CHILDCARE SELECT COMMITTEE - Parliament...The Royal Bank of Scotland (RBS), Camden Council and Confederation of British Industry (CBI) – Oral evidence (QQ 140 – 154) 574 Scope,

SELECT COMMITTEE ON AFFORDABLE CHILDCARE

Oral and written evidence

Contents

4Children – Written evidence (ACC0047) .............................................................................. 7

Asda Stores Ltd – Written evidence (ACC0025)................................................................... 17

Association of Directors of Children’s Services (ADCS) and Local Government Association (LGA) – Oral evidence (QQ 122 – 139) ................................................................................. 21

Baroness Bakewell of Hardington Mandeville – Written evidence (ACC0031) ................... 22

Barnardo’s – Written evidence (ACC0054) .......................................................................... 25

Barnardo’s, Child Poverty Action Group and Joseph Rowntree Foundation (JRF) – Oral evidence (QQ 86 – 97) ......................................................................................................... 35

Liz Bayram (PACEY) – Oral evidence (QQ 155 – 165)........................................................... 50

Dr Jo Blanden – Written evidence (ACC0016) ..................................................................... 51

Dr Jo Blanden (University of Surrey), Institute for Social and Economic Research and Institute for Fiscal Studies – Supplementary written evidence (ACC0061) ......................... 55

Dr Jo Blanden (University of Surrey), Professor Mike Brewer (University of Essex and Institute for Fiscal Studies), Dr Sarah Cattan (Institute for Fiscal Studies), Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies), Professor Emilia Del Bono (University of Essex), Dr Kirstine Hansen (Institute of Education), Professor Sandra McNally (University of Surrey) and Dr Birgitta Rabe (University of Essex) – Supplementary written evidence (ACC0061) ................................................................................................ 56

Ryan Bourne (Head of Public Policy at the Institute of Economic Affairs) – Written evidence (ACC0026) ............................................................................................................. 57

Professor Mike Brewer (University of Essex and Institute for Fiscal Studies), Dr Sarah Cattan (Institute for Fiscal Studies), Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies), Professor Emilia Del Bono (University of Essex) and Dr Birgitta Rabe (University of Essex) – Written evidence (ACC021) .................................................... 68

Professor Mike Brewer (University of Essex) and Dr Birgitta Rabe (University of Essex) – Oral evidence (QQ 74 – 85) .................................................................................................. 69

Professor Mike Brewer (University of Essex and Institute for Fiscal Studies), Dr Jo Blanden (University of Surrey), Dr Sarah Cattan (Institute for Fiscal Studies), Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies), Professor Emilia Del Bono (University of Essex), Dr Kirstine Hansen (Institute of Education), Professor Sandra McNally (University of Surrey) and Dr Birgitta Rabe (University of Essex) – Supplementary written evidence (ACC0061) ................................................................................................ 82

Bright Horizons Family Solutions UK – Written evidence (ACC0042) .................................. 83

Professor Ann Buchanan – Written evidence (ACC0010) .................................................... 88

Camden Council – Written evidence (ACC0043) ................................................................. 91

Camden Council, Confederation of British Industry (CBI) and the Royal Bank of Scotland (RBS) – Oral evidence (QQ 140 – 154) ................................................................................. 96

Camden Council – Supplementary written evidence (ACC0063) ...................................... 112

Capacity – Written evidence (ACC0049) ............................................................................ 114

Dr Sarah Cattan (Institute for Fiscal Studies), Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies), Professor Emilia Del Bono (University of Essex), Dr Birgitta Rabe (University of Essex) and Professor Mike Brewer (University of Essex and Institute for Fiscal Studies) – Written evidence (ACC021) ............................................................... 121

Dr Sarah Cattan (Institute for Fiscal Studies), Dr Jo Blanden (University of Surrey), Professor Mike Brewer (University of Essex and Institute for Fiscal Studies), Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies), Professor Emilia Del Bono (University of Essex), Dr Kirstine Hansen (Institute of Education), Professor Sandra McNally (University of Surrey) and Dr Birgitta Rabe (University of Essex) – Supplementary written evidence (ACC0061) .............................................................................................. 122

Centre for Policy Studies (CPS) and Institute for Public Policy Research (IPPR) – Oral evidence (QQ 42 – 54) ....................................................................................................... 123

