A Hunter preschool is "desperate" for a government funding boost as its operator struggles to pay staff wages and maintain the centre's 46-year-old demountable building.
The director of Girrinbai Community Preschool in Jewells, Lyn Best, said she was battling increasing financial pressure at the early childhood centre.
"We are really struggling, it has been really tough," Ms Best said.
"The money I get for doing this job is just insane, it is disheartening," she said.
In a letter to parents in June, Ms Best said she was "gutted" to make the decision to increase parent fees for Term 3 to accommodate essential pay rises mandated by the NSW Fair Work Commission.
She said this included a planned 4.75 per cent increase in the Children's Services Award as well as an extra 5 per cent increase for gender-based undervaluation, given they were a mostly female-based workforce.
"This means an increase of nearly 10 per cent after July 1 without any extra funding to support this increase," she said.
While the government did increase funding significantly to community preschools during COVID-19, Ms Best said the current funding model was not enough to meet costs.
Community preschools are not-for-profit that are majority funded through the state government's Start Strong program and through parent fees. They are not department-run facilities.
They are different to long day cares, which can be for-profit and receive funding from the federal government.
A spokesperson for the Department of Education said funding to support community preschools and families had increased 106 per cent under the Start Strong program, providing up to $550 million in 2026.
"Community preschools can use Start Strong program payment funding for operational costs beyond staff salaries and education resources, including rental and license costs, maintenance, upgrades, utilities and cleaning," they said.
The department said it had no record of community preschools contacting them to advise that staff wage increases made them unviable.
Going through their finances, Ms Best said it was likely that they would need to increase parent fees by $10 to meet the wage rises.
With partial fee relief from Start Strong, a parent with a four-year-old in a two-day program would be paying nearly $30 a day rather than just under $20.
"The department tells us that we have to keep our fees as low as possible but if they're not going to be subsidising this fee increase, where are we going to get the money from?" Ms Best said.
"With the cost of living today, our families are being forced to bear the brunt of the fee increase," she said.
She said the only other option was to lose some of the 12 employed staff, but that would compromise the safety of the children.
The preschool's growing maintenance costs were further putting pressure on its finances.
Since April 2024, the preschool has dealt with intermittent leaking in one classroom and the staff bathroom.
Damage to the roof did not appear to be caused by a weather event and only worsens during heavy storms, Ms Best said.
While the preschool had a tarp that temporarily stopped the leaking in the classroom, it was not a permanent solution, she said.
The Newcastle Herald has seen two different quotes from builders that said the roof needed to be wholly repaired and could cost upwards of $45,000.
The Australian Charities and Not-for-profits Commission register showed that the preschool had a net income deficit of more than $60,000 for the past two years.
While the preschool had a net assets balance of more than $95,000, Ms Best said it wouldn't be able to sustain its costs if it made another $60,000 loss this year.
"We will then only have $35,000 and if we spend that again the next year, we could be in receivership," she said.
"We are depleting anything that we have."
Girrinbai preschool is just one of many centres bargaining for increased funding as part of the Independent Education Union's (IEU) campaign for more government funding.
IEU NSW/ACT branch secretary Carol Matthews said they had been arguing with the state government for almost two years to address the funding shortfall.
"We have set out clear grounds for that which is that increased wages is essential to maintain quality of care," she said.
She the union was specifically asking for increased funding of about 15 per cent to be tied to increased wages as staff in community preschools earn up to 30 per cent less than their counterparts in schools with similar qualifications.
"We are really hopeful that there'll be increases in the budget, but we will have to see," she said.
The NSW budget will be handed down on Tuesday June 23.
The union has been backed by the Fair Work Commission recommendations and the parliamentary inquiry into the early childhood sector to revise Start Strong funding for community-run preschools.
Girrinbai parent committee president Kate McGregor said she was worried about the sustainability of community preschools.
"Every year it's a fight to pay teachers, let alone keep the building up to scratch," she said.
"I see the wonderful time that my son has at the preschool, he just loves it."
Ms McGregor has been looking for ways to fund the roof replacement, and has applied to local ClubGrants, which she would hear back from in August.
