Govt confirms education subsidy cut

Education Minister Anne Tolley. Photo / Daily Post

The Government's top subsidy for 20 hours early childhood education (ECE) will be reduced in February next year, from $12.45 an hour to $10.88, Education Minister Anne Tolley confirmed last night.

Earlier in Parliament she had disputed the same figures put to her by Labour MP Sue Moroney, who says the cut breaks National's pre-election promise to keep all existing subsidies for the 20 hours ECE policy.

Centres that are part of the 20 hours ECE policy won't be able make up the shortfall by increasing fees to parents because National will keep the fees' control mechanism, which prevents participating centres from charging more than the subsidy covering those hours.

A number of centres that are not part of the policy will be able to push up fees for their hours, including attendance within the 20 hours.

Mrs Tolley told Parliament yesterday that funding reductions in affected centres were likely to be $8-$30 for children attending around 20 hours a week and between $15-$40 for children attending full-time.

"Fee increases are impossible to predict because early childhood centres are independent bodies which set their own fees."

Government subsidies were changed in last week's Budget and centre around cutting the top two of the five graduated financial incentives for early childhood centres to have qualified teachers.

Participating centres will have to protect the fees within the 20 hours, but not hours beyond that.

Non-participating centres will not have to protect fees at all.

Early childhood services currently receive government funding at different rates - with the highest funding going to those who employ 100 per cent fully qualified and registered teachers.

Mrs Tolley indicated that the new rules could provide an incentive for qualified teachers to be reshuffled and spread across the sector.

The Government's goal of having 80 per cent of qualified teachers in each centre by 2012 remained, and at present 63 per cent across the sector were qualified.

"So if teachers do leave some of these centres that have over 80 per cent [of qualified teachers] they may well lift the ratios then for other centres."