Swings + Roundabouts Spring 2020

The New Zealand early learning sector has historically enjoyed a high-level of freedom when it comes to selecting locations to establish new centres. Centre owners have been able to select suburbs and sites based on their own assessment of the needs of the community and the demand for education and care. Provided that the locations were appropriate in the context of child health, the Ministry of Education (MoE) has largely refrained from getting involved in locational decision-making. This is in stark contrast to the primary and secondary education sectors where the provision of services is planned by the MoE and land secured to cater for population growth. This freedom has resulted in both positive and negative outcomes for children, whānau and the early learning sector as a whole. On the positive side, this free-market approach has resulted in increased supply of licence places and therefore increased parental choice. The second order effect has been that centres have had to maintain or increase quality to ensure that they continue to appeal to whānau. On the flip side, some argue that the free- market approach has led to an oversupply of licence places in parts of the community THE EDUCATION AND TRAINING ACT 2020: A NEW APPROACH TO NETWORK PLANNING BY LOGAN WHITELAW and a significant undersupply in others. The second order effects of this can be significant pressure on centres all competing for the same children and teaching staff – ultimately driving down the viability of centres. The not-for-profit subset of the sector has been particularly vocal about these concerns. Whatever side of the free-market argument you previously sat on, everything changed on the 1st of August when the Education and Training Act 2020 (ETA) was enacted into law. The ETA introduces an active network planning approach to new centres and the expansion of existing centres. In simple terms, the MoE will now actively control where new centres will be allowed to establish and will be able to decline licence applications where a centre owner cannot demonstrate clear demand for the type of service proposed. The licensing process will be split into two distinct phases. The first will be a new preliminary approval (pre-approval) to establish a service; the second will be just like the existing licensing regime. A major component of the first phase will be an assessment of the proposed new centre against the “capacity of the network in the surrounding community to meet demographic and community needs, including the provision of different service types, such as Māori medium.” In simple terms, the burden will be on centre owners to demonstrate that there is actual demand for a new centre, or an expansion of an existing centre, on a specific site. This is a significant departure from the existing licensing process and one that adds a layer of complexity and cost to the whole process. If a centre owner is unable to demonstrate that there is a lack of capacity of the network in the surrounding area to meet the needs of the community now and into the future, the MoE will be able to decline the pre-approval. If granted, a pre-approval will last for two years – by which time the second phase of the licence must be applied for. For those who have established a new centre before, you will know that two years from identifying a site through to having a licence issued can be a tight timeframe given the complexities of both the resource and building consent processes. There is uncertainty over how long the pre-approval process will take and whether applicants will be able to have pre-approval in place prior to purchasing a site. If not, centre owners may be taking September 2020 { 28 }