In recent years, the state of Victoria’s kindergarten services have undergone multiple rounds of industry-shaping reforms.

Under the ‘Best Start, Best Life’ policy, all sectors (government, private for-profit, and private not-for-profit) have a role to play in kindergarten infrastructure and service provision to respond to rapidly increasing demand.

Local governments, in particular, are weighing what the latest reforms, the emergence of integrated kindergarten programs, and the establishment of new kindergartens on school sites mean for their market share and the services they provide.

To facilitate implementation, the Victorian State Government is currently liaising with local councils to develop updated Kindergarten Infrastructure and Services Plans (KISP) to calculate unmet demand for kindergarten places through to 2036. But in our recent discussions and project work with at least a dozen local governments, we have yet to identify one that has an updated KISP finalised and adopted, despite being nearly three years out from the reforms being announced.

While this is likely due in part to the fact that the rollout schedule again shifted in 2024, it seems that many councils are also locked in a stalemate with the state government on draft supply and demand modelling results. At the very least, the KISPs often seem to raise more questions than provide answers for local government.

Understanding what the KISP is and isn’t

A KISP is little more than a high-level document intended to support the early childhood sector (not just local government) in planning for and investing in 3-year-old kindergarten and pre-prep (4-year-old kindergarten) by identifying areas of forecasted unmet demand. Each one is, principally, a municipal- and suburb-level quantitative assessment of supply and demand year-on-year from 2024 to the end of the reform rollout (2036). In identifying current and future areas of unmet demand, its purpose is to provide an evidence base for seeking Building Blocks funding for new infrastructure. And importantly, grant applications are highly unlikely to be approved by the state government if the KISP does not support the conclusion that the project is required to address forecast unmet demand.

In contrast with a detailed early years infrastructure and services plan that a local government (or other provider) may develop, it is not a holistic, strategic assessment of the need for services, or a roadmap that sets out exactly where and how much additional infrastructure should be provided, or how services may be optimised. This leaves much work to be done by the council and other providers if they are to develop a plan for their respective investments that responds to demand and the unique needs of the communities they serve.

KISP modelling assumptions and inputs

Another challenge posed by the KISP for each local government is that its assumptions and inputs sometimes misalign with Council’s datasets and policies. The state government prefers to adopt the VIF23 population forecasts for the KISP demand modelling, but council may have a set of preferred forecasts that were commissioned separately. A mid-point can be reached as a compromise, but some councils, especially those with major growth corridors, feel that this does a poor job of reflecting actual patterns and rates of growth in certain areas.

Vulnerability and disadvantage are factored into kindergarten demand under the KISP modelling, as this determines when these two ‘priority cohorts’ can access the full 30 hours of 4-year-old kindergarten. Many of the datasets that would indicate whether or not a child qualifies are confidential in nature (e.g. contact with Child Protection Services). In the absence of this data, it is unclear how the state government has estimated the number of children who qualify for either of the early access priority cohorts. Councils have observed that estimates do not align with their own analysis, and do not recognise differences in disadvantage and vulnerability levels between suburbs.

Another key assumption—this time on the supply side and a frequent source of friction— is that of capacity multipliers. A capacity multiplier reflects the number of kindergarten places (in the unit of 15 hours per week) that can be accommodated per licensed place. Different capacity multipliers are applied to kindergartens provided in a sessional setting (where all capacity is kindergarten capacity) versus in a long-day care (LDC)/integrated setting (where only some childcare capacity translates to kindergarten program capacity). For the LDC setting, the multipliers vary between LGAs, and typically increase over time, reflecting the assumption that the sector will integrate kindergarten services at an increasing rate over time.

The state government-applied multipliers were developed based on a comprehensive 2019 survey of all services providing kindergarten, raising questions around their accuracy in 2025 for a sector that grows and evolves significantly each year. Justifiably, many councils have voiced doubts and concerns about how well they estimate capacity in today’s LDC market.

Due to the limitations inherent in the KISP methodology and the limited scope available for variations to reflect local needs, the unmet demand scenario it presents should be interpreted with caution. Each KISP can only partially form the strategic analysis required for councils to plan effectively for kindergarten infrastructure and service provision. For many, it will likely only serve as an evidence base for Building Blocks funding applications.

