ChildForum Office of Pre-Primary Education

ChildForum Office of Pre-Primary EducationLead advisor on early childhood care and education 
National membership 

Publisher of the New Zealand-International Research in Early Childhood Journal


The State of Early Childhood Education, 2010 Report

© ChildForum

The feedback reported here is:

1.  How things really are in early childhood services

2.  What's likely to improve in the early childhood sector in the coming 12 months (Nov 2010 - Nov 2011), and

3.  What's likely to worsen in the early childhood sector in the coming 12 months (Nov 2010 - Nov 2011) 

Then at the end of this page you are invited to add your comments and share your experience or insights.


1. How Things Really Are In Early Childhood Services

In November 2010 ChildForum invited people involved at  grass roots level in early childcare and education to answer an open question which was:  “How are things in your early childhood service at the moment?”.

In contrast with the news stories carried in the media during 2010 painting a picture of crisis in the sector the responses we received gave a somewhat different and fascinating picture of how things are in services.

(a) All Humming Along

Parents thinking about enrolling with an early childhood service next year will be pleased to hear that the entire sector is not in crisis. Here is a selection of comments to illustrate:

“Playcentre is a great place for children … I am learning and contributing to my children’s learning and the community we live in” (parent)

“As far as I am aware we are unaffected by the recent changes to funding” (educator)

“Very BUSY!” (educator)

“Pretty good” (educator)

“Less sickness now winter is over, so rolls more stable and funding more reliable” (educator)

 “Excellent” (home-based service manager)

 “Well at the moment; classes are full, the waiting list is long and parents seem to be happy as indicated by general feedback at last week’s parent evening and last term’s parent survey”  (centre manager)

“We are tracking really well. One of the most exciting things for us is seeing the impact of greater and deeper teacher knowledge on children’s learning experiences” (centre manager)

“Really good. All humming along. Children, staff and families really happy.  Well staffed” (centre manager)

“Great Full Centre, children and staff really busy – ‘countdown’ to Christmas!!  One staff has left to work in Kindergarten (Following his dream, but we have employed another)”  (centre manager)

Parents will also likely be pleased to hear that not all services that are facing funding cutbacks and problems due to policy changes are in full crisis mode.

(b) Who’s Hurting and Who’s Not

The section of the sector which is hurting and hurting badly at the moment is primarily the teacher-led centre-based services on funding bands for 80% - 100% registered/qualified teachers including daycare/crèches/preschools (education and care services) and kindergartens (all-day kindergartens only as part-day kindergartens will not be losing the funding incentive to have more than 80% qualified/registered teachers).

There is concern within this group of teacher-led services that efforts to raise and maintain a high level of quality for children through the presence of qualified and registered teachers are being undermined by government doing away with the funding incentive to employ more than 80% registered teachers and other policy changes, e.g.

“Our centre’s vision is being compromised by the present government. Our centre receives 100% BGF as our vision for many years has been to provide registered teaching staff to the Tamariki in our rohe. We are now spending hours that we do not have, meeting to focus on how we can continue providing our children with quality education and care. Teachers are wasting their precious time on concern about their future and what it holds for them in Aotearoa/NZ; parents/whanau are concerned about the cost to them in the future; management is focussing on how to prevent costs escalating while still providing registered teaching staff. We are a not-for-profit community based service”.

“On edge, the budget cuts are really affecting our team and committee. Concern about the viability of our small family centre being able to survive without increasing numbers – the main philosophy of our centre … Qual of teachers undervalued. Wages under threat. Opportunities for children in their learning environment is at risk. Education is undervalued in NZ, especially the early most informative years. New prisons for those who education cannot reach … sad times.” (community service)

“We are all frustrated at the funding cuts that the National Government is doing as it undervalues us as teachers and children’s education” (educator working in a part-day service).

There are also concerns about how the bills are going to be paid and where the money is going to come from, e.g.

 “Our occupancy is good but money is a real problem as we prepare to cope with the funding cuts … we just have to hope nothing major happens next year that requires maintenance, such as heaters breaking down or a hot water cylinder springing a leak. There is no doubt that we will have to increase our fees at some point although we have made a commitment to parents that they will mostly not pay much more depending on their hours of attendance” (private service providing ECE in low socio-economic areas)

 “As the manager of the centre, I am being careful not to be pessimistic as it isn’t good for the team. But I am starting to feel a bit concerned about the viability of the centre and how we manage beyond next year” (community service)

While there are reactions of anxiety and anger about policy and funding changes such feelings are not typical of every service that has will be affected. Some are approaching the pending funding cutbacks with a sense of acceptance, resilience and self-determination, e.g.

