It seems like the morally right thing to do – improve pay rates for educators. But is the government listening to the debate?

Educators from an estimated 320 services across Australia went on strike for up to a full day on Tuesday 27 March, 2018 to join public rallies. Listen to what educators striking on the day said on the Early Education Podcast here. ‘Keep your children home day’ was not a snap strike.

Third educators strike in a year

It was the third time union members and supporters had walked off about pay in 12 months. Something had been in the wind after the relevant union, United Voice, recently lost its five-year case at the Fair Work Commission for a 35% wage increase. United Voice unsuccessfully searched through award agreements to find one that compared early childhood educators with workers in a male-dominated industry. Bu there wasn’t one. Women account for 97% of educators in Australia, says the union.

At issue is the average $21 per hour pay rate for educators. It is a little over half the average hourly wage in Australia. However, the website puts the median pay as $23.85. Still not much higher than the minimum wage of $18.29 as set by the Fair Work Commission.

A sector being professionalised

Helen Gibbons, Assistant National Secretary of United Voice captured the striking educators’ argument well:

“[This wage] does not reflect the skills of this demanding, important work and the qualifications and skills required to educate our children. The sector has changed, everyone must have qualifications.”

“We’ve moved beyond any need to establish that this is a professional workforce. Everyone knows and agrees that early childhood education is professional, important work. The work is historically undervalued as ‘women’s work’ and it’s time for these outdated concepts to change.”

“No wonder educators are angry and frustrated,” she said in a media release about the strike.

The move to further professionalise the sector and boost the requirement for qualifications, meeting accreditation and rating standards should lead somewhere, educators are thinking … like higher pay.

The Federal Government’s call

The day after the strike, educators met at Parliament House in Canberra to take their message to the Federal Government.

And that’s where the issue now sits – perhaps the last port of call. United Voice had set Prime Minister Malcolm Turnbull a deadline of 1 February to “deliver funding for equal pay”. He’s been fairly quiet on that one, although Federal Education Minister Simon Birmingham has publicly said the government didn’t employ any childcare workers.

Between a rock and a hard placeeducators' pay rates

If the Federal Government isn’t budging, where’s the money for higher salaries going to come from? Parents say they are already paying through the back teeth for childcare. Often more than they’d be paying if their child was attending a private primary school. Australian parents pay almost 40% of the total cost of childcare – that’s more than other OECD countries, says The Mitchell Institute’s Sarah Pilcher and Stacey Fox in The Mandarin.

There’s money in the sector

There’s a mix of operator types in the sector. Some services are working with thin margins. A good chunk of the sector is not-for-profit, community-owned co-operatives, social enterprises or local government run. But there are also swathes of for-profit corporate operators.

The childcare services industry can be lucrative for operators, having made $1 billion profit in 2015, according to a Sydney Morning Herald editorial (and about the same the following year). It says that was equivalent to 10% of the funds the federal government gave in subsidies to the sector (the billion-dollar-profit doesn’t include landlords’ profits).

So, the Herald, too, has nudged the government for action here, saying: “It’s better for government to strengthen its hand to intervene when the market is letting us down.”

The Mandarin’s Pilcher and Fox agree, pointing to the government’s “significant public investment in the early childhood education and care sector (ECEC) and vocational education and training”.

“There is a role for government in ensuring money is being spent on the right things, that quality standards are met and, arguably, capping or regulating [training] fees to some degree,” they say.

“To make a mixed ECEC market work — for children, families and taxpayers — it is absolutely essential that regulators are resourced appropriately.”

Government’s marketization of childcare

Perhaps that’s what it comes down to: the sector is a non-government social service that operates in a market framework. The marketisation of childcare has seen users of services – parents – not services funded, say Professors Susan Newberry and Deborah Brennan in their paper, The Marketisation of Early Childhood Education and Care (ECEC) in Australia: A Structured Response. The paper was published in the August 2013 issue of Financial Accountability & Management.

In it, they reflected on what happened before the 2008 demise of the world’s largest listed childcare provider, ABC Learning Ltd (ABC).

“As ABC grew and replicated its structured model to other forms of property including intangible assets, the rising child care prices and government subsidies supported a growing array of other enterprises all seeking profitable operations,” say Newberry and Brennan.

“ABC acknowledged its economic dependence on government policy and subsidies.”

In the wake of ABC implosion, $100 million in government funding helped ensure its childcare centres didn’t close en masse until an “orderly disposal was organised”. That shows a high level of government intervention in the sector. Perhaps even spurred on by a moral imperative to act.

Newberry and Brennan conclude: “Even if at the micro level the naive pursuit of marketisation is less costly for governments at the outset, as prices charged to service users rise, so too does the government come under pressure to increase its contribution.”

For now, it’s watch and wait time. The sector’s unionised cohort is going cap in hand to the Federal Government to deal with the issue of educators’ low pay. The moral high ground can be a shifting beast.

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