By S Y Lee and Leong Sze Hian
We refer to the article “My First Skool to raise fees next year” (Channel NewsAsia, Sep 24).
The article states that My First Skool is given the approval to increase its fees for its 111 childcare centres by the Early Childhood Development Agency. The school said its fee increase is necessary to improve the quality of its programmes and to keep up with rising operating costs.
This round of increase is the school’s second fee revision within two years.
Profits increased 25%?
According to NTUC (National Trades Union Congress) First Campus’ (My First Skool) annual reports for 2013 and 2011 – net profits for the co-operative and the group increased from $5.2 to $6.5 million from 2011 to 2013 – an increase of 25%.
Why was the subject fee increase approved by the Early Childhood Development Agency – when its profits increased by 25% over the span of just two years?
Revenue increased 81% and dividend increase of 100%?
The total revenue of the childcare arm of NTUC also increased from $84.3 to $152.4 million – an increase of about 81%.
The final dividend which it recommended also increased from 2 to 4 cents per share – a staggering increase of 100%.
No financial statements?
We are unable to see the details of the “rising operating costs” as the annual reports do not have financial statements – showing only a paragraph on financial performance.
5% fees increase justified?
As the labour movement’s co-operative seeks to provide childcare services to the masses – how can another increase in fees by as much as 5% for 5 of the 6 categories be justified and approved – when profits increased by 25% and dividends increased by 100%.
Patrick Tan commented about the increase last year in the Today’s Voices section, whose points holds true even for this round of fee increase by My First Skool.
“As one of the two not-for-profit pre-school anchor operators, NTUC’s My First Skool enjoys recurrent government grants to operate childcare services.
In turn, it should be seen as a price moderator. Its announcement of a fee hike after childcare subsidies were increased in April, and right after a new pre-school fund and another subsidy was rolled out for other operators, does not speak very well of the role it should be playing.
If it indeed uses the national median fee as a guide, it should not be increasing fees now because the median would naturally increase as a result. Being an anchor operator, its fee hike would be seen as an opportunity for other operators to follow. (read more)”
Considering the fact that it was one of the two only anchor operators which could receive Government subsidies for many years, till the recent addition of 3 more anchor childcare operators – plus the priority allocation of 4 of the 17 new centre sites – makes the justification for the fees increase, arguably even more questionable.
Who are we benefiting?
With the consecutive increase in fees approved by the government despite growing profits and dividends by the childcare school, are we not excessively benefiting First Campus’s shareholders at the expense of pushing more financial burden to Singaporean parents and their children?
Affordable childcare fees?
In this connection of increased fees for childcare, you may also like to read our earlier article “400,000 citizens earning less than a month’s childcare fee?“, Sep 25).