Supporting vulnerable children is one of the Government’s priorities within Better Public Services (BPS). As part of the BPS goal, a Government priority for education is that every child has the opportunity to participate in quality early childhood education (ECE). This significantly increases a child’s chance of future educational success, particularly for children from vulnerable families. The Government has a target that in 2016, 98 percent of children starting school will have participated in quality ECE.

To meet this target, Government has said that it will need to “change funding policies to incentivise better support for and participation by vulnerable children.”[1]

Equity Funding[2] is one of the Ministry of Education’s funding schemes for eligible licensed early childhood services to support and enrol vulnerable children in high quality ECE, retain these children in ECE and support their successful transition to school.

This report complements ERO’s report Use of Equity Funding in PacificEarly Childhood Services, October 2013 which presents findings about the use of Equity Funding in 15 Pacific early childhood services.

In this evaluation, ERO investigated the extent to which 147 early childhood services[3] reviewed in Term 4, 2012 and Term 1, 2013 effectively used Equity Funding to support children’s participation in quality ECE. The findings are presented in relation to:

  • the services’ awareness of receiving Equity Funding
  • services’ use of the different components of Equity Funding and the positive impacts for vulnerable children or groups
  • the extent to which services met the Ministry of Education’s (Ministry) reporting requirements.

Overall, ERO found that 14 percent of the 147 early childhood services were highly effective in their use of Equity Funding. These services had several strategies and initiatives to ensure and support participation in ECE by vulnerable children. Strategies included keeping costs of ECE affordable for parents, providing a supportive and inclusive environment for children with special needs, and engaging and developing relationships with the children, their parents and whānau as partners in learning. These services also supported ongoing professional learning and development for teachers and training for parent-educators. They regularly reviewed their use of Equity Funding and identified the positive impacts for targeted children or identified the need to modify their strategies. These services met all of the Ministry’s reporting requirements.

In a further 47 percent of services, the use of Equity Funding was effective. Although these services had similar characteristics to the highly effective services, ERO found some variability in relation to:

  • their provision of support for children with special needs
  • their support for teachers’ professional learning and development
  • their review of the use of Equity Funding
  • the impact for targeted children or groups
  • the extent to which they met all of the Ministry’s reporting requirements.

Most of these services had reported on the Equity Funding received and how it was used, but did not state their reasons for using it in the way they did.

ERO found that in 27 percent of services, the use of Equity Funding was of limited effectiveness. Although most of these services were aware of receiving Equity Funding and its intended purpose, they did not report on its use. In some cases, Equity Funding was included in the service’s operational budget and reported as a total amount. The different components of Equity Funding were not identifiable; nor were the ways the funding was being used. These services were characterised by their lack of self review. They could not show how Equity Funding was spent or how it supported targeted children’s participation in ECE.

In the remaining 12 percent of services, use of Equity Funding was not effective. Most of these services were unaware they received Equity Funding, and did not report on its use or the impact for targeted children or groups.

The conclusion of this report discusses some challenges in the context of ERO’s findings and in relation to the equity objectives of participation and quality. These challenges are related to:

  • the link between educational policy goals such as increasing children’s participation in ECE and the eligibility criteria for Equity Funding
  • the extent to which Equity Funding can be used by services to increase participation by those children not currently participating in ECE
  • the extent to which Equity Funding can support children and families when working with relevant external agencies
  • the extent to which Equity Funding can support services to implement their programme in another language.