CEY1009

Written evidence submitted by Child’s Play Pre-School

Introduction

We are an independent, single site pre-school based in Guildford, Surrey.  We are open term time and school hours.  We are submitting evidence as we feel that the organisations representing the sector do not always fully represent our views.  The large corporate providers tend to have most influence on policy making when the small PVI providers are the backbone of the sector.

We have been operating for 14 years and we have never known things to be as bad as they are now.  We are struggling financially which is a combined effect of unsustainably low funding rates and a significant reduction in the number of children on roll – we suspect the current economic climate is having a bigger than normal impact on families deciding to send their children to pre-school only when they qualify for the free hours.

Affordability of current provision

It is often said that childcare in the UK is incredibly expensive.  But that statement needs some qualification.  When talking about this it is generally with reference to children below the age of universal free hours eligibility – so under 3’s.  Our hourly rate for a two year old is £6.80 which I do not think it is expensive given that we are looking after someone else’s child and we have to provide this care and education with a ratio requirement of 1 adult:4 children.  But I appreciate that some providers have much higher rates and that when this is factored over a full week of care, it adds up to a considerable amount.

It should also be stressed that costs for under 3’s are more expensive than they would otherwise be, because of the gross and unsustainable under-funding of the free hours. Providers effectively cross-subsidise the underfunding by charging parents of younger children, or those taking additional hours, more.  When the 15 hours was first introduced, the funding rate was reasonable.  Since then, funding increases have generally been below inflation, year on year, with increases of only pennies or often nothing and consequently the hourly rate is now massively below the level needed for sustainability. 

We are currently paid £4.87 per hour for a three/four year old.  We are paid £6.13 for a funded two year old. 

To give you an idea of how that has changed over time:

-          When 15 hours was introduced in Sept 2009 as a pilot (which we were part of) the rate was £3.78.  The policy was then rolled out to all settings nationwide in Sept 2010 which was accompanied by a decent increase to £4.03.

-          Over the following 6 years (Sept 2010 – Sept 2016), the rate rose by only 3% to £4.15

-          The following year, in April 2017, it was increased by just under 9% to £4.51 when the 30 hours was introduced.  This was very much a one-off “sweetener” to the sector but was a much lower increase than we had been led to believe we would be given.

-          Over the last 5 years (April 2017 – April 2022), it has risen by 8% to the current level of £4.87.  In a recent response to a petition on funding rates HMG said for 2022/23 LA’s received an extra 17p per hour for 3 and 4 year olds.  In Surrey, we were given 9p an hour increase for 22/23. 

-          We do not yet know what our funding rate will be from April 2023 – we generally find this out right at the last minute (sometimes actually at the start of April) which makes any kind of financial planning impossible.

When you get evidence from HMG on funding, please do not let them get away with the usual obfuscation – “we put £X billions into childcare last year” etc – that is just meaningless without drilling down to the hourly rate paid to providers.  They usually blame LA’s for not passing on the full amount – again that is obfuscation.  And can you ensure that they address the “normal” rate.  Often, when a Minister does get pressed on hourly rates, they quote a rate including the EYPP/deprivation payment which is grossly misleading as very few children receive this amount.

If parents realised that settings receive less than £5 per hour for the free hours, they would begin to see where the problem lies.

Effectiveness of current funding entitlements

Overall, I think the recent comment – I can’t remember who made it - that the various different offerings for early education/childcare were “incoherent” hit the nail on the head.  There are a multitude of different schemes, all aimed at different groups, and administered by different parts of Government.  It is a mess, and it needs a complete overhaul to make it simpler and more coherent.

There are two issues which are conflated – early education and childcare.  They are different things and while education is clearly a Governmental responsibility, it is for the current Government to decide if it thinks childcare comes under the role of the state.  I would argue that everything aimed at up to 2 years old is childcare.

15 hours for three- and four-year-olds

This scheme is easy to understand, easy to administer and available to all children for a start at any point during the year.  For example, if we get a child starting mid-way through the term, they can easily claim their free hours from the day they start. 

