Free preschools for all children need to be offered in Australia if we are to compete economically with other developed countries, says leading international early childhood education expert.
Research by Edward Melhuish from Oxford University has also found that a quality preschool education has a bigger influence on a child's literacy and numeracy skills at ages 11 and 14 than their primary school education - but a mother's education level was the most significant factor.
Professor Melhuish urged the government to follow Britain, Scandinavia and many European countries in offering free early education in a submission to the Productivity Commission inquiry into childcare and early childhood learning.
He warned the inquiry that Australia risked falling behind unless the government invested more in the pre-primary years.
''If you want to be with the top economically successful countries in the future you are going to need to do this,'' he said.
When Britain introduced fully government-funded preschool for every child for 15 hours a week 10 years ago, it raised the cost of early education from 0.5 per cent of gross domestic product to 1 per cent. By comparison, Australia only invests 0.3 per cent of GDP on early education, ranking it at 32 out of 34 OECD countries.
The cost of a free program could be offset by an increase in female workforce participation, the creation of a better-educated workforce and a reduction in welfare dependence.
Chief executive of the Community Child Care Co-operative (NSW), Leanne Gibbs, said the organisation supported the proposal for free preschool but believed it would meet political opposition due to the expense.
''It should be outside of the political cycle and in the social policy agenda that all governments agree to,'' she said. ''It's the only way we are going to get ahead in early childhood and in the future.''
The previous federal government committed $1 billion to subsidising preschool places under its universal access scheme but the funding runs out at the end of this year and there is no confirmation about whether it will be renewed.
Lane Cove mother of two Kylie Peake said a greater government investment in early education would take the cost pressure off parents and be beneficial to children.
She has witnessed the power of preschool for her four-year-old daughter, Jemma.
''Her ability to reason has improved and she is able to communicate more confidently,'' she said.