4.1 The cost of kindergartens

Costs increase in real terms

The cost of providing public services increases every year due to general inflation and wage growth. In order to measure real-term growth in spending, all figures in this chapter have been adjusted to reflect such changes.

Local authorities spent a total of NOK 40.9 billion on kindergartens in 2015 – a reduction of just over 2 per cent since 2014. This figure includes the cost of running municipal kindergartens and grants for private kindergartens, but it excludes parental contributions.

An average of 15 per cent of all spending on municipal services was allocated to kindergartens in 2015. Only primary and lower secondary education and healthcare received more funding than kindergartens.

The total cost, including parental contributions, was NOK 48.1 billion in 2014 (Lunder et al. 2016).

Municipal grants and parent contributions fund kindergartens

Local authorities meet most of the cost of running both public and private kindergartens. The shortfall is mostly covered by the parents, while public funding and other grants from the local authority or kindergarten owners make up a small part of the funding (Figure 4.1).

Parents should not pay more than the maximum price for a kindergarten place. As of January 2016, the maximum price is NOK 2,655 per month.

Figure 4.1 Kindergarten funding by ownership type. 2014. Per cent.

figure-4-1-kindergarten-funding-by-ownership-type-2014-per-cent

Source: Lunder et al. (2016)

Almost half of local authority spending is allocated to private kindergartens

Private kindergartens made up 54 per cent of all kindergartens in 2015. Funding for private kindergartens accounted for 46 per cent of local councils’ total spending on kindergartens (KOSTRA, preliminary figures). On average, municipal kindergartens spend 15 per cent more per child compared to private kindergartens (Figure 4.2).

Figure 4.2 Cost per full-time kindergarten place, older children. Changes from 2009 to 2014. NOK.

figure-4-2-cost-per-full-time-kindergarten-place-older-children-changes-from-2009-to-2014-nok

Source: Lunder et al. (2016)

New national schemes for reducing parental contributions in 2015

Households should not pay more than 6 per cent of their income for a kindergarten place. In 2016, it applies to households with a combined income of less than NOK 486,750 per annum.

All 4 and 5-year-olds living in households with a combined income of less than NOK 405,000 are entitled to 20 hours of free kindergarten time.

A kindergarten place costs local authorities NOK 143,600 in total

In 2015, local authorities spent an average of NOK 143,600 on each child in kindergarten (KOSTRA, preliminary figures). This figure includes municipal funding of private kindergartens but excludes government funding and parental contributions. Spending ranges from NOK 100,000 to more than NOK 240,000 per child (Figure 4.3).

NOK 226 million to help reduce parental contributions for low-income households

A total of 20,000 households were granted a reduction in parental contributions due to low incomes in 2015. Altogether 25,000 children had their kindergarten fees reduced because of low incomes, while 10,000 children benefited from the regulations on free core time in kindergarten. Local authorities spent more than NOK 226 million on reducing parental contributions due to low household incomes in 2015.

Figure 4.3 Local authorities and kindergarten children by municipal operating cost per full-time equivalent. 2015. Per cent.

Source: Directorate for Education and Training and Statistics Norway (KOSTRA), preliminary figures