Billions for ECD aren’t reaching centres, practitioners warn as subsidies go unpaid

Allocated billions failing to reach front-line ECD centres, sector leaders say

Despite sizable budget allocations for early childhood development (ECD), centres and practitioners report not receiving subsidy payments, leaving some centres unstable and children at risk, sector groups and court papers say.

What the budgets promised

The department of basic education’s 2024-25 annual report said R10 billion was secured from National Treasury to increase the ECD subsidy to R24 per child per day and to extend access to an additional 700,000 children. The department’s 2025-26 annual performance plan allocated R6.3 billion over the medium term for the ECD conditional grant, with further allocations including R210 million for infrastructure, R100 million for a results-based financing pilot and R236 million for an ECD nutrition pilot. Basic Education Minister Siviwe Gwarube also launched a R496 million ECCE outcomes fund.

On-the-ground reality: unpaid subsidies and centre closures

Despite those allocations, reports from the provinces paint a different picture. In the North West, ECD centres were allegedly told the provincial ECD budget had been depleted and that no funding was available for the year. The department has dismissed that specific claim as false but could not explain why centres in the province had not been paid their stipends for over a year.

Kwazulu-Natal is facing similar issues: the Legal Resources Centre has taken the provincial education department to the KwaZulu-Natal High Court in Pietermaritzburg over a widespread failure to pay subsidies to registered ECD centres. In May last year the court ordered the department to settle outstanding payments owed to three centres. A second phase of the case is seeking a structural interdict requiring the department to disclose all outstanding subsidy payments and settle them within a week.

Sector groups warn of systemic failure

Tshepo Mantjé, ECD coordinator at Real Reform for ECD, said the crisis reflects deeper systemic failures and stressed that on paper R24 per child per day is already inadequate. He said many centres do not receive the subsidy at all, or they receive it late and inconsistently. Mantjé noted that only about 40% of the subsidy is allocated to meals, amounting to less than R10 a day for two meals and a snack, which he said did not cover basic nutrition costs.

Annah Fourie, chair of the SA Association for Early Childhood Development, said the situation had reached crisis levels and that many centres were facing closure, adding that compliance requirements were being used as an excuse.

Department response and administrative action

Basic Education spokesperson Terrence Khala said it is not possible for any province to have depleted their funding allocation for the 2026-27 financial year because the government financial year runs from 1 April to 31 March and the ECD conditional grant is transferred to provincial departments quarterly. He said the department tracks expenditure fortnightly to detect under-expenditure and provides targeted support to provinces struggling to process payments timeously.

Khala said the department is rolling out a digitised process to enable more efficient processing of subsidy applications and emphasised that the subsidy is intended to supplement fees to make programmes more affordable, not to fully fund them. He also said facts would need to be presented for the department to respond to claims that ECD funds were diverted to other programmes.

Impact on children and inequality

Sector representatives warned that when subsidies are not paid, children suffer from poor nutrition and reduced stimulation, centres become unstable, some close and practitioners leave the sector. Mantjé said the crisis deepens inequality, with poorer communities hardest hit, and referenced research from the 2024 Thrive by Five Index which shows fewer than half of South African children were developmentally on track, with poverty a key driver.

What’s next

The legal challenge in KwaZulu-Natal moves to a new phase seeking structural remedies, while the department says it is improving monitoring and digitising subsidy processing. Meanwhile sector groups continue to call for reliable, adequate and timely funding to prevent further instability in ECD services.