A proposal for offering complimentary preschool education may encourage parents to have children, as part of efforts by China to increase the nation's birthrate.
In a significant move towards educational equality and population development, China's State Council has announced that preschool education will be made free for children in their final year of kindergarten starting from autumn 2025. This policy is expected to benefit around 12 million children and offer relief to families struggling with a weak labour market and a prolonged real estate slump.
Ding Shuang, chief Greater China economist at Standard Chartered Bank, views these measures as a step in the right direction.
The guidelines for funding distribution were released by the State Council. Fiscal departments will subsidize kindergartens to compensate for income lost due to the waived fees, with central and local governments jointly funding this, and greater support provided to central and western regions.
The fee reduction in private kindergartens is matched to the amount waived in public kindergartens at the local level. Kindergartens that charge more than the local public kindergarten standard may still collect the difference from parents.
Authorities must manage funds efficiently to ensure the smooth operation of kindergartens despite the fee waivers. The government encourages local authorities to strengthen supportive policies for disadvantaged groups such as children from low-income families, orphans, and children with disabilities.
As part of broader childcare support, a nationwide childcare subsidy of 3,600 yuan per child under three (born before 2025) was also announced.
This initiative aims to reduce families' education costs significantly, estimated savings of ~20 billion yuan or 2.8 billion USD in the first semester, promote educational equality, support balanced population development, and make the country more birth-friendly.
The move is a continuation of previous consumption policies and is part of a phased plan to make preschool education free in China. The specific amount of subsidy for each locality has not been specified.
China will waive tuition fees for children in their final year at public kindergartens starting from autumn 2021. Kindergartens will receive subsidies to offset the loss of tuition revenue from the new policy. Beijing will fund at least half, and up to 80 per cent, of the total cost, depending on the fiscal strength of the locality.
The tuition fee waiver is intended to address China's plummeting birth rate. The impact of these measures remains uncertain. The subsidies are intended to help kindergartens adjust to the new policy.
The policy will be improved over time based on demographic changes such as shifts in school-age population. The reduction in tuition fees for private kindergartens will be based on the value of the fee exemption at public kindergartens in the same locality.
The State Council, China's cabinet, announced the tuition fee waiver on Tuesday. The measures are seen as a step towards improving the quality of basic public education services in China.
- The policy of waiving tuition fees for children in their final year at public kindergartens starting from autumn 2021 is part of China's aim to reduce families' education costs and promote educational equality.
- The fee reduction in private kindergartens will be based on the value of the fee exemption at public kindergartens in the same locality, aligning with the government's policy of balanced population development.
- The nationwide childcare subsidy of 3,600 yuan per child under three, announced alongside the education policy, is another step towards providing support for family-health and parenting.
- The broader childcare support measures, including subsidies and fee waivers, are expected to impact the economy by offering relief to families struggling with a weak labour market and a prolonged real estate slump.
- The move to make preschool education free for children in China is not only a step towards educational equality but also a strategic decision in the realm of policy-and-legislation and politics, aiming to make the country more birth-friendly and support population development.
