November 23, 2023
Pay Parity

‘Discrepancy’ of $253 million means 18,000 teachers missing out on Pay Parity and ECEs closing fast

The Labour Government’s early learning Pay Parity promise became unaffordable in June 2023.

“To see a shortfall of $253 million being labelled as a ‘discrepancy’ by Minister Tinetti was a surprise and seems to down-play something significant - the breaking of Labour’s Pay Parity promise to 18,000 teachers” said Early Childhood Council CEO Simon Laube.

A Ministry of Education Cabinet paper shines a light on how difficult this year’s secondary school industrial action was for the previous government, not provisioning sufficient funds to fully honour the outcome of the secondary teachers’ settlement. The result is that 18,000 ECE teachers will miss out, and $306 million more is required in the next budget just for secondary, primary and kindergarten teachers, but excluding the majority of ECE teachers.

The Labour Government’s commitment to an early learning funding review now looks like a veiled pre-condition before they’d even contemplate further Pay Parity commitments, essentially saying ‘enough is enough’ on their promise of pay parity for early learning teachers.

It becomes clearer now that the previous Pay Parity method was indeed built on flawed teacher data, with averaged salary increases leading to clumsy marginal funding rate changes for centres. This previous method is still in place and it is not working well for smaller centres and those with above average numbers of highly qualified and/or experienced teachers.

In June 2023, the Ministry changed their method to simply offering ECE centres the same funding rates as kindergartens, with the cost determined by how many centres could make that work. The new scheme started on 1 November and then parity slips away from 1 January 2024.

The latest data based on funding claims of ECE’s indicates that it doesn’t work for many - the Ministry’s own data estimated 55% would opt-in, but only 35% have actually done so, indicating that most ECE operators aren’t confident about the Full Pay Parity initiative.

Meanwhile, an average of ten early learning centres are shutting down every month, with 120 estimated to close in the next year, a very high rate of closures.

“While it’s reassuring to see Labour’s focus in Pay Parity changing to being about parents getting secure access to quality, affordable childcare – that change has come much too late and after the Pay Parity promise appears effectively ended.”

“Disappointingly, the incoming government will find they have inherited a costly and complex problem to sort out, or else centre closures will mount up and access issues will become even more real for parents. The pressure is on the promised funding review to happen quickly and effectively.” said Simon Laube.

What is ECC doing about this?

For more information on the work that ECC is doing to support centres navigating Pay Parity, check out our campaign below.

Pay Parity
Pay Parity