Kindergartens crying poor - with big cash stashes

Photo / Thinkstock

Kindergartens have increased fees, put playgrounds on hold and made staff redundant because of Government funding cuts - but many have large sums of money in the bank.

A search of the charities register reveals many kindergarten associations have shown surpluses in their annual returns.

Many of the surpluses are in the hundreds of thousands of dollars, and some associations, including Counties Manukau, Waikato and the Central North Island, have between $1.7 million and $3.2 million in reserve.

The Auckland Kindergarten Association - which represents more than 100 centres - is a rare exception, posting a $584,000 deficit in the 12 months to June last year.

Many kindergarten teachers took to the streets last year in protest at $15 million being cut from their budget.

They said the cuts would result in higher costs to parents - some of whom might no longer be able to send their children to kindergarten - once they took full effect this month.

Some centres have raised fees or introduced "donations". Others have cancelled projects such as building new playgrounds, and some made support staff redundant in a bid to cover the funding cuts - estimated to be around $40,000 for each centre.

But questions are now being asked about why the cuts are claiming jobs and being passed on to parents when many of the centres have large surpluses they could draw on.

Marilynn McLachlan, founder of the social networking site Mums on Top, said a lot of parents would be highly disappointed to learn their kindergartens had big surpluses they could have drawn on - especially as they had been so vocal in their complaints about cuts to funding.

NZ Kindergartens chief executive Clare Wells said there was more to the big bank balances than met the eye - and it was important to note that they were for last year, and did not include the funding cuts.

"I think we are going to see some very, very different figures in a year," she said.

Ms Wells said kindergartens were charities and therefore not run to make a profit.

Large bank balances might well reflect the fact that money was given by the Ministry of Education in three large sums throughout the year and was in the bank to pay wages for the following quarter, she said.

The large surpluses were often used for things such as building new centres or expanding existing ones.

Counties Manukau Kindergarten Association general manager Karen Shields said her group was "breaking even" but now had an accumulated surplus of $3.1 million.

That money was for the creation of new centres.

The association, which operates 26 kindergartens, had reduced spending on professional development and some building projects, but none of its centres had increased fees because of the funding cuts, Ms Shields said.

Education Minister Anne Tolley said the "substantial reserves" built up through taxpayer funding and fees from parents would be an eye-opener for many families.