The claim

In announcing its plan to overhaul childcare with a $4 billion funding boost, Labor has sought to blame the government for an increase in childcare fees over the past five years.

The Opposition Spokesperson for Early Childhood Education and Development, Amanda Rishworth, told ABC Radio: "While the Liberals have been in government, there's been a 28 per cent increase in the cost of childcare fees."

Opposition Leader Bill Shorten has also made this claim on a number of occasions, including during the first leaders' debate.

"Wages growth in this country, under this government is at record lows, and everything is going up. Childcare is up 28 per cent," he said.

Has the cost of childcare risen by 28 per cent under the Coalition?

RMIT ABC Fact Check takes a look.

The verdict

Ms Rishworth's claim is in the ballpark.

The increase in childcare costs can be measured by comparing average hourly childcare fees or by examining childcare costs as part of the Consumer Price Index.

Using either of these measurements gives an increase in childcare costs within the range of 23 to 28 per cent since the Coalition took office in September 2013, when Tony Abbott became prime minister.

Amanda Rishworth, left of Bill Shorten, is the Opposition Spokesperson for Early Childhood Education and Development. ( ABC News: Matt Roberts )

But what about government assistance?

While the average hourly fee for childcare in 2013 can be compared to the average hourly fee for childcare in 2018, it's worth noting that this calculation does not factor in government assistance paid to parents, such as the childcare subsidy or childcare rebate.

The Consumer Price Index, on the other hand, measures quarterly changes in the cost of living and includes a net cost for childcare fees.

In other words, the CPI data factors in government assistance paid to parents.

Fact Check took into account both methods of calculating the increase in childcare costs over the past five years.

Childcare: comparing average hourly fees

Average hourly fees are published in the Department of Education and Training's Early Childhood and Child Care Summary reports, which are published quarterly.

The total average fee per hour for all types of childcare was $7.50 in September 2013, when the Coalition came to power, rising to $9.25 in June 2018 — an increase of 23 per cent.

The September quarter 2018 report provides the latest available figures but does not include home-care fees as part of total fees, as has been the case previously. Instead, Fact Check drew on the June quarter report for comparison.

Asked how Ms Rishworth had calculated the increase in childcare fees, a spokeswoman from Labor's election campaign media office referred Fact Check to the average hourly fee for long day care in the department's September quarter 2013 report ($7.65) versus the September quarter 2018 ($9.80). This amounts to an increase of 28 per cent.

Labor's calculation, while correct, only looks at long day care (albeit the most popular form of childcare) and does not include other types of care such as that offered outside of school hours and family day care.

Nor does this calculation take account of childcare assistance paid by the government.

So, the increase in the childcare fees since the Coalition came to office is either 23 per cent (if calculated using total average fee per hour for all types of childcare) or 28 per cent (if calculated using the average hourly fee for long day care only).

But neither of these percentages factors in government assistance to parents.

To calculate this figure, you need to refer to childcare costs as incorporated in the CPI.

Childcare: what the CPI shows

The Consumer Price Index, compiled by the Australian Bureau of Statistics, shows childcare costs rose 25 per cent from the September 2013 quarter to March 2019.

Childcare costs as recorded by the CPI are more representative of out-of-pocket costs for families as the data takes government assistance into account.

This is also the preferred method of calculation according to Associate Professor Ben Phillips, of ANU's Centre for Social Research and Methods.

What did the experts say?

Associate Professor Phillips told Fact Check: "There [are] different ways of looking at it [the increase in childcare costs] but they're probably all going to roughly come out to 20-something per cent."

He noted that childcare costs had risen under the Coalition, but also under Labor before the Coalition came to power.

"While it [Labor's percentage increase in childcare costs] is in the ballpark, there's a bit more to it, in that prices have been increasing strongly for many years, at least 10 years or even longer, probably 15 years," he said.

Indeed, the Department of Education and Training's Early Childhood and Child Care summary report for the March quarter 2016, shows the annual percentage change to long day care hourly fees, for example, jumped to14 per cent in the 2008-2009 financial year, when Labor was in office.

Average and annual percentage change to Long Day Care hourly fees (March quarter 2007 to the March quarter 2016) ( Source: Department of Education and Training )

University of Melbourne tax expert Professor Miranda Stewart told Fact Check that a steep increase in childcare costs was indicative of a large variation in fees across cities and regions.

An increase in fees at the more expensive end of the range was likely pulling the average up, she said.

Referring to the increase in childcare costs as represented by the average hourly cost, Professor Stewart sounded a note of caution. "That's only an average and there's a great diversity of fees for different families in different parts of the country and city.

"In Australia, we have an almost exclusively private sector childcare system.

"Government provides almost no childcare and that's unusual, internationally, and it leads to this great diversity in fees.

"The substantial increase is not unconnected to the fact that it's mostly privately provided care."

Principal researcher: Sushi Das, chief of staff

Sources

