The school holidays should be a time when children rest from school and enjoy fun times with friends. Many parents rely on their local school holiday programme to provide safe and enriching child care, however these programmes are struggling to maintain affordable fees and Government assistance through fee subsidies is unavailable to many parents.
For parents who have work commitments during school holidays it can be a time of tremendous stress and uncertainty.
“….we are borderline above the threshold for any kind of assistance ….. most of my pay goes into child care and makes it not worth it…I even take my kids to work with me which is not best practice. It can be unsafe.” [Parent feedback, OSCAR National Survey, 2019]
Based on fee data collected by the Out of School Care Network (OSCN), a non-profit group who provide advice and support to the OSCAR sector, a parent with 2 school age children, using 50 hours of school holiday care pays on average over $450 per week in fees. While there are fee subsidies available to offset this cost, families with a household income of more than $84,000 are currently not eligible for any financial support.
If the same family was also using after school care, OSCN reports that they could be spending over $9,000 per year on OSCAR (Out of School Care and Recreation) child care fees. International benchmarks for child care affordability suggest that 7% of income is the upper limit. Many New Zealand parents are paying over 10% of their income for OSCAR services.
In a 2019 national survey of parents, cost was the most common reason given for not accessing OSCAR services. Significantly more sole parents than co-parents cited cost as the most important barrier to accessing an OSCAR service.
While holiday programme fees can vary greatly, cheaper holiday programmes aren’t necessarily poorer quality. Some of the lower-cost programmes may rely on a proportion of voluntary staff or have a venue provided at no cost to the operator. Higher fees are often a reflection of higher operating costs – such as the escalating costs of excursions, venue hire or staffing.
OSCAR providers have proven themselves to be durable and resourceful but the current situation is being described by OSCN as an “affordability crisis point”, as OSCAR providers are facing unprecedented financial pressure on two fronts.
The most recent minimum wage increases have pushed staffing costs up significantly in a very short time frame and staffing costs are likely to be 60-70% of a holiday programme’s expenses. At the same time some parents are losing their entitlement to OSCAR Fee Subsidy as their wages rise above the income cut-off point.
We welcome the commitment In the 2021 Budget to raising these income thresholds. However these income limits have been frozen for 10 years and we are well behind countries like Australia, where parents on much higher incomes can access fee subsidies. Although many parents struggle with the paper work through Work and Income to get OSCAR Fee Subsidy, OSCN has seen these payments have had a huge impact on the affordability of OSCAR services for some families. We wish to see this financial support available to more families.
Many holiday programmes do also receive an operating grant from Ministry of Social Development. A typical MSD grant may equate to about 10-20% of an OSCAR service’s operating costs. An ECE service may have 50-60% of its costs met by Government grants, with Childcare Fee Subsidy making a contribution on top of that, depending on how many parents were eligible.
OSCAR providers are saying that a fundamental rethink is needed for Government investment in the OSCAR sector. Funding support for the sector should be brought more into parity with the rest of the child care and child welfare sector.
Media Release on 8 June 2021
John Kennedy, The Out of School Care Network Inc (OSCN)