Education and Training (Grants—Budget Measures) Amendment Bill

I present a legislative statement on the Education and Training (Grants—Budget Measures) Amendment Bill.

💬 SPEAKER: That statement is published under the authority of the House and can be found on the Parliament website.

I move, That the Education and Training (Grants—Budget Measures) Amendment Bill be now read a second time.

This is, in essence, a very simple bill. It removes an ambiguity that was created in the Education and Training Act of 2020 that drew into question whether or not the Minister, in specifying a funding condition around early childhood education grants, could specify a funding condition relating to the employment conditions of teachers. This bill removes the doubt around that and makes it clear that the Minister, in specifying conditions around grants, is able to do that.

This is necessary because the Government has made a commitment that we want to deliver better pay and conditions for those working in education and care services so that they are brought into line with the teachers who are working in kindergartens and primary schools who have pay parity. So we want to see that extended to the broader early childhood education sector, where those teachers working in that sector get the same qualifications, often have the same experience, and in many cases are doing pretty much the same work but are being paid significantly less. There are some other variations around employment conditions, including the hours that the centre is open and so on. That is a matter for the employer. What the Government is interested in here is the hourly rate, effectively, that people are being paid for that work. This provision will allow us to attach as a condition to a higher rate of funding the proviso that that higher rate of funding needs to be applied to the salaries of their teachers so that that money can flow through.

Let’s be very clear about what this bill is and it isn’t. It is not the funding rates. Those funding rates are under discussion with the sector. There’s a variety of views about what the sufficient level of funding in order to deliver pay parity should be. This bill does not deal with that issue. That issue is being dealt with through the discussion that’s happening at the moment around the future rates of funding. This bill simply allows for that differentiated rate of funding to be introduced, and then we are in the process now, in the passage of this bill through its final stages in the House, that will therefore allow the next part of that to happen, which is for those draft conditions to be put out for consultation and further debate to be held around that.

I also want to make it clear the Government doesn’t intend to impose additional conditions not related to salary in terms of employment conditions related to those grants. I’m aware that there’s been some suggestion that we’re already planning to do that, when, in fact, the two conditions being cited relate directly to salaries. So the condition, for example, that a person who has a certain length of tenure should be paid at least a certain amount is directly related to the implementation of salary progressions and salary steps. Both of the conditions that are being questioned relate directly to salary. They don’t relate to those wider terms and conditions.

If I look at some of the other wider terms and conditions there, things around the amount of non-contact time, for example, the ratios, the group sizes, and so on that may exist in other collective employment agreements, we do not intend to pass those through this mechanism to other parts of the early childhood education sector. Those are, rightly, employment matters for the operators of those centres. This is simply giving us the ability to say, if we are providing more money to deliver pay parity to increase the pay of teachers working in the rest of the sector, which the rest of the sector have been asking for—we want to make sure that the money that we’re putting in is actually going to that thing, and the ability to set this condition will allow us to do that.

The question is that the motion be agreed to.

Thank you very much, Mr Speaker. I’m very pleased to take a call on the Education and Training (Grants—Budget Measures) Amendment Bill. The National Party voted in favour of this bill at the first reading to give it the chance to go to select committee and have a full—well, a semi-full process. It was obviously a very truncated process that we ended up with, but I’ll talk more about that later. But we did vote for it at the first reading to give it a chance for us to scrutinise it and hear from the sector, and indeed hear from the sector we did.

Now, the Minister has predetermined a number of things that I’m going to bring up, and indeed I will bring up those things, but, before I do, I want to just say that early childhood teachers are extremely valuable. Those formative years, between one and five, before children go to school, are extremely important, and the role that teachers play in those formative years is so very important. When we see teachers that are overburdened, overworked, stressed out, leaving the sector, something has to be done. And I want to put it on the record that the National Party certainly broadly supports paying teachers what they are worth and that we do recognise that there have been some issues with kindergarten teachers being paid more than their counterparts in early learning centres. What the National Party also wants is quality of service and the ability for people to be able to afford to send their children to early childhood education (ECE). That’s important, and I’ll come back to it later.

The Minister described the bill today—and indeed he did so in the committee when he appeared before us—as a relatively simple bill, not long or complex, and he made it seem like a small technical change that would be relatively non-controversial. But, indeed, we heard from over 550 submitters, many of them who were very concerned about what this bill would mean. We only had time to hear from 14 in person. I want to say today that I believe that the Minister probably knew that this actually would be very controversial, which is why we ended up with an extremely truncated process where we only had 14 days for submissions.

Now, if you think about the ECE sector right now, under intense pressure with massive staff shortages, 14 days to be able to understand what is being sold as a really simple bill, but actually has a number of unintended or potentially intended consequences, is not a very long time for centres who are stressed out trying to manage their way through winter flus and staff shortages. Then there were only three days in select committee for those submitters to be heard, and if they couldn’t make those days, well then, that was tough.

Now, those days and those times that were selected coincided with the times that the ECEs were open. Given the staff shortages, it’s no wonder that we only managed to hear from 14 of the submitters, who mostly spoke against the bill. I want to refer to just some of the comments from the submitters speaking on the time frames. Firstly, the Early Childhood Council said, “We are concerned that the Amendment Bill has been designed and presented without adequate consultation with the ECE sector.” And they also commented on the time that centres had to submit on the bill. We mentioned this at the first reading. We said that the sector had not been consulted, and the Minister disagreed and said, “No, that’s not true. I’ve consulted widely about pay parity.” Indeed, he has consulted widely about pay parity, but he did not consult on this particular bill. The Early Childhood Council and many of the centres mentioned the fact that they were blindsided by this bill—they had no idea that it was coming—and then 14 days to get their thoughts together, to understand the bill, and to submit wasn’t enough time. Now, the Early Childhood Council mentioned that, as did a number of other submitters.

There were many of them, but one of them I’d like to quote in particular was out of Arohanui Early Childhood Learning Centre, who said, “there has been a lack of consultation with the ECE sector and the Bill is being rushed.” The City Kids Childcare Centre said, “We need more time to respond with due consideration and it is difficult to respond to the proposals without more time.” Those are just three of the many submissions that talked about the fact that they didn’t have enough time to fully understand this bill.

