Best Start’s tax-free proceeds help repay $332m sale to owners’ own charity

Summarised by Centrist

New Zealand’s largest childcare operator receives about three-quarters of its revenue from government funding, while its tax-free proceeds have largely gone towards repaying the wealthy owners who sold the business to their own charity, the NZ Herald reports.

Best Start Educare generated $420 million in annual revenue, putting its government funding at roughly $315m. It sits within the Wright Family Charity Group following a 2015 sale financed through a $332m loan from Wright family private interests.

By March 2025, that loan’s outstanding balance had fallen to $83m. The Herald estimates that clearing the remaining debt could free up more than $30m in annual cash flows for the charity’s education and health work.

The payments described are repayments of the loan used to purchase the business.

Across 174 large charities, the survey found 1,320 key management personnel received $271m annually, averaging about $205,000 each. Average executive remuneration rose 5.5%.

However, the rankings divide management remuneration by reported full-time equivalents. They do not necessarily represent individual salaries or pay rises, and restructuring can distort comparisons.

Other entries reveal substantial costs alongside charitable distributions. The Crown-funded Waikato River Authority reported $4.1m in operating expenses against $5.1m in grants. Ngāti Whakaue Endowment Trust distributed $1.7m while incurring $1.4m in administration expenses.

Charities Services director Charlotte Stanley said: “There is no salary cap for charities in New Zealand.”

The regulator’s guidance is that payments must be reasonable and no higher than market rates. Responsibility ultimately rests with boards and trustees.

Read more at The NZ Herald (paywalled) 

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