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Soaring childcare prices in Australia


Interesting article regarding increasing childcare prices in Australia:

http://www.sbs.com.au/news/article/2014/06/22/rocketing-childcare-fees-sees-parents-lose-60-salary

In my opinion, the explanation by principal researcher of rising prices is not all valid.

I agree with lack of supply though. This is due to following reasons:
  1. Too much regulation and red-tape before a childcare facility can start operating. This is reasonable, because not everybody should be allowed to open a childcare facility. 

  2. High wages that childcare centres have to pay to a high number of employees. It's not high salary that each childcare worker receives - in reality it's indeed opposite. There is a requirement that children per teacher ratio should be 4 or 5. Therefore many teachers are required. 

  3. High rent. 
I accept the items 1 & 2, because it's is valid to keep the regulations high and keep proper basic childcare at a good level of compliance.

However "high standards" is something you can't say about childcare in general. Therefore it's not a price raising factor.
The demand is much higher than supply. Also majority of parents don't have a choice and are forced to enroll their children to the only childcare centre even if they are not satisfied with the quality. I mean there is no economic reasons for childcare providers to care about quality.
It's natural to expect higher quality for higher rates, but it's not realistic.

Another problem is that current situation makes childcare for working families a luxury. Therefore it pushes socializing and early for majority of working people children almost impossible.

In my opinion education, housing and medical services should not be regulated by the free market rules as it happens at the moment.  


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