Under-5s policy may cost $42m

School-age change adds millions to early childhood costs

Axing school entry for under5s may cost taxpayers up to $42 million a year, official documents show. National’s former Education Minister Nikki Kaye, who obtained the figure, slammed the Government’s decision to restore the pre-2017 policy that children could not start school until they turned 5, meaning higher early childhood education costs.

“When you look at what $42 million could do for special education, it’s a huge sum of money.”

Labour’s Education Minister Chris Hipkins hit back, saying National’s decision to let children start at the start of the term closest to their 5th birthday — up to two months before they turned 5 — was aimed at cutting costs in early childhood education.

“Ms Kaye has accidentally tipped people off as to National’s real motives when it introduced its lower than 5 years old cohort policy.

“National said it was about increasing parental choice, when it was really about cutting costs. The truth has finally come out.”

But a note to Hipkins from the Ministry of Education dated November 24, released to Kaye under the Official Information Act, shows even National’s changes were expected to increase the cost to taxpayers.

Until last year, all schools had to accept any child after they turned 5. Although parents don’t have to send their children to school until they turn 6, most children start on or soon after their 5th birthday.

National’s change last year allowed schools to take children only in “cohorts” at the beginning of the term closest to their 5th birthday.

The ministry’s note says that change would have cost taxpayers an extra $8.3m a year if all schools had adopted cohort entry, because the number of children forced to wait in early childhood centres for up to two months after their 5th birthday was expected to be more than the number starting school before they turned 5.

Hipkins wants to keep the change allowing schools to take children only in cohort groups at the beginning of each term, or possibly also at halfterm entry points — but only after children have turned 5.

The note says that “will impose greater additional ECE [early childhood education] costs on families and substantially increase government expenditure across ECE”.

If all schools adopt cohort entry, with entry only at the start of each term, it says Labour’s policy would cost taxpayers an extra $50.3m a year — $42m more than National’s policy.

The extra costs arise from higher subsidies to early childhood centres and higher childcare subsidies to lowincome parents.

The note says Labour’s policy will require changing the childcare regulations, which set a maximum age for subsidies of 5 years and 28 days, as well as changes to the Education Act.

In practice, the costs of both parties’ policies will be below the potential costs stated because not all schools are expected to adopt cohort entry. Only 51 out of more than 2000 primaries have adopted it so far.

Hipkins has asked for submissions by Monday on whether schools should be allowed to take new entrants at mid-term entry points, or only at the beginning of each term.