Child Poverty Action Group, Barnardo’s and Joseph Rowntree Foundation (JRF) – Oral evidence (QQ 86 – 97) ....................................................................................................... 124

Childcare Voucher Providers Association – Written evidence (ACC0044) ........................ 125

Citizens Advice Bureau – Written evidence (ACC0029) ..................................................... 131

City of London Corporation – Written evidence (ACC0038) ............................................. 136

Confederation of British Industry (CBI), Camden Council and the Royal Bank of Scotland (RBS) – Oral evidence (QQ 140 – 154) ............................................................................... 139

Confederation of British Industry (CBI) – Written evidence (ACC0064) ............................ 140

Contact a Family, Every Disabled Child Matters, Family and Childcare Trust, Working Families and Scope – Written evidence (ACC0039) ........................................................... 144

Rosie Cox – Written evidence (ACC0034) .......................................................................... 154

Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies), Professor Emilia Del Bono (University of Essex), Dr Birgitta Rabe (University of Essex) Professor Mike Brewer (University of Essex and Institute for Fiscal Studies) and Dr Sarah Cattan (Institute for Fiscal Studies) – Written evidence (ACC021) ............................................................... 156

Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies), Dr Jo Blanden (University of Surrey), Professor Mike Brewer (University of Essex and Institute for Fiscal Studies), Dr Sarah Cattan (Institute for Fiscal Studies), Professor Emilia Del Bono (University of Essex), Dr Kirstine Hansen (Institute of Education), Professor Sandra McNally (University of Surrey) and Dr Birgitta Rabe (University of Essex) – Supplementary written evidence (ACC0061) .............................................................................................. 157

Professor Emilia Del Bono (University of Essex), Professor Mike Brewer (University of Essex and Institute for Fiscal Studies), Dr Sarah Cattan (Institute for Fiscal Studies), Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies) and Dr Birgitta Rabe (University of Essex) – Written evidence (ACC021) .................................................. 158

Professor Emilia Del Bono (University of Essex), Dr Jo Blanden (University of Surrey), Professor Mike Brewer (University of Essex and Institute for Fiscal Studies), Dr Sarah Cattan (Institute for Fiscal Studies), Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies), Dr Kirstine Hansen (Institute of Education), Professor Sandra McNally (University of Surrey) and Dr Birgitta Rabe (University of Essex) – Supplementary written evidence (ACC0061) .............................................................................................. 159

Department for Education (DfE), Department for Work and Pensions (DWP) and Her Majesty’s Revenue and Customs (HMRC) – Oral evidence (QQ 1 – 19) ............................ 160

Department for Education (DfE) – Written evidence (ACC0068) ...................................... 186

Department for Education (DfE) – Oral evidence (QQ 166 – 179) .................................... 210

Department for Education (DfE) – Supplementary written evidence (ACC0069) ............. 233

Department for Work and Pensions (DWP), Department for Education (DfE) and Her Majesty’s Revenue and Customs (HMRC) – Oral evidence (QQ 1 – 19) ............................ 250

Department for Work and Pensions (DWP) and Her Majesty’s Revenue and Customs (HMRC) – Supplementary written evidence (ACC0072) .................................................... 251

Sarah Douglas-Pennant – Written evidence (ACC0051) .................................................... 252

Steve Dyke – Written evidence (ACC0017) ........................................................................ 254

Early Childhood Research Centre – Written evidence (ACC0019) .................................... 259

Early Education – Written evidence (ACC0018) ................................................................ 264

Every Disabled Child Matters, Contact a Family, Family and Childcare Trust, Working Families and Scope – Written evidence (ACC0039) .......................................................... 268

Family and Childcare Trust, Gingerbread and Working Families – Oral evidence (QQ 20 – 31) ...................................................................................................................................... 270

Family and Childcare Trust – Written evidence (ACC0057) ............................................... 289

Family and Childcare Trust – Supplementary written evidence (ACC0067) ...................... 311

Family and Childcare Trust, Contact a Family, Every Disabled Child Matters, Working Families and Scope – Written evidence (ACC0039) ........................................................... 318

Federation of Small Businesses – Written evidence (ACC0060)........................................ 319

Fiveways Playcentre – Written evidence (ACC0027) ......................................................... 323

Gingerbread, Family and Childcare Trust and Working Families – Oral evidence (QQ 20 – 31) ...................................................................................................................................... 328

Victoria Glasson – Written evidence (ACC0003) ............................................................... 329