There was no consultation with the sector on the bill. Yes, around parity; not around this bill. And I’m not surprised, even with the short time frame, we had many in opposition. For a relatively simple and non-controversial bill, I actually was surprised at the number of people who submitted. The way in which the bill was originally worded has some clues in it as to why the sector were so concerned and upset, because new section 548(5A), in clause 4, said “conditions or purposes—(a) specified under subsection 5(a) or (b)” may relate to matters that include employment conditions “(for example, remuneration).” So you can see that the first thing that jumped out to the owners of these early childhood centres, or in fact the Early Childhood Council was: what employment conditions? Because remuneration was just a secondary thing in brackets. Rightly so, the submitters said, “Well, what else is the Minister planning? What other conditions and terms is the Minister planning to impose upon us? And at what cost to us? And will we have a grant to cover those?”

So what ended up happening with the bill was it was changed to try and make it clear the Minister’s intention was not actually to impose any further conditions. But what we ended up having was—what we have in this bill is much the same. The Minister came to committee and said, “I don’t intend to impose any other conditions. Trust me, I won’t.”, was basically what he said. But when they reworded the bill, he made it very clear that, although the bill’s being reworded, he still has the ability to impose any conditions that he likes. So although the bill has been reworded, he has made it very clear that if he does want to impose other conditions, he will.

Now, this is important. The Minister today talked about two of the conditions relating to remuneration that will be attached to the grants. Now, these two conditions were never discussed, not by the Minister in his first reading speech, not by the officials. It wasn’t until members from my party—me, actually—questioned them on some of these conditions that they did actually admit that, yes, it will be the case that the teachers will go up the scale by tenure and not by performance. That’s something that was never mentioned. The second condition is the fact that the centres had assumed that where a teacher would start on the scale would be decided by them. Again, it wasn’t until we questioned the officials—who admitted that actually, no, the condition will be that it will be decided upon via length of service overall.

Now, these things are important to the sector. And although the Minister says, “Oh, well, we’ll worry about it later; we’ll kick the can down the road and we’ll discuss it later.”, it’s integral to this bill to know what kind of conditions will be imposed on centres. It matters because of the cost that will be imposed upon them. And I know the Minister’s saying, “Don’t worry about the cost. We’ll talk about the funding down the track.”, but actually, this bill is setting up the mechanism that will impose huge costs on centres, because the grants will not fully account for the teachers’ pay. So what’s going to end up happening is that the centres will have to make up the difference either by reducing their ratios, reducing the number of good qualified teachers, or upping fees to parents.

Now, going back to what I said really early on, the National Party has always said that the quality of centres and the ratios that they offer is important, as is the ability for parents to be able to afford access to ECE services, and this bill is going to compromise those things. And while the Minister downplays it and says, “Don’t worry about it; we’ll work on those things later.”, they are integral to this bill, which is why the sector does not—

Order! The member’s time has expired.

Thank you, Mr Speaker, and thank you for the opportunity to take a call in this second reading of the debate on the Education and Training (Grants—Budget Measures) Amendment Bill. As the chair of the Education and Workforce Committee that considered the bill, I just want to start off, knowing my manners, thanking our wonderful Clerk’s team—the Minister’s officials, Parliamentary Counsel Office—for their hard work to help us report this bill back, in time, to the House. I also would like to pay gratitude to our submitters. I know that Ms Stanford talked about the time line, but yet 558 people managed to submit on this bill, and also we heard 14 oral submitters. We heard from a variety of parties in the industry. We heard from early childhood education (ECE) service owners or managers, we heard from teachers who work in, or have previously worked in, this sector, and we also heard from representative bodies, and I want to thank all of those individuals as well as the representative bodies for submitting on this bill.

Now, I know that the Minister spoke about a relatively simple bill, not overly complex—basically, making a small technical change that is needed for clarification on the subject matter. I know it’s easy when it’s a technical bill to convolute issues and try and make something more out of it and get the conspiracy theories going, but really what this bill is is it is actually just clarifying a simple provision.

And so what it is is it actually turns on whether the existing, and very broad, condition-making power, which is in place and which has been in place since the 1990 Act, is actually sufficient to be able to impose the salary-related condition on what is an existing bulk grant funding for early childhood education.

So to make sure that there is that clarity and nobody can be in any doubt about that, this bill makes that small technical change to section 548 of the Education and Training Act, an Act which underpins the funding system for early childhood education in New Zealand. Now, Ms Stanford did mention the submitters expressing some concerns, and I would like to dig a little bit further into that, because some of our submitters actually spoke about the proposed funding condition relating specifically to pay parity between education and service teachers and kindergarten teachers, so that’s what they submitted on, rather than the actual amendment of this bill.

So on pay parity, or teacher conditions in general, we had teachers tell us their stories of financial insecurity and hardship and, at times, their difficulty in finding jobs. But I would like to say that, contrary to the National Party member who’s just gone on record to—and I quote verbatim—“broadly support paying teachers what they are worth”, our priority actually is to completely support paying teachers what they are worth—there’s no putting of any qualifier on that particular statement.

Now, there’s also been a mention of kicking the can down the road. I think that is rather disrespectful. We’ve always said, from the start, that this is a small step; it’s a first step. We have, in fact, already made some steps in our previous Budget, but with this particular step we are showing that work is continuing, it’s not the end—we are very much looking forward to working with the sector, as the Minister has pointed out, in working towards pay parity in the last term of Government, as we have been doing for some time now.

💬 Erica Stanford: Then why didn’t he consult on the bill?

And listening to the comments from the other side, given how fundamentally National seems to be objecting to placing conditions around remuneration on ECE funding, one has to query whether National is actually committed to achieving pay parity. Not only do they frequently vote against these bills but now they also seem to be making a lot of noise with regards to that particular aspect of this bill.

So, again, we’ve always said that this funding will be an interim step: the funding system for ECE will need to be reviewed in order to achieve pay parity. Again, we look very much forward to working with that sector, and I commend this bill to the House. Thank you, Mr Speaker.

