Introduction

What does it mean to be a citizen of Aotearoa New Zealand? For our children, it means being protected so that they can grow and reach their full potential. What are our shared values? What are our national aspirations? To a large extent, our answers to such questions reflect the education we have received. Systems of public education transmit across the generations our collective sense of identity and our sense of our place in the world. As the social, political and economic activities of nations become more integrated, the importance of education to individual and collective well-being increases. Today, countries like New Zealand cannot allow young people to fail in our schools, to leave them lacking the essential skills needed to support themselves and others through life. To move forward as a society, we must recognise the long-term benefits of high quality education and step up to invest in it at appropriate levels.

What happens in the early years of a child’s life can have enormous consequences for that child’s future well-being. For that reason, high-quality early childhood education deserves to be among the highest priorities for any society. To develop this report, we reviewed the best available research and extracted the lessons it holds for the design of public policy for early childhood education. This report presents an agenda for amazing children. By following our policy recommendations, this Government and governments to come will lay a strong foundation for national development. In this sense, everyone supporting a better start in life for our youngest and most vulnerable citizens is a nation builder. Viewed from a long-term perspective, this agenda for amazing children is also an agenda for an amazing country.

Most people understand and accept the fundamental role education plays in supporting our growth and regeneration as a nation. But the role of early childhood education has not always received the attention and support it deserves. This is true both in New Zealand and elsewhere. Fortunately, the tide has started to turn. Over recent decades, successive New Zealand governments have devoted considerable resources to supporting early childhood education. Significant investments have been made in developing the national curriculum, Te Whāriki, effective initial teacher education programmes, and regulatory and monitoring activities designed to promote safe environments and good learning outcomes for children.

In this report, we urge continuing investment in early childhood education. We understand that in times of fiscal distress expenditure cuts must be made to reduce deficits and the accumulation of national debts. But against that we must weigh the evidence showing the high returns society can gain from investing in early childhood education. So long as we can be assured that government expenditures in early childhood education are funding effective practices, then those expenditures represent better investments than almost anything else government could do. Those investments help children grow to reach their full potential in society, in education and well beyond. Subsequently, they go on to have healthy and productive lives. Participation in high-quality early childhood education can make the difference between having a life of poverty and dependence or a life characterised by on-going self-development and positive social engagement.

Our Job

We were asked to:

1. undertake a full review of the value gained from the different types of Government investment in early childhood education in New Zealand
2. consider the efficiency and effectiveness of Government’s current early childhood education expenditure, and ways that this might be improved, particularly for Māori, Pasifika and children from low socio-economic backgrounds
3. develop new ideas on innovative, cost effective and evidence-based ways to support children’s learning in early childhood and the first years of compulsory schooling
4. make recommendations to Government about proposed changes to funding and policy settings for early childhood education, and their costs, benefits, and risks, and
5. consider how our recommendations could be implemented without increasing current government expenditure.

Additional matters were raised, and these are fully set out in our terms of reference. Among other things, we were also asked to identify a desired future state for early childhood education in New Zealand over the next three to five years, and the broad mechanisms that could support that aim. Our brief involved focusing on an integrated system of education and care that could support a range of valued outcomes.

Our Terms of Reference from the Minister of Education can be found at Appendix 1.

Focusing Problems

Early in our Taskforce activities, we used a set of focusing problems to guide our work programme. Those problems were expressed as follows:

• New Zealand must be future-oriented; providing a great start for our children is crucial. The Government accords high priority to ensuring all children can participate in quality early childhood education. But funding is constrained. The Government and taxpayers need assurance that public investments in early childhood education will yield the highest possible returns – for children, their parents and all of society.
• Despite considerable recent growth in government funding for early childhood education services, there are still many children who do not engage with formal education and care services prior to entering school. Given the research evidence of benefits from pre-schoolers acquiring a strong start in education, and the transparency of any vulnerabilities in human capital as children embark on the important transition to school, ways must be found to ensure all children benefit from at least some engagement with early childhood education services.
• The education of children rests on partnerships between families, whānau, service providers and taxpayers. Broader economic and social changes necessitate periodic review of those partnerships. We need to be sure that publicly-funded early childhood education services respond effectively to the diverse and changing needs of all stakeholders.
• The voluntary and highly disaggregated nature of early childhood education service delivery has great potential to drive continuous improvement in the sector. We need to be sure that our funding and regulatory models encourage local innovation and system-wide learning about what works best for improving service quality.

A Common Theme: Stepping Up

Our agenda for amazing children calls for a shift in values and commitments. It calls for full recognition of the citizenship rights of our children. Government has an important role to play in early childhood education. But governments can only make fundamental changes in social practices when other stakeholders are prepared to step up to meet their responsibilities. What will stepping up entail?

We propose that the Government step up, by making a range of structural reforms that will enable the desired future state of the early childhood education sector. Those structural reforms include:

• reprioritising expenditures to allow increased support for high-quality early
  childhood education services
• establishing a simplified funding model for early childhood education that
  encourages effective use of taxpayer funds
• targeting support to Māori, Pasifika and children from low socio-economic
  Backgrounds
• enabling more effective parent support
• targeting support to children whose parents engage, or seek to engage, in the paid workforce
• establishing stronger incentives for employers to establish family-friendly Workplaces
• creating better performance reporting mechanisms so that services face suitable pressure to continuously improve their practices.

We propose that the organisations delivering early childhood education services across a range of settings step up, by becoming more professionalised and by engaging in practices that are proven to promote the best outcomes for children.
Those actions include:

• aiming for high quality in all aspects of their work
• agreeing to become community hubs where appropriate, allowing for an
  integrated response to the needs of local families
• reaching out into the local community and responding effectively to community needs for local early childhood education provision
• operating in locations and for hours that are supportive of the needs of working families and their children
• exhibiting the kind of flexibility in service delivery that allows an effective
  response to children who have special education needs or are from Māori, Pasifika or lower socio-economic backgrounds
• supporting the development of a new performance report and ways of informing parents of service quality
• promoting leadership education across the early childhood education sector, from the local service level upwards
• committing to creating a more innovative culture that promotes continuous improvement in the delivery of services to children and their families
• ensuring that all those working in the sector are able to receive on-going education and professional development in how to improve the quality of their interactions with children and families.