Janet Grauberg (Editor of “Early Years: Valuable Ends and Effective Means”, a CentreForum Report) – Written evidence (ACC0030) ....................................................... 330

Sam Gyimah MP, Parliamentary Under-Secretary of State, Department for Education (DfE) – Oral evidence (QQ 166 – 179) ......................................................................................... 335

Dr Kirstine Hansen (Institute of Education), Dr Jo Blanden (University of Surrey), Professor Mike Brewer (University of Essex and Institute for Fiscal Studies), Dr Sarah Cattan (Institute for Fiscal Studies), Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies), Professor Emilia Del Bono (University of Essex), Professor Sandra McNally

(University of Surrey) and Dr Birgitta Rabe (University of Essex) – Supplementary written evidence (ACC0061) ........................................................................................................... 336

Her Majesty’s Revenue and Customs (HMRC), Department for Education (DfE) and Department for Work and Pensions (DWP) – Oral evidence (QQ 1 – 19) ......................... 337

Her Majesty’s Revenue and Customs (HMRC) – Written evidence (ACC0070) ................. 338

Her Majesty’s Revenue and Customs (HMRC) and Department for Work and Pensions (DWP) – Supplementary written evidence (ACC0072) ...................................................... 341

Her Majesty’s Treasury (HMT) – Written evidence (ACC0071) ......................................... 345

Institute for Fiscal Studies and Institute for Social and Economic Research – Written evidence (ACC0021) ........................................................................................................... 352

Institute for Public Policy Research (IPPR) and Centre for Policy Studies (CPS) – Oral evidence (QQ 42 – 54) ....................................................................................................... 353

Institute for Social and Economic Research and Institute for Fiscal Studies – Written evidence (ACC0021) ........................................................................................................... 372

Institute for Social and Economic Research, Institute for Fiscal Studies and Dr Jo Blanden (University of Surrey) – Supplementary written evidence (ACC0061) .............................. 379

Joseph Rowntree Foundation (JRF), Barnardo’s and Child Poverty Action Group – Oral evidence (QQ 86 – 97) ....................................................................................................... 383

Clare Kenney – Written evidence (ACC0001) .................................................................... 384

Kingsway Pre-School – Written evidence (ACC0014) ........................................................ 385

Louise Kirby – Written evidence (ACC0008) ...................................................................... 387

Ivana La Valle (University of East London), Ofsted and Sandra Mathers (University of Oxford), – Oral evidence (QQ 55 – 65) .............................................................................. 391

Linden Leas Pre-School – Written evidence (ACC0011) .................................................... 392

Kathleen Linton-Ford – Written evidence (ACC0002) ....................................................... 394

Local Government Association (LGA) – Written evidence (ACC0050) .............................. 395

Local Government Association (LGA) and Association of Directors of Children’s Services (ADCS) – Oral evidence (QQ 122 – 139) ............................................................................. 400

Local Government Association (LGA) – Supplementary written evidence (ACC0062) ..... 424

Local Government Association (LGA) – Further supplementary written evidence (ACC0065) .......................................................................................................................... 430

London Borough of Hackney – Written evidence (ACC0024) ............................................ 432

London Early Years Foundation – Written evidence (ACC0035) ....................................... 436

Sandra Mathers (University of Oxford), Ofsted and Ivana La Valle (University of East London) – Oral evidence (QQ 55 – 65) .............................................................................. 440

Professor Sandra McNally (University of Surrey), Dr Jo Blanden (University of Surrey), Professor Mike Brewer (University of Essex and Institute for Fiscal Studies), Dr Sarah Cattan (Institute for Fiscal Studies), Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies), Professor Emilia Del Bono (University of Essex), Dr Kirstine

Hansen (Institute of Education) and Dr Birgitta Rabe (University of Essex) – Supplementary written evidence (ACC0061) .............................................................................................. 441

The Montessori Nursery Ltd T/AS – Written evidence (ACC0007) .................................... 442

Montessori Schools Association – Written evidence (ACC0012) ...................................... 444

Emeritus Professor Peter Moss – Written evidence (ACC0006)........................................ 449

Mothers At Home Matter – Written evidence (ACC0055) ................................................ 452

National Association of Headteachers (NAHT) and St Bede Academy, Bolton – Oral evidence (QQ 105 – 112) ................................................................................................... 460

