U-turn on 20 hours policy avoidable with consultation - ECE leader

An early childhood education sector leader says the government's U-turn on a key policy it announced in this year's Budget could have been avoided with more consultation.

And the opposition thinks it was designed to "get a good headline on Budget day" and not thought through properly.

Just over a month ago the government said not only would it be extending the 20 hours free early childhood education (ECE) policy to cover two-year-olds, parents would also be able to enrol their children for just 20 hours without having to pay anything extra. Many ECE services charged daily fees on top of the 20 hours free, or capped the number of free hours per day, forcing parents to pay for a few more to cover a whole day.

"Twenty hours is not fully funded - the value of that funding has been degraded over time," Simon Laube, chief executive of the Early Childhood Council, told Morning Report on Tuesday.

"Services charge fees for hours over and above the 20 hours, and that is the way they meet the cost of delivering those 20 hours… if you bring in a policy that requires you not to charge fees, then you've lost the revenue stream that you were using to cross-subsidise or top-up your costs."

The government on Monday abandoned the requirement, which would have kicked in next March, allowing ECE centres to continue charging fees on top of the 20 hours.

Laube said the backdown could have been avoided with more consultation prior to the Budget.

"It's great progress and it certainly was the top hot issue. But we found out about this from the media yesterday, and we just opened a dialogue with the government around refining or working with them on trying to get this right so it would be deliverable.

"Not ideal to find out by a press release what's going on because, you know, in our minds, we were thinking maybe another meeting… There has been no consultation. There has been one initial meeting and consultation requires more than one initial meeting."

Anna Catley, a Napier mother-of-three, told Morning Report the U-turn was "disappointing".

"It's just is a classic example of the government jumping the gun on announcing policy without having done their homework and, you know, on the feasibility of it.

She also expressed concern the policy would drive extra demand for ECE places, adding to waiting lists and pressure on staff, as well as take more money out of parents' pockets when they could least afford it.

"Times are tough so parents are having to go back to work a lot earlier, so it is something that kind of needs to be accessible. Unfortunately, it is a lot of money, so families are having to sort of do the calculations and work out if it's worth going back to work."

Losing trust

Prime Minister Chris Hipkins on Monday defended the lack of consultation ahead of the Budget, telling media it would not have been much of a secret "if we were telling everyone about it".

Laube said the sector was losing its trust in the government.

"It seems time and time again that the government doesn't really have an intention to work with the sector to deliver new policies using the Budget kind of 'secrecy' thing. Pretty much every budget if you go back.

"Pay parity is still a major issue for our sector. We have a massive funding gap for the increased teacher costs that our providers now have to pay, so the government has not provided the funding to do that.

"So that is, it's like a pressure cooker and you, you kind of layer on new things that cost more money and what happens? It means that fees go up, but it also means that the sector doesn't really trust the government because you know, even a good news budget where ECE is the centrepiece turns into a, you know, negative story. How does that happen? Well, they're not willing to work with us. Even after they announce it, they don't really want to consult, they don't work with us and refine these things."

Laube said the ECE sector wanted an independent review of how the funding is calculated, saying the reason providers charge additional fees/place restrictions on use of the 20 hours was because the existing level of funding was too low.

'Parents can ultimately use their feet'

Hipkins, appearing later on Morning Report, said the government took the sector's feedback into account when rolling back the policy. But centres would still be required to be more transparent about what they are charging, he said.

"Ultimately they've got a business model at the moment which to some extent has been working quite well for them - requiring that transparency might disrupt that.

"Because if they've been charging a daily fee without a breakdown of where the 20 hours subsidy goes or how that's applied, then you know, providing that greater information to parents might not be that convenient for some of the service operators… Parents can ultimately use their feet to make choices - if the centre they've got their child in isn't giving them what they want, they can choose one that is."

He said some providers were "fully supportive of the government's overall direction of travel", but there "some who are a bit noisier than others who aren't so keen on the things we've been doing".

'Botch-up'

National Party deputy leader Nicola Willis earlier on Tuesday told RNZ's First Up Monday's announcement was a "fix-up to what was a botch up of the government's own making".

"They rushed out a policy with a great slogan but hadn't consulted with the early childhood educators who needed to deliver. It hadn't sorted out the details and it was unworkable, so they've now proposed this change.

"The question remains - will parents actually be better off? Because what some centres will be forced to do is charge more for extra hours in order to fund the 20 hours free.

"National continues to think the simpler approach is our Family Boost policy to provide a childcare tax rebate of up to $75 a week straight into the bank account of parents. They choose where they send their children, they choose the hours that suit their family and their circumstances."

Willis rejected the explanation from Hipkins and Associate Minister of Education Jo Luxton that Budget confidentiality superseded the importance of sector consultation.

"I think they were rushing to get a good headline on Budget day and this has been proven time and time again - policy is all about the detail of delivery. It's not just about the slogan on the day.

"So National's approach is to be really practical about the details and the delivery mechanisms, not just the PR spin."