I rise to speak against this bill. National is not supporting the Education and Training (Grants—Budget Measures) Amendment Bill. We’ve heard a number of speeches already from the other side, which is to say, “Oh, this is not a significant change. It’s only a minor little technical matter—nothing to see here, nothing to worry about. Everything’s fine, don’t worry. It’s all steady as you go.”, and, of course, that’s not the case. What we’re talking about here is the Minister giving himself—or maybe later, herself—the power to set conditions. What’s been mentioned is pay rates, but it could be all sorts of other things, and we’ve seen every day, every week, from this Government, something new, some new idea that’s dreamt up on the backbenches or in the union rooms or wherever their ideas come from, for new costs to be added on to employers. And this Government will no doubt dream up some more.

What we’ve seen time and time again is this Government coming into this Chamber and trying to rush through legislation, under urgency, and not giving New Zealanders the opportunity to sincerely and properly engage in the laws that affect them. I just want to take a little bit of time to tease that out, because a lot of people tuning into this debate mightn’t follow the intricacies of the parliamentary process. But what’s meant to happen when Governments are changing laws that affect New Zealanders—and in this area it’s affecting the people who run and operate early education facilities, and there are many of those. Tens and hundreds of thousands of young New Zealanders’ children go to these centres, and their parents rely on them to do a good job, look after their kids, get them started on the process of education, and to do it in a good way. Many do. Some can do better. And it’s a very important sector, setting New Zealand kids on a path towards educational attainment in order that they may be properly equipped to thrive and succeed in the modern knowledge economy. So it’s important that we get it right.

Now, what’s supposed to happen when the Government decides that it wants to change the rules is that it’s supposed to consult the sector and then, ideally, put out some draft legislation so that people can comment on it, and then, once those comments have been carried out, they introduce legislation into this House. Then it’s sent off to a select committee, and the usual time is around nine months or so, so that people have the opportunity. The committee calls for submissions, and then everybody comes in, having had a chance to look at the bill and plenty of time to consider it and give some consideration—

💬 Jo Luxton: Speak to the bill.

Well, the process is important, Mrs Luxon—Luxton, whatever, sorry; I was getting confused there. Anyway, that’s what’s supposed to happen, but what’s happened here, and has happened time and time again from this Government, is they come in and say, “Oh, no we’re in an urgent rush. It needs to happen quickly. Here’s the piece of legislation. In fact, we’re only going to give you a couple of weeks to make a submission. We’ll listen to you for a couple of days, and then whoomph—we’ll pass it through.” There is always some urgency requiring this, and that’s what’s happened here. So even in the very short period of time they allowed for discussion of this legislation, some 558 submissions were made, indicating that there is real concern around this.

We heard the submissions, and we heard the concern that was being outlined. The obvious point that was being made by the sector was that if the Minister was genuinely focused on ensuring pay parity in the sector, he has the tools available to him to do that, and that is through the processes available to him right now in the way that there is an attestation by the providers about what they have done. So that process is available now, and the Minister could have availed himself of it. But, instead, he’s trying to rush through this legislation in an extremely truncated time.

What the submitters were worried about were all the additional conditions that may accompany the parity remuneration, and we’ve already suggested a few of those. They’re not funded at a higher rate to reflect the terms and conditions of these collective agreements that are reached with kindergarten teachers. There’s no extra funding coming through, so there’s one of two obvious things that can happen. A number of early childhood centres came in and said that, effectively, this will cost them about $40,000 a year, for example, in some of them. They’re not getting any extra funding to go with this, and so two likely consequences are either that the fees will have to go up to parents, and that’s the last thing parents need at a time when costs are going up everywhere, or centres might be inclined to slightly reduce the student to teacher ratios. A number of them have it higher than they need to have, and they’ll squeeze, and so the children will get less focused attention on them.

So what we’d have as a consequence of this legislation—and this is just yet another example of how this Government operates. They make big gestures, “Yes, we’re going to help this group.” But when you look into the details of the consequences of the legislation that’s rushed through under urgency without due and proper consideration, the most likely outcome is that there will be higher fees for students and parents to have to deal with, or lower ratios and more kids per teacher. That doesn’t seem to me to be a good outcome.

So what we have is the Government wanting higher pay rates across the board for teachers, which is a worthy object—they’re not prepared to pay for it and so the assumption is that parents will pay for it. I suppose parents may or may not thank them for that, but what they would have liked is for Parliament to have a proper opportunity to consider this legislation.

I suppose the broader question is: is this going to lead to better educational outcomes? Now, if you were to look at the evidence that the Minister came to the House with to indicate this legislation is going to lead to better outcomes by X, Y, and Z, you’d be struggling to find it, because he hasn’t, really. It’s just based on a decision that they’ve made. They want to give the Minister greater powers to direct independent private early childhood education centres about how they pay their staff and about the terms and conditions in which they operate. The outcome of that, as I said, is most likely to be higher fees for parents.

I suppose the question that many struggling working families will be asking themselves, when they’re faced with higher costs in so many areas—inflation is starting to rip in this country, and the higher cost of living is affecting many families, and there is difficulty affording housing and rents—and with all the other pressures that are piling up on New Zealand families, is: “Why is it the priority of this Government to ram through legislation quickly in this House which is most likely to have the outcome that my fees are going to go up? Why do they see this as a priority?” It’s a fair question to ask, and I’d very interested to hear from Government members as to why they think that’s a good idea.

Normally, in the normal democratic process that we have, we have several months and an elongated select committee process where people who are the most directly affected—that is, the early childhood centre owners and controllers, the parents, and the staff; all the people involved—have the opportunity to consider the impact of what is being proposed, and to then have their say and for that to be properly considered.

We on this side feel that it is wrong that they haven’t had that opportunity, and we are worried that this bill will have the opposite impact to what it’s intended to have, and that won’t be the first, unfortunately, or the last that we see from this Government that is like that.