National Children’s Bureau – Written evidence (ACC0058) .............................................. 471

National Children’s Bureau – Oral evidence (QQ 113 – 121) ............................................ 477

National Day Nurseries Association – Written evidence (ACC0036) ................................. 490

National Day Nurseries Association and Pre-School Learning Alliance – Oral evidence (QQ 32 – 41) .............................................................................................................................. 495

Professor Cathy Nutbrown (University of Sheffield) – Oral evidence (QQ 66 – 73).......... 509

Ofsted – Written evidence (ACC0059) ............................................................................... 516

Ofsted, Sandra Mathers (University of Oxford) and Ivana La Valle (University of East London) – Oral evidence (QQ 55 – 65) .............................................................................. 518

Ofsted – Supplementary written evidence (ACC0066) ...................................................... 534

Parental Choice – Written evidence (ACC0040) ................................................................ 536

Plymouth City Council – Written evidence (ACC0053) ...................................................... 539

Pre-School Learning Alliance – Written evidence (ACC0041)............................................ 541

Pre-School Learning Alliance and the National Day Nurseries Association – Oral evidence (QQ 32 – 41) ....................................................................................................................... 547

Professional Association for Childcare and Early Years (PACEY) – Written evidence (ACC0046) .......................................................................................................................... 548

Professional Association for Childcare and Early Years (PACEY) – Oral evidence (QQ 155 – 165) .................................................................................................................................... 560

Dr Birgitta Rabe (University of Essex), Professor Mike Brewer (University of Essex and Institute for Fiscal Studies), Dr Sarah Cattan (Institute for Fiscal Studies), Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies) and Professor Emilia Del Bono (University of Essex) – Written evidence (ACC021) ................................................. 571

Dr Birgitta Rabe (University of Essex) and Professor Mike Brewer (University of Essex) – Oral evidence (QQ 74 – 85) ................................................................................................ 572

Dr Birgitta Rabe (University of Essex), Dr Jo Blanden (University of Surrey), Professor Mike Brewer (University of Essex and Institute for Fiscal Studies), Dr Sarah Cattan (Institute for Fiscal Studies), Dr Claire Crawford (University of Warwick and Institute for Fiscal Studies), Professor Emilia Del Bono (University of Essex), Dr Kirstine Hansen (Institute of Education) and Professor Sandra McNally (University of Surrey) – Supplementary written evidence (ACC0061) .......................................................................................................................... 573

The Royal Bank of Scotland (RBS), Camden Council and Confederation of British Industry (CBI) – Oral evidence (QQ 140 – 154) ................................................................................ 574

Scope, Contact a Family, Every Disabled Child Matters, Family and Childcare Trust and Working Families – Written evidence (ACC0039) .............................................................. 575

Somerset County Council – Written evidence (ACC0032) ................................................. 576

Southampton City Council – Written evidence (ACC0015) ............................................... 584

St Bede Academy, Bolton and National Association of Headteachers (NAHT) – Oral evidence (QQ 105 – 112) ................................................................................................... 585

Dr Kitty Stewart – Written evidence (ACC0022) ................................................................ 586

Imogen Thompson – Written evidence (ACC0005) ........................................................... 594

Melanie Tibbs – Written evidence (ACC0004) ................................................................... 596

Tower Hamlets Council – Written evidence (ACC0037) .................................................... 597

TUC – Written evidence (ACC0020) ................................................................................... 602

UNISON – Written evidence (ACC0056) ............................................................................ 606

UNISON – Oral evidence (QQ 98 -104) .............................................................................. 613

Jen Withers – Written evidence (ACC0013) ...................................................................... 621

Working Families – Written evidence (ACC0023) .............................................................. 623

Working Families, Every Disabled Child Matters, Contact a Family, Family and Childcare Trust and Scope – Written evidence (ACC0039) ................................................................ 627

Working Families, Family and Childcare Trust and Gingerbread – Oral evidence (QQ 20 – 31) ...................................................................................................................................... 628

4Children – Written evidence (ACC0047)


Dear Sir/Madam,

Re: 4Children’s Response to Affordable Childcare Committee

1. 4Children welcomes the opportunity to submit to the House of Lords’ Affordable Childcare committee call for evidence. We are the national charity for children and families. Families’ need for high quality childcare has been, and remains today, core to the aims and activities of our organisation.

