Private pre-schools worry about being edged out

A playgroup comprising Nursery 1 children in progress at Little Explorers' Cove childcare centre in Jurong West. The centre is said to have a higher proportion of minorities because of its mother tongue niche. Mr Viknesh Subramaniam runs two Little E
A playgroup comprising Nursery 1 children in progress at Little Explorers' Cove childcare centre in Jurong West. The centre is said to have a higher proportion of minorities because of its mother tongue niche. ST PHOTOS: SEAH KWANG PENG
A playgroup comprising Nursery 1 children in progress at Little Explorers' Cove childcare centre in Jurong West. The centre is said to have a higher proportion of minorities because of its mother tongue niche. Mr Viknesh Subramaniam runs two Little E
Mr Viknesh Subramaniam runs two Little Explorers' Cove childcare centres, which offer all three mother tongue languages - Chinese, Malay and Tamil. But with MOE kindergartens slated to offer the same thing, he will have to think about finding new niches.ST PHOTOS: SEAH KWANG PENG

For the last 30 years, Appleland Playhouse has been able to draw in a steady stream of pre-schoolers to its one centre, just by word-of- mouth recommendations from parents.

But a slew of government initiatives announced over the past week has principal Kelly Chuaworried about the future of the family- owned business.

By 2023, pre-schools that are run or supported by the Government will take up two-thirds of the market share, up from half.

They charge below-average fees and include kindergartens run by the Ministry of Education (MOE), which will expand their numbers to 50 by 2023 - more than three times the current 15 - and cater to 20 per cent of children aged five and six.

A three-year national campaign will also be launched to recruit more pre-school teachers, and work on improving their salaries and career prospects.

Ms Chua, whose centre charges below the average full-day childcare fee of about $1,000 a month, said the industry knew the move was coming.

 
 
 

"But now that it has been made official, we are nervous. Looking at where things are going in the near future, we may not be able to take in kindergarten-age children," she said.

GAME CHANGER

It is no longer going to be good enough to provide pre-school places. Operators will be forced to provide good-quality education at prices that are affordable.

MS M. NIRMALA, chief executive of Child at Street 11, on how pre-school operators should not worry about competition, but instead relook their offering.

The centre may target expatriate parents instead of just locals, in addition to exploring how it can differentiate itself from government options. Fewer than 10 per cent of the 180 or so children now in Appleland Playhouse have expatriate parents.

Minister for Education (Schools) Ng Chee Meng had stressed last week that the Government's moves were not an attempt to nationalise the early childhood sector.

He pointed out that the 50 MOE kindergartens are still a minority compared with the 450 or so kindergartens already running.

PCF Sparkletots, the largest pre-school operator, has 179 kindergartens and 184 childcare centres. And NTUC's My First Skool has more than 130 pre-schools.

The majority of the other operators run fewer than 10 centres each.

While private pre-school operators welcomed the Government's significant investment in the sector - annual spending will double to $1.7 billion in 2022 - and its efforts to raise teaching standards, with the setting up of a new national institute for pre-school educators, concerns remain.

Smaller players - particularly those that charge fees below or near the industry average but do not get government funding - worry if they have a future.

PRESSURE TO UP THEIR GAME

Mr Vincent Yap, managing director of Eshkol Valley Preschool, which has two childcare centres and a kindergarten, said: "When one puts all the announcements into perspective, the picture painted for private operators can be rather gloomy.

"Having higher wages puts pressure on the bottom line, while more competition from MOE kindergartens and anchor operators puts pressure on the top line, and the cycle goes on."

Anchor operators get government grants and priority in securing sites, but must meet fee caps and quality criteria.

For Mr Viknesh Subramaniam, who runs two Little Explorers' Cove childcare centres, there is another issue.

His centres are different in that they offer all three mother tongue languages - Chinese, Malay and Tamil. But MOE kindergartens will be offering the same thing, and they will be many.

He said: "We usually get a higher proportion of minorities, but that may drop in future and we have to think about finding new niches."

Attracting teachers could also be tougher, he added, as his centres cannot offer career progression that can match up to what is offered by MOE and government-supported operators.

THE MOE ADVANTAGE?

All MOE kindergartens will also be located in primary schools, so pre-schoolers have a smoother transition to Primary 1.

Some industry players believe MOE kindergarten pupils may eventually have priority admission to the primary schools that the kindergartens are sited in. That is not the case now.

MOE said last week that this is something it "would have to study quite closely" as more MOE pre-schools are set up.

THE FLIP SIDE

But the operators remain hopeful that they will survive by tailoring programmes for more specific needs.

MapleBear Singapore chief executive officer Patricia Koh said some parents may prefer their children to go to the same pre-school until age six, rather than move from the new "early-years centres" - that will be set up by anchor operators and admit children only up to age four -to MOE kindergartens or other pre-schools after Nursery 2.

"Some parents may like a small, cosy environment rather than a big school," she added.

Eshkol Valley's Mr Yap said programme quality matters too.

He added: "The litmus test for customer satisfaction in those pre-schools is when they are set up in areas without high demand for pre-school places.

"Only then can we be sure that parents send their children there because of the quality and not because of the lack of other alternatives."

Ms M. Nirmala, chief executive of Child at Street 11, said: "Operators should not worry about or fear a competitor, and that includes MOE. Instead, they should look at what they offer.

"It is no longer going to be good enough to provide pre-school places. Operators will be forced to provide good-quality education at prices that are affordable."

A version of this article appeared in the print edition of The Sunday Times on August 27, 2017, with the headline 'Private pre-schools worry about being edged out'. Print Edition | Subscribe