Teachers Are Paying The Price For Lack Of ECE Funding In The Budget

The Office of Early Childhood Education (OECE) fears sweeping – and sudden – changes to the pay parity scheme, allowing most ECE centres to pay graduate teachers, teachers coming from overseas and those moving from primary schools to ECE lower salaries, will seriously harm the sector’s ability to attract new talent.

Today, the Ministry of Education has announced that from July 1, education and care centres will only have to pay newly certificated teachers and certificated teachers who are new to working in New Zealand ECE centres at step 1 of the salary scale, which is $57,358 per year ($27.58 an hour) for at least the first year.

Previously, services were required to take into account whether teachers held additional and higher qualifications, such as an honours degree or Masters degree of teaching, when working out what their starting salary should be. They also had to recognise any prior relevant work experience and any experience in the primary school system when assessing teachers’ level of experience.

The OECE’s chief advisor Dr Sarah Alexander says the message this sends to educators and employers alike is clear: “ECE teachers and their families are the ones that must self-sacrifice to keep ECE service financial margins up”.

“It also sends out a message that higher qualifications and experience for teachers count for nothing. This is devastating news for ECE teachers and the future of our profession.”

Although ECE employers will be required to honour existing pay rates with teachers, it is not entirely accurate for the Ministry to claim that currently employed certificated teachers should not be affected by the change.

That’s because under the new rules, services that have opted to pay their permanently employed certificated teachers according to the parity or extended pay parity scale amounts won’t be able to opt in to attest to paying higher salary scales after the July 2025 funding payment, for a period of 2 years.

This could effectively equate to a pay freeze for many teachers employed at more than 1000 ECE services across Aotearoa because the service providers they work for won’t be able to access increased funding to improve pay for staff.

In Alexander’s view, the government is doing this to try to limit its expenditure on ECE sector funding – because each funding round the number of centres opting in to paying extended and full pay parity goes up. (Under the pay parity scheme, services get more funding if they agree to pay certificated teachers according to one of four increasing salary scales.)

The changes come just days after Finance Minister Nicola Willis announced the cost adjustment for ECE in the 2025 Budget would be just 0.5%. This was miles behind inflation, which is at 2.5%, so is effectively a funding cut. (See https://oece.nz/newsroom/press-releases/budget-2025-nz/

The Ministry has said in documents detailing the changes that the rationale is to “support the sustainability of education and care… alongside the cost adjustment to subsidy rates announced as part of Budget 2025.”

Alexander says: “In other words, the Ministry is saying ECE teachers must pay the price for the lack of investment in the sector in Budget 2025. This is a way of keeping the cost of ECE centre funding down for the Government, while also not affecting service providers’ bottom lines.”

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