2. We have worked with successive Governments to develop a million childcare places through a number of development programmes from the Out of School childcare programme in the 1990s to the Big Lottery funded programme, Neighbourhood Nurseries programme and Children's Centre programme. Most recently we have supported the development of Childminding Agencies (CMAs) on behalf of the Department for Education (DfE) and are piloting a new approach to blended, and flexible, co-ordinated childcare through Childcare Hubs with the support of the DfE.

3. Over the last eight years, 4Children has embarked on a policy into practice programme to become one of the top ten largest providers of childcare in the country with over 50 childcare settings around the country - all of which run in areas of disadvantage. This unique experience in early years and childcare bringing together both policy and practice provides a unique perspective and knowledge on affordability for parents and deliverability and childcare models for providers. This expertise is reflected in our position as the Government Strategic Partner for early years and childcare (further details of our work and experience are provided in the attached Appendix).

Summary and recommendations

4. We know that parents struggle to pay for childcare and that many find the current price of childcare unaffordable. 4Children is aware of the price sensitivity of childcare in disadvantaged areas and always seeks to set the price of a childcare place at or below the market rate. We offer flexible childcare sessions at sessional rates to provide the flexibility and affordability that parents on sessional employment need. Our pilot Childcare Hubs are a potential solution to the co-ordinated and flexible childcare that parents need. They will also help support affordability through offering a blended approach.

5. The difficulties in affordability is reflected in research showing that almost a third of the average family with children’s disposable income is presently taken up by childcare costs, and that it has risen quickly and above inflation in recent years. Government also has a key role in helping parents pay for childcare. As a provider, we know that there are limitations to the ability to reduce the price being charged to parents without reducing quality whilst the link between costs and price remains unbroken. This means that in order to reduce the price charged per hour to parents, and hence the cost of childcare (making it affordable to more parents), the only real


policy lever available is by subsidy. Where subsidies are being provided in the form of the offer of free places for 2 year olds, and 3 and 4 year olds this is clearly making an impact on the affordability of provision for parents. This is reflected in the high take up rates, including 97% for the latter. The new tax free childcare support of up to £2,000 will provide important help for parents. 4Children believes in the principle that this must be built upon over time to increase from a 20% of price to 50% to offer a clear partnership between parents and the state.

6. There is a duality of benefit to affordable accessible childcare between parents and children and wider society. Access to a skilled and productive workforce will only be achieved in a modern society if good quality, accessible childcare is available. This is crucial to both economic success and in terms of equality of opportunity. Many countries have led the way in the development of childcare and there is much to be gained in examining and drawing on their experience. The UK has its own distinct context however so should not seek to replicate models in other countries wholesale.

7. The overarching Government role in relation to childcare must therefore be to ensure that there is the high quality support needed for children to develop and for parents to work and/or train, and to provide the national framework to make this happen. 4Children believes that there is much to be gained by Government being explicit in its offer of childcare by providing a childcare "guarantee" to parents such as that that exists in some Scandinavian countries. This has the potential to provide the security and clear expectation that parents need to plan their employment and caring needs with confidence.

8. The charity also believes that there is considerable scope to revisit the role of employers in supporting parents with childcare costs. The 80s and 90s saw the development of significant levels of involvement from some employers in the face of changes in demography tightening of the labour market. Over the last 15 years this has dropped off in the main - partly, in our view, because of a plentiful labour market and partly because there has been much more of a lead from Government. The employer voucher which has maintained a link with childcare for some employers is now about to cease. We therefore believe that this is a timely opportunity to explore the potential for great employer involvement in subsidising childcare - especially where there are particular business needs.

9. In the discussion over affordability 4Children would urge the committee to place a high priority on maintaining and improving the quality of childcare. This inevitably means that costs will not reduce. Four fifths of a provider’s costs are on average taken up by staffing. The unit cost will continue to rise with the move towards higher qualified staff in the coming year. The move towards better qualified, better paid, staff is essential if we seek to retain, and enhance quality of provision. This is essential to providing a safe environment for the child to enhance and maximise their development. This also means costs should not be reduced by removing or relaxing regulations, for example amending ratios so an individual carer can look after more children (increasing ratios). We believe that there is the potential to reduce the cost of school age childcare for providers by increasing access to school premises out of formal hours and by reducing or removing any rental costs charged. All political


parties have committed to requiring schools to provide school age childcare before and after school in the future. We believe that this is best achieved in partnership with local community providers.

