Albanese wants universal childcare, Mamdani has a roadmap

When asked about his legacy, Anthony Albanese has always been clear about what he wants to be remembered for: universal childcare.

It’s a headline vision he shares with a prominent politician on the other side of the planet: New York City’s new mayor, Zohran Mamdani.

But while both politicians have stated that universal childcare is their ambition, there’s a big difference between them when it comes to the details.

New York’s universal Pre-K (a catchall for pre-kindergarten) programs began in 2014, and Mamdani is expanding them to include more two- and three-year-olds, with the eventual goal of free, full-day, full-year childcare for all of the city’s children. Essentially, it means extending public education to children under five – a truly universal childcare system.

Albanese’s ambition is more modest.

His government’s current policy, the “3 Day Guarantee”, means the cost of childcare can be subsidised for up to 72 hours each fortnight – or around three-and-a-half days a week – per child. The subsidy is capped at $14.63 per hour for centre-based and before/after school care (by far the two most common kinds). It is also scaled with family income, with families earning up to $85,279 per year getting 90% of the subsidy, then the percentage decreasing by 1% for every $5,000 in income above that. Families earning $535,279 or more get 0%.

Find all of that confusing? You aren’t the only one.

Albanese’s “big vision” for childcare would mean eventually abolishing this complex subsidy scheme, replacing it with a flat-fee model where parents pay “no more than $10 or $20 a day”. But even then, it seems like families would be guaranteed “at least three days” of “affordable and accessible” early education – a far cry from the fee-free, full-year system planned out by New York’s mayor.

In his article “There’s a case for nationalising child care, but of course it won’t happen”, ABC financial journalist Alan Kohler laid out a compelling case for adopting a New York-style public education model.

As Kohler points out, care and education of children under five is entirely run by private entities, 70% of which are run for profit and often owned by private equity firms. But when a child turns five, they suddenly have access to free and public education, a completely different world.

For-profit childcare centres charge more and increase their fees more often than their not-for-profit counterparts. They also spend less on staffing, relying more on casual and less experienced educators to keep their margins high. As it stands, much of the Government’s subsidies increase the profits of shareholders and private equity investment firms. And means testing, where the subsidy drops with income, ensures that many middle-class families who are already struggling with the rising cost of living and mortgage payments don’t always have access to the support they need.

There is clearly a problem with how the system is currently operating – one that wouldn’t be an issue in a fully-public model like Mamdani’s. So, if Albanese wants fixing childcare to be his legacy, why is he not aiming for the kind of truly universal childcare system being rolled out in New York?

It’s not because public childcare wouldn’t work here. The Parliamentary Budget Office puts the cost at around $9 billion per year, and Kohler estimates a somewhat larger $17 billion. That might sound like a lot of money, but it’s relatively small in the scale of federal budgets. Putting a 25% tax on gas exports, for example, could raise $17 billion, enough to pay for a fully public and truly universal system of childcare.

At its core, the reason New York City strives for public, free, full-day and full-year early education and Australia does not is the same reason why Kohler says, “but of course it won’t happen”.

Making such transformative change opens politicians up to attack; it requires bravery to push through that and see reform through to the end.

Zohran Mamdani has faced critics of his childcare plans at every turn but has continued unfazed. Last month, he faced criticism after opening a new childcare centre in one of the city’s wealthiest neighbourhoods.

But as mayoral spokeswoman Dora Pekec told the New York Times, “city government’s job isn’t to decide who deserves dignity — it’s to guarantee it for everyone.”

“We already treat essential services as public goods: The [Fire Department] answers emergencies, the city collects trash and every child has access to a safe, rigorous education. Child care should be no different.”