ECE Funding Handbook

Welcome to the Early Childhood Funding Handbook. This Funding Handbook is issued under section 311(5) of the Education Act 1989. The funding paid to licensed services is paid subject to the terms and conditions set out under this Handbook and must be complied with. The terms used in this Handbook are based in the Education (Early Childhood Services) Regulations 2008.

This Handbook is designed to be a ‘one-stop-shop’ for all you need to know about early childhood funding, including:

  • the Early Childhood Education (ECE) Funding Subsidy
  • 20 Hours Early Childhood Education (ECE)
  • Equity Funding
  • the Annual Top-Up for Isolated Services

Note: The information in the Funding Handbook does not apply to certificated playgroups. These services should contact their Ministry regional office for further information.

Downloading the ECE Funding Handbook

If you want a printed copy of this handbook, refer to the list of downloads in the contents section where you will find downloadable PDF versions of each chapter.

ECE Funding Handbook downloads

Licensing Criteria Cover

10-1 What is Equity Funding?

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  • Equity Funding
    • Equity Funding is a targeted funding mechanism for all licensed ECE services. Equity Funding is paid to eligible services in addition to the ECE Funding Subsidy and 20 Hours ECE.

  • Key objectives
    • The objectives of Equity Funding are to:

      • reduce educational disparities between different groups in New Zealand communities
      • reduce barriers to participation faced by those groups that are under represented in ECE services
      • support ECE services in raising their level of educational achievement.
  • Eligible services
    • Licensed ECE services that meet the criteria outlined in this chapter are eligible.

  • Structure of equity funding
    • Equity Funding consists of four components. Services may be eligible for funding against one or more (or all) components. Each component is described in detail in this chapter, but the following table provides a summary:

      ComponentMeasured By
      A: Low socio-economic communities Equity Index (EQI)
      B: Special needs, and non-English speaking backgrounds (including sign-language) Equity Index (EQI)
      C: Language and culture other than English Attestation (EC15 Form)
      D: Isolation Isolation Index
  • When is funding paid
    • Eligible services will receive funding along with the payment of the ECE Funding Subsidy and 20 Hours ECE (i.e. March, July and November of each year).

  • ‘Tagged’ funding
    • Equity Funding is ‘tagged’. This means that it is identifiable as an amount additional to a service’s ECE Funding Subsidy and 20 Hours ECE.

      Equity Funding must be spent with the equity objectives for participation and quality in mind. Guidelines for expenditure of each component are listed in the relevant section of this chapter.

  • Reporting requirements
    • Services are required to report to parents and the local community about how they have spent their Equity Funding.

      The specific reporting mechanism is at the discretion of the individual service (or service provider). However, the following minimum standards are required:

      • outline of the amount received under each Equity Funding component
      • brief description of the purpose to which the funding was applied (e.g. purchase of goods or services)
      • brief outline of the reasons for spending the funding in that way
      • the report is included in the service’s annual report for presentation at its annual general meeting.

      Reports may be subject to external review by the Ministry and/or the Education Review Office (ERO).