“I remember the uproar when the previous Government introduced 20 hours ECE and the reluctance particularly of the private sector to participate. Now with funding being amended again there is another uproar. The sooner centres just roll up their sleeves and find a way to make it work the better. The world is in financial turmoil and we are not exempt from that” (private service)

“We are having to reduce the teacher support hrs as our budget next year is in a huge deficit and only have one Assistant Supervisor instead of 2. So that will definitely be a lot harder work than previous years. But if that’s what has to happen then we will go with it. We will do everything to keep the centre running” (community service)

“We have carefully planned for the reduction in BF as were on 80% … A major change is that we are staying open over the end of year so that govt will have to pay us BF for this time!” (private service)

“All good. We’ve done the calculations and will remain in a healthy financial position despite the funding cuts” (community service)

(c) Teacher Supply Improving

A sense of relief and optimism is emerging amongst teacher-led services especially those not currently on the higher funding bands for 80% - 100% qualified registered teachers.  There are reports that the staffing shortage is already beginning to ease, e.g.

“All is going really well in our centres.  It seems a lot easier to get staff, as I have a few teachers waiting for positions in my centres – Wow! Never had that before” (private service).

Though for one service any policy changes that might help are perhaps coming too late:

“Private centre.  Number of qualified staff dwindling. No pay rises. Going slowly downhill. Not full.”

While some services are noticing an easing of the teacher shortage (before funding changes on 1 February next year) and celebrating this, in services that are downsizing now it seems important for management committees, professional advisors, and service operators to be aware that this is likely to have an emotional impact on remaining staff, e.g.

“Hard. We made the decision to lay off two qualified teachers as a result of the funding cuts supposed to be the end of the year, but in fairness to them allowed them time to look for other jobs. They got them straight away (of course), this devastated the remaining staff and it’s like we have a huge hole that we can’t fix” (community service)

(d) New Problem Emerging of Empty Spots for Children

We received comments from some early childhood service managers and owners about there being vacancies for children and smaller waiting lists at the moment. This can be a seasonal thing, e.g.

“Quiet in terms of childcare enquiries, however this is traditional for this time of year” (home-based service manager)

But it appears to be more than this for teacher-led services, e.g.

“Numbers are down a bit, parents tightening their hours” (private service).

Centres are noticing the beginning of a trend from high waiting lists and families increasing their hours of childcare to families leaving or changing their hours for financial reasons, e.g. 

 “We have been operating since 1992, and child numbers are slightly lower than usual. Economy is very slow and parents are regularly becoming unemployed” (private service)

“For the first time in the history of our centre, we have parents needing to reduce their days (by compacting their work into less days) and so have children who are staying for longer days. We are also noticing that it’s a bit harder to fill empty spots … For the first time ever, we have had a family leave because they couldn’t afford the fees and were offered a cheaper (and they admit, a far less quality) space at a nearby centre” (community service).

It’s not clear if reports of child numbers being down in some centres are related mostly to families being less able to afford childcare these days, or if we might be seeing the beginning of a new trend of more mums and dads making a personal choice to stay at home and/or to use informal ECE services such as playgroups, grandma, or sharing care between families.  Over the coming year some services with falling rolls and empty places may have to make hard decisions regarding remaining open or reducing their license size (see discussion of what’s likely to happen in the next 12 months later in this newsletter).  Services that raise their fees next year in response to funding cutbacks may risk more parents thinking about reducing hours or changing to a cheaper childcare option.

(e) Suggestion of a Drop in Under-Twos In Childcare/ECE

Comments suggest a beginning of a reversal in the rapid growth in under-two enrolments in licensed ECE over recent years, e.g. 

