Thursday, 20 February 2025 (for immediate release) – As the Government of National Unity (GNU) returns to the drawing board on the 2025 National Budget, Real Reform for ECD is greatly encouraged by the now-withdrawn budget proposals for early childhood development (ECD). R10 billion in new funding was proposed for the ECD subsidy and R210 million was added to the ECD infrastructure grant–the single biggest increase for ECD funding in South Africa’s history.
After years of minor and incremental funding increases, these proposals make tangible the repeated commitments of President Cyril Ramaphosa to support our youngest generation to thrive, leaving no child behind.
These crucial investments were set to be announced in the 2025 Budget Speech on 19 February. However, at the last moment, the speech was postponed to 12 March 2025, due to a lack of consensus from political parties within the GNU, reportedly on a proposed 2% VAT increase.
The R10 billion allocated over three years beginning in 2025, in addition to existing funding for the ECD subsidy of around R4 billion per annum, would fund a much-needed increase in the value of the ECD subsidy from R17–where it has been frozen since 2019–to R24 per child per day. This increase would greatly assist ECD practitioners in providing quality care, nutrition and early learning stimulation for young children, amidst rising inflation. The R10 billion allocation would also ensure that the approximately 700,000 eligible children from low-income households attending ECD programmes, but not benefiting from the ECD subsidy, have access to the subsidy by 2027/28. This will bring the number of poor children benefiting from subsidised access to early learning from around 800,000 today to 1.5 million by 2027/28, as envisaged in the Department of Basic Education’s 2030 Strategy for ECD Programmes.
The R157 million proposed allocation to ECD infrastructure and registration support in 2025/26, and the R210 million in additional funding proposed for the 2026/27 and 2027/28 financial years (largely to support the government’s Bana Pele Mass Registration Drive), would enable a ramp-up of targeted support to the more than 19,000 unregistered ECD programmes in the country. This grant will assist programmes to improve equipment and infrastructure to provide safe, quality and holistic care to young children.
The withdrawn 2025 budget also cemented an increase in funding for the DBE’s early nutrition pilot, from R197 million in 2024/25 to R336 million in 2025/26. We welcome this continued commitment to addressing child nutrition and call for further engagement with the sector by the DBE on the design of this pilot, which must benefit the most vulnerable children. World Bank data shows that ending stunting in South Africa would boost GDP by at least R80 billion, demonstrating how important the successful implementation of the DBE’s nutrition pilot is.
We also welcome the now defunct 2025 budget’s proposal to increase the value of the child support grant by 9.4%, from R530 to R580, with effect from 01 April 2025. In recent years, the value of the grant, which is accessed monthly by 13 million children, has not kept pace with rising food prices, making many families more vulnerable to food poverty.
While the withdrawn budget speech positioned ECD as “a key investment in the future of our country”, the budget as a whole was funded in large part by a proposed 2% increase in the VAT rate. Real Reform for ECD unequivocally supports progressive taxation that protects low-income households and improves income and wealth distribution while ensuring critical investments in ECD are maintained. Real Reform for ECD therefore calls on our government to explore more progressive revenue generation measures.
Expanding ECD services is essential and must remain a top priority come 12 March. Seventy percent of children already live below the poverty line and one in four children under five are stunted. Over 80% of Grade 4 learners in the country cannot read for meaning. Now is not the time for political posturing—it is time to make bold, strategic investments that will instill confidence in South Africans. It starts with an investment in young children. A government that invests in ECD is forward-thinking and committed to addressing the triple challenge of unemployment, poverty and inequality, by laying a foundation for improved education and health outcomes, gender equity, and inclusive economic growth.
The economic evidence is irrefutable: Nobel Prize-winning economist James Heckman has demonstrated that investing in quality ECD services in low-income communities generates a return on investment of 13%. Implementing the DBE’s progressive 2030 ECD Strategy would, in itself, help create 70,000 care and early learning enterprises and support the creation of 300,000 new care jobs, mainly in township and rural economies. An expansion of ECD services to all children could reduce childcare burdens for up to two million women, promoting their equal economic participation.
In the National Budget Speech on 12 March, Real Reform for ECD urges National Treasury to:
- Follow through with its proposed injection of R10 billion into the ECD subsidy and R210 million into ECD infrastructure and registration support.
- Follow through with the increase in funding for the DBE’s early nutrition pilot, from R197 million in 2024/25 to R336 million in 2025/26.
- Follow through with plans to increase the child support grant from R530 to R580 per month from 01 April 2025, and commit to further increases to ensure parity with the food poverty line, currently R798 per month.
- Ensure that revenue and spending proposals do not further burden low-income households.
- Support the implementation of a double-discounted list of 10 budget-friendly food items to promote maternal and child nutrition.
This is a defining moment for the GNU to fight for our youngest citizens, and demonstrate its commitment to this country’s sustainable development and economic growth. An investment in ECD is an investment in the just and equitable society we strive to be.
Statement Issued by Real Reform for ECD
Real Reform for ECD (RR4ECD) is a movement advocating for holistic, well-funded, inclusive, and ECD services. It supports a broad network of over 1000 practitioners and is backed by more than 300 organisations. For more information, visit their website: https://www.ecdreform.org.za/