400,000 citizens earning less than a month’s childcare fee?

By SY Lee and Leong Sze Hian

When we read a facebook post showing the increase in childcare fees’ schedule of one of Singapore’s largest childcare operators – the first thought that came to our mind was how affordable is it for middle income families?

The full-day childcare fee will increase from next year, from $1,310.75 to $1,342.85.

Middle-income family pays $733 after subsidies?

According to childcarelink’s web site – a family with household income of $3,501 (income range $3,501 to $4,000) would have to pay a net fee of $732.85 ($1,342.85 less $300 basic subsidy less $310 additional subsidy).

How affordable is childcare?

How affordable is this for a family of 3 with gross household income of $3,501 ($2,800.80 after employee 20% CPF contribution)?

Increase subsidy, increase fees?

What’s the point of increasing the subsidy for childcare fees, when the fees increase such that even middle income families may find it a stretch to pay the net fees?

416,500 workers earn less than $1,500?

In this connection of earning power, according to the Yearbook of Manpower Statistics 2014 released on 30 June 2014 – there were 44,300 residents earning (gross monthly income from work excluding employer CPF contribution) less than $500, 207,100 earning less than $1,000, and 416,900 earning less than $1,500.

400,000 earn less than a month’s childcare fees?

So, to put the childcare fees increase in perspective – does it mean that about 400,000 people may earn less than or around the monthly childcare fee of $1,342.85?

What kind of a country have we become, such that about 20% of the total workforce earns just as much as a month’s childcare fees in a basic childcare centre?

Since the additional subsidy only applies for Singaporeans – the burden on lower and middle income permanent residents (PRs) and foreigners may be even greater.

Read here to see if the increase in fees by My First Skool is justifiable.