A 1.6 per cent Budget increase for early childhood education centre universal funding has disappointed the principal of Inspired Kindergartens, Peter Monteith.

Early childhood education received $590 million to fund more places and a 1.6 per cent funding increase for ECE centres from January 2019.

Monteith was underwhelmed with the budget boost for the early education sector and would have liked to see a bigger increase in "backline funding".

"The 1.6 per cent just doesn't do it," he said. "That is not even one full teacher salary for the year."

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Monteith said the government had signalled an additional 1500 teachers for schools, but nothing to address the critical shortage of qualified teachers in the early childhood sector.

"I do not think they have made their election commitments," he said.

Monteith's said if three new schools were to be built in Tauranga "we could fill them".

"We are operating at 97 per cent at the moment across all of our kindergartens," he said.

Apart from a nod towards early childhood education and learning support, Monteith said there was a significant lack of detail as to how and where funding would be allocated.

"Whether there it is just for the increase numbers of children who will be participating or whether there is money there to ask for community services to build new places, we don't know," he said.

An extra $1.6 billion over the next four years in operating funding and $334m in capital funding was also allocated to address rising demand, fund 1500 more teachers and raise teacher-aide funding.

A total of $272m was announced for learning support such as teacher aides, Ongoing Resource Scheme and early intervention.

Education Minister Chris Hipkins said the $105m spend on increasing that funding would help take the pressure off more than 4000 centres and 200,000 children.

He said it was the first universal cost adjustment to the rates paid to centres since 2008 and described it as a "first step".

"The 1.6 per cent funding increase is a fiscally responsible adjustment and is the first step in our plan to lift ECE quality."

About $483m would be to meet increased demand and population growth - about $130m more than the former National Government had funded for.

Additional reporting NZME
BUDGET 2018: EDUCATION
• $1.6 billion more in operating funding and $334 million in capital funding.
• Education budget will be $12.26b, up from $11.85b last year.
• $395m to build new schools and classrooms. Includes $62m for Christchurch schools rebuild and $332m nationwide.
• $204m for a 1.6 per cent increase to schools' operational funding and to cover school roll growth.
• $370m to fund 1500 new teacher places by 2021 ($70m more than National funded).
• Early childhood education: $590m to fund more places and a 1.6 per cent funding increase for ECE centres from January 2019.
• $272.8m for learning support such as teacher aides, ORS and early intervention.