We propose that parents step up. No matter how much investment governments and others in society make into early childhood education, the choices that parents make on a daily basis always have the most influence on outcomes for their children. Parents can support the safety, development, health, well-being and early education of their children by:

• creating safe, violence-free and loving home environments, and serving as rolemodels to their children
• recognising high-quality early childhood education as an investment in their children’s future and being prepared to pay a proportion of the costs of the services they use
• becoming more actively involved in their children’s early education and being actively involved in their learning
• engaging with the available parent support when this is appropriate
• viewing themselves as on a career path, and avoiding long gaps in their
  participation in the paid workforce
• reaching out to family and friends for support, and – when they are sufficiently able – doing their bit to support the parenting work of others.

Finally, we propose that employers step up. The evidence is clear on the advantages for employers of retaining staff, and of staff having their children enrolled in early childhood education. For too long, too many employers have ignored the needs of working parents and assumed that raising future generations should be a private concern for families or, if it is a public concern, then the Government should address it. In fact, employers face many choices when it comes to setting human resources policies and making their workplaces more family-friendly. More employers should support working parents by:

• supplementing the Government’s paid parental leave provisions
• paying some of the costs of early childhood education for employees’ children
• supporting access to early childhood education services, for example, by contracting service provision on site or for places in nearby services for their employees
• creating flexible work hours
• allowing more staff to spend part of the work week working from home
• recognising that all parents have family responsibilities
• explicitly recognising family situations when reviewing employees’ career plans
• valuing the kind of management skills that parents learn through raising children.

Figure 1: International Paid Parental Leave Entitlements

Societies, economies and nations derive their strength from the practices of the individuals, voluntary groups, organisations and businesses that comprise them. Governments play a fundamental role in setting the broad parameters for those decentralised actions. But government activities – no matter how well-intentioned – can never substitute for the dynamism and creativity released when groups of people work together in mutually-supportive ways.

Our agenda for amazing children calls for government to play its part in ensuring that the youngest New Zealanders receive a great start in life. But just as important are the contributions made by others. For early childhood education to deliver on its promise of being the best investment a nation can make, government’s efforts to step up must be matched by the actions of others.

Approach

How we prepared the report

The ECE Taskforce was established in October 2010 and we had six months to prepare this report to the Minister of Education. With such a timeframe, it was imperative that we got down to work immediately. We began by creating our joint vision for the future of early childhood education in New Zealand. One of our earliest tasks was to call for submissions. We wanted to collect views from a wide range of sources, from across the sector, from academics and especially from parents.

This report incorporates ideas and views from the 439 submissions received. As well as appearing in each of our essays on policy design in Part Two of this report, a summary of submissions can be found at Appendix 2.

Alongside this process we also sought and received further ongoing comment and feedback from these submitters and many others; in particular, individuals and groups who preferred to communicate orally rather than in writing. We also undertook field visits to selected early childhood education services and met with various sector stakeholders.

All of these sources of information and advice, along with the considerable breadth of knowledge and experience of our members, and many vigorous discussions, were vital in helping us answer many of our questions. We have been able to reach evidence-based conclusions about what kinds of improvements and changes are needed to redesign key aspects of early childhood education policy and services.

Throughout this process, we have held firm to our vision for the future of our youngest citizens. Some of our recommendations are bold and some present challenges. These things are to be expected of an independent taskforce: following the evidence, speaking truth to power .

We have endeavoured to make our report accessible to all of our audiences. Seven background briefings about early childhood education, the final written report, video dialogues and other print summaries are available on the Internet via our website and through specific postings on YouTube.

Structure

This report is comprised of two parts. The present part on the role of government in early childhood education provides an overview. Here, we summarise the case for investments in early childhood education and our vision of the future early childhood education sector in New Zealand. We also present an overview of our recommendations to the Government. The part ends with our suggestions for how change processes might be most effectively led and sequenced. If pursued, this realistic reform process will have major transformative effects while minimising the potential for sector resistance, policy failure and poor outcomes for children.

Part Two of this report, on making change happen, comprises eleven essays on policy design. These essays cover a range of important topics relating to early childhood education. They include how to make the sector more innovative, how we might improve on current funding mechanisms, how the curriculum might evolve over time, how to increase participation in early childhood education, and how to support parents.

The essays on policy design all follow a common structure. After establishing the importance of the topic under consideration, each essay provides background on the current situation and suggests policy changes that would produce improvements.

Principles

To guide the analysis and discussion presented in this report, we developed ten general principles for policy design. Throughout our policy design essays, these principles form the basis for making meaningful comparisons between current institutional arrangements and our proposals for future arrangements.

1. Respect fiscal constraint

This is a general principle that should cover all of government spending. When, for whatever reasons, no new money can be found, by taxes or by borrowing, then scrutiny should be given to how all current government funds are being allocated. As a general rule, it would be best if government could fund activities that are likely to yield positive future outcomes. By definition, such spending represents an investment. Spending wisely on our children, by funding quality early childhood education, is an obvious example of an investment, so long as the money going into the sector is being used prudently.

2. Promote economic growth

Again, this is a general principle that should stretch well beyond funding of early childhood education services. We have used it as a guide to policy design in our work because it sets a high standard to be met by early childhood education spending. We believe that through wider application of this principle, into all areas of government spending, Government could identify areas of current expenditure elsewhere that would be better allocated to early childhood education. In our view, which is well supported by research evidence, greater spending on high-quality early childhood education now will result in a much stronger economy and less call on government spending for social services in the future. By helping children to reach their potential and lead fulfilling lives, we can grow our economy. This is the key to recognising how greater spending in early childhood education can serve, longer term, to improve – not harm – the Government’s fiscal position.

