Giving FamilyBoost a boost: Options to increase FamilyBoost uptake
29 May 2025
Statement from the Office of Early Childhood Education
Submitted to the Inland Revenue Department and Minister Nicola Willis
Released on 7 July 2025
The FamilyBoost initiative signalled a long-awaited potential shift in government policy on focusing ECE funding on benefitting families, instead of payment to service providers.
However, it has not met expectations, with fewer families applying and fewer families getting the maximum $75-a-week ECE rebate than was forecast.
Data from the Consumer Price Index shows that FamilyBoost has not immediately reduced the financial burden on families who use ECE services.
In February 2025 the OECE wrote:
“Plainly, some ECEs are taking the opportunity to increase their underlying charges because people’s ability to pay higher charges has improved due to the rebate.
“The government should take note that the cost of increased childcare fees is being borne by taxpayers. And, choice of ECE services for parents is much more limited than the government might think.”
In the OECE’s view, the best ways to expand FamilyBoost up-take and support, ensuring more families benefit from increased financial assistance for ECE costs, are to:
- Address public perception of FamilyBoost as an inferior policy because money is directed in this case to parents rather than services
- Make it a requirement for ECE providers to provide timely and correct invoices and not place their own conditions on parents making a claim
- Reduce administrative hurdles for parents to make a claim and spread the word through short influencer videos on TikTok and other social media platforms that it’s now much simpler and easy
- Apply the cap of $975 per quarter on a per child, rather than per family basis
- Establish a minimum amount payable to parents in lower tax brackets so these parents get back more of their fees paid up to the cap
- Review amounts and income thresholds for the Childcare Subsidy and the suite of other ECE subsidies provided by Work and Income in the light of the introduction of FamilyBoost
- Maintain the rebate of 25% of eligible fees for higher-income households but increase the rebate to 50% or higher for lower-income households.
Perception
The government announced the FamilyBoost policy after Labour had put forward a proposal for extending 20 Hours ECE to two-year-olds. The fact that an alternative way of increasing funding for ECE was already being discussed influenced the public’s perception of FamilyBoost.
A stronger initial communications plan could have been used to counter the perception that FamilyBoost was an inferior policy and highlight how FamilyBoost might lead to better outcomes.
But, it’s not too late to implement this. Government could challenge the negative public perception of FamilyBoost and “rebrand” the policy by creating communications (media releases, social media content, video case studies featuring real families) that highlight how FamilyBoost is putting money back into parents’ pockets whatever the age of their child(ren) attending ECE. FamilyBoost could be presented as a hope for the future after a period of settling-in, testing, and refinement.
ECE provider backing of the FamilyBoost Policy
ECE providers are not compelled to support parents with their FamilyBoost applications by ensuring they have all the information they need to make a claim, such as the correct ECE service details (including the licence number) and fee information. In the OECE’s view, service providers do not see how they benefit from doing this, since the money goes to parents directly and is not paid to them.
This is evident in the examples of passive resistance by service providers that have been raised with us: leaving it to parents to personally request invoices each quarter instead of proactively supplying them, not providing these in a timely manner, and making parents feel they are causing a burden by asking or reminding the service provider, or a trouble-maker if they make a complaint.
The Early Childhood Council business lobby group gave its centres an amended enrolment agreement requiring parents to only submit their invoices for FamilyBoost once their fees were fully paid (with no debts to the centre) if they wanted to keep their child(ren) enrolled. The ECC claimed this so-called ‘sector innovation’ was supporting FamilyBoost. But essentially, it made FamilyBoost into some kind of weapon or punishment tool that centres could use against any family.
Requiring early childhood service providers to provide all families with compliant invoices/statements, and hold them accountable for doing this, would ensure 100% of eligible parents have the fees information they need to make a FamilyBoost claim each quarter.
This could be done by:
- Changing tax legislation
- Making an amendment to Clause 47 Governance, management, and administration standard: general in the Education (Early Childhood Services) Regulations 2008
- Revising the Ministry of Education’s ECE Licensing Criterion on information provided to parents (contained in the Governance Management and Administration section)
- Establishing a dedicated phone line and online complaint form for confidential reporting by families of difficulties around accessing compliant invoices
Bureaucracy
FamilyBoost comes across as an excessively complicated administrative procedure.
The video on what FamilyBoost is and how to make a claim is long and impersonal. It does not motivate time-poor and low-resourced families to take up the policy.
The last thing families with an infant or young child need is to have time taken up chasing documents and engaging in bureaucracy.
