Early Learning Bulletin 27 May 2021

Message from the Secretary for Education

Kia ora koutou,

Since the announcement of Budget 21 decisions last week we have received several questions about the pay parity scheme. This special bulletin has further information to help you understand the changes and links to all the relevant information on our website.

If you have more questions at any stage, please continue to send them in so we can include the responses in future issues of the Bulletin.

Ngā mihi,
Iona

In today’s bulletin:

Summary of funding changes announced in Budget 2021, including answers to key questions.

For more detailed information visit Funding Changes.

Budget 2021 announced three different funding changes, as follows:

From 1 July 2021, there will be an increase to existing subsidy rates at the same time as raising the minimum rates services must attest to paying. The current rules that apply to the minimum attestation process will still apply. That is, if your service chooses not to attest to paying all your certificated teachers at least $51,358 per annum from 1 July 2021, your funding will drop to the 0-24% certificated teachers’ band.

From 1 January 2022, there will be an across-the-board 1.2% increase to funding rates for all early learning providers, except for home-based services on the standard rate. The increase in Targeted Funding for Disadvantage will take effect from 1 March 2022.

From 1 January 2022, subject to the passage of the Education and Training (Grants – Budget Measures) Amendment Bill, an additional set of higher premium rates will be made available. Education and care services that agree to pay, at a minimum, their certificated teachers at the first six of the eleven applicable pay steps set out in the Kindergarten Teachers, Head Teachers and Senior Teachers’ Collective Agreement 2019-2022 would be paid the new premium rates.

If your service does not opt into these rates but is still paying all certificated teachers at least $51,358 per annum, your funding will continue according to the proportion of certificated teachers working with children. Your funding would not drop to the 0-24% certificated teachers’ band if you do not opt into the new higher pay parity funding rates.

The new rates from 1 January 2022 may not work for every service.

The new funding rates were calculated to cover the cost of salary increases across the whole sector, based on information from the recent salary survey and the 2020 ECE Census. This means that for some services, the new rates will exceed the cost of the salary increases, and for other services the new rates will not fully cover the cost of the salary increases. This is why the rates are voluntary – services must assess their own situations and decide whether to opt in. The Government expects those services that do opt in to pass on the increases in funding to their teaching staff, even if they are already being paid above the minimum required.

The current ECE funding system is a bulk grant that does not differentiate salary costs from other costs, or fund services according to the experience profile of their certificated teachers. This is why the Minister referred to the need to revise the funding system to achieve the goal of pay parity in his announcement on Wednesday 12 May. Redesigning the funding system to achieve pay parity will take time and we will need your engagement to do this, including through better information provision to the Ministry. The nature of the work is still to be scoped. We’ll provide more information in the coming weeks.

If you have further questions, please email ECE.Funding@education.govt.nz