Who is the Director of Regulation?
The Director of Regulation (ECE) is now one of the most influential positions in New Zealand’s early childhood education system.
After rushed legislation and a rocky start, the first permanent appointment to this role is Ray McMillan, who holds the expanded title: Deputy Chief Executive Regulation and Early Childhood Education | Director of Regulation.
The Director is not simply a statutory decision‑maker, he is also a Deputy Chief Executive, a member of ERO’s Executive Leadership Team, and responsible for establishing and leading a new regulatory group inside the agency. This places the Director in the very top of the Education Review Office’s organisational hierarchy, shaping both regulatory decisions and the strategic direction of the entire regulatory, monitoring, and enforcement system.
Previously, the Secretary for Education in the Ministry of Education held ultimate responsibility for licensing and regulatory decisions. For political reasons, the Government chose to shift all ECE and private‑school regulation out of the Ministry and place it within the Education Review Office, an agency historically focused on review rather than enforcement.
Purpose for ECE Regulation – Enabling Parent’s Workforce Participation
The Education and Training Act now states that the purpose of regulating early childhood education is to:
- ensure quality early childhood education
- support the choice of parents and caregivers to participate in the labour market
This second purpose (added in Feb 2026) requires the Director of Regulation to give effect to labour‑market participation when exercising their powers.
The Director must only consider the principle that children’s health, safety, and wellbeing are paramount. This means decisions about licensing, compliance, and enforcement must now take into account parents’ access to childcare so they can remain in paid work.
The Children’s Commissioner warned Parliament that adding labour‑market participation to the purpose of regulation risks:
- reducing the primacy of children’s education, health, and safety
- aligning regulatory decisions with business needs and workforce demands
- weakening intervention in services with compliance failures
- prioritising continuity of service operation over transparent action
- downplaying serious issues to avoid disrupting parents’ employment
The Office of Early Childhood Education also opposed the change because framing ECE as a labour‑market tool showed “a troubling lack of understanding about the true nature and purpose of ECE.” While childcare may support parents’ employment, that is a secondary benefit and is not the core purpose of early childhood education. It is no different from schools: schools may enable parents to work, but the purpose of schooling is children’s learning and wellbeing, not supporting parent choice to participate in the labour‑market. (Read: Cobra Effects: How the Education and Training (ECE Reform) Amendment Bill Could Bite Back)
Because supporting parent labour‑market participation is now a legal purpose of regulating ECE, the Director of Regulation and ERO are required to give effect to it when making decisions. This shifts the regulatory system toward keeping services open and maintaining childcare availability for working parents. The Director and ERO are more likely to:
- Delay or soften enforcement to reduce costs for providers and prevent closures
- Minimise public communication about serious issues
- Prioritise service continuity over decisive regulatory action, even when children’s education, health, or safety concerns are present.
This is the predictable consequence of making labour‑market participation a statutory purpose that the Director must give effect to, while children’s wellbeing is something the Director must only consider.
Ray McMillan’s Powers and Role as Director of Regulation
Under section 27B of the Education and Training Act 2020, the Director of Regulation has two statutorily independent function and these are:
- issue licences to early childhood services and certify playgroups
- enforce compliance by service providers, including by undertaking investigations and prosecutions
These are the most consequential powers as these powers determine whether services can operate and how failures are addressed.
The Director has eight other functions that are non-independent, such as to provide support and guidance to service providers, investigate parent complaints, and collaborate with other agencies involved in regulating early childhood services. These other functions are influenced by the Education Review Office and Ministers.
Dual Role
Ray McMillan’s job title is: Deputy Chief Executive Regulation and Early Childhood Education | Director of Regulation. This title means:
- He is both the statutory regulator and a senior executive leader inside ERO.
- He is accountable to the ERO Chief Executive, who is accountable to ministers.
- He leads the entire regulatory group, including licensing, monitoring, complaints, enforcement, and private‑school and school hostel regulation.
- He is responsible for implementing the Government’s regulatory priorities, including labour‑market participation.
Who the Director Answers To and What This Means
Section 27C(3) of the Education and Training Act states: “The Director of Regulation is accountable to the Chief Executive of ERO.”
It means:
- The Director is not an independent regulator like the Commerce Commission or Ombudsman.
- Their work is shaped by ERO’s organisational culture, leadership priorities, and internal pressures.
Ray McMillan sits at the centre of a regulatory system that must constantly balance:
- labour‑market participation
- political expectations from ministers
- provider pressures to avoid sanctions and financial costs of meeting standards
- ERO’s organisational culture, capability, and internal constraints
- children’s rights and wellbeing, and public confidence in the safety and quality of ECE services
The law requires him to give effect to the government‑supported purpose of enabling and upholding parents’ labour‑market participation, while only considering the principle that children’s wellbeing is paramount. This imbalance creates a regulatory environment where economic objectives can override children’s rights.
Further Reading: Key Articles on ECE Regulation, System Change, and Government Decisions
2026 Annual List of ECE Services with Regulatory Action – Significant political and regulatory shifts have meant that far fewer services are being formally held to account in 2026, whether through a provisional licence, suspension, or cancellation.
Submission: Proposed Transfer of ECE Regulation – Why shifting regulation from the Ministry of Education to ERO raised major concerns.
A Transfer That Wasn’t – How the Ministry’s entire regional ECE regulatory workforce was disestablished.
ECE Funding Approvals Now Routed Through ERO – How the new two‑agency system complicates funding and compliance.
Who the Government Is (Not) Listening To – In November 2025, The Post published an Op‑Ed by Dr Sarah Alexander questioning who the Government listens to when making decisions about the care of our youngest children. Minister Seymour responded two days later, but his reply did not address the central concern: that Government is engaging with only a small minority of the sector – service provider business lobbyists.
When Minimum Standards Don’t Matter – Minister Seymour, the ECC, and the Country Kindy regulatory failures.
New Shoots Ltd–Educare Group Ownership Shift – There’s a regulatory gap allowing companies to acquire large numbers of centres without this registering as a change of ownership and triggering licence change checks
Safety Checks and a Minister’s Intervention – An ECE service in South Auckland was suspended for inadequate staff safety checks, prompting a person linked to the service to ask Associate Education Minister David Seymour to intervene who then challenged the Ministry to defend its decision.