3. Use government funds efficiently

Efficient use of resources is a general criterion used whenever public policy proposals are being assessed. A strong case can be made for greater government investment in our children through early childhood education. But this does not mean that any spending in the sector represents a wise use of scarce resources. We have to be sure that current government expenditure in early childhood education delivers value for money. We should be able to explain why our proposals for change represent improvements in the efficient use of government funds.

4. Fairness: Encourage cultural diversity

Contemporary New Zealand society is the bicultural product of a co-existence and blending of many long and rich cultural traditions. The early childhood education sector takes pride in its promotion of cultural diversity, manifest, for example, in the national early childhood education curriculum, Te Whāriki. One way to pursue fairness involves encouraging and celebrating cultural diversity, which can be done in a variety of ways.

5. Fairness: Ensure access for all to high-quality early childhood education services

Since we know participation in high-quality early childhood education services produces significant benefits for children and their families, and that education is a citizenship right of children under the United Nations Convention on the Rights of the Child, the pursuit of fairness suggests that all families should have access to such services. We believe that ‘access’ includes ‘suitability’ – a match to a child’s and family’s needs and wishes. Many barriers to access can arise. They include income constraints, children’s special educational needs and geographical location. We have thought hard about how to promote fairness around access to services.

6. Encourage parental connections to the paid workforce

Research tells us that children benefit from being in households with sufficient financial resources. Supporting parental participation in paid work often generates good outcomes for children, and for all members of their households. None of this is intended to suggest that all parents should be continuously in full-time employment when their children are very young. A part-time connection to the workforce is a valuable connection. It reduces the risk that parents will find re-entry to the paid workforce difficult or impossible after they have devoted years to caring for their children in the household.

7. Create a predictable environment for service providers

It is important that early childhood education services are able to operate and plan with a high degree of certainty. The more stable the sector, the better families and others can plan.

8. Pursue administrative simplicity and low compliance costs

There is a view that some of the current arrangements between the Government and early childhood education service providers – such as allocation of funds, reporting and regulation – create too much bureaucracy. As a design principle, we sought to find ways that costs can be reduced, both with respect to government delivery of policies and with respect to the sector services that must comply with them.

9. Encourage sector collaboration

Historically, the early childhood education sector has sometimes seemed divided into unique groups, with members of those groups seeing themselves as having fundamental philosophical differences. In considering how to create a better sector, we placed a high value on the importance of encouraging collaboration among service providers and between the sector and government. We see this as a key to promoting on-going professionalisation of the sector. At a practical level, collaboration could include a range of cost-sharing innovative practices devised among service providers.

10. Promote innovation across the sector

Organisational innovation is a way to promote continuous improvement in the quality and efficiency of our services for children. We are keen to ensure that, through time, individuals and organisations in the early childhood education sector will be able to consciously explore how to keep getting better at providing services that meet the needs of children and their families. This will help the early childhood education sector move from ‘good’ to ‘great’.

Conclusion

Aotearoa New Zealand is a young nation whose citizens pride themselves on their compassion towards others, their ingenuity, their creativity and their entrepreneurship. We feel a great sense of collective accomplishment when our fellow Kiwis do well and make positive contributions on the world stage. Down the generations, successive governments have played important roles in shaping our collective identity. They have given us the confidence to make the most of our individual talents and skills. They have done this primarily by building a strong education system. That system has served as an engine for our national success. It has given us spaces in which to dream ‘big’, and it has supported us as we have matured into adults and found our respective places in the world.

The greatest gift any generation can give to the young is to ensure they receive education at quality levels exceeding those of the past. This is not sentimental stuff. In making these intergenerational gifts, we increase the likelihood that vital government services, such as health care and support to those who cannot fully support themselves, will be adequately funded. Currently, most use is made of those services by the oldest members of our population, and that trend is set to continue.

The evidence base clearly shows that early childhood education is an effective investment for governments: one that can pay off many times over through increasing the odds that children will grow to be productive citizens. Such citizens form the bedrock of a strong, healthy and prosperous nation, one that can afford to give everyone a fair go, and help all people to live full, rich lives. In what follows, we explain why early childhood education matters. We also recommend important actions the Government can take to ensure early childhood education in New Zealand will deliver the best possible outcomes for everyone.

Figure 2: ECE Services In 2010, there were 4,321 licensed early childhood education services of a variety of types and an additional 831 licence-exempt (certificated) groups. The table below shows how the sector was made up in that year:

The Case for Investing in Early Childhood Education

Convergence in the results of substantial international evidence, based on well-designed longitudinal research studies and cost-benefit analyses, reveals positive long-term effects for individuals who have experienced high-quality early childhood education compared to individuals who have not. Good outcomes for children have significant spill-over benefits for society. As well as generating these long-term positive effects, early childhood education can also deliver immediate returns. For the children receiving it, those benefits come through more high-quality attachments with sensitive adults, and more play and socialisation with other children, which can support development in a range of ways. Perhaps most importantly, their quality of life, as they experience it as a child, is enriched. In some cases, the safety of children can be enhanced by ensuring that they participate regularly in early childhood education. For parents, the immediate returns on early childhood education include, among other things, access to parent support, knowledge of child development, educational knowledge and more time available to participate in the paid workforce, if that is a priority.

One submitter said, ‘As a teacher my focus is not on 21st century workforce productivity but on children as human beings right now i.e. as young children with the right to participate, to learn, to be provided for, to be protected and to know they have a place. The best interests of the child should be the driving force in all decisions.’

