CEY1350

Written evidence submitted by Ark Start, a venture of Ark

1.              How affordable and easy to understand is the current provision of childcare in England and what steps, if any, could be taken to improve it, especially in relation to families living within the most deprived areas in England? 

It is widely acknowledged that childcare costs are among some of the highest in the developed world.  According to Business in the Community research findings, In England the median weekly take-home pay of a working-age adult is £418. Nursery for a child under two years old costs £274 per week, which is 65% of one parent’s weekly median take-home pay. However, despite these high costs, parents struggle to find good quality provision close to where they live. Access to high quality childcare and early education in England is a postcode lottery. Location really matters as proximity of childcare is a big factor in parents being able to use childcare.

One of the aggravating factors here is that government subsidies make it largely untenable for providers to operate in low-income communities and offer affordable rates. NDNA, the has tracked nursery closures since the 30 hours policy was introduced in 2017. During the summer term April to July 2022, 65% more nurseries have closed compared with the same months in 2021. More than a third of closures were in the 30% most deprived boroughs, with 15% of closures in the 10% most deprived wards. This compares to just 8% of closures in the 10% most affluent parts of the country. Until these issues are addressed, many more providers will have no option but to close their doors and no-one will replace them.

There is a real imbalance in terms of who provides childcare where. Private and voluntary providers deliver 69% of places in the least deprived areas but only 34% in the most deprived.  Schools are the majority provider in the 30% most deprived areas, acting as provider of last resort when the market fails. 80% report having to subsidise their nurseries from elsewhere in the budget to cover the shortfall in government funding.

Additional funding is required but the market should also be reformed to ensure that funding is spent on what is needed: more qualified, better paid staff who will increase the quality of provision. This could be done through regulation: for instance, increasing requirements on staff qualifications; or setting fair pay levels for receipt of government funding that are higher than minimum wage.

We have worked with a number of organisations and not-for-profit providers to propose alternative funding models that we believe would better serve middle and lower income families as well as those children from the most disadvantaged communities. See the full report here.

 

To incentivise the market to deliver affordable places in and for more disadvantaged communities, we are also advocating for a differentiated funding model where funding is targeted more steeply towards disadvantaged children. A 33% weighting for children of families earning less than £23k would cost an additional £0.46b. 

Widening access to high quality childcare could also be improved through commissioning. For instance, by funding local authorities to develop non-profit trusts  or new organisations built out of existing social enterprises or maintained nurseries. Ark, our Multi- Academy trust has, used philanthropic funding alongside government allocations to pilot a model for affordable, high-quality childcare in low income communities by opening 2 nurseries. This kind of activity could be promoted elsewhere by offering capital funding and additional funding top-ups to offer provision in lower income areas and to offer a proportion of funded-only places. The IPPR recently made a series of recommendations related to these issues here. To support the expansion of these types of organisations, the DfE and local authorities could:

 

2.              Are the current entitlements providing parents/carers with sufficient childcare, and to what extent are childcare costs affecting parents/carers from returning to work full-time?

The DfE has acknowledged its own under funding of the 3-4 entitlement for working parents, the allocated funding only covers 2/3 of the actual cost of delivery.   Nurseries have to charge at a much higher rate for children under 3 to offset the loss made on 3-4 year olds and charge higher rates for “extras” and any additional hours. This drastically increases the cost of childcare in the earliest years where there are more perceived barriers to a return to work full-time. The impact here would be more profound in low income communities work remains one of the best routes out of poverty for families with children.  According to the Department for Work and Pensions (DWP), 74% who gain full-time employment move out of relative poverty.

The cost to the economy of inaccessible and expensive childcare is huge. 50% of non-working mothers say they would prefer to work if they could get appropriate support. Illustrative analysis from IPPR shows the kind of economic benefits that could accrue from more parents – particularly mothers – being able to work when their children were pre-school age. If mothers of younger children were able to work at the same level as when they were older it would add around £6bn a year to the exchequer through extra tax take. On top of this it would also reduce the welfare bill by increasing family incomes. Families with parents in full time employment and far less likely to require universal credit support.

Finally better childcare provision would help with the ongoing gender pay gap which is stable until the arrival of the first child and then gradually rises over the next 12 years, up to 33 per cent.

