Costs and benefits of free childcare, House of Commons, 19 February 2019

As providers seek to offer children spaces within the current funding constraints, there is a risk to provision for disadvantaged two-year-old children and those with special educational needs and disabilities (SEND), for whom provision is more expensive.


Key messages

  • Effective, high quality early years provision makes a difference to young children, helping to break the cycle of disadvantage, improving social mobility and offering them a good start in life.
  • Recent changes to early years provision, including the 30 hours free childcare scheme for working families, are positive. The current funding rates are insufficient, this is risking both the sustainability of many providers and the sustainability of high quality provision. Research suggests that the deficit between the cost of delivery and funding paid via local authorities has grown to an average of £2,166 per year per child.
  • As providers seek to offer children spaces within the current funding constraints, there is a risk to provision for disadvantaged two-year-old children and those with special educational needs and disabilities (SEND), for whom provision is more expensive.
  • Highly qualified staff improve the quality of nursery settings. Unfortunately many councils are concerned about the quality of staff in their local areas, citing issues with pay, professional development and career progression when it comes to recruiting and retaining high quality staff. Increased wages are difficult for providers to offer at a time of significant funding constraints.
  • Maintained nursery schools (MNS) offer an exceptionally high standard of education and support disproportionately high numbers of disadvantaged children and those with SEND. The supplementary funding provided to enable them to do this ends in 2019/10. We are calling on the Government to extend the supplementary funding into 2020/21. This will provide certainty to providers while a sustainable solution is found as part of the Spending Review.
  • The new Early Years National Funding Formula (EYNFF) reduced the proportion of the early years funding block that councils could retain for central services, including support for providers and families. This is resulting in less outreach work to encourage take-up of childcare and less training for early years staff.

Download the full briefing
Costs and benefits of free childcare, House of Commons, 19 February 2019