Thank you, Mr Speaker. It’s a pleasure to stand and rise and take a call on this Education and Training (Grants—Budget Measures) Amendment Bill. Before I do, can I just acknowledge all those early childhood teachers out there across the country who work extremely hard in sometimes extremely trying conditions, and they play such a vital role in the care and education of our young children aged zero to six years old. So just firstly to acknowledge them.

This bill is just a small, technical bill that clarifies that there is already the ability for the Minister to impose or have conditions based around funding. For example, currently now, in order for a centre to receive a certain level of funding, they must sign an attestation form that states that they pay their teachers a minimum base rate, and then from there on it’s up to them how much they pay. But in order to receive that funding, aside from that, the funding is based on the number of qualified staff that you have in the centre on the floor. It’s also based on the number of children and the different ages of children. So there’s certainly already conditions around the level of funding that centres receive.

As a previous speaker said, there had been some concerns that the Minister was going to impose additional conditions based around employment, but he did clarify that that was not the case. So this is small, this is technical, and it just reiterates that there are already the provisions in legislation for the Minister to impose certain conditions. So I commend this bill to the House.

Kia ora, Mr Speaker. It’s great to take a call on the Education and Training (Grants—Budget Measures) Amendment Bill, and I acknowledge that this is a first step. It’s a first step in what needs to be many steps. For me, the call for pay parity has been around for a while, and so the processes can be truncated, but the conversation and the discussion around the really important needs out there in the early childhood education (ECE) sector have been with the sector for quite some time.

I do want to acknowledge and join everyone else with acknowledging the incredible work that our ECE sector does. They do an incredible job teaching our tamariki. The first years in a child’s life are so important and set our children up for educational success. The future of our physical, cognitive, emotional, and social development is profoundly affected by our early experiences. At the heart of those experiences are the relationships children form with their parents and, of course, with their teachers, and ensuring that those teachers are paid properly is really, really important.

The Green Party believes that every child deserves a high-quality, free, accessible public education that gives them the best possible start in life, and we want all children to reach their full potential. But, unfortunately, not all learners get equal opportunities and recognition. This is particularly so in early childhood education, which is a sector dominated by private providers. There are serious institutional inequities, of which pay parity is one issue impacting the whole ECE sector.

We support this bill, but would also welcome action on concerns expressed by submitters about the implementation of pay parity and the possible missed opportunities of this bill. The bill is a clarification of the Minister of Education’s powers, but it is not sufficient to deliver pay parity itself—for example, any funding can be opted out by private providers. Further work would follow so that fair pay and working conditions for teachers can be delivered, no matter who their employer is.

For me, I have friends and relatives who work in the ECE sector, and, when this was announced, I asked them if they were going to get a pay bump. But because they had been working where they were for a while, that wasn’t for them. So it’s really important that we recognise this as a first step, and I look forward to all those additional steps to make sure that we are on the pathway to achieve pay parity, because the gap is massive in terms of that.

I’d just like to reference a press release, actually, that just came out from the New Zealand Educational Institute (NZEI). It starts with “A $100K difference in pay over ten years—union says ECE pay parity needs to be accelerated … The pay differential between ECE and other teachers is a key contributor to the shortage. NZEI Te Riu Roa estimates that within ten years, an ECE teacher starting their career today will on average have been paid more than $100,000 less than their colleagues in kindergarten unless the Government accelerates pay parity.” So that is the size of the gap, and the gap has been there for a while. This bill is a small, technical bill and it is a mechanism to help to actually direct some of that funding where it needs to go, but it really needs to be ramped up and connected in with that broader vision of ensuring they have pay parity across the ECE sector.

At the end of the day, it’s going to be money, it’s going to be funding, and I’m sure that those of us who have worked in the education sector are aware of the pressing needs of the education sector. I was just out at Hutt Valley High School, where they’re fixing up their mouldy buildings, but there are a number of schools whose buildings are going to need significant repairs, and that is another big-dollar item.

So I think it’s really important that we put down exactly what we need right across the educational sector, but especially with the ECE sector, so that we’ve got a fair amount, actually, so that when we take these next steps—look, my expectation is that it needs to be followed up in the next Budget, and then the next Budget and then the next Budget, if we are going to really get serious about making sure that we are doing what we need to do to support teachers in terms of their claims for pay parity. When we have those numbers, then, possibly, the Minister has got a very clear picture of the sorts of things he’ll have to ask the Minister of Finance in terms of the money he needs to shake out of the money tree to actually sort out the issues that we have right across the education sector.

So, in summarising, the Greens support this bill. We see it as a first step of many steps, and we look forward to those many steps being: adequately funding and supporting our ECE teachers. Thank you, Mr Speaker.

Thank you, Mr Speaker. I rise on behalf of the ACT Party to speak to the Education and Training (Grants—Budget Measures) Amendment Bill. The bill seeks to address the issue of pay inequities in early childhood centres with kindergarten teachers by giving the early childhood centres the opportunity to get a slice of a $170 million pie if they agree to paying staff what the Minister says.

Currently, it’s obviously an unfair system; everyone knows that, and it needs to be fixed. If you’re doing the same work, with the same qualifications, it makes sense you receive the same pay. But business owners also need the flexibility to pay some staff more and some staff less if they want to; it’s their business. Not all employees are the same and, contrary to popular thinking, some work harder than others and actually deserve more pay. ACT supported the bill in its first reading because we know the great job that the early childhood centre teachers do. We all have examples of how good teachers can make a huge difference in a child’s life and, ultimately, their future, often doing the job of a busy working parent whose life makes it impossible for them to be there.

It became obvious during the select committee process that things weren’t quite as straightforward as was being presented and that there might just be an ulterior motive at play. The short time frame for submissions was a concern expressed by a lot of people, and the timing of the hearings, and a number of more technical details regarding the wording and the motives. Overwhelmingly, the early childhood centre owners said they agreed their employees deserve to be paid more. Like all businesses, they value their employees. They train new ones; they care about their welfare. It’s in their best interests to have a happy workforce, as well as the employees’. This is something that a Christchurch early childhood centre owner wrote: “I want to be able to give increases to my teachers, many of whom have been with me for many years. They’re looking forward to it. They deserve it. The wage gap between unqualified and qualified experienced staff has eroded away due to minimum wage increases and the recent wage increase for newly qualified staff. We’re going to lose many qualified and dedicated teachers from our workforce if we can’t make pay parity work. And it will happen soon. They’ve waited too long.”