The main issue I have with this scheme is that it discriminates against summer born children.  Autumn born children get 5 funded terms; summer born only get 3.  The Government gets round this by arguing that summer born children are not required to start school until the summer term when they turn 5, which would give them 5 terms of early years.  While that is theoretically correct, in practice the overwhelming majority of children start school in the September of the year they turn 5 so, de facto, they only get 3 terms of funded early years.

Recommendation : give all children 5 funded terms in early years settings.

30 hours

This is a disaster of a policy.  Applications have to be made to HMRC in the term prior to the funding starting.  That works fine in the scenario where both parents are already in work in the term in which their child turns 3.  In that case the 30 hours will be available to them from the term after the child turns 3 and they will get their full entitlement.  So, it is probably a good benefit to those already in work.  But, because of the time lag in getting the funding I don’t see it providing an actual incentive to work, especially for those in low paid, or erratic, work.  For example, if a parent of a 3 or 4 year old gets a job in, say, September, they will only be eligible for the additional hours from January and will have to cover the childcare costs themselves in the intervening period. 

And the fact that household income can be up to £200K and still qualify is quite simply appalling. I don’t know what the thinking was behind allowing such a high-income threshold.  Families with such high incomes can afford all the childcare they need.

2-year-old funding

We get a few funded two-year-olds each year, but it is variable.  There is a general problem with low take up of the scheme: someone in Government knows who the eligible children are but I don’t think parents are contacted directly to persuade them to take up places. 

It would be better if the funding were universal for all two-year-olds.  This would remove any stigma from taking up places, which are currently aimed at only the most deprived children.  It would also help the Summer born children – they would still receive less funded terms than Autumn born but the differential would be comparatively less than it is at the moment.

EYPP/Deprivation payments

The same problems apply as for funded two-year-olds re low take up: parents must identify themselves to providers by completing a form to allow us to claim EYPP – many don’t complete the form which means we can’t claim funding.  We get one or two EYPP children, but we never know from one year to the next how many we will have.  They are the only children who are adequately funded.  In our view, children who qualify for EYPP would be better served by giving them an automatic entitlement to 30 hours, rather than an additional payment to providers.

Tax-Free Childcare

We only ever have a handful of families using this.  We make our families aware of the scheme when they join us but often that is the first time they have heard of it.  It clearly isn’t being widely advertised to new families.  We used to get lots of families using the workplace childcare voucher payments which Tax-Free Childcare replaced.

Childcare support for families on Benefits

This scheme would seem to be a good idea, but I have read that uptake is low.  I would suggest that this may be because it requires parents to pay childcare costs up front and then re-claim from DWP.  I currently have a family who have been waiting 8 weeks to be paid by DWP, which is ridiculous.  They have now, consequently, stopped using the scheme.  It would be much better if payments could be channelled directly to providers.

Proposed improvements

I would suggest getting rid of all the peripheral offerings and have one central offer, administered by DfE along the following lines:

- 15 hours to all two year olds

- 20 hours to all three year olds

- 30 hours to all four year olds; alternatively 30 hours to all three and four year olds

This would be an increase in the offer for parents and would help settings.  If we work on the basis that the Government are not going to radically increase the hourly funding rate, then the next best thing is children taking more hours.  At the moment, parents tend to only take the free hours and to start their children when the free hours kick in.  So, more hours and an earlier start date would help providers like us.  But it needs to happen urgently - we are struggling to remain viable at the moment.

For children in the most deprived households, rather than paying a financial top up to providers I would suggest an enhanced number of hours.  So, an automatic 30 hours for all deprived children aged two and above.  Additionally for children below the age of two there does need to be some help with childcare costs so parents on benefits can work.  I don’t think the current DWP system works well enough for this, so it needs a re-think.

A key problem in finding a way forward is the diverse nature of the sector.  There are Childminders, schools, term time pre-schools, and year-round full time day care.  We are all different: we serve different markets, and we have different perspectives on what is needed to change.  A one size fits all policy is unlikely work for everyone.

