Magazine of Socialist Action in Australia

Kick the profiteers out of childcare

Reading Time: 3 minutes

Australia’s childcare system is in desperate need of an overhaul. Waiting lists of two years or more have lengthened due to the collapse of big private providers ABC Learning, and CFK Childcare.

A recent UNICEF report found Australia’s services were the third-worst in the OECD! Using ten benchmarks, including GDP spent on early childhood services, paid parental leave and subsidies for childcare, Mexico, Slovenia and Portugal rank higher.

Profit based care has failed as the interests of shareholders and children are not compatible. One academic, Professor Brennan, points out “shareholders seek high returns on their investment while children require high-quality care that is expensive to deliver”.

In Australia, private businesses have provided over 70 per cent of day care services. Labor’s policy, introduced in the 1990’s, to outsource childcare by encouraging private centres through subsidies has translated into cutting down on quality. In 2004, four centres in NSW were prosecuted for 56 breaches of the regulations, including exceeding the staff to child ratio.

Currently regulations allow one worker, with a minimum qualification to look after five babies, or one staff member for every 15 children over three.  Experts stress the need to reform staff to child ratios, for under twos ideally it should be 1:2, but at least 1:3. So far, efforts by early childhood educators to reform regulations have been resisted by powerful private providers.

Consistency of staff is also crucial to quality of care, yet the majority of workers are paid only the minimum wage and overworked. It’s no surprise that there’s a massive turnover of staff.  Pam Cahir of Early Childhood Australia points out “childcare worker salaries in Australia have been notoriously low while corporate profits have grown, parents are going to work on the back of low-paid workers”.

ABC was listed on the stock exchange in 2001 and adopted an aggressive strategy of taking over centres run by community groups. Rather than increase competition that improved care, ABC actually reduced the amount of places, and therefore was able to keep their prices high.

The real question is why do we not have a free child-care system? Despite growing calls to remove the private sector from childcare, Julia Gillard has ruled out public ownership of failing centres. Given the failure of the market to provide care, and given the obvious need for childcare not to be run for profit, why is Labor refusing to fix the problem?

Labor is wedded to the idea of outsourcing as many essential services as possible. They believe in a user pays system where big business interests are put before those of ordinary people. On top of this, Labor have scrapped the introduction of a nationally funded paid maternity leave scheme.

Labor has failed to deliver on electoral promises to improve the rights of women and address discrimination. Women need access to continuous childcare from the birth of a baby onwards, including before and after school care. That is why we need a complete overhaul of the current system. We need the universal provision of flexible childcare free at the point of use.

The Socialist Party calls for the immediate nationalisation of ABC and CFK childcare centres, to be run democratically by committees of parents and workers. The subsidy system should be scrapped. We need a massive increase of direct capital funds into childcare to build more centres and increase the number of places. We need regulations to ensure decent wages, conditions and training for childcare workers and an improvement in current child-worker ratios. Only under a publicly owned and run system can we plan the provision of children’s services that meets community needs, rather than lining the pockets of big business.

By SP reporters


The COVID-19 pandemic has laid bare many of the problems with capitalism. The Socialist strives to explain the systemic causes of this crisis, and reports about the issues that are important to working people. We also help to organise struggles against the powers that be.

We don’t receive a cent from big business or governments. Our work is fully funded by our supporters. Even if half the people who read our website every month donated a few dollars each we would raise thousands to help our work!

We need organisations of struggle now more than ever, so if you support what we do please consider making a donation.

One-off or regular donations can be made securely HERE.