This new streamlined funding initiative strengthens the role of Aboriginal Community Controlled Organisations (ACCOs) and advances self-determination in early childhood education.
What is changing for ACCOs
From 2026, ACCOs will benefit from increased funding of $5.3 million over four years. The increased funding will help enable ACCOs to deliver programs tailored to the needs of their communities.
ACCOs delivering funded kindergarten programs will receive a new increased and streamlined funding rate. This will provide more certainty and greater flexibility in using funding. The new ACCO funding rate will incorporate all other kindergarten funding streams. ACCO services will receive a single per child rate that comprises the maximum rates for:
- Per capita funding
- Free Kinder
- Early Childhood Teacher Supplement
- Ratio supplement
- School Readiness Funding (SRF).
ACCOs will also receive minimum funding equivalent to 18 enrolments. This is for both sessional and long day care kindergarten programs at ACCO-managed services.
Funding amounts under the new initiative
The 2026 ACCO funding rate will be $14,839 per child for a 15-hour program. Funding is pro-rated based on each child’s enrolled hours and additional Pre-Prep hours. Each additional hour of Pre Prep is paid at $989.27 per hour.
ACCOs will also receive the 2025-2026 SRF payment (representative of 25 per cent of the 2025-2026 allocation amount) as one-off funding. This will help assist with the transition to the new ACCO funding initiative. ACCOs will receive this funding in the second half of 2025.
How to access this new funding rate
ACCO services are not required to opt-in to this initiative. Funding is based on Arrival enrolment data and paid automatically.
Approved uses for the new funding
The new funding for ACCOs must be used for the delivery of kindergarten and Pre-Prep programs and supporting activities. There is more flexibility in how it can be spent, but it must be in line with service agreement and kindergarten funding guide requirements. This can include specialist programs, supporting access and participation, parental engagement and directly reducing parent fees through Free Kinder.
Specific examples of how funding can be used include additional staff time, cultural and language programs, building connections with other early childhood and family services and outreach activities. This will be a decision for each ACCO and their community.
While Free Kinder is no longer a separate funding stream, this benefit is required to be passed on to families. Sessional kindergarten programs should be free for all children. A minimum fee offset equivalent to the sessional Free Kinder rate (pro-rated for enrolled hours) should be applied for kindergarten enrolments in long day care settings.
In Victoria, Free Kinder is an allowable third-party payment under Commonwealth funding rules. This means that Free Kinder does not impact a family’s CCS entitlement. It also means that long day care service providers must apply the Free Kinder offset to each families' fees after CCS has been applied.
Accurate records of funding expenditure must be kept and can be requested by the department.
ACCO enrolment funding
The new per-child rate will apply to all children enrolled in a funded kindergarten program at an ACCO-managed service.
This funding setting does not change the number of hours of kindergarten a child is eligible for.
In 2026, children will only be eligible for additional Pre-Prep hours if they meet the requirements for the geographic roll out or the 2026 priority cohort eligibility.
For example, non-Aboriginal children attending an ACCO-managed service who are not part of another 2026 priority cohort (children known to child protection and refugee and asylum seeker children) will not have access to funded additional Pre-Prep hours before it becomes available in their area.
Funding is pro-rated based on each child’s enrolled hours and additional Pre-Prep hours.
School Readiness Funding (SRF) plans
SRF will no longer be a separate funding stream. It’s now part of the new per child funding model, so there is no need for a separate SRF plan.
ACCO services can continue to use items from the SRF menu if they meet the needs of the community. For 2026, ACCOs are encouraged to continue using their current two-year SRF Plan but are not required to acquit this.
The department will continue to work in partnership with ACCOs to offer support and ensure services meet core kindergarten funding requirements.
Alignment with the Pre-Prep rollout
In 2026, First Nations children will have access to up to 25 hours of Four-Year-Old Kindergarten through the roll-out of Pre-Prep, no matter where they live in Victoria.
In line with these arrangements, the ACCO per-child rate will be pro-rated based on each child’s enrolled hours, in line with Pre-Prep arrangements
Services can check the Pre-Prep rollout schedule to see when Pre-Prep becomes available in their area.
Available support for ACCOs
To support ACCOs and facilitate collaboration around the roll-out of Pre-Prep, the department has engaged the Victorian Aboriginal Education Association Inc (VAEAI) and the Secretariat of National Aboriginal and Islander Child Care (SNAICC).
The department’s Early Childhood Improvement Branches (ECIBs) will continue to provide support and advice to ACCOs delivering kindergarten programs. Like all providers, ACCOs are expected to stay connected with their local ECIB for ongoing guidance and updates.
ACCOs should also continue to seek additional, targeted supports where needed for individual children. This includes Kindergarten Inclusion Support and Preschool Field Officers for children with additional needs.
Updated