Most submitters said the consultation process was flawed, as in there was none. It reminds me of when I was working for the police a few years ago and we had a consultation process—until it was explained to us that police’s definition of “consultation” was to fairly inform; in other words, to tell you what’s going to happen but tell you nicely. Anyone reading the Ministry of Education document about this bill would assume that this definition is pretty appropriate for these changes. The Minister has said the extra funding must be earmarked for wages, but the wording of the amendment makes it clearly obvious that it leaves a lot of scope to make any sorts of other rules. “That is not my intention” rightfully doesn’t give anyone confidence that this power will be used for other employment-related matters.

I’d like to read from the Early Childhood Council’s CEO: “The Minister told the committee ‘I have no intention of telling centres how to run their business.’ They sought and received assurances from the Ministry of Education and between then and now there have already been two amendments, rules that the Minister is imposing. One is the centres will be required to implement a process that mimics the conditions of the kindergarten teachers. The second is centres will be required to implement a process defining how a teacher’s prior experience is measured. These weren’t mentioned in the initial briefing.” He also goes on to say, “We support and welcome the commitment to teacher pay parity but our fear is that bringing the kindergarten teachers collective agreement into the picture would lead to new conditions and increased compliance burden on centres, and a push to unwanted collective agreements across the sector. The fears appear to be well founded. Our members are deeply concerned about what they consider underhanded efforts by the ministry to dictate the employment responsibilities of independent businesses, all without consultation.” These businesses are really hard-working businesses and they already have, as he mentions, 303 pieces of compliance for every minute that they’re open.

Almost all of the submitters said that they agree with the sentiments of the bill but that the funding for what it is asking for just isn’t enough. If the Government is going to impose conditions and dictate terms, they must fund it appropriately. From an early childhood centre in Auckland: “Funding for us covers about 20 percent of the additional cost in salaries.” Everyone that they speak to is coming to similar conclusions. The figures just don’t add up, and make most early childhood centres unviable. All of the owners said, if they were to survive, they would have to increase fees and have higher ratios of students per teacher. Again, from an early childhood centre owner in Auckland: “The only option we have is increasing our fees. I’ve calculated a minimum increase of 10 percent is required across the board to cover the additional cost. However, that becomes unaffordable for parents.” And another one from Christchurch: “Two of the ways that the Ministry of Education measures quality of a centre is if a centre has low adult-child ratios and also if it has a low turnover of teaching staff. This funding model rewards the exact opposite. It makes it good to have high numbers of children for each adult and good to employ staff who have only recently qualified and registered.”

These are unintended consequences of rushed legislation and poor or non-existent consultation. It’s another example of the Government making public sector businesses run their businesses the way that the Government wants them to, and we’ve seen a constant attack on small businesses, over the last wee while, trying to make a living and employ New Zealanders. I’ll mention again the minimum wage raise, the 90-day trials, the ridiculous compliance, the regulations, and the list goes on. It’s the attitude that “I know how to run your business better than you do” and an unfortunate, ignorant, but all too common sentiment that if you can’t run your business with these conditions we impose on you, then you shouldn’t have a business. There’s a bigger picture.

I will end with another quote from a submission, which describes the plight of most early childhood centre owners: “On the surface, it sounds good. The general public and our teaching staff think it is a great idea, and a done deal; however, when I do the numbers, it is hugely disappointing because the funding increase is nowhere near enough to support the steps. As a director, I cannot jeopardise the viability of the company by knowingly doing something that makes it unprofitable. I don’t want to go bankrupt. In its current format, it is not workable, but neither is the current situation of inequity.”

Like I said at the start, things need to change, but this bill deserves a thorough review, consultation that is listened to, adequate funding, and solutions that respect both the hard-working owners of the early childhood centres and their hard-working employees. This hasn’t happened, and for these reasons ACT opposes the bill. Thank you.

Thank you for giving me an opportunity to take a stand and take a call on this bill. I’m really disappointed about the confusion, and I don’t know if that is because people can’t get their heads around it or they can’t be bothered getting their heads around this bill. It is quite simple.

It has been interesting, and I recognise the tension that has been mentioned as we try and balance a business owner’s freedom to determine how they deploy resources, with their obligations and the responsibilities that come with Government funding. So bulk funding of salaries actually enables business owners to determine resource deployment, supports innovation and setting up their centres so that they’ve got appropriate conditions for their learners’ needs. But, unfortunately, the burden that comes with inappropriate funding models, or inadequate funding, actually falls on the provider. It leads to those providers having to make compromises, usually on pay or conditions. What happens is: conditions become a priority because things like staffing ratios and release times are the things that are most closely and obviously connected to learners’ conditions. So what happens is that the business owner compromises and says, “Well, I can’t do pay and conditions, or I choose not to, so I’ll stick to conditions because that’s important for the company.”

And we understand those decisions have been made. So this Government has provided $170 million more to support centres to step up and address those pay inequities. That additional funding is ring-fenced. We’re not just throwing more money and saying, “Do what you like with it.”; we’re saying, “If you want this money, you need to spend it on pay.” It is really simple. There is no obligation to take the money. If you want to take the money, it is to go towards pay parity. It is quite simple.

The controversy that was raised is about the funding model and the frequency. And I want to thank and encourage all of those submitters to continue and engage with the ministry to fix the funding, not the legislation.

Madam Speaker, thank you very much for the opportunity to talk on the Education and Training (Grants—Budget Measures) Amendment Bill second reading. I obviously stand on behalf of the National Party and as the member of Parliament for the North Shore. National oppose this bill. And I’ll tell you what, as a father of two young boys that have been through the early childhood system, I do want to compliment all of those early childhood teachers and support staff that work throughout that sector, particularly those in my home electorate of the North Shore who do an absolutely wonderful job for our tamariki, our young children, in equipping them well for the challenges of the future.

