Kindy, daycare operators see fee hikes of up to 20% after new minimum wage

The Malaysian Association of Kindergartens (PTM) has expressed concerns that the upcoming RM2,000 minimum wage could lead to fee hikes of up to 20% for private daycare and kindergarten operators. This is due to rising labor costs and increased expenses for food, hygiene items, and learning materials. PTM chairman Elvis Gan noted that operators' ability to absorb higher wage costs depends on factors such as enrollment numbers, fee collections, and other commitments.

Private daycare fees currently range from RM700 to RM1,000 per month, while private kindergarten fees vary from RM500 to RM1,500 per month. For instance, a RM300 wage increase for one caregiver translates to an added cost of RM100 per baby with a one-to-three ratio, RM60 per child at a one-to-five ratio, or RM30 at a one-to-10 ratio. However, these calculations do not include employer contributions or other employment costs, nor do they reflect the proposed fee increase rate by PTM.

Norsheila Abdullah, the president of the Association of Registered Child Care Providers Malaysia (ARCPM), warned that the closure of daycare centers would result in job losses for caregivers and limit parents' access to safe and accessible childcare services. She emphasized the importance of preventing these risks through policy measures before they occur.

Gan proposed targeted wage subsidies for eligible registered kindergarten operators during the adjustment period, as well as grants for training and safety equipment, and assistance to secure affordable premises. He also suggested fee assistance for families in need, bulk purchases of essential goods, and group training to help reduce costs without compromising caregiver adequacy, nutrition, education quality, and children's safety.

ARCPM proposed further studies on the impact of higher costs on private daycare centers, particularly those serving low-income families or operating in areas with limited childcare facilities. Norsheila also advocated for dedicated funding for childcare and early childhood development, separate from funding for formal education, stating that quality childcare should begin before children enter kindergarten or school.