Due to the challenges they face in remaining, consolidating, or selling their business, these operators shut down, Mr Tiong said.
As part of suggested sector-wide reform, he mooted the idea of preschool vouchers.
“This empowers parents to choose a preschool that best fits their child’s needs — be it PCF, Montessori, faith-based organisation, or play-based centres. It forces all schools, including state-backed giants, to compete fairly on quality, philosophy, service; without predetermining the winner’s business model,” said Mr Tiong in his speech.
However, Mr Chua said that having a voucher scheme alone may result in unintended consequences, such as increase in preschool fees without improvements in accessibility or quality.
He referred to examples in other countries, such as Hong Kong, where a preschool voucher scheme implemented in 2007 was discontinued as it worsened inequity. Affluent families used the vouchers for extra-educational programmes, noted Mr Chua.
Mr Tiong had in his speech referred to the same example, but said in his assessment that the Hong Kong system’s flaw lay more with how it used a flat rate rather than the voucher system itself. “We can learn from this by using targeted funding supplements for these policy targets: lower-income families, special needs, and teacher wages,” he said.
Mr Chua also said that in the United Kingdom, a nursery voucher programme implemented in 1996 was discontinued shortly after because it created unfair competition, reduced provider diversity, and potentially harmed educational outcomes for young children.
He said Singapore adopted a “comprehensive approach to preschool affordability” by keeping fees for government-supported preschools low and providing both universal and means-tested childcare subsidies to parents.
All Singaporean children are provided with basic subsidies of up to S$300 (US$231) each for full-day childcare, as well as means-tested additional subsidies for eligible families.
“As a result of both fee caps as well as subsidies, we have been able to effectively reduce out-of-pocket expenses while ensuring access and choice of quality preschools for families,” Mr Chua said, adding that full-day childcare expenses before means-tested subsidies will be similar to what households pay for primary school and after-school care fees combined in 2026.
“Mr Tiong has implied that a preschool voucher system would give parents more autonomy to choose a preschool that suits their children’s needs best and allowing for a market mechanism to work.
“This incentive is already built into the nature of childcare subsidies which preschools receive based on the number of children enrolled. Parents today are discerning when choosing preschools that best meet their child’s needs and preferences. This has promoted healthy competition amongst preschool operators, and consequent improvements in quality,” he added.
Preschool enrolment in Singapore has increased over the past decade.
Currently, around nine in 10 Singaporean children aged three to six are enrolled in preschool.
