fairness for employees, which can act as a brake on employers taking early or decisive action to protect children, for fear of industrial or legal challenges. Privacy laws can be seen as a barrier to proactive information sharing relating to individuals of concern. All these factors can divert focus from what is truly in the best interests of children.
These broader concerns filter down and inform decisions within services and can stifle reporting and important information being passed on to those who need it. Queensland’s Review of System Responses to Child Sexual Abuse reported that fear of reputational risks, or defamation and other legal risks to both organisations and individual staff may deter staff from raising concerns about a person and sharing that information with those who need to know, particularly where allegations have not been substantiated.
The Wheeler Review in New South Wales recognised these challenges in ECEC services, saying:
In addressing any competing interests, providers and services must ensure that the interests of enrolled children are of paramount importance in all decisions and transactions. Providers and services must place their duty to enrolled children ahead of those owed to their shareholders and other stakeholders.
Making the safety, rights, and best interests of children a ‘paramount consideration’ in the National Law is needed to unequivocally place children’s needs and interests above all other considerations. As Anne Hollonds, the National Children’s Commissioner, has said:
‘Everyone involved needs to make child safety their number one priority,
from the boardroom to the sandpit.’
This paramount consideration obligation should apply to staff in services; responsible persons; persons with management or control; approved providers of services; and entities that own and fund approved providers of services, including board members.
The amendments to the National Law should consider inconsistencies with Commonwealth and state/territory laws; establishing the necessary architecture to include actors other than providers and services, such as directors and office holders, and employees; and enforcement powers and options.
Detail of how to interpret the concepts of the safety, rights and best interests of children as a paramount consideration should be included in the Regulations and through operational guidance. This should consider how to minimise risks of differing and conflicting interpretations and the risk of unintended consequences in application, such as discrimination or unreasonable expectations placed on employees. Current frameworks for workplace occupational health and safety requirements may provide a useful model. These make clear that occupational health and safety is everyone’s business, duties and responsibilities apply to all levels of organisations, they are outcomes-based and build a shared understanding and culture of safety and risk management. They are usually accompanied by clear policy, guidance and training to operationalise.
Governments should produce guidance to make it clear how this paramount consideration should operate in practice for different decision makers—from senior managers in head office through to educators in the room—and how to manage conflicts of interest. Given this would be a change to the National Law, the Australian Children’s Education and Care Quality Authority could produce this guidance, as it has for the recent National Quality Framework Child Safe Culture Guide.
Recommendation 1: Safety, rights and best interests of children Make the safety, rights, and best interests of children the paramount consideration for staff in services, managers, service providers, their owners, funders and board members. This should be done by changing the National Law. |
1.2 The system needs fundamental change
The ECEC system has grown rapidly to meet the community need for early childhood education and care.
Since 2015 in Victoria, the number of long day care services has grown from 1,280 to 2,049—a 60 per cent increase. Over the same time, there has been a small increase in standalone kindergarten services, growing from 1,197 to 1,236 (3.3 per cent). Of the 769 new long day care services in Victoria since 2015, 726 (94 per cent) are operated by for-profit providers. For-profit long day care services in Victoria are more likely to be ‘Working Towards’ the National Quality Standard than not-for-profit long day care services, and less likely to exceed the National Quality Standard. An overview of the ECEC system in Victoria, including more data and trends over time, is at Appendix 2.
This rapid growth has not been accompanied by a coherent plan to ensure the delivery of safe and quality services. Rather, the market has been left to respond to financial incentives that encourage providers to open services and charge high fees, but does not drive investment in quality or safety, or a stable, capable and professional workforce. It means that the funding a service receives is linked to the fees charged to parents, not the needs of the children or the cost of delivery of high-quality education and care. It allows providers to charge premium fees for a minimum standard service, and in some cases maximise profits from the system. The child care subsidy represents a large amount of taxpayer’s money and needs much tighter controls on how it is spent.
It may have once been that a market-driven approach was appropriate for the ECEC system—when the sector’s composition was different, and when workforce challenges were not so significant —but this is no longer the case. It is clear now that this system is not delivering the outcomes government wants, or the community expects.
Governments need to monitor and understand how the system is changing, including who is entering or leaving the sector. They need to reconsider how they fund, monitor, support and regulate the system. The market has been allowed to run too far, for too long.
Australia’s ECEC system needs a fundamental reset.
1.2.1 Governments need to take responsibility for running the ECEC system
Governments need to use their levers and adapt their settings to protect children and families and get the outcomes sought from the system, including educational outcomes for children.
