The Truth Behind Those 30 Hours of Free Childcare

By Sue Cowley | May 13, 2016

Childcare and parenting author Sue Cowley is a leading teacher trainer and chair of her local preschool committee. Here she gives her views on the governments plans to increase the number of free childcare hours to 30 a week and what this could mean for nursery settings:

Early education is a perennial hot topic, because it is widely acknowledged that what happens during the early years is vital for children’s life chances, and for their later educational success. Access to affordable childcare is also crucial for those parents who need or want to go back to work while their children are still young. It is in the early years that a child learns language, develops key physical skills and builds psychological and emotional resilience. The Foundation Stage is the time when the foundations are being laid for all the learning that a child will do as he or she grows up. The first five years are a critical phase.

From the early 1990s, there was an ongoing rise in the demand for childcare in the UK. This was prompted in part by an increase in the number of women going back to work while their children were young. In 1998 the New Labour government launched the first National Childcare Strategy, aiming to increase the number of parents in employment, to reduce inequality and to improve child development. The Labour government also began the Sure Start initiative, designed to impact on a child’s life chances from the earliest age. As we moved into the 21^st Century, it seemed that politicians had finally accepted the importance of high quality early years provision.

To put it in plain terms: if the money settings receive from fees and from government funding is not equal to their outgoings, then settings will close.

But still childcare policy in England is confused and fragmented – there is not enough joined up thinking to create a coherent offer, nor enough funding to make the policy work well. The Conservative/Liberal Democrat coalition increased the amount of free childcare hours that parents could access, and brought in funding for two year olds from disadvantaged backgrounds. However, this was done alongside the largescale closure of Sure Start Centres, which supported families of young children, especially in deprived areas. At the preschool I help to run, the gradual increase in the amount of funded time has allowed us to extend our opening hours. It has put us on a far surer footing than previously – we no longer have to rely on fees and fundraising to survive. But the funding rate has remained stagnant for far too long, while our costs keep rising. And the government’s latest policy, that offers 30 hours free childcare to some working parents, could prove a step too far.

There are two key problems with the policy of 30 hours that must be addressed, if the Government is to have any hope of providing the number of childcare places that parents require. These issues are supply and sustainability. In a market, supply of a product or service generally increases in response to demand. Because demand for childcare has historically been in places where parents went out to work, and could afford to pay childcare fees, the supply that has developed is patchy. In some areas there are lots of private, voluntary and independent (PVI) settings; in other areas state run nurseries and infant schools provide the majority of early years care. Schools still only make up a tiny proportion of the early years sector, though – the vast majority of babies and young children are in PVI settings.

As more children have gained access to funding for early education, including 2 year olds from disadvantaged backgrounds, the demand for nursery spaces has increased. But because childcare provision is not directly controlled by central government, it has no mechanism for making sure that this happens in the places where it is most needed. Many full daycare settings do not have the space to offer more places – there are already waiting lists in areas where childcare is in high demand. With the 30 hours policy doubling the amount of free childcare that working parents can access, this will put even more pressure on supply. While there may be spaces available, the spaces are not necessarily in the locations where they are needed.

 

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Ironically, in places where there is less demand for full time childcare, the increase to 30 hours might be the straw that breaks the camel’s back, and that causes settings to close. Many voluntary run settings like the one I run are open for less than 30 hours a week, because most parents in our area only work part time, and do not want than 15 or 20 hours childcare. If we were to open for 30 hours, this would increase our running costs, but it is unlikely to increase the number of children who attend our setting. One solution would be for settings like ours to work in partnership with childminders, to offer the full 30 hours. Unfortunately for the Government, there has been a massive decrease in the number of registered childminders over the past five years.

The parents of babies and children who have not yet qualified for nursery funding are effectively subsidising the children who receive ‘free childcare’

The second key issue, sustainability, is a big worry for settings. To put it in plain terms: if the money settings receive from fees and from government funding is not equal to their outgoings, then settings will close. Funding has not increased for a number of years now, while the cost of running a setting has continued to rise. Rent, utilities, resources, staffing – there have been cost pressures in all of these areas. With the introduction of the Living Wage, and the new Automatic Enrolment Pension scheme, costs are rising even further. Government funding simply does not cover the cost of the children it is meant to pay for. Because of this, settings have had no option but to increase the fees they charge to fee-paying parents. The parents of babies and children who have not yet qualified for nursery funding are effectively subsidising the children who receive ‘free childcare’. This is the reality behind the stories of ‘expensive childcare’ that regularly appear in the media.

In its recent review of childcare costs, the Government talked about how providers should utilise statutory ratios to make settings more sustainable. What this translates to is settings using the statutory ratio of one adult to thirteen three and four year olds, rather than a higher number of adults to children. At many settings, providers refuse to use the Government’s statutory ratios. We do not feel that it is possible to provide high quality childcare with such high numbers of children to adults. Because we are independent from Government, we do not have to use their statutory ratios. We choose to prioritise parental views about what is best for their children, over Government views on how we could lower our prices.

You simply cannot have ‘champagne childcare’, if you are only willing to offer ‘lemonade funding’.

Although the Government has promised an increase in the hourly rate for the 30 hours offer, the details of what this will actually look like on the ground are sketchy. At present, there is a pilot of the 30 hours offer under way. Recently, though, providers have pulled out of the pilot in York, saying it was not sufficiently funded, and that it is therefore not sustainable. If all providers in an area refuse to participate and to offer 30 funded hours, this would make the policy completely unworkable. What, then, is the answer to a policy that is currently in crisis? First and foremost, it is vital that the DfE listens to providers, and that they give us information in sufficient time so that we can react to changes. Settings need to know right now, how the promised funding increase will translate to an hourly funded rate. The DfE needs to look at how it can encourage childminders back into the system, so that parents have flexible ways to access their 30 hours entitlement. And they need to accept that you simply cannot have ‘champagne childcare’, if you are only willing to offer ‘lemonade funding’.
References

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EYFS Developmental Milestones – Download Free eBook

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