The Evidence

Research Lesson One: First years last a lifetime

That the first years last a lifetime is the conclusion drawn by researchers from a range of disciplines, including education, economics and paediatrics. An impressive array of carefully designed studies has now traced the effects of early childhood education on subsequent outcomes. These studies have shown various on-going benefits. Figure 3 offers descriptions of the outcomes that have been recorded from specific early childhood education programmes in the United States. Those programmes had common characteristics. They were relatively intensive. The children attended for at least one full year, and generally for longer. Most involved services that worked with parents as well as focusing on children. The evidence also suggests that the teachers in these programmes were highly qualified. The child-to-teacher ratios were relatively low and the classroom sizes were limited. In other words, the positive interventions incurred significant up-front costs. However, where cost-benefit analyses were performed on these interventions, the findings showed that for every dollar invested, the resulting returns fell within the range of $3 to $16. In percentage terms, those are massive returns on investment.

Figure 3: Cost-to-benefit ratios found in major early childhood education programmes

(Note that these programmes are from the United States of America. No cost-benefit analysis has been conducted into early childhood education in New Zealand.)

In general, evidence shows that the children who have most to gain for high quality early education are those most at risk of subsequent failure within the school system and other social problems – children from lower socio-economic backgrounds.

What is it about early childhood education that can make such a positive difference in the lives of children as they go through school and on into adulthood? While exposure to high-quality early childhood education positively influences the cognitive abilities of children measured through a range of tests, over time the impact of the interventions becomes less significant on the same measures.

But two other factors appear especially important. First, children who have attended high-quality early childhood education with planned programmes are generally better prepared for school. As Nobel Laureate and economist James Heckman has said, “skill begets skill; learning begets learning”12. So investments in early childhood education lay effective foundations on which children can subsequently build stable knowledge and skill frameworks.

But the reverse is also true. That is, failure begets failure. As Heckman also noted, “advantages accumulate; so do disadvantages”13. Children who do not experience quality early childhood education can find themselves in a perpetual catch-up mode in schools and elsewhere. Too often this can be the precursor to failure within the education system and subsequent larger social problems.

Figure 4: A biodevelopmental framework for understanding the origins of disparities in learning, behavior, and health

The second important factor that appears to contribute to later success in schooling and adulthood has to do with the non-cognitive and behavioural dispositions of the children – like curiosity and perseverance – more often found in those who have experienced high-quality early childhood education than those who have not. Many participants in the programmes that have been studied appear to have acquired better social skills and to have manifestly fewer behavioural problems. They were more adept at social
interactions and conflict resolution. Further, where programmes effectively reached out to parents, research has suggested that parenting skills improved, and discipline problems and child abuse were less likely to occur. However, some studies found that very young children placed in long hours of poor quality childcare experienced higher levels of antisocial/worried behaviour at the time, and more negative behaviour at school entry15.

Research Lesson Two: Investing in early childhood education generates higher returns than spending on education or social programmes in later life

There are clear benefits to countries, economies and individuals from education. Education is known to be linked to economic benefits such as productivity and increased gross domestic product, and through these, to improved living standards for individuals and greater international competitiveness for economies. This is thought to happen through the development of the skills that build human capital. That skill-development
starts in the early years. Interventions received at different levels and different stages in the life-course have differential effects.

One submitter said, ‘This sector requires long-term thinking – developing policies which can be agreed and shared across the left/right divide.’

Early childhood education takes place during the first stages of human development where important skills for future functioning are embedded. Not only are investments made at this time effective and powerful, there is some evidence that they are more effective than later ones. When carried out in the early years of a child’s life, effective interventions deliver the best payoffs for society and for the individual as figure 5 shows. Additionally, the benefits are typically greater for disadvantaged children. Leading authorities on human capital formation have noted empirical evidence of low economic returns to interventions targeted toward disadvantaged adolescents but high returns for remedial investments in young disadvantaged children16.

Figure 5: Returns to a Euro spent at different levels of education

In response to the Washington State Legislature’s request for a comparative analysis of the net benefits of funding early intervention programmes, Aos18 assessed 61 programmes. These included home-visiting, youth development, mentoring, substance abuse, pregnancy prevention and juvenile offender programmes in the US. The purpose was to assess the net benefits of investing in different programmes in terms of the savings resulting from reduced crime and harmful behaviours which could also be attributed to participation in these programmes.

Aos found that early childhood education for low-income three and four year olds delivered a greater average total benefit for each taxpayer dollar spent ($2.36) than any other “pre-kindergarten” programme. (These results were found through a meta-analysis presented as one programme). The early childhood education for low-income three and four year olds was also found to provide a greater return for public funds than a variety of interventions targeted at adolescents, such as mentoring, teen pregnancy and substance
abuse prevention programmes. Aos et al concluded that ‘early childhood education for low-income 3- and 4-year-olds…provide[s] very attractive return(s) on investment’19.

As we note in Lesson One, these advantages accrue because long-term human capital formation is an ongoing process. Children’s learning experiences at one point in time therefore need to adequately prepare them for the next stage of their learning.

Research Lesson Three: Participation in quality early childhood education appears to improve aptitude in reading, maths and science at age 15

The Programme for International Student Assessment (PISA), the OECD’s long-running study into reading, maths and science achievement by 15 year olds, found in 2009 that, in all 34 OECD countries studied – including New Zealand – those 15 year olds who had attended pre-primary education for more than one year when under five outperformed those who had not. This finding remained unchanged after socio-economic background was taken into account. Significantly, the achievement gap between the two groups of 15 year olds in New Zealand exceeded the difference made by one full year of schooling.

Figure 6: Comparison of the difference in PISA reading scores, aged 15, between study participants who reported attending more than one year of early childhood education, and those that did not, after controlling for socio-economic status. Points difference made by an additional year of schooling shown for comparison.

