Regional Development Victoria


Loddon Mallee region of Victoria


Business case calls for government interventions to solve early childhood education and childcare issues in rural areas.

Improving access to early childhood education and childcare is a topical issue because of its clear benefits to children’s development, labour force participation, regional productivity, and gender equity.

A problem with policy responses to this issue is an assumption that one suite of solutions will solve the problems faced in all communities. However, rural communities are differentiated from more populous areas by their smaller and geographically dispersed populations, and their higher levels of socioeconomic disadvantage. These traits have marked implications on the viability of early childhood education and childcare services in rural areas.

SGS worked with Regional Development Victoria and targeted local governments to develop a business case for solving early childhood education and childcare issues in the Loddon Mallee region of Victoria. The approach and results could be applied to most of Australia’s rural areas.

The business case calls for a range of interventions, which require:

  1. The Commonwealth to:
    1. increase the Childcare Subsidy (CCS) by 9 per cent in rural areas to improve wages, conditions, accreditation and retention rates of early childhood educators
    2. fund core functions of early childhood education and childcare services like leadership and administration, and
    3. fund Additional CCS payments to disadvantaged families given the goal of maintaining disadvantaged child enrolment rates across rural areas
  2. The Victorian Government to fund the development of new childcare/ kindergarten facilities, preferably co-located with primary schools, in targeted rural locations.
  3. Local governments and/or childcare operators to fund the coordination of a ‘shared services’ model for collaborative service delivery. This will also promote the increased availability and reliability of rural services, pilot the flexible application of rural staffing and building regulations, and provide rural facilities maintenance services.
SGS Economics and planning business case enabling early childhood education

The business case includes a cost benefit analysis of the proposed interventions over a 10-year period. It generates a benefit cost ratio of 1.3; meaning that implementing the proposed interventions will increase economic welfare levels in rural areas and are worthy investments for governments’ consideration.

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