Ministers knew early years was underfunded

The funding rates paid to local authorities for the so-called ‘free childcare’ offer are just two-thirds of what the government itself estimated would be needed to fully fund the scheme.

This is according to the Early Years Alliance, who has analysed Department for Education data and found that civil servants estimated that the cost of a government-funded early years place for three- and four-year-olds would cost an average of £7.49 per hour by 2020/21.

By contrast, the average rate paid to local authorities is currently just £4.89. That’s a shortfall of £2.60 per child, per hour for every 30-hours place – or £2,964 a over the course of a year.

The documents obtained also reveal that ministers were aware that the inadequate levels of investment proposed would result in higher prices for parents of younger children and that many providers would be forced to use maximum statutory adult-to-child ratios in order to remain viable.

Neil Leitch, chief executive of the Alliance, commented: “For years, the early years sector has warned that the so-called ‘free entitlement’ offer is anything but free, in the face of repeated government claims that the policy is adequately funded. These documents, which they spent more than two years trying to hide, prove otherwise.

“The early years of a child’s life are critical to their long-term learning and development – and yet ministers have been all too happy to force providers to work to maximum ratios, inevitably reducing quality, in order to save the Treasury some money.

“For so long, the government has tried to deflect the blame for rising childcare costs. But these documents prove, in black and white, that it knew that the introduction of the 30-hours policy, along with an insufficient level of investment, would result in higher costs for parents of younger children.

“Early years providers and parents have had enough of being forced to pay the price for this underfunded policy year after year. There is still time for the government to do the right thing, but at this point, the only way for it to maintain any credibility with parents and early educators is by agreeing to a full review of early years policy in this country. That means delivering the substantial investment the sector needs in the upcoming Spending Review. Only with fair and adequate funding will we ensure nurseries, pre-schools and childminders can continue delivering the quality, affordable care and education that children and families both need and deserve.”