Childcare costs in New Zealand: 20 Hours ECE and the under-3 gap

The gap nobody warns you about

New Zealand's headline childcare policy is 20 Hours ECE, and it is genuinely good. It is also age-limited in a way that catches almost every new parent by surprise: all 3, 4 and 5-year-olds can get up to 20 hours of early childhood education fully funded by the Ministry of Education. Children under three are not included.

That is the structural fact to plan around. The years when childcare is most expensive and most needed — the return-to-work years, from the end of paid parental leave to a child's third birthday — are the years the flagship scheme does not touch.

How the 20 funded hours work

To get the funding you need to find an early learning service that offers 20 hours of funded ECE, enrol your child, and state on the enrolment form which days and hours you are claiming. The limits are no more than 6 hours in a day and 20 hours in a week. Not all services offer it, so check before you enrol rather than after.

Your service can charge you for any hours your child attends outside the funded hours. It may also ask for optional charges and donations, which are voluntary and cannot be described or enforced as fees. If your child attends two services, the hours can be split between them within the same daily and weekly caps.

FamilyBoost

FamilyBoost is an Inland Revenue payment that refunds part of what you have already spent on licensed early childhood education. It works quarterly and in arrears: you keep your invoices, then claim after each three-month period ends.

For quarters ending after 1 July 2025, FamilyBoost refunds up to 40% of your ECE costs, to a maximum of $1,560 a quarter. Before that date the rates were less generous: up to 25%, capped at $975 a quarter. The payment reduces by 7 cents for every dollar of household income above $35,000 a quarter, and cuts out at a household income of $57,286 a quarter. The previous cut-out was $45,000 a quarter.

Two design details matter. FamilyBoost is paid to the household, not per child, and only one caregiver per household can register. And it applies to children aged 5 and under, up to the day before they turn 6 — which means, unlike 20 Hours ECE, it does cover under-3s. For a family with a one-year-old in full-time care, FamilyBoost is currently the main lever available.

Childcare Subsidy

Work and Income runs a separate Childcare Subsidy. It is normally paid for up to 9 hours of childcare a week if you are not working, studying or training, and up to 50 hours a week if you are working, studying, on an approved training course, doing an activity Work and Income has asked you to do, working night shifts, seriously ill or disabled, or caring for a child in hospital or a child you receive the Child Disability Allowance for.

In most cases you cannot get more than 9 hours a week if the child's other parent or caregiver is available to care for them.

The interaction with 20 Hours ECE is strict: you generally cannot claim Childcare Subsidy for the same hours you are claiming 20 Hours ECE. The one exception is a home-based educator charging a top-up payment for those same hours.

Why we are not giving you an average weekly fee

You will find New Zealand childcare averages quoted online. Treat them with suspicion. There is no current published national average fee for early childhood education in New Zealand, and the Ministry of Education's own guidance for parents is to check fees and conditions directly with services before enrolling, because each service sets its own and the drivers differ.

We would rather give you the structural fact than a made-up number. The fact is this: the funded hours start at three, the daily cap is six hours, and everything outside that is priced by the individual service. Two centres on the same street can differ substantially.

What to ask before you enrol

Ask whether the service offers 20 Hours ECE at all, and for which sessions — some structure their day so the funded hours only cover times that do not suit working parents. Ask for the full fee schedule including any optional charges and donations, and ask which of them are genuinely optional. Ask whether attendance minimums apply, because some services require a minimum number of days or hours. And ask the service to confirm it is licensed, because FamilyBoost only applies to licensed ECE.

Keep every invoice from your provider. FamilyBoost claims are evidenced by them, and you can add invoices you left out of earlier claims, up to the maximum you are eligible for. Providers can issue quarterly statements as well as individual invoices, which is easier to work with, so ask whether yours does.

Register for FamilyBoost once, before your first claim, rather than at claim time. Registration is separate from claiming, it is done in myIR, and only one caregiver per household should do it — two registrations in the same household create a problem you then have to unpick.

Where to get help

The Ministry of Education handles 20 Hours ECE and can explain funding conditions and what fees are allowed. Inland Revenue handles FamilyBoost registration and claims, which are made through myIR. Work and Income handles the Childcare Subsidy and can assess whether your hours qualify for the 9-hour or the 50-hour maximum. Govt.nz brings all three together in one place if you want to start from a single point.