A Strategic Assessment of the Children's Services Industry

STRATEGIC ASSESSMENT OF THE CHILDREN’S SERVICES INDUSTRYOver the past four years, total available places have been increasing on an annual basis by 3.7per cent across Australia, with Western Australia, Northern Territory and Queenslandincreasing at faster than average rates (6.5 per cent, 6.2 per cent and 4.9 per cent annually).These increases have been driven predominantly by the growth of long day care, followed byout of school hours care. The annual average rate of growth of these two sectors over a fiveyear period was 7.3 per cent and 4.5 per cent respectively. Other service types have declinedduring that period, with variations between the States and Territories. In examining theseincreases the Commonwealth’s removal (in July 2006) of the previously existing limit onoutside school hours care and family day care places should be noted.Appendix B provides greater detail of supply data by region, funding source, and over time.Figure 5.5: Four year annual average change (%) by type and geographical locationSource: SCRGSP 2002, 20085.2 Demand for children’s servicesDemand is a measure of the quantity and characteristics of the services that parents buy at agiven price. The other determinants of demand are the number and ages of children and thenumber of mothers who are employed outside the home. Other demand factors are maritalstatus, family income, number of children in the family, parents’ career goals andopportunities, whether relatives live nearby, educational goals for children, types of careavailable in the community and how accessible or affordable a potential option might be.Demand for children’s services can be measured in several ways. This can be by determiningthe number of available places, where the full time equivalent place is treated as a unit ofservice. Alternatively, demand can be determined by the number of children that are accessingthe different services by age and level of usage. Both methods will be presented below.The first measure of demand for child care that will be used is by taking the utilisation rateand multiplying it by the number of available places. The utilisation rate is available for longday care centres and family day care. It is calculated as the total child hours paid for as a45