Alternative supply-demand modelling

If the KISP’s inputs and assumptions are at odds with a council’s observations or policies, the next step after the KISP is finalised would be to undertake alternative modelling that better reflects the council’s position. In addition to using council’s preferred population forecasts, this might include:

• Participation rates: For many LGAs, the rate of children participating is lower than 100%, recognising some families choose not to enrol. However, suppose the policy position is that every child has access to a place in a kindergarten program for 3- and 4-year-olds. In that case, councils may wish to adopt a rate of 100% or higher, if there is evidence of children travelling from other nearby LGAs to enrol.
• Vulnerability and disadvantage: Councils can determine rates of priority cohort children at the local level based on historical ‘early start kindergarten’ enrolments. This will help determine where additional provision is needed earlier (in 2026 or 2028, depending on vulnerability and disadvantage, respectively).
• Capacity multiplier vs. actual capacity: Rather than apply a standard capacity multiplier to all LDCs, council could collect data from each provider regarding how many kindergarten places are currently being provided for a more accurate and up-to-date estimate of kindergarten service capacity in the LGA. It may then also choose to convert this into a new capacity multiplier that can be increased over time to reflect higher levels of integration of kinder services at LDCs (subject to consultation with local providers), confirming that this is expected to occur.

Responding to unmet demand

Once a council is comfortable with the modelled unmet demand, there remains the mammoth task of forming their response as one member of a complex network of local providers and then acting as an effective partner or advocate to other providers on an ongoing basis. Any strategic approach that optimises infrastructure investment must include:

• Ongoing consultation with other providers: Some demand will be picked up by kindergartens on school sites, but only those schools in the short-term pipeline are typically known. The state government has also announced the delivery of 50 early years centres that will be run by Early Learning Victoria, with specific locations yet to be confirmed. The Catholic education sector is now following suit, with MACSEYE investigating school sites across metropolitan Melbourne for kindergarten service provision. Alongside this, growth in private childcare centres continues to outpace that of government, and these centres have the potential to integrate kindergarten services at higher rates, capturing a larger share of the market in the future.
• Council service review: A service review is key to determining what council’s role will be in kindergarten infrastructure and service provision moving forward. Many are resolving to reduce their footprint in the municipal network to save on costs. Modelling different scenarios can assist with this decision-making, exploring the potential capital and operational expenses of the council scaling back its services or continuing to invest to maintain its current market share. A more detailed service review may also identify areas where efficiencies can be gained and improvements made, such as through adjusted programming/timetabling to convert theoretical capacity into effective utilisation.
• Sessional vs. integrated: While there is potential for council to take on a lower share of the kindergarten market compared to historic levels, this may be out of step with community needs and preferences. Enrolments in sessional versus integrated programs vary between communities, influenced by a range of demographic factors, including workforce participation and disadvantage. Council may wish to adopt a policy position that a minimum share of kindergarten places for the LGA must be provided in a sessional setting, or establish localised rates of sessional demand that correspond with levels of disadvantage and/or other relevant criteria. This sessional service demand is, therefore, indicative of the need for council-provided infrastructure (assuming the council provides all infrastructure for sessional services, excluding kindergartens on school sites). No resolution should be made on council’s role in infrastructure and service provision without an understanding of this and the potential impacts of reducing the share of service capacity provided in a sessional setting.
• Exploring new partnerships: When it comes to delivering the sessional services themselves, not all must be provided by council; many LGAs already have long-running, mutually beneficial relationships with not-for-profit providers who lease some or all of the council’s kindergarten infrastructure. Typically, this arrangement is more cost-effective for a council than running all services internally. The Wyndham Early Years Partnership is a leading example of a partnership framework in Victoria.
• Investigating site-based responses: Once existing services have been optimised, the same approach should be applied to complex infrastructure. More detailed investigations are needed to consider the capacity, accessibility, and fitness-for-purpose requirements to guide site-specific investment in refurbishments and expansions of existing sites, maximising their capacity before considering provision at new sites.

These steps are all ones that can give councils the confidence that decision-making, planning, and future investment are based on a comprehensive understanding of future local needs. Their necessity also serves to illustrate just how limited a state-endorsed KISP is in its utility as a tool for local government kindergarten infrastructure and service planning, and that the real work comes after the KISP.