Education: Early Years

Baroness Warwick of Undercliffe Excerpts

Wednesday 29th November 2017 Lords Chamber

[Baroness Warwick of Undercliffe (Lab)]

My Lords, I thank the noble Lord, Lord Storey, for providing us with an opportunity to highlight, once again, the importance of early years education, one of the most important determinants of a child’s life chances. What is more important than making sure that all children are given the very best start in life? Indeed, the aim of doing so through improved childcare, early education, health and family support lay at the heart of the Labour Government’s creation of Sure Start in 1998.

I say with some sadness that I do not believe that expanding so-called “free” childcare to 30 hours a week for three to four year-olds, as it is currently funded, is the way forward. I say this for two reasons. First, I believe that an early years funding policy which focuses on subsidising childcare for working parents, rather than on child development, risks damaging the quality of early education provision. By failing to target disadvantaged families, whose children stand to gain the most from high-quality early education, I believe that we are also damaging social mobility.

My second objection stems from my knowledge of early years education from the perspective of committed, professional providers in this field. I declare an interest here as my sister is an early years professional, operating two nurseries in deprived areas of Nottingham. I have drawn on her experience when talking about early years education in this House previously, and she shared some thoughts with me before today’s debate.

A tremendous amount of research has been done into early years and into how to achieve high-quality provision. However, as a practitioner, my sister has an admirably short checklist of what is needed for its delivery: a well-qualified workforce, a comprehensive, age-appropriate curriculum, efficient management of provision, an effective inspection regime and the right resources.

This is really quite simple, but none of it is possible without adequate funding. Early years funding rates for 2018-19 show that most local authorities will not receive any additional funding next year, and that 14% of local authorities will actually see a reduction in funding. While the Government’s operational guidance for 2018-19 confirms that local authorities should take no more than 5% out of the funding that they pass on to providers—they have actually been taking more—funding is still woefully short of what is needed. Early years providers have said repeatedly that they will struggle to deliver high-quality care and education—and sufficient places—with the funding available.

I read with amazement in the FT some weeks ago that the children’s Minister, Robert Goodwill, seems to think that good-quality provision can be funded at an average hourly cost of £3.72 an hour. That beggars belief. He said that this was based on recent research. Where on earth did he get these completely misleading figures? It is not surprising that many practitioners are concerned about the sustainability of their business and believe that we need to get back to basics—to stop introducing ever more complicated ways of helping families to pay for childcare and education, and to go back to the original idea of one system of funding; that is to say, a realistic fee, paid direct to providers who are accountable to their local authority.

I suspect that many parents are actually frightened of becoming involved in the multifarious schemes, which include: funding two year-olds from deprived families for 15 hours per week; funding all three and four year-olds for 15 hours a week; since September this year, funding some three and four year-olds for 30 hours per week, in families where each parent can earn up to £100,000 per year—yet foster parents are, for some reason, excluded; and the tax-free scheme, which has been beset by problems.

Of all these schemes, the one that has worked the best and seen the greatest take-up is the original funding for three to four year-olds, with a reasonable rate given directly to the provider. As I recall, this was introduced by the then Prime Minister John Major in 1995.

The reasonable rate is the issue. As early years providers have highlighted for months, you cannot run a champagne nursery on lemonade funding. The campaigning group with that name has a very effective video, which explains simply that, if it costs you £5 an hour to deliver a service for which you are getting paid less than £4, and you are not allowed to increase the fee to cover the shortfall, you will decide either not to offer that service or to cut back on your costs, thereby affecting the quality of the service you can provide. A third option, of course, is to go out of business.

PACEY, the Professional Association for Childcare and Early Years, highlights that the “free” childcare entitlement for three and four-year-olds has been seriously underfunded in many areas, for many years. The National Day Nurseries Association has reported that 89% of private, voluntary and independent nurseries make a loss when providing funded places for 15 hours a week. It is not hard to see why. Nurseries are expected to employ graduates; pay wages above the national living wage rates, which increase at least once a year; pay contributions to employees’ pensions; pay increased business rates; serve high-quality, nutritious meals to combat the obesity epidemic; provide high-quality resources—and the list goes on. For this, in Nottingham for 2017-18 the Government set a local authority hourly rate for three to four year-olds of £4.92. Just over £4 is passed on to the provider, and there will be no increase in 2018-19. Can the Minister please give us any assurance that the Government will review the current funding rates?

Providers cannot continue to operate under these conditions. If funding rates do not increase in line with rising early years delivery costs, nurseries, pre-schools and childminders will go out of business. An Ofsted report earlier this month highlighted that the number of childminders operating in the early years sector has fallen by 26% since August 2012. What action will the Government take to tackle this decline?

My final point is on the need for a properly qualified workforce in early years—an issue raised by a number of contributors to this debate. In her 2012 review, Foundations for Quality, Professor Cathy Nutbrown says that the biggest influence on the quality of early education and care is the workforce. I believe it is crucial that staff working in the early years are highly trained, well managed and well led. They should be offered continuing professional development and enjoy the same status as teaching professionals.

Yet, as the Sutton Trust points out, we have seen the end of financial support for graduate training, the removal of the local authority role in continuing professional development, the lifting of the requirement for Sure Start centres in disadvantaged areas to offer graduate-led early education, and no movement on improving non-graduate qualifications in response to the 2012 Nutbrown review. Can the Minister at least offer any reassurance on the current proposals to remove the requirement for maintained nursery and reception classes to have a qualified teacher?

I hope that noble Lords will forgive me if I sound somewhat frustrated in my remarks today, but I have heard how practitioners feel about the funding of the 30 hours of “free” provision, and their frustration is understandable. We must recognise the true cost of providing high-quality childcare or we will reap other, longer-term costs from failing to provide this care. We need a long-term, sustainable funding settlement for providers that will offer families the affordable, high-quality childcare they need.