“The only thing we have experienced in the last twelve months is less 0 – 18 month olds being enrolled. Mums/Dads are staying at home longer – not as many part-time jobs out there. This isn’t necessarily a bad thing” (private service)

“Happy centre but now have several vacancies for under and over 2s. First time in years. Will probably consider closing U2 as it is costly to keep staff and very demanding emotionally. Mothers not finding part time/full time employment opportunities anymore (private service)

“Under-2 enrolments are way down” (centre manager/administrator or owner)

"The number of enquiries fielded dropped off substantially in the first part of the year but have picked up again now.  Not sure whether this was the slowing of the market or the fact that other centres no longer have waiting lists and field the calls first.  Most enquiries are for 3 – 5 year olds with the 20 Hour subsidy. We are chokka full in this area of our centre but our numbers of under two year olds has decreased and we have had vacancies for probably 10 – 12 months now” (centre manager/administrator or owner)

However we won’t know for sure until the Ministry collects its next lot of ECE statistics if the number of places for under-twos is beginning to drop nationally. The Ministry collects its data on the 1 July while we asked for feedback on how things were in services during November. Perhaps any drop in under-twos places in ECE centres is being picked up home-based services? (This data for 1 July 2010 is not yet available from the Ministry website Education Counts). Or perhaps there are more choices for parents looking for baby care as new centres continue to open so numbers are being spread across more services meaning more vacancies in some but overall a continuing increase in numbers across the sector? As at 1 July 2010 Ministry statistics shown below indicate that across both licensed home and centre-based services there was an increase in the number of under-twos in early childhood services (and not a decrease).

Table 3 - Enrolments in licensed early childhood services by age as at 1 July (2006 to 2010)







Difference 2006-10



Under 1








1 Year








(f) Other General Things Happening in Services

Some of the general things reported to be happening during November in services were:

“Over-burdened with red tape and paperwork – currently have the ERO [Education Review Office] visiting” (playcentre)

“Finances are a bit of a challenge. Hard to gauge yet how the GST is really impacting” (private centre)

“Needing to replace an outstanding supervisor” (private centre)

“Our 2 under-two staff struggle with the minimum 1:5 ratio, having 3 babies sometimes with 7 toddlers. There’s a lot expected from 2 staff for this vulnerable age group” (centre manager)

“Children showing signs of needing a holiday …” (private service)

“Professional development, teacher registration programmes, research, peer support, mentoring and inquiry are ongoing” (community service).

“At the moment as Team Leader it is very stressful due to changes that will be occurring in a few weeks time” (service manager, home-based)

“Change of staff has been decided this week, changing staff from one centre to another” (educator)

“Lost approx $50,000 in funding and [so] making sure we use primary registered teachers where possible” (centre manage or owner)

“Increased focus on how we ‘childcare’ with infants, were attending Penny Brownlee courses” (private service)


2. What’s Expected to Improve in the Sector in 2011

 Three key themes for what’s most likely to improve in 2011 were:

  • Opportunities for more self-determination of quality as an upshot of government funding changes
  • Better staff relations, teacher morale, and stronger teamwork
  • Strengthened internal management systems and financial efficiency

(a) More self-determination of quality as an upshot of government funding policy changes

Services facing funding cutbacks are starting to consider how they can bring families and communities more on side. There seems to be the beginning of a refocusing on partnership with families through family involvement and working harder to please families, rather than seeing public funding as the main thing that enables services to continue to tick over. As to what will improve during 2011 comments included:

“Funding will decline forcing services towards self sufficiency – both good and bad”

“Community support, back to basics with resources and staff morale builders”

“More dedication with parent involvement” (private centre service manager)

“Parent loyalty to centres” (private centre service manager)

“Parental involvement” (parent at a part-day service)

“Flexibility of hours for children and what is offered as attractions/add ons by different services” (educator at a private service)

“Community spirit in the centre – we will be asking for more volunteer help” (community service)

“In general, heightened awareness of the need to be proactive” (part-day service manager).

Some services see it as a very positive thing that they will likely be gaining some breathing space to employ staff they want to employ versus need to employ so they don’t lose funding. They think they will be more likely to hold onto staff they want to keep (because staff are less likely to be poached by another service), and let go of those who are less competent or who don’t fit in well (because teacher supply problems are thought to be easing):

“[a greater] supply of qualified motivated professional teachers” (private centre service, manager)

“Possibly easier [for us] to get qualified staff’ (private centre service manager)

“More qualified teachers will become available” (private centre service)

“I think this person will work herself our of the sector, which will be positive” (educator, home-based service)

 “Greater selection of teachers to choose from when interviewing for new staff” (community centre service).