Research Lesson Four: Participation in quality early childhood education can reduce child abuse and increase the well-being of children

Early childhood education services can be nodes of connection to social services for vulnerable families, linking them into health, housing and income support services where necessary. Services can also support peer-to-peer modelling of good parenting. Participating in an early childhood education service has been shown to support improved parenting – e.g. reading daily, less smacking, more positive parent-child interactions, more father involvement, and increased parental knowledge of child learning, development and behaviour. Participation in early childhood education has also been shown to reduce the risk of death or serious injury for children as a result of child abuse. In New Zealand, work by the Ministry of Social Development on child homicides and by the Children’s Commissioner on death and serious injury by assault for children under five confirm this21. In addition, US research on the Head Start programme22 found
that participation in Head Start reduced child mortality rates in five to nine year olds, compared with those rates observed in non-participating control groups.

Research Lesson Five: The cumulative benefits of education translate into better quality of life through adulthood and into old age

Quality early childhood education can have positive benefits for individuals in terms of their subsequent performance in school and in the job market. Evidence from American studies has also highlighted how those who receive high-quality early childhood education subsequently, on average, experience better health, more stable family relationships, and less likelihood of engagement in criminal activity. Research shows the strong linkages between individuals’ levels of educational attainment and their subsequent health status23.

Further, consistent with the investment model of success begetting success and failure begetting failure, the evidence on health outcomes suggests that, in later life, the gap increases between the health status of people with higher levels of education and the health status of those without it. These results have taken account of other plausible explanations, such as socio-economic status. They offer further confirmation that investments in high-quality early childhood education increase the odds that children will go on to experience success in the educational system and, in adulthood, to live socially-oriented, productive, healthy lives. This is of fundamental importance to national advancement, because people who display these characteristics are well placed to contribute to society. The more that we can encourage such positive outcomes for individuals, the more likely we are to witness positive outcomes for all.

High-quality early childhood education supports positive human development. That is why we view it in nation-building terms.

Responsibilities

The foregoing discussion points to the high value of early childhood education both to society and to the individuals who participate within it. Where the positive value to individuals and society has been clearly demonstrated, we propose that the Government should continue to make significant investments into early childhood education. There are several reasons.

• Children gain immediate educational and social benefits from participation in high-quality early childhood education. All children have the right to receive
  such benefits.
• All of society benefits from the subsequent success of children who have
  experienced high-quality early childhood education.
• Not all parents can afford to cover the costs of high-quality early childhood
  education, but since children have no ability to choose their parents, it is unfair to limit access to early childhood education based on the income status of parents.
• Children of beneficiaries who attend early childhood education can gain access to services that have a safe, healthy, orderly and stimulating environment, while their parents engage with training or seek to re-enter the workforce.
• Access to high-quality early childhood education services that operate during working hours create greater opportunities for parents to participate in the paid workforce, thus increasing the likelihood that children will grow up protected against socio-economic disadvantage, and parents will remain productively employed throughout their adult lives.

Conclusion

Early childhood education represents a high-yielding social investment. In New Zealand, participation in early childhood education is not compulsory unlike, for example, participation in primary schooling. Yet, successive governments have acknowledged the benefits of participation in early childhood education for all children. Governments have made significant investments in early childhood education and have made efforts to increase participation among those groups that could benefit most from it. Those
investments have been well justified. Government should continue to take leadership in funding early childhood education and setting the broad parameters within which voluntary exchange occurs between families and services. Indeed, investing in early childhood education can be thought of as one of the most effective uses of taxpayer funds. We note that successive governments have increased the level of investment in early childhood education. In the remainder of this report, we suggest policy reforms that will increase the likelihood that government expenditure on early childhood education will yield high returns.

One submitter said, ‘We need to have conversations about what is truly best for children and develop government policies that reinforce this’.

A Vision for the Future Early Childhood Education Sector

Ki te kāhore he whakakitenga ka ngaro te iwi
Without foresight or vision the people will perish

New Zealand’s early childhood education sector has benefitted greatly from government investments made over time and the cumulative efforts of people at the local level, including generations of teachers and parents. Today, we observe both growing professionalism in the sector and high levels of diversity in service forms. Both have their merits. Because we value the many good things about the current early childhood education sector, our vision for its future is grounded in the present, and mostly involves taking the best of what is happening now and finding ways to replicate it across the sector. Given this, our vision for the sector could be realised through a set of carefully orchestrated, incremental changes. Here, we summarise our vision for the future early childhood education sector. The central components of our vision are high-quality services, access for all children, support for parents, and a strong sense of collective identity among those working in the sector. The vision is given a more detailed treatment throughout the eleven essays in policy design that comprise Part Two of this report, Making Change Happen.

High-Quality Services

The research literature makes clear that the best outcomes for young children occur when they participate in high-quality early childhood education. Currently, quality in New Zealand early childhood education services is generally good, but there is significant variability across services. We wish to see a continuing rise in overall quality and a simultaneous shrinking of the variance in quality levels across early childhood education settings. The concept of quality should remain multi-faceted. Among other things, it is a function of staff education and professional development, the ratios of teachers to children, and group sizes. Efforts to promote quality can involve both the setting of minimum standards and the use of incentives to encourage continuous service improvements. In our vision, the early childhood education sector in New Zealand will face strong incentives to attain and maintain high levels of service quality. For example, government licensing of service providers will require that they meet high standards. In addition, provision of accurate information to parents concerning the comparative performance of services will create another set of pressures for high-quality services. Our vision also includes promotion of collaborative and innovative practices among services. Further, we propose that staff education and professional development be used to promote continuous quality improvement.

In sum, our vision for the early childhood education sector gives top priority to highquality service provision. The actions of government, the informed choices of parents and the greater professionalisation of the sector itself will all contribute to continuous pursuit of excellence.

We recognise that high-quality early childhood education services are expensive. But we also know that providing high-quality early childhood education to children represents one of the best investments that any society can make. Our vision for the future early childhood education sector involves ensuring that it is delivering good value for money, both to the Government and to families. So long as this is happening, we believe that strong grounds exist for governments to reprioritise their spending so that high-quality early childhood education services attract the kind of subsidies they deserve.

