28/05/2026
The Early Childhood Council (ECC) has welcomed the Government’s 1.5 percent cost adjustment for early childhood education in Budget 2026 – but has warned tough times remain ahead for the ECE sector.
“The ECC campaigned hard on a 5 percent increase in funding for ECE in this year’s Budget. While it’s not near the amount required to keep the sector sustainable, we welcome this year’s cost adjustment,” says ECC CEO, Simon Laube.
“Government funding has not kept pace with inflation, dropping more than 11 percent in real terms since 2019. This pressure has contributed to 443 service closures since 2022 and unsustainable fee discounting across the sector.
“Rising staffing costs remain a major pressure point for providers. Unfunded employment-related costs continue to be passed on to families or absorbed by already struggling centres – many of which end up making the difficult decision to close.
“A 1.5 percent increase – the first meaningful cost adjustment in years, in challenging economic times – will be enough to keep some providers going. But it isn’t enough to make the sector sustainable.
“Quality education is one of the best things we can give our young people. It sets them up for success, at school and for the rest of their lives. Lumping the country with debt that our children have to pay off is irresponsible, but equipping them with a quality education is part of the solution. It’s no surprise that the government found a way to make this ECE investment.
“ECE cannot continue limping from Budget to Budget. Longer-term work is still needed to put the sector on a sustainable funding path.
“The Government’s focus on an economic recovery is the right focus, as we need families to be able to afford childcare while having jobs. Today’s announcement is a small step in the right direction.”