 “We can keep our excellent non qualified staff” (educator at a community centre service)

(b) Staff relations, teacher morale, and stronger teamwork

The way staff work together and their commitment is a key area of likely improvement in 2011. Open poaching of staff across teacher-led home-based and centre-based services may be going to be a thing of the past as more staff look to hang onto their jobs as the shortage of qualified teachers eases and services also look to build staff capability and input. 

“More stable staffing and therefore more potential to develop a professional teaching team” (service manager/owner)

“Team pulling together in adversity with more shared leadership” (private centre service)

“Continuing to grow our distributed leadership model that will improve educational leadership” (home-based service)

Moreover, we note in the comments received that supervisors and employers in general acknowledge pressures that teachers must be feeling as a result of government policy changes: 

“Hopefully morale will improve with a small pay rise”. (private service)

“Stress, tension, sense of belonging, well being ………”. (community service)

And educators/teachers want things to improve even if it’s difficult to see how this might be the case when one is a teacher:

“I am going to be positive and hope that things will improve”

From the perspectives of service managers and owners there is a sense of pride and enthusiasm for achieving a settled and stable staffing team which may be reassuring for teachers who are worried about the safety of their position and/or their ability to get a job they like:

“For our service, happy settled staff” (community service)

“We have a stable and excellent teaching team and they just keep getting better and better” (private service)

(c) Internal quality management systems and financial efficiency

2011 could be a year that services give more attention to internal management, for example some of the comments received were along the lines of:

“Changes being positive, and consolidating our service will see growth in our service” (home-based service).

“Self-review will be more important as centres take stock” (community centre service)

“Thinking outside the square, financial sharpness, working as a team” (community centre service).

Finding ways to achieve what one wants to achieve with less money looks to be on the cards for services set to receive less government funding next year and who may not be able to make up enough of the shortfall by raising fees or getting funding from other sources. For example a manager of 11 community-based early childhood services listed as an improvement for next year “consideration for financial efficiency”. And the manager/owner of a private service planned to improve her/his admin systems and specifically the fee collection process. 


3. What’s Expected to Worsen in the Sector in 2011

Views on what’s likely to worsen or deteriorate clustered around the following themes:

  • Worries about money and financial uncertainty
  • Parents paying more for ECE and losing families
  • Staff quality, employment opportunities, pay and conditions of work

(a) Worries about money and financial uncertainty

To date lack of money has often been expressed as a worry for parent-led centres - but this may be about to change:

“With 20 hours funding Playcentre stands to receive more funding in the coming 12 months.”

Lack of money has not been a worry for most teacher-led centres but money worries are now emerging particularly for those services currently sitting on funding bands of between 80 – 100% qualified/registered teachers. Until now teacher-led centres in a position to maximise what they could receive from government by operating longer hours and for more weeks in the year, maintaining full rolls and working to get the highest possible percentage of registered/qualified teachers on the floor were finding they were financially very well off. Further, the funding climate and rules ensured that services with economies of scale (through operating several centres and/or home-based schemes) were in a strong position to grow profit margins and expand if they chose. 

Over recent years money has been used by policy makers to drive changes in the affordability, accessibility, and quality of ECE in both commercial services and community services through (a) pushing up parental demand for ECE by making it cheaper (b)  incentivising services to structure their hours so children must attend more hours thereby creating more demand for child places to be met through new services opening, and (c) providing financial incentives for services to employ more ECE recognised qualified staff and support them through teacher registration.  As an outcome, there have been some major shifts in practices and in expectations in early childhood education. Feedback suggests that in the coming 12 months being able to maintain expectations, e.g. for ECE to be affordable for families, with less government funding is likely to mean:  

  • less profit,
  • following a tight budget,
  • financial belt tightening,
  • a lack of funds for running the programme, and
  • reduced funds for capital improvements, resources, professional development and staff number reductions.

Further, signals from the Minister of Education that there may be more cutbacks or reprioritisations of government spending is adding to financial pressures for services trying to set their budgets now for next year when its not known what other changes might be announced by government in 2011.

“Lack of knowledge re: funding makes me wary of hiring extra staff which we need now” (private service)

[Things will worsen because of] the reduced funding, and am also worried about 20 free hours being reviewed” (community service)

“Confusion with funding as it keeps changing” (home-based service)

(b) Parents paying more for ECE and losing families

While the staffing shortage looks likely to ease as a result of funding policy changes (see above) a new problem is being predicted within the sector and that is of a shortage of children caused by ECE becoming more expensive for families and families choosing to reduce their ECE use. What this could mean is:   

“Too much competition with centres in close proximity of each other”


“Centres having to make hard decisions to remain operating with some centres closing.”

