3 major pre-school chains raising fees next year

They cite soaring operating costs for increases of between $4 and $62
By Janice Tai, The Straits Times, 27 Sep 2014

THREE of five major pre-school chains - which are required to keep fees affordable in return for regular government grants - will increase their prices next year.

They need to raise fees by between $4 and $62 because of soaring operating costs, they said.

This comes after the median monthly fee for full-day childcare rose in a year by $80 - the biggest increment in at least eight years - to reach $830 last year.

The anchor operators raising their fees are NTUC's My First Skool, PAP Community Foundation (PCF) and Metropolitan YMCA's MY World Preschool.

Skool4kidz and EtonHouse International's E-bridge Pre- School are not doing so because their current fees have hit the maximum allowed for anchor operators. For example, a full-day childcare programme cannot cost more than $720 a month.

PCF, which runs 361 childcare centres and kindergartens, will raise fees for 124 of its 131 childcare centres. The hike will range between $4 and $62 for infant- care services, and between $23 and $45.50 for childcare services.

Its childcare programmes for centres built before this year now cost between $420 and $697.

Of its 230 kindergartens, 170 will raise their fees by between $10 and $20 next year.

Its spokesman said: "Given rising operation costs, most notably salary costs and costs to implement improved programmes, there is a need to selectively raise fees to defray overheads."

My First Skool, which has 11,000 pupils in its 111 centres, will raise its fees by an average of $32 a month. Fees, inclusive of goods and services tax, will be $1,342 for infants, $707 for toddlers and those in play groups, and $646 for those in nursery and kindergarten.

"Our fee adjustment policy is to have moderate adjustments to keep pace with salary adjustments and quality improvements, rather than large increases every two to three years," its spokesman said.

Metropolitan YMCA will charge $20 to $30 more at eight of its 14 centres. Fees start from $610 for full-day childcare, and from $1,250 for infant care.

The three operators said the Early Childhood Development Agency (ECDA), which oversees the pre-school sector, has approved the fee increases.

ECDA said: "Pre-school operators raise fees from time to time to ensure sustainability as operating costs rise, and to recruit and retain sufficient teachers to deliver quality programmes."

Asked about the impact of the fee hikes on lower- to middle- income families, ECDA said the impact on out-of-pocket expenses "may be significantly lower" with childcare subsidies.

For example, a family with a household income of $2,500 and below will continue to pay only $3 a month for full-day childcare even if the monthly fee rises from $615 to $646. A family with household income of $4,000 will pay $69 monthly, up from $60.

All parents, regardless of income, get a basic subsidy of $300 a month for full-day childcare. They also get a second subsidy based on household income, with poorer families getting more help.

Manager Wendy Lim, 31, whose two-year-old son is in childcare, said: "Anchor operators that are subsidised quite a bit by the Government should keep their fee increases minimal as they are mass-market options. But the fee hike is not so bad because lower- income families get larger childcare subsidies than the rest."