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Home / New Zealand / Education

Newly qualified early childhood teachers to lose as much as $22m over next two years

RNZ
24 Jul, 2025 07:26 PM4 mins to read

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The paper says sector groups, including the Early Childhood Council, had indicated pay parity costs were creating funding shortfalls that were causing some centres to close. Photo / Cole Eastham-Farrelly, RNZ

The paper says sector groups, including the Early Childhood Council, had indicated pay parity costs were creating funding shortfalls that were causing some centres to close. Photo / Cole Eastham-Farrelly, RNZ

By John Gerritsen of RNZ

A Cabinet paper shows newly qualified early childhood (ECE) teachers will collectively lose as much as $22 million over the next two years so their employers can have lower costs.

It also reveals the Government has decided to end the pay parity scheme for early childhood teachers, even though a review of the sector’s funding has barely begun.

The parity scheme gives services higher rates of funding if they promise to pay their qualified, registered teachers similar rates to qualified school and kindergarten teachers with similar qualifications.

More than 90% of services had opted into the scheme, despite complaints that they could not afford it.

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Earlier this year the Government announced it would change the rules so from July 1 services could pay newly qualified teachers at the bottom rung of the pay scale, $57,358 or $27.58 per hour, regardless of their prior qualifications.

Previously a qualified teacher with a degree would have to start on $61,948, while a teacher with a master’s degree could expect to start on $67,794.

The option was one of four included in a recently released document titled “Options to reduce ECE service staffing costs”.

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The three other options were redacted from the document.

It said the change would save services up to $22m over two years depending on how many decided to give new teachers a lower salary than they might otherwise earn.

It said the move would address a key concern of service owners relatively simply, but some new teachers would earn less.

“Likely that some teachers’ pay will be less than it would otherwise have been under the status quo. Makes teaching in education and care services less attractive for those considering studying and entering the ECE workforce,” the document said.

The paper said sector groups including the Early Childhood Council had indicated pay parity costs were creating funding shortfalls that were causing some centres to close.

It said either Government, parents or teachers would have to pay for reducing centres’ costs.

A paragraph in the paper also showed the Government was “moving away from” the current pay parity scheme.

“The options in this paper begin the process of proactively moving away from the opt-in pay parity system and providing greater autonomy to providers to negotiate with teachers on matters of pay. The wider funding review you are seeking Cabinet approval for provides the opportunity to complete this process,” it said.

NZEI Te Riu Roa early childhood education representative Zane McCarthy said the report indicated the Government had already decided that pay parity for ECE teachers would be scrapped entirely in the upcoming funding review.

“It is appalling that on one hand the Government says it values teachers, yet on the other, baldly states here that ‘the potential savings for education and care services … would be funded through reductions in teacher pay’,” he said.

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“Early childhood education teachers are infuriated about this. To lose pay parity altogether would be absolutely devastating for everyone working in early childhood education, and for those thinking of becoming early childhood teachers.”

McCarthy said the change would destroy decades of hard-won progress to pay parity.

“The Government’s comments leave us in no doubt as to its priorities and values: teachers paying for the profits of providers, and parents footing the bill, while it devalues the sector and steps away from its responsibility to provide quality early childhood education for tamariki,” he said.

He said the Government appeared to be trying to compensate centre owners for providing only a 0.5% increase to their funding rates in the May Budget.

Associate Education Minister David Seymour said the Government was looking at ways to make the sector more viable so more parents could access childcare.

“There is currently an independent funding review under way, and I wouldn’t want to pre-empt their findings. However, I note that pay parity is an issue that has been raised by the sector as something that is putting enormous funding pressure on centres and leading to higher costs for families,” he said.

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-RNZ

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