Workforce challenges

We lost a key member of staff at the end of the summer.  We can’t afford to replace her at the moment, and we know that recruiting a qualified person will be nigh on impossible.  We already have one unqualified member of staff.  She is excellent – an ex-parent of ours who we recruited once her youngest child had left the setting.  She is highly qualified - a graduate - but has 3 children and is not persuadable to do the early years training.  So, we could not employ another unqualified staff member because of the strait jacket of qualifications ratios.  But the term “unqualified” only relates to the official childcare qualification.  She is First Aid trained; has completed the Local Authority induction training; is up to date with Safeguarding training; and does a range of CPD training on child development.

In early years the best staff have that “certain something” that no amount of training can give you.  Working with small children requires the “right person” more than the “right qualification”.  I would like to see some flexibility in the ratio requirements to enable settings to employ, and have included in ratios, a percentage (maybe 10%) of “unqualified” staff, if they have core training in First Aid, Safeguarding and understanding the EYFS.  That would go some way to help us with the current workforce challenges.

Does the current system meet the needs of SEND children

I can only answer this according to our direct experience of the system, and I would have to say that, while not perfect, the system has worked fairly well for us.  Over recent years we have been able to access the necessary support for children we have identified as having SEND needs and we have been able to secure places in specialist provision on several occasions when that has been appropriate.  It does take a long time to get diagnoses – but that is, to a large extent inevitable.  You can’t diagnose, say, autism in a 3- or 4-year-old by a visit to the GP. 

The main problems we encounter are around timing.  To secure diagnoses and secure the right support package etc in good time for starting school is sometimes difficult.  This is especially the case with summer born children.  As stated earlier, summer borns only qualify for free hours from the September of the year in which they turn 4.  So, they may only have one year in early years (unless parents have paid for an earlier start).  That does not usually give us enough time to identify issues and secure additional support in time for the following September when they will start school.  So, they will sometimes have to start school without additional support being in place.

If all children were given at least 5 terms of free hours that would help us to get SEND provision in place for all children in time for school.  It would also help if more flexibility was given to children with SEND to delay their school start date while their needs are being assessed. 

Does the current system adequately prepare children for school?

This is best addressed by schools but the feedback we receive from local schools is that our children are generally well prepared for school.  To repeat the same point however, it is the Summer born children who we find are most likely to be the ones who may not leave us fully school ready; that is because they have often only had one year of pre-school.

Proposals to relax staff:child ratios

I am in favour of a relaxation of the current rules.  If the rules have been relaxed in Scotland without detriment, then I don’t see why we can’t at least adopt the same. 

I would also be in favour of a more flexible approach.  We may sometimes have a need to go out of ratio for a short amount of time so a member of staff can, for example, take a zoom call with SEND advisers or complete some paperwork.  But the current rigid rules prevent that, and we don’t always have cover available.  We once had a situation where for a half hour period over lunchtime we would have been slightly over ratio because we had a couple of two-year-olds.  These children were actually almost three and when we asked Ofsted if there was any flexibility given the short period of time involved and the ages of the children – we were just told we must comply with the statutory requirements.  So, we had to turn a couple of children away to keep within ratio.

There is a world of difference between a just turned two-year-old and an almost three-year-old, yet they are treated the same.  Some pre-schools will only take children over 3 years old because of the onerous 1:4 requirement for two-year-olds.  We routinely risk assess certain children who we feel need closer supervision – and this is not always related to age. 

To be honest, I’m not sure what the best way forward is but maybe starting the 1:8 at age 2½ (30 months) rather than age 3 would be a compromise.  It would help settings financially and would ensure the youngest children are kept at 1:4 ratios.  At the end of the day, if ratios are relaxed, it will not be a requirement to work to these ratios.  Indeed, we often have a much higher staff: child ratio than is required as we have a minimum staffing level which we feel is necessary, even if we don’t have the number of children to financially sustain that level of staffing.  So those settings which are opposed to changing ratios are not obliged to do so.