Government Launches ECE Funding Review to Strengthen Early Learning

In a bid to address mounting concerns over complexity, inefficiency, and accessibility in the early childhood education (ECE) sector, Associate Education Minister David Seymour has announced a sweeping ECE Funding Review, aimed at ensuring New Zealand’s $2.7 billion annual investment in early learning delivers better value, fairness, and outcomes for families and taxpayers.

The review, which will span a full year, will be led by a newly formed Ministerial Advisory Group (MAG), chaired by experienced economist and sector expert Linda Meade. The group will report its findings by mid-2026, with a focus on financial neutrality and system effectiveness rather than cost-cutting.

Why the Review Is Needed

The current ECE funding model is widely regarded by providers and parents alike as confusing, outdated, and inequitable. According to Minister Seymour, these inefficiencies not only increase financial pressure on services and families but also hinder the sector’s ability to scale and respond to growing demand.

“Vote Education spends approximately $2.7 billion on early childhood education,” Seymour stated. “We need to make sure this funding is going as far as it can and prioritising the right things.”

While demand for ECE services is surging, supply is not keeping pace, leaving families across the country without access to reliable care, and in some cases, forcing parents to leave the workforce or reduce their hours.

Aims of the ECE Funding Review

The Advisory Group’s mission is to evaluate and recommend reforms to create a system that is:

• Simpler for families to understand

• More transparent and predictable for providers to plan around

• Responsive to the needs of diverse family structures and non-traditional working patterns

• Efficient and equitable, providing the best return on taxpayer investment

• Supportive of workforce participation by making childcare more accessible and reliable

Seymour emphasized that the review will retain the core benefits of existing policies, such as the 20 Hours ECE subsidy and FamilyBoost, which are widely viewed as essential supports for working families.

Leadership and Expertise: Who Is on the Advisory Group?

The Ministerial Advisory Group will be chaired by Linda Meade, whose credentials blend economic expertise with sector experience, making her a suitable leader for this transformative effort.

“Linda Meade brings a powerful combination of economic literacy and real-world experience in early learning. She is the perfect chair for this review,” Seymour noted.

The remaining MAG members have been selected to represent a cross-section of experience, including:

• ECE service providers

• Early learning advocates

• Education economists

• Business and financial planning professionals

Scope and Limitations of the Review

While the review will be wide-ranging, Seymour clarified that some key areas are out of scope, including:

• The 20 Hours ECE entitlement

• The FamilyBoost payment scheme

• Existing pay parity opt-in frameworks, which were recently amended to reduce cost pressures for ECE providers

Instead, the review will focus on questions such as:

• Whether the “one-size-fits-all” funding model disadvantages certain families, particularly those with irregular work hours or sporadic childcare needs

• How to ensure funding follows the child and supports diverse delivery models

• How to enhance cost-efficiency without compromising child outcomes

The review also aims to complement reforms currently underway through the broader ECE Sector Review, which focuses on regulatory simplification and child safety. A modernised regulatory system for ECE providers is expected to be in place by the end of 2026.

Next Steps: What Families and Providers Can Expect

The Advisory Group is expected to begin its work immediately, with extensive stakeholder engagement planned throughout the next 12 months. Key deliverables will include:

• A comprehensive analysis of current funding settings

• Engagement sessions with parents, providers, and advocacy groups

• Development of recommendations for a more effective and adaptable funding framework

Crucially, the Government has pledged that no funding cuts will result from the review. All proposals must be financially neutral or improve value for money, with any potential shifts designed to enhance affordability and accessibility for families.

Ministerial Vision: A Better ECE Future

Minister Seymour outlined a vision of an ECE system that is child-focused, parent-friendly, and economically sound, supporting New Zealand families in their early learning journey while also facilitating stronger workforce participation.

“ECE should provide accessible, affordable services that help parents return to the workforce and give kids a great start in life,” Seymour said. “We want to be certain taxpayer money is used effectively—and equitably.”