Current roles and responsibilities for the ECEC system is split across Commonwealth, state and territory, and local governments. They have evolved from a historical split of responsibilities where the state or territory is responsible for ‘education’ and the Commonwealth Government for ‘care’ to support workforce participation. This split doesn’t match the daily experience of children and families. Children are always learning, even when in ‘care’, and many children receive the dedicated ‘educational’ program (kindergarten) in a long day care service. Despite the aspirations of a single National Quality Framework, the split continues to drive governments’ approach to the system.
The Commonwealth Government is the majority funder of child care for children aged from 0–5, but states and territories are the majority funder of kindergarten for 4-year-olds (and 3-year-olds, where offered). States and territories are responsible for regulating all services in the sector, but the largest portion of services they regulate are long day care services driven by Commonwealth Government funding.
This leads to gaps in the system.
The workforce is the main way to deliver quality and safe services for children, but no government is specifically or holistically responsible for the workforce, and the ECEC sector and workforce continues to experience many challenges.
A lack of dedicated and coordinated effort, funding settings and the funding approach have contributed to workforce challenges including shortages, casualisation, the use of labour hire staff, and high turn-over rates.
In Victoria, 66.8 per cent of long day care and kindergarten service staff have 3 or fewer years at their service, including 22.7 per cent who have less than one year. Analysis of large providers nationally by the Australian Competition and Consumer Commission showed not-for-profit long day care services had a 27 per cent turnover rate, and for-profits had a 41 per cent turnover rate. Further context on the ECEC workforce is in Appendix 2.
No single factor is determinative of child safety, but there are many influencing factors. A workforce that is highly casualised may be less likely to feel comfortable to speak-up and report something if they have concerns. A workforce that is low paid and not properly valued by the community may struggle to attract and retain the most capable people. A workforce that struggles to attract staff may lead to services having to choose between hiring staff they don’t have full confidence in, or reducing capacity and turning children away. A workforce where many are less experienced, or are still working towards their qualification, may not know what to look for to protect and promote child safety, or how to report concerns. A workforce that has high turnover makes it hard to build a strong culture within a service, or strong relationships with children. A workforce where one staff member undertaking professional development ‘off the floor’ creates rostering and operational challenges is not one where professional development will always be prioritised.
Governments must work together to clarify and resolve their responsibilities in ECEC, ensuring that gaps are filled and ambiguities resolved. This should then be formalised, for example, in a broad intergovernmental agreement that addresses the whole ECEC system, and any funding implications addressed through a National Agreement.
1.2.2 The system needs a long-term vision and a plan to achieve it
The Commonwealth Government should lead work with all levels of governments to clearly articulate Australia’s vision for the ECEC system. This should include moving from a split approach to ‘education’ and ‘care’ to a strong, system-wide focus on the safety, wellbeing, education and development of every child, in every setting. This will clarify for governments what they are using their levers to achieve and send a clear message to the sector and the community about where the system is heading. Governments started developing a National Vision for Early Childhood Education and Care in Australia, but this has stalled. It should be restarted.
Governments should then develop a long-term plan to meet their objectives. This should outline how they will move ECEC from a market-driven model to a system that is actively managed with greater emphasis on quality and safety for children. This could include:
- reform to the funding system, or a new funding system, to better align incentives, ensure value for money for governments, and limit the ability of providers to unreasonably profit from public funds
- sustained and coordinated investment in the pay and conditions for the workforce and future workforce planning
- tighter regulation of providers, including being more willing to use funding and regulatory levers to remove low quality or poor performing providers from the system
- consideration of the optimal market composition and balance of providers in the sector, and how this can be achieved
- investment and support for high-quality providers to expand, especially not-for-profit providers who may need additional help
- investment in incentives and support for quality improvement
- monitoring the level of profit being generated from public funding
- greater coordination and planning of provision, and planning for service transition when providers fail or have funding or approvals withdrawn; and
- equity and inclusion of children from different socio-economic backgrounds, cultures or those with disability or developmental delay.
While a long-term plan is important to addressing systemic issues in the ECEC system, some actions cannot and need not wait. Elsewhere in this report, the Review has recommended the Commonwealth Government commence a quality improvement program in long day care services, resume investing in the regulatory system, change funding rules to better support staff professional development, and fund grants to improve lines of sight in services. All these actions can commence almost immediately and, in the context of a long-term reform program, are ‘no regrets’ investments that will be of benefit irrespective of how governments eventually progress long-term reform.
