New research supported by the Australian Public Policy Institute (APPI) finds that while most NSW-funded early childhood programs are assessed for outcomes and effectiveness, far fewer are evaluated for their economic impact. This can make it difficult for policymakers to identify where public investment delivers the greatest value for children, families and taxpayers.
The report, Strengthening economic evaluation of early childhood interventions in NSW, by University of Wollongong Professor Alfredo R. Paloyo and Dr Ryan Joseph R. Dizon, examines how NSW evaluates early childhood programs and identifies opportunities to strengthen economic evidence for investment decisions.
The research reviewed publicly available evidence on NSW Government-funded early childhood intervention programs. It found that most programs had been evaluated for outcomes and effectiveness, but economic evaluation remained uncommon.
Early childhood interventions can improve health, education and social outcomes while reducing future demand for costly crisis services. However, many benefits emerge over long periods, accrue across different government portfolios or involve outcomes that conventional economic tools struggle to value, including wellbeing, mental health, family relationships and social-emotional development.
To address this gap, the report identifies practical opportunities for the NSW Government to strengthen economic evaluation, including better use of long-term data, stronger evaluation capability and more sophisticated approaches to assessing public value.
Lead author Professor Alfredo Paloyo said stronger economic evidence would help government distinguish between programs that achieve positive outcomes and those that deliver the greatest overall public value. “NSW has invested significantly in early childhood programs and has developed strong evaluation infrastructure. The next step is to ensure government can assess not only whether programs work, but whether they deliver the greatest value for children, families and taxpayers.”
NSW has invested significantly in early childhood programs and has developed strong evaluation infrastructure. The next step is to ensure government can assess not only whether programs work, but whether they deliver the greatest value for children, families and taxpayers.
Professor Alfredo Paloyo, Lead author
APPI Executive Director of Policy and Projects Marianna Brungs said the report provides a practical agenda for strengthening evidence-informed investment in early childhood. “Early intervention can improve outcomes for children and families while reducing the need for more costly services later in life. Stronger economic evidence would give government greater confidence to scale programs and direct public resources to the interventions with the greatest impact.”
The report was produced through APPI’s Policy Challenge Grant program, which supports academics undertaking policy-relevant research on major public policy challenges facing Australia.
