Warning over impact of government policy on childcare provision

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The Education Policy Institute (EPI) has published new research on the impact of government policies on the take-up of different childcare entitlement groups and on the total number of funded places.

The report focuses on whether changes to entitlements have resulted in some groups being prioritised over others. It reveals that in some local authorities (LA) the take-up for disadvantaged two-year-olds fell, or increased less, in areas with a higher number of children using the 30-hour scheme.

The main findings of the report are as follows.

  • There is a possible trade-off in provision between the take-up of the entitlement for disadvantaged two-year-olds and the take-up of the 30-hour entitlement. While there is wide variation across LAs, the difference in delivery costs for two-year-olds and three and four-year-olds could explain the decision of some LAs to prioritise places.

  • There is no clear connection between the take-up of 30 hours and the change in the supply of places.

  • There is no evidence that changes to funding rates have impacted the take-up of 15 or 30 hours in the short term.

Purnima Tanuku OBE, Chief Executive of the National Day Nurseries Association (NDNA), said:

“This latest report from the Education Policy Institute (EPI) is further evidence of the unintended impacts of the 30 hours policy.

“Time and again we have highlighted the difficulties providers are facing due to rising costs against a backdrop of stagnant Government funding.

“Our latest findings show that 87% of providers cannot cover their costs for the 30 hours offer while 54% do not meet their costs on the hourly-funded rate for two-year-olds. This will only get worse next year with unfunded increases to minimum wage on top of inflation. Clearly, chronic underfunding is limiting the positive effect this policy could have on the sector as a whole.”

The full report is available here.

Last reviewed 4 February 2019

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