3.              Whether the current Tax-Free Childcare scheme, and support for childcare from the benefits and tax credit system, is working effectively or whether these subsidies could be better used within other childcare subsidies   

No response

Section Two: Early years provision

4. What challenges do early years providers face in terms of workforce, including recruiting, and retaining qualified staff, and the barriers faced by individuals joining the profession? To what extent has the Covid-19 pandemic exacerbated workforce challenges?  

Thousands of nurseries have closed in the last few years, and the ones that have stayed open have had to reduce costs. The effect of this has been to reduce very significantly the number of qualified people working in the sector as so many staff are paid at minimum wage. The numbers with level 3 qualifications, equivalent to A-levels, fell from 83% in 2015 to 52% in 2019. There is also a big shortage even of unqualified staff as supermarkets and other retailers pay higher wages. 94% of Local Authorities have reported difficulties recruiting qualified staff. Ark itself   Ark is not immune to these issues. Despite higher than standard wages and improved benefits as well as investment in CPD, we remain under-staffed in both nurseries. As well as putting additional pressure on existing staff, under-staffing means we are unable to open more classes and are holding a waiting list at both sites.

44% of staff are accessing some kind of benefit themselves. The extent to which it makes economic sense for them to work, especially if they have to pay towards their own children’s care is often limited.

Recruiting and retaining staff is made all the more challenging by the fact there is limited opportunity for professional development and progression. At our two Ark Start nurseries which are supported by philanthropic funding, we have made CPD integral to our approach but most providers can’t give staff any non-contact time for learning and development. We support our staff to gain qualifications and even achieve qualified teacher status which can dramatically improve their prospects and salary but despite the attractiveness of our offer we still struggle to recruit.

Working in Early Years education and childcare is considered a low status profession involving challenging work and a great deal of responsibility vs other jobs young people perceive to be easier, better paid and more flexible available.

5. Whether the Early Childhood Education and Care (ECEC) system is meeting the needs of pupils with Special Educational Needs (SEN), and the improvements that could be made to better support young children with SEN within early years provisions 

According to the Education Policy Institute Children living in the most disadvantaged areas of the country are less likely to be formally recognised as having SEND than similar pupils in more affluent areas, highlighting how there is a “rationing of support” in many areas of high need. At Ark Start where we have more specialist knowledge, we have been able to secure additional funding and support but most nurseries lack access to trained SENDCO’s and the ability to draw down additional funding. These skills are something that could potentially be shared across settings, although this would require co-ordination or if schools we better funded in this regard it might be possible for them to do outreach work to local providers.

As the Green Paper on SEND provision recognises, more trained SENDCo’s working in early years would be beneficial and the quality of SEND provision varies greatly by local authority.

6. To what extent does the early years system adequately prepare young children for their transition into primary education, particularly children from disadvantaged backgrounds

Our experience is that children who attend nursery are better prepared for school

There are clear educational benefits from attending high quality early years provision. 2-3 year olds who do so are 8 months ahead developmentally of those who don’t attend nursery. And the benefits stick throughout schooling: they are 20% more likely to get 5 good GCSEs. Given the relative costs of trying to improve outcomes when young people are further through their education it makes sense to make as much possible ground early on in their lives.   It's early days but reception teachers have reported the smooth transition children at our Ark Start nurseries have made into Reception. High quality early years provision helps disadvantaged children the most. 40% of the disadvantage gap at 16 is already present at aged 5. Focusing additional support on lower incomes areas would, again, reduce the cost of trying to narrow this gap later.

Reception teachers are reporting increasing numbers of children are arriving in Reception ‘not-ready’ to thrive: Kindred2research suggests that on average 50% of children are not ready when they start school and worryingly the gap in outcomes between the most disadvantaged 5-year-olds and their peers rose to 32.4% in 2019

7. The extent to which the reduction of Sure Start Children’s Centres has affected children and families, particularly children from disadvantaged backgrounds, and the role of Family Hubs 

There is value in central places that help parents navigate local services, access direct help and support and get advice about childcare options. Take up of the funded hours at 2 would perhaps be higher if families felt consistently connected from birth to children starting their early education. At present most experience brief interaction with health services only to then disappear off the radar until much later in the child’s life.

Katie Oliver

Director, Ark Start

January 2023