Affordability of early childhood education

Why This Is Important

Children who attend a quality early childhood education service (ECE) gain benefits that last through to their early years in school and beyond (Wylie, C., et al., 2006). To achieve any benefits the family must find the ECE services affordable. The affordability of early childhood education services is one of the factors that determine how accessible early childhood education is and hence the extent that children are likely to participate.

Lack of affordability is for some, a significant barrier to participation in ECE and the workforce. In the 2009 Childcare Survey, 24% of parents who had difficulties accessing childcare while working or wanting to work reported that ECE care was too expensive. Improving ECE affordability is therefore considered a key strategy to increase participation in ECE and the workforce.

Whether a family considers ECE to be affordable is dependent on three factors: the cost of the service to them, the family's income, and the importance the family attaches to ECE relative to other ways their income can be spent. It is possible to measure changes over time for the first two factors and for their change relative to each other. This will not only indicate how affordability is changing generally, it will also enable an assessment of the impact of policies targeted at ECE affordability (such as the introduction of 20 Hours ECE for 3-4 year-olds) and of various factors affecting the costs faced by ECE services.

Indicator

Change in the level of early childhood education fees paid by families relative to their change in income

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Numerator: (Data Source: Statistics New Zealand: Consumers Price Index (Childcare Section))

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The CPI index for childcare, rebased to equal 1000 in quarter ended March 2005.
Denominator: (Data Source: Statistics New Zealand: Quarterly Employment Survey (Average Hourly Ordinary-time Earnings))

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The average hourly ordinary-time earning index, rebased to equal 1000 in quarter ended March 2005.

Interpretation

The figures presented in these indices are based on averages – average fees, average earnings, and average affordability. Changes in the affordability experienced by individual families/whanau may differ from the average; their fees and earnings may follow different trends.

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