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Child Care on the Cheap Is Bad Policy

Both the Government and the Opposition want to get women back into the workforce as quickly as possible after giving birth. I suspect that most mothers are also keen on getting back into paid employment as soon as possible.

The problem is the politicians want to do it on the cheap, while mothers are reluctant to entrust their children to second-class care or to paying so much in child care that there is no financial incentive to return to work early. The result is a halfway house in which the Government doesn’t take direct responsibility for the provision of child care and early education but provides what amount to vouchers that subsidise these services run by non-profit and for-profit organisations…

The Scandinavian countries spend between 1.7 and 2 per cent of GDP on early childhood education and care. To reach this level would require a three-to-four-fold increase in government spending on children up to age six. The Scandinavian countries spend between $12,000 to $15,000 a year for each child aged one to six years, but this is not a net burden on taxpayers. The much higher expenditure has to be set against the much higher workforce participation rates for young women with children compared with Australia and the higher proportion of Scandinavian women occupying high-productivity, full-time professional jobs.

In 2006 the OECD published a comprehensive survey of early childhood education and child care. The central insight in the report was that it saw early childhood services as a public good, which provides an unequalled opportunity for investment in human capital. It cites research that shows the social return from investment in child care and preschool is higher than an equivalent level of investment in primary and post-primary education.

According to the OECD report, “In early childhood positive (or negative) dispositions towards society and learning are absorbed and the basic life skills acquired … Additionally, parents are particularly protective of their children at this age and eager to support development and learning. In comparison, remedial education interventions targeting young school drop-outs or adults with poor basic skills are far more costly, and according to the research, of limited benefit.” …

Source: The Age, Australia
http://tinyurl.com/2pr5wa

Thursday, 25 October, 2007. Link

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