Member for Northern Tablelands Adam Marshall said he's spoken to preschool directors who say their enrollment figures have dropped because farming parents have slashed childcare expenses like fees and travel.

He made the comments while announcing a new drought relief subsidy with education Minister Sarah Mitchell in Tamworth today. Childcare centres across the region will receive around $9000 a pop in the program, provided through the larger drought support package.

The funding will provide $5.2 million in subsidies to early childcare centres in droughted communities statewide.

"This is the first time the State Government has expanded the Drought Relief funding to long day care centres as well as community preschools, because the drought doesn't discriminate based on the type of service a child attends," Mr Marshall said.

"I think this is a great initiative to help our youngest students and their families continue to access the education in the years that are most crucial to a child's development."

Each childcare centre will determine how to spend the money. They could choose to rent a bus service to help parents access local services, or simply use it to reduce fees. The formula for funding is based on severity of the drought and number of enrolled kids.

"What is important about this measure is services have the flexibility to spend the funding as they wish, within the guidelines, depending on what support would be most beneficial to each preschool's families," Mr Marshall said.

"For a typical preschool in the Northern Tablelands, today's announcement means a funding boost of around $9,000 from August, all of which will go back into the pockets of young families.

"I have spoken to preschool directors who have told me their children numbers are fluctuating because farming families are cutting back on their expenses and now can't afford the cost of travel or preschool fees.

"This support allows preschools and long day centres to assist families and children in a range of ways, including travel arrangements to maintain participation in early childhood education, crisis planning or fee subsidies to further support families.

"I know that the drought not only impacts farmers but also regional communities as a whole, and that's why the NSW Government has delivered a holistic record package that also provides much needed support to our local businesses and services."