The Coalition has proposed vouchers for nannies or child care. It raises more questions than answers

The federal coalition has proposed an alternative to the universal child care system, with vouchers that can be used for long-term child care, family day care, nannies or a combination of these.

Senator Leah Blyth argues in an opinion article in The Australian Financial Review that a voucher system would provide families with choice and flexibility to better meet their needs.

This would contrast with the current system, in which the federal government funds long-term childcare and family care directly with subsidies to the provider. Blyth argues that the subsidized system distorts the workforce.

So what are the real problems that the vouchers would address? And how would they address the current shortcomings in the system?

The childcare system has bigger problems

The latest and most publicized issues in long-term childcare, used by 47% of Australian families with children under five, include:

1. child safety (including abuse)

2. insufficiently qualified teachers and lecturers

3. high staff turnover – educators and teachers need to be able to interact with children and families over time and build trusting relationships

4. the predominance of for-profit services (75% nationally believe that their structure is very likely to put profit over the quality of care for children)

5. the shortage of places, also known as ‘childcare deserts’ – these are geographical areas where there are insufficient or no services to meet demand.

Any reform proposal must certainly address at least some of these challenges.

Would a voucher change the choices available?

The voucher proposal raises several concerns.

Choice of service implies that such services exist. Many families live in areas where there is little choice. In rural, remote and regional areas, or on the outskirts of towns, there may be only one service. Or there may not be enough demand for a center to be financially viable.

A focus on choice also implies that parents know what childcare is available and what they offer, and can make an informed choice.

For example, a shiny new building or frequent media advertisements may not inform parents about the Australian Children’s Education and Care Quality Authority centre’s staff retention, qualifications or quality rating.

The coalition states that overregulation is stifling supply. Currently, state regulators are working to improve quality by closing consistently underperforming centers. Centers carefully assess teacher qualifications. Reducing regulations will not solve safety and quality problems.

Expanding the vouchers to home care services, such as nannies, would ignore safety concerns. Steps are being taken to address the employment of abusers in long-term childcare. But a voucher system that includes in-home child care could give abusers unsupervised and long-day access to young children.

Given the workforce crisis, it is difficult to see how making the system less financially stable due to its reliance on vouchers would encourage potential teachers to consider a career in the sector.

How would centers plan for the future?

As with any organization, both for-profit and not-for-profit, financial viability is critical. Centers must have reliable sources of funding to operate an ongoing service.

Salaries are the largest expense in any service, followed by running costs. Under the current model, centers can plan for these costs because they know the number of children, their ages and attendance well in advance.

Under the proposed voucher model, funding would be more likely to fluctuate, which could make planning services difficult due to financial instability. It would also increase the administrative burden.

Vouchers should list the cost of care for each child per hour and per day. Because costs vary between cities and regions, it would be difficult to calculate a uniform cost per child that could apply across Australia.

Families with children with special needs often experience difficulty finding a service. These children need costly additional support that services claim they cannot provide. Currently, an additional childcare allowance is only available under certain conditions, such as temporary financial difficulties. A voucher system should take this specific challenge into account.

Why do we place our children in preschool education and childcare?

As a nation, we must decide on the primary purpose of early childhood education and care.

Should we care for children so that their parents can be part of the workforce, thereby increasing overall productivity?

Or is its purpose to provide children and families with access to quality early childhood education and care, which is their right? If we choose the latter, we must consider whether offering a voucher system would be in line with that goal.