Access for All Children

Children from Māori, Pasifika and lower socio-economic backgrounds are less likely to attend early childhood education than other children. The missed opportunities for those children can have negative effects, both in the short term and the long term. Opening up access to increased participation in early childhood education has been a focus for government for some time, but with limited success. We would like to see greater collaboration between the sector, government and local communities. To promote greater access, especially for children from Māori, Pasifika and lower socioeconomic backgrounds, we propose a move towards a model where local communities themselves identify their early childhood education needs and where this is appropriately supported by government. A focus on community is expected to promote parent input into the early childhood education settings. That can make an enormous difference to involvement, attendance and children’s achievement.

In thinking about access for all children, we have also been mindful of families who have children with special education needs. To increase the inclusion of all children in early childhood education, we have proposed that the per-child hour subsidy be higher for children with special needs. We have also proposed that their parents gain support from advocacy services so that they can more effectively access appropriate services. We believe the pursuit of high-quality services and access for all children will have a transformative effect on early childhood education and subsequent educational achievement. It will open new developmental opportunities for children, their parents and their communities. This is how great societies are built, and how great societies sustain themselves.

Parent Support

Parenting is an incredible privilege. It is also really hard work, even for the est-resourced adults. In developing our vision for the early childhood education sector, we have carefully considered the needs of parents – and by this, we mean all those performing a parenting role, including grandparents and non kin carers – and the ways that early childhood education services can work in effective partnerships with them. Many families face significant challenges in addition to those that come with bringing up children, such as poverty, violence, inflexible work conditions or marital breakdown. Parents are the biggest influence on children’s educational achievements, and educational achievements are inextricably linked to other life-course outcomes. Early childhood education programmes that have strong parental connections have been shown to be more effective than those that do not. Enabling effective parent support is therefore potentially one of the most effective ways that governments can ensure good outcomes for children. Our vision for the future of the early childhood education sector involves having services build trusting, reciprocal and warm relationships between parents and teachers. Most importantly, this model avoids viewing parents as deficient, but rather as potential reservoirs of strength, and it looks for ways to recognise them in their context and build on their current strengths.

We have also given careful consideration to how early childhood education services can better support parents engaged in paid work. Since it is growing increasingly common for all parents in households to be maintaining some level of connection to the paid workforce, we believe that such parents should be supported through extending the hours per week for which their children are entitled to the per-child-hour early childhood education subsidy. Likewise, we consider that strong grounds exist for extending the hours per week for which people receiving income support are entitled to the per-child-hour early childhood education subsidy.

A Strong, Unified Sector

We want the early childhood education sector in New Zealand to be highly diverse yet unified around a commitment to high quality. For this reason, we have proposed continuation and strengthening of several institutional arrangements that can ensure unity in the sector on all the right kinds of things.

First, we have proposed the introduction of a new funding mechanism that extends the logic of the popular 20 Hours ECE model, currently applied to children aged three to five. Our mechanism provides a per-child-hour subsidy to centres based on the time each week that children of any age spend there. The subsidies can be adjusted to take account of children’s needs and their family circumstances. This funding model will create a level playing field for funding across the sector.

Second, we have endorsed the national early childhood education curriculum, Te Whāriki. It has proven to be highly successful and it has brought a lot of unity and focus to the sector. It embraces diversity. We have proposed a review of the implementation of Te Whāriki, with an eye to increasing its positive influence on early childhood education in New Zealand.

Third, we have proposed ways of ensuring that the teachers and other professionals in the early childhood education sector are well educated and that they continue to acquire appropriate professional development throughout their careers.

Fourth, we have proposed improvements to licensing processes and performance reporting. It is helpful for services and the people working in them to have a good sense of the standards to which they are being held, and that evidence of performance is made transparent. Whenever systems of this kind are used, task performance improves.

Finally, we have proposed mechanisms to connect peers across services with the goal of promoting a culture of innovation and continuous improvement across the sector. Many opportunities now exist for spreading the word about good practices from place to place, and we wish to see more of this. As well as helping to raise service quality, the mechanisms for the diffusion of innovation can serve to build professional unity.

Our Recommendations

Overview

Below, we present an overview of our recommendations. These recommendations canbe grouped into key themes, all of which focus on driving up quality and create our agenda for amazing children.

To achieve our vision for the future of the early childhood sector, we recommend:

1. An immediate focus on system quality and the effective use of government spending. This includes:

• a careful review of spending to ensure it is high value
• strengthening quality measures for home-based services, education and care for children under two years of age, group sizes, and accountability measures for kōhanga reo
• reduced tolerance for variability and under-performing services – intensive
  support followed by decisive action for services receiving supplementary ERO reviews
• regulating for a minimum of 80% registered staff in teacher-led, centre-based services (up from 50%).

2. A better funding system. This should:

• drive up quality
• preserve the idea of universal access, including a subsidy for a core 20 hours, and fund on that basis, but
• include strongly differentiated payments for priority groups – Māori, Pasifika, children from lower socio-economic backgrounds and children with special education needs
• be linked to a new licensing system that differentiates between teacher-led, centre-based services and other services
• move away from cost drivers, and towards incentives, support and rewards
• remove unnecessary compliance costs for services.

3. Increased productivity by greater support for working parents. That means:

• incentivising services that meet the needs of working parents
• combining existing supports from the Ministry of Social Development and the Ministry of Education into a single, transparent, easy-to-understand system that offers incentives and support for parents to return to paid work
• requiring earning parents to pay more for early childhood education where
  they can afford to.

4. Improved accountability. This would be achieved through:

• standardised performance and outcome reporting on government expenditure on early childhood education
• mandatory performance reporting by services, linked to their funding
• better information for parents about the quality of early childhood education services in their area
• an evaluation of the implementation of the national early childhood
  education curriculum, Te Whāriki.