In particular, around this bill, our challenges are very much around the fact that the significant, I guess, strength of the current early childhood system is that it provides parents and participants within that system with flexibility and choice—all right? The system allows me as a parent, or others, to decide where we send our kids and what type of institution. It also provides that flexibility for those businesses to be able to deploy the revenue that they receive in the areas that they believe is going to provide the best outcome. From my interaction with a number of these private centres, particularly in the North Shore, they are hugely focused and motivated around ensuring that they provide absolutely best-in-class services to our young people. They are hugely passionate and hugely care about that.

One of the challenges around this bill in particular is that this is going to bring in additional constraints on those businesses. It is another example from the other side of the House here of overreach of regulation, trying to tell business how to run their business. Well, I’m sorry; with respect, businesses know how to run their businesses, right? They don’t need a Government telling them, “This is how you spend your money. This is where your money needs to go. This is what you need to do.” You know, sort of that parent-child relationship, which I think is very much where this side of the House sees how they should treat State control: overreach and regulation. That is a significant burden that is placed within and across our small-business communities across this great country. I think it’s a travesty. I think it is really, really, another example of what has been a difficult year for our small-business community—and particularly those within the education and training area, because of the impact of COVID and the changes with lockdowns and all the other stresses that have come across. And now what they’re seeing from this Government is additional processes, procedures, regulation, and, at the end of the day, cost on them in order to do that.

What I want to also refer to there is around the 560 submissions that were received on this bill. The majority of these submissions were opposed to the Minister having significantly more influence, particularly around the employment conditions related and aligned to those collective contract arrangements. This is estimated—in terms of if I talk about cost burden on these businesses—somewhere in the region of an additional $14,000 to $110,000 per business. And some of these businesses aren’t big, but there is a complete disregard from that side of the House in terms of the imposing of additional costs, significant costs—110 grand; that is a heck of a lot of money for some of these small businesses—and this is what I refer to as another sea anchor being thrown out of the back of the boat to drag along and slow down our business community, when they should be being unshackled from regulation and allowed to get on and prosper and share that economic growth with this country.

But what is very clear from this Government is that that’s not how they operate. That’s not their modus operandi. They want to do everything within their power to overregulate, to overreach with regulation, and to impose additional costs on business, and I think that is an absolute disgrace.

I want to finish—again, to those staff out there working within the sector, I’m sorry, but I think this probably is going to go through, no doubt, but we are very firmly opposed to this bill. Thank you.

Today is a great day for ethnic communities. For the first time in the history of Aotearoa New Zealand, ethnic communities have their own ministry that will be dedicated to looking after the ethnic people in this country. That goes to show that when you have the Government that actually values everyone, the Government that’s dedicated to looking after every Kiwi, that’s what happens. I just want to mihi to our hard-working Minister, Priyanca Radhakrishnan, for the hard work she has done to make this happen.

ASSISTANT SPEAKER (Hon Jacqui Dean): Order! Order! And now the member will come to the bill.

I apologise, Madam Speaker. I rise to take a short call to speak on this very important, I believe also timely, bill. As the Minister explains in his legislative statement, this bill intends to amend section 548 of the Education and Training Act 2020. This will confirm the power of the Minister of Education to set conditions on grant funding for employment relations purposes. These small but very important changes to the Education and Training Act 2020 will allow us to deliver on our commitment to move towards closing the pay gap. This amendment will push forward achieving pay parity for education and care teachers in comparison with kindergarten teachers, who are generally paid at higher rates. Pay parity in the early childhood education (ECE) sector is well overdue, and our teachers have been praying for it. I’m very proud that this Government is taking yet another important step to resolve this critical issue.

This issue will have had very longstanding consequences for both teachers and employees equally. As stated by the New Zealand Educational Institute in their submissions, employers in major cities have been reporting of the ECE severe teacher shortage, yet we have heard Chris Baillie quoting employers after employers about why this bill is wrong. I’ve also heard from Mel Burgess, who runs the ECE centre in Newtown: “Pay parity overall would help address the early childhood teacher shortage crisis. For our centre, it would mean that we can get qualified relievers when staff are away sick. We would then find it easier to maintain our goal of 100 percent qualified teachers.” This is what it’s going to do for the employers. It’s not bad news, as the Opposition makes it sound.

We have to listen to the voice of the ECE teachers. We have to value the precious role they play in our society, looking after our children at the most critical stage of their development. We have to acknowledge the unfair expectations in the sector where ECE teachers are made to put up with the standard that they earn less than they deserve. In the end, it’s about fairness, that people doing the same job receive fair pay. It’s about valuing the hard-working ECE teachers. With that, I commend this bill to the House.

Thank you, Madam Speaker. I stand in support of the Education and Training (Grants—Budget Measures) Amendment Bill. I sit on the select committee, the Education and Workforce Committee, that considered this short, technical bill.

We heard a lot today in the House about what this bill may do, but I think it would be pertinent to look at what this bill actually does. It is a technical bill that implements new sections 548(5A), (5B), and (5C), that were amended with further clarity at the select committee, which I thought was a very collaborative process in relation to looking at the wording of those particular sections, which are very brief in their nature. These new sections would clarify that a desirable course of action is available to the Minister, and that course of action is that he or she can specify that funding is available for the purposes of employment relations, and that’s when providing funding for early childhood services and certified playgroups.

It was arguable that these conditions could be specified under the existing law, section 548(5), but this technical amendment makes it absolutely clear that these conditions can be made when the Minister is determining funding and that it can be for employment relationship purposes. As a former lawyer, I can see that this change is desirable as good legislative drafting practice to ensure that the law is clear and understandable and to remove any possible doubt as to its meaning, which I think everyone in the House can agree is a desirable aim.

In terms of the specific change, it paves the way clearly for pay parity in the early childhood sector, which is under discussion at the moment with the sector in relation to rates, as we heard in the Minister’s first speech in relation to this bill today. This bill proposes an interim step. It’s not a pay parity bill itself, but it paves the way for pay parity in the early childhood sector, and this is work that the Government is committed to, and this work will be progressed with a separate funding mechanism which is not provided for in this bill.

