The Front Project commissioned Mandala to explore the impact of policy settings on market composition over time.

Paving the Path: Addressing Market Imbalances to Achieve Quality and Affordable Childcare reveals key insights into the current state of the Long Day Care (LDC) market in Australia, including: 

• LDC places have increased 69% since 2013. In 2013 there were 19 places per 100 children. In 2024 it increased to 31 places per 100 children. This has primarily been driven by higher female workforce participation, a growing child population and increased government funding.

• However, distribution isn’t even. In low SES areas there are 41% fewer LDC places per 100 children than in high SES areas.

• 70% of LDC services are run by for-profit providers, an increase from 60% in 2013. Meanwhile, not-for-profit services are declining, from 32% in 2013 to 23% in 2024.

• This trend is most stark in ‘gentrifying’ LGA where not-for-profit LDC places declined by 10% between 2021-2024, while for-profits grew by 25%

• 28% of not-for-profits LDCs are rates above the National Quality Standard (NQS) compared to 15% of for-profits.

As the early childhood education and care grows and evolves, it’s imperative that quality remains central and guides policy and funding decisions.  

Professor Deborah Brennan’s Supplementary Statement in the Productivity Commissions Volume 2 report The operation and adequacy of the market, including types of care and the roles of for-profit and not-for-profit providers states 

“A universal system will require planned and supported expansion of services, as well as transparency about costs, fees and profits. Governments will need to address the imbalance between for-profit and not for-profit providers and ensure that the business models and employment practices of all providers are aligned with the National Cabinet vision.” Productivity Commission (2024) A path to universal early childhood education and care Volume 2, P339. 

For more information read Professor Brennan’s paper.