Pay parity funding reduced due to education budget cutback

WELLINGTON: The Government reduced pay parity funding for early childhood teachers in its May Budget to keep its education spending within agreed limits, briefing documents show.

It also scaled back subsidy increases for education providers and slightly reduced funding for changes to the school system.

The documents, which were part of the Budget information release, showed Education Minister Chris Hipkins was under pressure to keep the fouryear cost of education spending rise close to $2 billion.

A March Treasury report said Mr Hipkins had made difficult tradeoffs to reduce the size of his bid for funding, but it suggested further changes including reducing acrosstheboard subsidy increases for schools, early childhood services and tertiary institutes from more than 2.8% to 2.3% or possibly 1.5%.

It also suggested increasing funding for alternative education and increasing funding for the equity index, which would replace the decile as the means of allocating funding to tackle socioeconomic disadvantage, from $75 million per year to $100 million per year.

‘‘Because it is very well targeted, the Treasury considers this initiative has excellent value for money and alignment with government priorities.

‘‘It especially benefits akonga Maori and Maorimedium kura, for whom deciles underestimate disadvantage,’’ the Treasury report said.

‘‘This increase would need to be matched with an equivalent decrease elsewhere in the package.

‘‘We recommend doing this by reducing the general schools’ operational grant cost adjustment from [redacted] to 1.5%.

‘‘When combining the scaledup Equity Index and cost adjustment initiatives, the overall operational grant increase would remain well above inflation at [redacted].’’

The Government decided not to do that. Instead it opted for a 2.75% subsidy increase to schools, early childhood services and tertiary institutes, saving tens of millions of dollars, and increased equity index funding to between $80 million and $85 million per year.

The documents showed the Government also trimmed funding which would help early childhood centres pay teachers the same as schoolteachers.

‘‘A [redacted] lower scaled option reduces, at the margin, the size of the increases for steps 710 for teachers in education and care (saving [redacted]) and reduces uptake assumptions for homebased care (saving $1.069 million),’’ an Education Ministry report from March said. — RNZ