This is consistent with the Government’s work to ensure fair remuneration, free from historical, often gendered norms. This includes the area of work on pay parity, as has already been discussed at length in relation to this bill, but also this Government’s work on pay equity. Members will recall the Government’s work on amending the Equal Pay Act to ensure claims of equal pay for work of equal value can be made in this country, allowing traditional female workforces to finally be paid what they are worth. Early childhood teachers are a predominantly female workforce and deserve pay parity.

Funding has also been set aside to work with Kōhanga Reo to improve staff pay. This is important for equity but also in relation to the Crown’s obligations under Te Tiriti o Waitangi.

I would like to thank the many submitters, many of whom were very passionate educators in this sector or owners of early childhood centres, and almost all of whom—and I cannot think of an exception—wanted the best for both children and teachers in the early childhood sector. I think we received 558 submissions and 15 oral submissions.

Those opposite have said that this has been a truncated process. While the process was short in its duration, I found it both helpful and elucidating, and found that there was a significant amount of participation from within the early childhood sector, both from unions, teachers, owners of centres, and, in fact, individuals who were very, very interested in submitting on the bill. Much of the substance of those submissions was not focusing on the actual content of this bill, which I’ve said is actually a technical amendment to allow funding to be specified and allow clarity for the purposes of that funding specification by the Minister.

Most of the people who submitted on the bill were actually talking about the funding mechanism in relation to pay parity, which they had various views on—almost all supporting the aim of pay parity, like this Government. So it was not the substance of this bill that those opposite were reflecting on in relation to their opposition to the bill; it was actually, possibly, issues that they had with a different thing, which is the funding mechanism.

So, in conclusion, this bill is a technical bill. It will provide clarity and a path forward for the Government to continue its work in relation to fairness and equality in relation to pay, and therefore I commend this bill to the House.

This bill is a Trojan Horse. It is not a pay parity bill, as the previous Labour speaker acknowledged; rather, it is a specific tool to give the Minister of Education the ability to dictate the employment, terms, and conditions of private businesses’ employees. It is a direct intervention from a Government Minister who proudly aligns himself with a union movement that has a stated goal of State control of early childhood education.

I want to remind the members opposite of how much New Zealand women, in particular, but New Zealand families, in general, have gained from the genuine diversity of the New Zealand early childhood education sector, because that is what is at stake here. What we have in New Zealand is a vibrancy that comes from not having, simply, kindergartens, and the union collective agreement that goes with them, but also community-led centres, privately owned centres, Montessori centres, Rudolf Steiner centres, centres with 20 kids, centres with 100 kids, centres in the middle of cities, and centres with farms.

Intrinsic to that and why that has happened is because up and down this country there are mums and dads, there are former teachers, there are people who have said, “I’m going to invest my money in an early childhood education business, and I’m going to provide what the families in my community want.” And when those people make that decision and when they invest in that early childhood education centre, I’ll tell you what they also do: they decide how best to deliver that service. And, yes, that includes how much they will pay their staff. And, yes, that includes under what conditions they will give their staff promotions; under what conditions they will say, “I’m going to step you up to the next level of pay”. That is a really important part of how those owners manage their businesses, and this bill puts that power directly at risk. It authorises the Minister of Education to attach conditions to Government funding to achieve a broad range of employment relations aims.

Now, I want to be very clear: right now, in New Zealand, there are too many early childhood teachers who are not getting paid enough. National values their work. We know what a difference they make to the lives of young people, and, in fact, the lifelong difference the work of a good early childhood teacher can do. National supports the notion that, actually, we need to have more fairness between what a kindergarten teacher gets paid and what a teacher in a non-kindergarten early childhood education service gets paid. And that is why, at first reading of this bill, we said, “Well, look, we’ll take a look at this, because, in principle, we don’t have a problem with the idea that the Minister will provide more funding to centres to ensure that teachers are getting fairer pay.” But that is not what this bill is, because the only way—and Labour speakers opposite have acknowledged it—that teachers will actually be paid more is if the Minister of Education puts in the funding to achieve that.

So I want to turn to what early childhood services themselves have told us about what they see in this bill. I thank the more than 550 people and entities who took the time to make a submission on this bill, who were given only 14 days to do so, who are running businesses that are literally running all hours of the day, looking after young children, and took the time to submit, but who only had two days to actually come and present their submissions, because this Minister decided to curtail the process. He did not want a detailed examination of exactly what is going on here. But let me, in this House, take the opportunity to tell you their concerns. What they say about this bill is that without the funding being guaranteed, attached to the employment conditions that the Minister may or may not dictate, they are going to be faced with stark choices, because if the Minister says, “Well, from now on, you need to step your teachers up to this pay level after they’ve spent this many years.”, or, “You need to make sure that they are doing this or that.”, then that comes with a cost, and the Minister is not guaranteeing that he will pay for that. So how will the early childhood centres fund that?

Well, they’ve got a few choices. One of the choices is lifting the fees that parents pay. Some may choose to do that; it will be just another cost of living increase from a Government who has callous disregard for the fact that its decisions have to be borne by someone. Others won’t have that choice, actually, because others are running early childhood services in communities where there are very few resources in the families whose children attend them. We know this because there has recently been a report which says that New Zealand has some of the most unaffordable early childhood education in the world. We are actually OK on the quality scale, according to the international comparisons; where we lack is affordability. So what the services tell us that this bill means for them is that the choice they may be forced to make is that—dictated to about the employment conditions they must provide, potentially aligning them with a collective agreement for union requirements—the way that they will have to meet that cost is that they will make cuts to quality. And do you know the number one way they’ll do that? They’ll say, “We can’t have as many staff anymore, because we can’t afford them, so we will increase the ratio of children to teachers.”

