Budget Based Funded Program

$57 million to support child care and early learning services in urban, regional, remote and Indigenous communities


The Budget Based Funded Program is an important part of the Australian Government’s support for Australian children to have the best start in life through access to ECEC services. The Budget Based Funded Program provides direct operational funding to ECEC services in areas where the market would not normally allow services to operate, particularly in regional and remote communities, and where there are additional needs for culturally appropriate services. In many cases, these children are some of the more vulnerable children in Australia.


Program funding

In keeping with strong support for the Budget Based Funded Program and the role it plays in providing access to ECEC services, the Government is committed to maintaining its funding.

From 2013–14, Budget Based Funded Program funding will be approximately $65 million, which will provide for the operation and support of services under the program. The Australian Government is also providing additional ongoing funding for centre-based Budget Based Funded services through the Budget Based Funded Quality Measure. As the Quality Measure is rolled out, this funding will gradually increase to an estimated additional $12 million per year from 2016–17.


What is the purpose of the Budget Based Funded Program?

The Budget Based Funded Program contributes to the goal of better early childhood outcomes and the best start in life for all for children by providing access to ECEC services in places of ‘market failure’ where services may not otherwise be viable. This includes targeted assistance in places where there is a need for additional culturally competent services for Aboriginal and Torres Strait Islander children and families.

Services funded under the Budget Based Funded Program aim to meet the developmental and cultural needs of children and families by:

  • delivering quality child care that enhances the cultural, physical, social, emotional, language and learning development of all children
  • providing flexible ECEC services that meet the needs of all families in the community
  • fostering individual children’s strengths, abilities and interests through providing developmentally and culturally appropriate play and learning experiences.


What is the history of the Budget Based Funded Program?

The services currently funded by the Budget Based Funded Program each have their origins in previous programs introduced progressively since the mid-1970s. These programs reflected a range of policy goals and approaches and a wide range of community and government priorities over time.

In 2003, a range of ECEC services were consolidated under the Budget Based Funded Program. Bringing the services together reflected their common aim of delivering services in locations where they were needed, including locations that needed additional culturally competent services. As a result, the current mix of services within the Budget Based Funded Program largely reflects historical developments rather than a single and contemporary vision of how best to meet community needs and to deliver the best start for all children

Each Budget Based Funded-funded service is unique. Services can, however, be broadly grouped into five main types:

  • centre-based services, including MACS, crèches and flexible/innovative services
  • outside school hours care (OSHC) and enrichment programs
  • Indigenous playgroups
  • mobile child care services, including those that visit regional and remote areas and provide flexible children’s sessions, playgroups, vacation care, on-farm care, parenting support, toy and video lending libraries and parent resource library services
  • other services; for example, nutritional programs, toy libraries and school lunch services.


How does the Budget Based Funded Program currently operate?

The Budget Based Funded Program currently provides operational funding to some 337 individual ECEC services delivering the different service types in locations across all Australian states and territories and across urban, regional and remote locations (Figure 2). In 2011-12, about $60 million was provided to these services, with approximately $45 million for Indigenous-focused services.


What is different about Budget Based Funded services?

Budget Based Funded services can differ from mainstreamservices to varying degrees and in many different ways. Some services in remote areas have less predictable use and attendance patterns, either because they serve transient communities or because of local or cyclical patterns that affect families’ residence, income and/or employment. In general, remote Budget Based Funded services tend to have smaller sizes than non‑remote services and higher cost structures. Rural and remote services can also experience difficulties attracting and retaining staff. Some urban and regional services also provide low-cost child care services to families who may have difficulties with fees.

Delivery models for Budget Based Funded services are very diverse. They incorporate not just centre-based settings but also mobile services and a range of program types, including playgroups, parenting support and libraries.

Services with a significant proportion of Aboriginal and Torres Strait Islander children and families may undertake a range of activities beyond traditional child care, such as outreach and transport support. These activities can allow better access to and participation in services. Service delivery can also be influenced by local customs and traditions.

The style, formality and governance of some Budget Based Funded services also vary widely, from volunteer arrangements through to arrangements very similar to those in mainstream services or local government/shire run organisations. Due to the services provided, Budget Based Funded services do not always need to be licensed in the state or territory in which they operate. Currently less than a quarter of Budget Based Funded services are licensed.


What is different about Budget Based Funded funding?

Where the number of children and families who require a particular service is small, services may face significant practical challenges to remaining viable. This is more likely to be the case in regional and remote communities, where populations tend to be smaller. In Aboriginal and Torres Strait Islander communities, children and families may require highly specific, culturally appropriate services.

In each of these circumstances, flexible funding may be needed for individual ECEC services to operate and to allow equitable access and participation to remove barriers for some families. The Budget Based Funded Program helps to address this need by providing operational funding directly to services. In this way, the program and the services it funds help to fill the gap left by “market failure” and help ensure that children and families can access appropriate services.

Currently, the program’s funding is fully allocated and has no capacity to meet the needs of any additional locations.

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