5. A well-supported, highly-regarded, professional and innovative sector. It should:

• insist on high-quality education and invest in professional development, with Government setting the benchmark by creating minimum requirements
• provide warm and welcoming settings that draw on family strengths, becoming a hub within the community, and in some cases, a site for integrated services
• work collaboratively in a strong and unified manner that retains our distinctly diverse sector
• be supported by Government with high-quality advice, and governance and management structures for stand-alone services, including umbrella groups for Māori and Pasifika services
• be supported by structures that allow innovative practices to flourish and
  grow leadership from within the sector.

6. New roles and relationships. This means:

• Government continues to provide primary leadership by setting regulatory
  requirements, and providing funding
• professional leadership from the sector, driving a culture of continuous
  improvement on high-quality services
• partnerships drawing on the wealth of experience and knowledge within the sector, supported by officials and decision-makers
• consideration given to the role of employers in supporting the needs of
  working parents
• more emphasis on cross-government responses to the needs of families.

7. A strong foundation in research and evidence. The components of this should include:

• a well-funded research programme, to include advice on care for children
  under two among other matters
• evidence-based policies that take account of emerging research
• identification of effective professional practice
• systematic evaluation of innovative practices and ways of working.

8. A measured pace: a structured, phased and trialled approach, monitored by regular reporting on progress and outcome. This should include:

• the development of a government early childhood education expenditure
  strategy that provides a coherent framework for a programme of work
• a structured work programme in three phases – immediate quality measures, implementing supporting mechanisms and improvements put in place
• trial of the new funding system
• partnerships between the sector and Government.

The full set of our recommendations to the Government regarding its role in early childhood education appear in each essay in the second section of this report, entitled Making Change Happen: Eleven Essays in Policy Design.

Leading Change Processes

In developing our advice on the role of government in early childhood education, we have been mindful both of the potential and the limitations of government action. A stark line often exists between the views people have about what government should do and the realities of what government can do.

In New Zealand, early childhood education is delivered by non-government entities, who receive most of their funding from government. Government leadership is manifest through the frameworks it provides to the sector (e.g. licensing requirements, the curriculum, etc.) and the incentives it creates (e.g. funding rules, service grants, performance monitoring, etc.). The strength and value of government’s influence on the early childhood education sector inevitably depends on the quality of the relationship established between government entities and early childhood education service providers. Trust and goodwill contribute greatly to the achievement of intended policy outcomes.

Comments received from early childhood education service providers and other stakeholders suggest that the most effective change processes occur when new government policies are introduced in consultation with those who will be directly affected by them. In each of the essays in Part Two of this report, Making Change Happen, we discuss how we think the change process should be managed for each facet of policy implementation. We propose that small, focused working groups of officials and experienced sector leaders be formed into project teams to work through the details needed to translate our recommendations into day-to-day practices. This type of partnership is vital for success. Officials can bring resources, analysis, advice and knowledge of the Government’s broader constraints. Sector leaders can bring practical experience and knowledge of the likely impacts of changes, and advise on the most effective methods of achieving the desired outcome.

These project teams should be given very specific tasks and tight deadlines for task completion. We anticipate that well-managed engagements of this kind will contribute to the sound implementation of policies, along with the building of trust and goodwill.

To keep the change process on track, and to ensure that appropriate credit is given to the change leaders, we propose that progress on implementation of the Taskforce’s recommendations, and accompanying sector commentary, are combined in an annual report to Parliament and the public, setting out successes, things that could work better and next steps.

The change process envisaged here positions the Government as a catalyst for activities that should prompt greater leadership from the early childhood education sector itself. Over the past three decades, there has been a steady move towards more professionalisation in the sector and a greater commitment to the provision of high-quality services. This move must continue. Strong sector support for the changes we have proposed could make the early childhood education sector one of the most vibrant and professional parts of New Zealand’s society and economy. The more this occurs, the greater the likelihood that those who work in this sector, who give so much to our youngest citizens, will be recognised and respected for their contributions to nation building.

Key Considerations

Change is a difficult process. We expect government, parents, services and employers to act differently, in some cases very differently to the way they do now. Organisations and individuals need time to plan, adjust and adapt. But we also recognise the urgency of the need to act. Every year, over 50,000 children exit the early childhood education system and start school. Some are unlucky enough to start school without the benefit of early childhood education. Given that, every year some of the reforms we suggest are delayed is a missed opportunity for those children and for society as a whole.

But a climate of instability for the early childhood education sector will be unsettling and counterproductive. In particular, we note that around 1,400 services – over a quarter of the total number of early childhood education services – are single services owned by a single person or organisation. These services are vulnerable to sudden shocks without the support of a larger organisational infrastructure. Sector leaders, and in particular the leaders of some of the larger membership organisations, need to be prepared to guide and assist services through the forthcoming period of change.

The change strategy we recommend has five key elements.

1. Ongoing cooperation between government, government agencies and the sector to design and implement changes. We discuss this above, with particular reference to sector/government working groups.
2. Sequenced change that enables later reforms to build on earlier reforms in a sensible, sustainable fashion. We set out a recommended sequence for change below.
3. Support for the sector, provided by the sector, to make necessary changes. We believe that the sector leaders who form part of the working groups should take responsibility for supporting and advising services on the change process.
4. Specific, well-defined timeframes that let parents and services know what is to happen, and by when. Our recommendations for this are set out below.
5. Frequent and clear reporting on progress, including an annual report presented to Parliament. This could include quarterly reports published on a dedicated website, which in turn should be reflective of strong, regular project reporting within the working groups and the agencies tasked with implementing the changes.

The Rationale for Sequencing

We consider change can occur in three basic phases.

Phase one will focus on immediate quality improvements. These do not need to be costly to the Government, but we consider them to be urgent to safeguard children’s welfare and to ensure the sector is performing how it should. Important actions from this phase will also be the establishment of support mechanisms for Māori and Pasifika early childhood education services. This phase will also include some immediate regulatory change.