Commonwealth legislation to give greater powers to stop or add conditions to child care subsidy funding for poor quality or unsafe services is welcome and should be applied. It is important for governments to effectively enforce a quality floor, remove ‘bad eggs’ from the system, and send a strong signal to others to maintain or improve quality and safety. However, ceasing funding will typically mean closing a service, which can disrupt families’ lives. In some cases, there may be other services nearby with places available, but in others it may be both possible and beneficial to keep a service open by bringing in a different, high-quality provider to address quality and safety concerns and maintain service continuity for families.
Governments should have a clear plan and mechanism to deal with service closures, including by facilitating another provider to take over the operation of a service, with a focus on quality. When ABC Learning collapsed, Goodstart was established to take over most of its operations.
However, this process took over a year to complete. Having a process developed in advance would make it easier and quicker for other providers, including not-for-profits and government providers, to quickly step-in and operate the service. This planning should involve state and territory governments, as they are more likely to know local communities and know which local providers would be strong candidates to take over a service.
Changes may also be needed to the National Law to facilitate this in a timely way, and the new provider may need financial or other supports from government to quickly improve the quality and safety of the service. But the Review considers that it may, in some circumstances, be a good way to address what can be competing objectives of maintaining safety and quality and maintaining access for families. It could also provide an opportunity for government to support high-quality providers to grow their operations.
Recommendation 2: Commonwealth Government-led rethink of the ECEC system 2.1 Call for the Commonwealth Government to lead a rethink of the ECEC system. This needs to prioritise quality and safety, reconsider the current funding model and reliance on the market, and set a 10-year strategy to fundamentally reform the ECEC system, including careful planning for workforce growth and quality. 2.2 Call for the Commonwealth Government to establish a process to quickly appoint a trusted, high-quality provider to take over a service that has had its funding or other approvals cancelled, to quickly improve quality and safety and enable continuity of access for families. This process should include consultation with the relevant state or territory government. Where necessary, the National Law should be amended to facilitate this. |
1.2.3 Establish a commission to drive national reform
The Education Ministers Meeting (which consists of Commonwealth, state and territory Education Ministers, across ECEC, schools and higher education) provides a forum for collaboration and decision-making on ECEC. However, in light of recent child safety incidents, several Commonwealth and state ministers have expressed frustration with the slow pace of national reforms in ECEC.
Many Education Ministers have responsibility for school education or other portfolios in addition to ECEC, and departmental officials often have broad responsibilities, including the ongoing operation of existing programs and services, and the regulatory system.
The Review is concerned that the lack of progress in reforming the ECEC system is, in part, a result of this lack of dedicated focus on the issue. A catalyst is required to drive reform.
The Review therefore recommends the establishment of an Early Childhood Reform Commission, to accelerate national reform. While there are national frameworks in place for ECEC regulation and policy reform, they have not been as nimble as needed to respond to such a rapidly changing environment as the ECEC system has become. What is required is a Commission focused on ensuring that necessary reforms at the national level are progressed in a timely way.
The Commission would not replace ministers, officials or departments’ decision making or other responsibilities, but it would provide a specialist resource, dedicated to supporting ministers develop and progress national reforms.
The Commission could be time-limited to drive through agreed reforms, acting as an ‘honest broker’ between governments, and helping ministers to track that work is being done across the various parts of government involved.
The Commission would be solely focussed on the reform of the ECEC system, and not have its attention diverted by running grants, programs or services, or administering a regulatory system. The Commission would work with other bodies in the space, including the Australian Children’s Education and Care Quality Authority, to help ensure that agreed reform measures are implemented. The Commission should use evidence to underpin its work, and drive linkage of national, state and territory data to inform decision making by ministers.
The Commission would work to, and at the direction of, the Education Ministers Meeting. Through this model all governments would have a say in the Commission’s governance and workplan. Similar approaches are used for organisations such as the Australian Education Research Organisation and Education Services Australia.
The Commission should be established quickly and with simple governance (rather than a large board), as is appropriate for the proposed role of the organisation, working to deliver a work plan set by the Education Ministers Meeting.
The Commission should be supported by a parent advisory group to ensure that parents inform the policy that drives the whole system.
While not setting a sunset date, the Review expects that the Commission would be time limited and, if successful, cease operating in its current form within 5 years.
Recommendation 3: National Early Childhood Reform Commission Advocate for National Education Ministers to establish and resource a time-limited Early Childhood Reform Commission to provide dedicated focus and capacity to prioritise national ECEC reforms. National Education Ministers should direct the Commission’s work program and deliverables, and it should be informed by a parent advisory group. |
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