Some families may have had previous negative experiences with Inland Revenue, or while claiming for benefits through Work and Income, and therefore may shy away from engaging with government agencies, especially if they are not certain they will receive money back to make it worth their while.
Options to reduce or eliminate some of the administrative hurdles (both perceived and actual), may be to:
- Review how FamilyBoost is portrayed in communications and make videos and social media differently to better appeal to the target group – new parents
- Review eligibility rules – EG: why an infant needs to be tax registered with an IRD number for a parent with an IRD number to get the tax rebate
- Review and reduce the amount of information that parents must input before they upload invoices, such as service provider details (which should be shown on the invoices or statements in any case)
- Make practical help available to support families who find the process of proving eligibility, gathering documentation, and making precise or correct entries confusing and frustrating. Some of the people in this situation face language barriers or have limited digital access. One way to help this group would be through opening help desks on specific times/days each quarter, at local shopping malls or locations easy for families in low socio-economic communities to get to.
Financial benefit
Making the financial benefit greater could boost the uptake of FamilyBoost by incentivising parents to apply each quarter for the rebate instead of leaving it until another time and not getting around to catching up with the online paperwork.
The fact that the policy is “one-size-fits-all” and does not account for families’ specific situations (besides their income level) is another potential barrier to uptake. For example, we’ve heard anecdotally from families accessing low-cost ECE (such as kindergarten association-operated centres) that the amount they’d get back through FamilyBoost per quarter is so low it’s not worth the amount of time it takes (in some instances families only qualify for a rebate of $20 per quarter).
Options to raise the payment amount families receive as a tax rebate include:
- Raising household income thresholds and/ or increasing the rebate amount – currently 25% of eligible ECE fees up to a maximum of $975 per quarter
- Establishing a minimum amount payable to parents in lower tax brackets so these parents get back more of their fees paid up to the cap. Perhaps setting this at $50 per quarter would incentivise more families accessing lower-cost ECE to submit their claims
- Applying the cap of $975 per quarter on a per child, rather than per family basis. This will benefit families with 2 or more children in ECE and make the system seem “fairer” and reflective of the fact that they are paying more in fees to begin with. It could also help to boost ECE enrolment and workforce participation because families with more than one infant or young child would see a greater financial benefit to accessing ECE
- Reducing subsidisation under other policies, such as reducing the number of hours funded under the 20 Hours ECE policy – This comes with the risk that it would probably be unpopular with families though, because they would then end up paying more for ECE initially, even if the cost was net neutral to them after the rebate
- Reviewing the settings for the Childcare Subsidy and the suite of other ECE subsidies provided by Work and Income in the light of the introduction of FamilyBoost.
Targeting FamilyBoost
Higher-income household families may spend a high proportion of their household budget on childcare since they can opt for services that charge higher fees. Lower-income families often have fewer choices due to cost and access (e.g. transport) constraints, impacting on educational disparities from the start of children’s education.
Enabling more middle-income and high-income household parents to access the full tax rebate would certainly help their household budget, but would widen educational and economic disparities. A case could therefore be made for maintaining the rebate of 25% of eligible fees for higher-income households but increasing the rebate to 50% or higher for lower-income households.
Final comment
The government needs to address the tension between putting more money in parents’ pockets to pay for the cost of ECE and what ECEs charge.
The ECE Parents’ Council recommended in its submission to the Ministry for Regulation that Government place some controls on fee charging practices to:
- Prevent unexpected fee hikes
- Reduce opportunity for profiteering by private operators
- Ensure families are not charged for access to any hours within the 20-Hours ECE
- Support free kindergartens to return to being donation-based so all children can experience ECE no matter what their family income may be.
We hope these suggestions are helpful to you while you consider how to ensure more families are applying for and receiving FamilyBoost. If we can be of further help, please get in touch. We are always happy to help, as our job is to support education and care.
Dr Sarah Alexander
Chief Advisor to the Office of Early Childhood Education (OECE)
May 29, 2025
Feedback
Joanne replied: For some of our centre families, it is the requirement to apply for this online that is the barrier to them accessing it. This can put it in the too hard basket as not everybody is computer literate or has access to the internet. They have commented that a paper based claim form would be preferable that they could then post off to the IRD, along with their quarterly statement. I do offer to help our centre families who are unsure how to go about accessing family Boost, but most do not take up this offer and therefore miss out on what they are entitled to. A paper based option may assist with this.