Phase two will focus on the design and introduction of the funding and performance reporting systems. These will be major changes for the early childhood education sector, and will require intensive effort to ensure successful implementation. We expect that, around the end of phase two, Government will be in a position to regulate for 80% qualified teachers as a minimum, and thus establish a high and significant quality benchmark.

Phase three will focus in more detail on more incremental improvements to quality and teaching. We consider this to be a good time to build on the research and information base built up during the first two phases, by conducting a thorough evaluation of Te Whāriki, and instigating any reforms necessary to initial teacher education and registration. We consider that by the end of phase three, Government will be in a position to consider further quality reforms such as regulating for ratios of 1:4 for children under two years old.

We describe change processes in more detail in the individual essays in Part Two.

Figure 7: The Change Process: phased recommendations

 

Note on the interpretation of data For much of the New Zealand data contained in this report, we have relied on data collected by the Ministry of Education through licensing and funding processes, parent questionnaires completed on school entry, and an annual census of early childhood education services. It is worth noting the following specific points when considering our analysis of various factors of low socio economic status. Prior-participation rate: The percentage of Year 1, new school entrant, New Zealand citizens and residents who have regularly participated in early childhood education immediately prior to starting school. School decile: Schools are assigned a socio-economic score based on five socio-economic factors, based on where their students live. The 10% of schools with the lowest scores (i.e. with the highest proportion of students from low socio-economic areas) are considered decile 1 schools, the next 10% of schools are considered decile 2 schools, and so on). New Zealand Index of Deprivation (NZDep) decile: This is a measure of socio-economic status, where higher deciles are poorer (in contrast to school deciles where high deciles are more affluent). This measure has certain drawbacks, but most importantly it is based on service location. We know that families tend to travel to early childhood education services. This means that this measure is only an indication of the socio economic status of families attending a service. More information can be found at http://www.uow.otago.ac.nz/academic/dph/research/NZDep/

References

5. Derived from Moss, P. (2010). International Review of Leave Policies and Related Research 2010. Employment Relations Research Series no. 115. London: Department for Business Innovation; except Australia: http://www.deewr.gov.au/Department/Publications/Documents/PPLBooklet.pdf.

6. The term ‘speaking truth to power’ was coined by Aaron Wildavsky. (1979). Speaking Truth to Power: The Art and Craft of Policy Analysis. Boston: Little, Brown.

7. ‘Licensed’ means that the service is licensed under the Education (Early Childhood Services) Regulations 2008 or the Education (Playgroups) Regulations 2008 and receives funding from the Ministry of Education. Data from the Ministry’s Annual ECE Summary Report 2010 available at www.educationcounts.govt.nz

8. This term includes services (mainly playgroups) that are licence-exempted by the Education (Early Childhood Centres) Regulations 1998.

9. Largely adapted from Karoly, L. A., Kilburn, M. R. & Cannon, J. S. (2005). Early Childhood Interventions: Proven Results, Future Promise. Santa Monica, CA: RAND Corporation, table 4.4. Studies marked with an * were taken directly from Karoly. Other sources are referenced.

10. Reynolds, A. J., Temple, J. A., White, B. A., Ou, S.-R. & Robertson, D.L. (2011). Age 26 cost-benefit analysis of the child-parent center early education program. Child Development, 82 (1), 379-404.

11. Note that this number is often reported as being 17.07 as it was in Karoly (2005). It has been corrected in this table following the errata issued by the study author, Lawrence J. Schweinhart.

12. Heckman, J. J. & Masterov, D.V. (2004). The productivity argument for investing in young children. New York, NY: Committee for Economic Development.

13. Heckman, J.J. & Masterov, D.V. (2004). The productivity argument for investing in young children, p3.

14. Shonkoff, J.P. (2010). Building a New Biodevelopmental Framework to Guide the Future of Early Childhood Policy. Child Development (81)1, 357–367, p358.

15. Mitchell, L., Wylie, C. & Carr, M. (2008). Outcomes of Early Childhood Education: A Literature Review. Wellington: Ministry of Education.

16. Cunha, F. & Heckman, J. J. (2007). The Technology of Skill Formation. American Economic Review, 97(2), 31-47.

17. Wößmann, L. & Schütz, G. (2006). Efficiency and Equity in European Education and Training Systems. Analytical Report for the European Commission. Munich, Germany: European Expert Network on Economics of Education p12 derived from Cunha, F., Heckman, J.J., Lochner, L., & Masterov, D. (2005). Interpreting the evidence on life cycle skill formation. British Educational Research Journal, 30(5), 713-730.

18. Aos, S., Lieb, R., Mayfield, J., Miller, M. & Pennucci, A. (2004). Benefits and Costs of Prevention and Early Intervention Programs for Youth. Washington DC: Washington State Institute for Public Policy.

19. Aos, S. et al. (2004). Benefits and Costs of Prevention and Early Intervention Programs for Youth p2.

20. OECD (2011) PISA in focus 2011/1

21. Martin, J. & Pritchard, R. (2010). Learning from Tragedy: Homicide within Families in New Zealand 2002 – 2006. Wellington: Ministry of Social Development and Duncanson, M., Smith, D. A. R. & Davies, E. (2009). Child deaths and serious injury from assault of children aged under 5 years in Aotearoa New Zealand: A review of international literature and recent findings. Wellington: Office of the Children’s Commissioner.

22. Ludwig, J. & Miller, D. L. (2007). Does Head Start Improve Children’s Life Chances? Evidence from a Regression Discontinuity Design. Quarterly Journal of Economics, 122(1), 159-208. Note that the Head Start programme includes some health services, such as immunization and screening.

23. Topitzes, J., Godes, O., Mersky, J. P., Ceglaret, S. & Reynolds, A. J. (2009). Educational success and adult health: findings from the Chicago Longitudinal Study. Prevention Science, 10, 175-195.

24. Said by Kingi Tawhiao Potatau te Wherowhero, to show the urgency of unification and strong Māori leadership.