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How much Senior Managers are paid in ECE and the right of teachers and parents to know

money greed fat catOught you know what ends up in the pockets of kindergarten senior managers if you are a parent of young children who has sacrificed time to help with fundraising, or perhaps donated goods or services, paid fees and other charges, and/or contributed to funding the organisation as a taxpayer?

Do not teachers have a right to know if the pay of senior managers is increasing in line with their pay increases – or increasing at a much higher rate?   

In NZ and overseas there is a trend toward public disclosure of remuneration received by chief executives of member organisations and public organisations. Openness is recognised as being important to retaining the trust and confidence of members, the taxpaying public and any donors.

Disclosing salary and total remuneration (including base salary, car, performance related payments, superannuation contributions and any other benefits received, such as additional leave) makes sound business sense.

The kindergarten sector is comprised of a number of regional associations, and typically these are not-for-profit and community-operated. Openness around the salaries paid to senior managers therefore would be a reasonable expectation held by a member of any kindergarten, and associations need to ensure that the salaries paid are defensible.

The Auckland Kindergarten Association has said that needing more money is a principal driver behind it increasing fees to parents and extending hours and weeks of kindergarten operation to year-round and not closing for term breaks in order to claim a substantial amount more in taxpayer funding per enrolment.   

In a statement made by the AKA chairman in the 2016 annual report it is admitted that “A planned surplus was still achieved even though there was no increase in the government’s budget for bulk funding the early childhood sector. We were however, pleased that kindergarten associations did receive a slight increase in funding to meet the Kindergarten Teachers Collective Agreement obligations that are negotiated between the Ministry of Education and NZEI.”

The AKA’s accounts under a category of 'Key Management Personnel Compensation' show that it paid 9 senior managers a total of $1,421,000.00 in 2016 - that’s an average of $157,888.88 per senior manager

This represents an increase of 18% from the year previous (2015) when 9 employees were paid a total of $1,201,000.00. There may have been exceptional circumstances that led to such a high increase, but an explanation cannot be found in the 2016 report. What proportion of the $1,421,000.00 went into the salary and any other benefits paid to its chief executive last year is not disclosed.   

Although the number of key management personnel is not specified in the AKA’s 2014 Annual Report, the cost of remunerating key management personnel has jumped some 63% since 2013 - going from $871,000.00 to $1,421,000.00

For comparison the North Auckland Kindergarten Association with 4.75 full time equivalent management personnel paid a total of $451,902.00 in 2016 (average per person $95,137.00) In 2015 the total paid was $427,820 (5.6% increase)

The Whanau Manaaki (Wellington/Rimutaka) Kindergarten association with 8 management personnel paid a total of $777,000.00 in 2016 (average per person $97,125.00).  In 2015 the total paid for 10 managers was $932,000. (4% difference).

Note that the average remuneration increase for Public Service chief executives in New Zealand in the 2015/16 year was 1.3%, reflecting inflation.

At a time when other comparable kindergarten associations have increased the cost of paying their management personnel by 4 or 5%, could the payments made to senior managers at the AKA be out of line? 

There is also a question over the AKA Board's spending of $839,000.00 in 2016 on professional consultancy services (up from $708,000.00 in 2016) and the need for this, on top of already paying a much higher average amount of compensation to senior executive managers. At Whanau Manaaki professional consultancy was $0. (that was disclosed) and $4,948.00 at NAKA.

Transparency in regard to chief executive and senior staff remuneration would help to increase public trust and confidence in the AKA Board's ability to effectively manage the AKA, especially in the light of its recent actions - increasing charges to parents, reducing teacher non-contact time for planning and writing learning stories etc., and claiming more taxpayer funding per child. At present it would appear the AKA may be more interested in gathering revenue than in maintaining the community, non-profit ethos of its 107 year legacy as a NZ Free Kindergarten Association.

 

You may also be interested in reading

Heroes or Dictators – a Charitable Community Board, its chief executive and standard of consultation on changing a publicly revered early childhood education service

Wages, pay rates and conditions of work in the early childhood sector 

 

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