I’ve spent some time reading the evidence of what works in early childhood education, and I’ll tell you one thing: the more vulnerable you are—

ASSISTANT SPEAKER (Hon Jacqui Dean): Order! Order! Keep the Speaker out of it—

—excuse me, Madam Speaker—the more vulnerable a child is, the more at risk they are in their home circumstance, the more important it is that they have stability in their caregiver and teacher relationships at an early childhood service. It can be very challenging to create continuity in those relationships, and stability in those relationships, if the ratio of children to teacher gets higher and higher and higher.

What we see here in this bill is the inevitability of a trade-off. Members opposite can say, “Oh no, there’s no trade-offs.”, but we live in the real world and we’ve listened to the more than 500 submitters who have said, “I’m running an early childhood service”—most of them, actually, run it for passion and for love because they love young children, they love teaching, they want to make a difference to those kids. And what those owners are saying, and we are listening to them, is: “If you force me into rigid requirements for how I”—

ASSISTANT SPEAKER (Hon Jacqui Dean): Order! Order! Don’t bring the Speaker into the debate.

—sorry, Madam Speaker—“If we are forced into rigid requirements, then, actually, we will lose flexibility, we will lose dynamism, we will lose the ability to do what we do so well. And we are very worried, indeed, about that.”

So I want to say, again, very clearly: National values early childhood teachers. We believe it would be very simple to ensure that their pay is better aligned with kindergarten teachers by increasing the attestation rates for their minimum pay. That is an option that is on the table for the Minister of Education right now. We have heard no good reason why it is necessary for him to introduce new tools which allow him to attach other conditions to achieve employment relations aims. We mark, in this House, the beginning of a slippery slope, we mark the stated intention of this Government’s allies to have complete State control of the early childhood education system, and we state our opposition to that.

To the early childhood services out there who provide diversity, who look after their teachers, who love teaching kids, who have done the great things that have made such a difference to New Zealand culture and society, who have extended their hours beyond what kindergarten has ever provided, who have provided programmes in school holidays because some people can’t get the school holidays off, who have said, “Actually, our parents need to be here at 7 in the morning because they’re shift workers.”, to those private early childhood education services who have innovated, we say: we value what you’ve done, we don’t want to get rid of you. That’s what Labour is up to. This bill is sneaky, it’s a Trojan Horse, and it should not stand.

I’m astonished, and I’ve got to give the previous speaker, Nicola Willis, credit, because that is a remarkable ability to stretch out very, very scary outcomes from what is, essentially, a technical bill. What this bill will do is clarify something; that’s it. It doesn’t introduce new powers. The powers already exist—they have since 1990—but it clarifies that the bulk funding can be used for the purposes of wages; simple as that, so that there is no confusion.

What I heard over there is the same sort of rubbish we’ve been hearing from the National Party for generations. We hear a lot of lip-service, because, of course, they will want to go to their local early childhood centres in their electorates and pose for pictures and post them on Facebook. So we hear a lot of lip-service, but what we don’t hear, actually, is a commitment to pay parity. What we don’t hear is an acknowledgment that if we’re going to get there, we actually need to do something about it, rather than just stand there like they did when they were in Government for nine years and say, “We value early childhood education.”—then, when the discussion came to actually doing something about it, what did they do? Nothing. Did it achieve anything? Nothing. And they can get as angry as they like, but the facts stack up. And even the claims in the previous speech don’t stack up. They ignore the fact that there was $170 million over four years in the 2021 Budget, building on the $150 million that was in the Budget before, and they use the age-old scare tactics of “The Minister is aligned to the unions.” Hello, we’re the Labour Party. Everybody knows that we’re aligned to the unions, because we are the party that lifts wages and improves conditions.

💬 Nicola Grigg: And crushes productivity.

We hear the scaremongering tactics of those yelling over there and saying that intervention is not the way to achieve good wages—the free market, that’s what that is. That stuff was debunked years ago. The trickle-down theory is what we’re hearing. If we took the alternative approach that’s being proposed to this bill here, what we would see is wages going backwards in real terms, conditions being dismantled like we saw over many, many years. And this bill brings in a very simple, technical change that allows the Government to then actually achieve what that party has been giving lip-service to for many, many years, and that is pay parity.

The question that I want to pose is: why are they satisfied with people working in an industry with the same qualifications, the same skills, and the same experience getting paid less than others? Why? They don’t have an answer because they cannot justify it. We are not satisfied with that. This technical change in this bill will allow this Government to actually do what other parties have promised and never delivered. We are not satisfied, and it’s not just in early childhood education; it is across the board that we believe that people should get paid a decent wage and good conditions and have the ability and the right to be able to negotiate for that and actually have the provisions in place set by this Parliament to allow them to do that. And in an industry like early childhood education, it is this exact provision and this clarification that will allow the Government to achieve it.

Now, if I am lucky enough one day to be a father, and my children go to an early childhood education centre, I want the confidence that their teachers’ skills and experience and qualifications are being valued. Now, we heard all sorts of scaremongering around diversity of choice. The question I pose is: where in this bill does it say that diversity is going to be undermined? It doesn’t. It’s a fantasy. We heard all sorts of talk of nationalisation of the industry. Where is it in the bill? Again, it is a total fantasy. We hear, again, lip-service—too many teachers are not being paid enough, that’s what they said. Too many are not being paid enough, but what did they do about it? Nothing—absolutely nothing. They hear a lot about values, and a lot about support, but it’s just talk.

We heard the quote a couple of times in the previous contribution from the last speaker: National supports the notion—the notion, the idea, the theory. They don’t support it; they support the idea. New Zealanders are sick of hearing about support for ideas; they want action. That is why this technical change will enable that to occur.

I commend the Minister for introducing this bill. I commend the members on the Education and Workforce Committee for clarifying what this is about for those that may have heard some of the stuff that we heard on the other side tonight, actually believed it, and got worried, came into the select committee to submit, got the clarification, and have gone away satisfied that this is actually going to achieve our mutual goal of valuing early childhood teachers and ensuring that we actually achieve pay parity. It’s been talked about for too long; this Government is going to deliver it. The National Party had an opportunity to join us, and they’ve just sent a message to all the early childhood teachers in their electorates that, actually, all they are is talk.