A key thing an ECE tertiary educator/researcher said was likely to worsen was “parents paying more for ECE”.  And within the sector feedback is that there are risks around bringing in larger than usual fee increases even when these are considered very necessary to absorb GST increases, funding losses and rising operational and staff wage increases.

What is worrying those in services planning to raise fees is that the funding cutbacks and fee increases come at a time when families “will have less money to spend on childcare.” As one educator wrote when prices rise there is a drop in attendance. When fees are cheap parents will enrol their child for possibly more hours than they need. Parents who are not in paid employment will access their entitlement of 20 hours free ECE like any other parent. But when fees increase for those hours used outside of the 20 free hours or when optional charges for the 20 hours increase, its anticipated that some parents will re-think their use of ECE and adjust to what hours they either really need or find they can afford. 

A second worry is that ECE may become inaccessible to the ‘working poor’ and less accessible to those who really need support but can not access it elsewhere, e.g.   

“There is concern over the funding cuts.  It is concerning that the funding for provisionally registered teachers is also likely to be cut. We are having to charge fees to cover costs as opposed to be being a free ‘state funded’ service previously.  This impacts on availability to lower income families” (educator, community all-day service)

(c) Staff quality, employment opportunities, pay and conditions of work

In the comments received there was concern about possible worsening conditions of work for teachers and the impact this would have on quality for children, e.g.

“Vacancies for qualified educators” (tertiary educator/researcher)

 “Good teachers being forced out of jobs.  Quality of care for chn and their families” (educator)

“Knowledge of staff – competence and understanding” (educator)

“Less staff, less qualified staff, less child/staff ratio” (community service manager)

“Loss of quality environments for our Tamariki.  Undervaluing of teachers in their chosen profession” (community service manager).

We won’t know until later next year whether these predictions will come true.  In any case, there has grown a strong belief that children are best served by qualified teachers if they are not attending a parent-led service.  And to argue this the teachers’ union, NZEI, are planning to mail copies of a national petition in January to early childhood services calling for “restoration of the 100% qualified teacher target and funding to support it, and a commitment by Government to move toward spending 1% of GDP on ECE” (ECE together website)  


Overall Conclusions

The main challenge for teacher-led services for 2011, especially those currently on the top funding bands, is to find ways to successfully “manage significant negative change after many years of positive change” (community service manger).  Challenges will lie first in finding ways to rely less on government funding increases to meet increasing costs, and second to cope with increasing competition for children at a time when parents are less able to afford fee increases and may reduce their hours or trade down to a cheaper ECE service.

For parents the main challenge will be weighing up the cost of ECE with need for childcare and perception of the worth of it. Different families in different circumstances will make different decisions. Under 20 Hours Free ECE there was encouragement for parents to make full use of the free hours available and services expanded to meet the demand; but the free ECE is already not ‘free’ in many services now so any further cost increases could see some parents thinking more about their ECE centre use. Government funding cutbacks next year will likely see some increases in fees and families are facing higher petrol prices, food prices and other expenses in an economy that continues to be tight. What this means for services is that they will likely need to work harder to keep families through stronger relationships and altering what they do and how they do it to e.g. giving flexibility in hours.

For home-based services in particular, challenges will lie in increased competition between providers and finding ways to consolidate that will enable growth to continue. There is a possibility that home-based services might pick up some of the enrolments from teacher-led services as costs increase and parents seek greater flexibility in hours. This was something that was also referred to by a home-based service manger who predicted that parents will be looking to home-based services more for the primary care of their 0 – 3 year old child. The challenge for home-based services will be in showing parents that their child is receiving as high or higher standard of care and education with an educator who is well supervised and supported (as opposed to, for example, what was highlighted in a recent Herald article about a PORSE independent contractor who left a baby home-alone for several hours).

For parent-led services the main challenges seem to lie in keeping rolls stable, coping with paper-work and red-tape, ERO visits and meeting new standards for relicensing.  Playcentres could capture and involve families who decide to reduce their hours at a teacher-led service or pick up more enrolments from parents who decide to stay at home and not use childcare.


An Invitation

What's happening in your early childhood service? 

And what do you think is likely to get better or worse in the sector?  

Add your further comments below.


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