10. 4Children believes that there is a unique opportunity for political parties to commit to developing a universal guarantee of affordable childcare for all children 0 - 14. This means expanding/rolling out the current free supply side offers (for 2 year olds, and 3 and 4 year olds) to more children and/or hours and increasing support for school age childcare. It also means increasing the principle of the direct subsidy of ‘tax free childcare’ to a greater proportion of costs. We believe that a staged ten-year plan should deliver this by 2025.

The cost of childcare

11. The cost of childcare to parents should not be prohibitive to families. As the “Cost of a Child Report”1 research from the Joseph Rowntree Foundation has shown, families with two working parents may struggle with living costs and become increasingly indebted as a result of the high cost of childcare. Less well-off parents are prevented from using childcare when they need to in order to enter the workplace or work more hours. Formal childcare use remains much lower in the most deprived areas: 58% per cent of families with incomes over £45,000 use formal childcare, just one-third of families below £10,000 do2. Analysis by 4Children published earlier this year3 shows that almost a third of the average family with children’s disposable income is presently taken up by childcare costs. One-quarter of parents say that more affordable childcare would be the one single thing that would make the biggest positive difference to family life4. Over the last five years the price of childcare has risen 27 per cent5.

12. Underlying the cost of childcare to parents, is the price per hour that providers charge. The Family and Childcare Trust Cost Survey 20145 has calculated that the price of child care across the UK, as national average hourly childcare fee was £4.51 per hour for a child under two. The Department for Education allocated funding to local authorities to deliver 15 hours of free childcare for two year olds at a national average rate of £5.09 (to be adjusted for the area’s average costs)6. For the fifteen hours of free early education for all three and four year olds, the Department provides between £3.37 and 4.50 per hour (adjusted by area) to local authorities to allocate to providers, depending on provider type. For nurseries the level is £3.77 per hour which we know – even with adjusted – is lower than the actual cost of providing child care per child per hour for each provider.

1 Child Poverty Action Group / Joseph Rowntree Foundation (2014) The cost of a child 2014 http://www.cpag.org.uk/content/cost-of-a-child-increases 2 Department for Education (2014) Childcare and early years survey of parents 2012-2013 https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/275992/SFR06-2014_Childcare_and_Early_Years_Survey_of_Parents_2012-13_final.pdf 3 4Children (2014) Media Release http://www.4children.org.uk/News/Detail/4Children-calls-for-Childcare-Guarantee-of-quality-affordable-care-to-lift-disadvantaged-children-out-of-poverty 4 4Children (2014) Making Britain Great for Children and Families www.4Children.org.uk/manifesto-2014 5 Family and Childcare Trust (2014) Childcare Costs Survey 2014 6 Department for Education (2014) £755 million to double free childcare offer for 2-year-olds https://www.gov.uk/government/news/755-million-to-double-free-childcare-offer-for-2-year-olds

http://www.cpag.org.uk/content/cost-of-a-child-increaseshttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/275992/SFR06-2014_Childcare_and_Early_Years_Survey_of_Parents_2012-13_final.pdfhttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/275992/SFR06-2014_Childcare_and_Early_Years_Survey_of_Parents_2012-13_final.pdfhttp://www.4children.org.uk/News/Detail/4Children-calls-for-Childcare-Guarantee-of-quality-affordable-care-to-lift-disadvantaged-children-out-of-povertyhttp://www.4children.org.uk/News/Detail/4Children-calls-for-Childcare-Guarantee-of-quality-affordable-care-to-lift-disadvantaged-children-out-of-povertyhttp://www.4children.org.uk/manifesto-2014https://www.gov.uk/government/news/755-million-to-double-free-childcare-offer-for-2-year-olds


13. Providers need to be adequately recompensed for the true cost of the childcare, and we believe further research is needed in this area in order to gain a completely accurate picture of the factors driving the price paid by parents. There is a specific issue that arises around the price per hour charged to parents linked to the supply of free hours of childcare for 2, 3 and 4 year olds, which we believe leads to some providers cross-subsidising by charging more to these parents for the additional hours they use, or even charging other parents (particularly those with children under the age of 2) who do not receive free-hours more than the actual unit cost would be otherwise.

The benefits of affordable accessible childcare between parents and children and wider society

14. Families tell us they have been held back by unaffordable and inflexible childcare. The overarching Government role in relation to childcare must be to ensure that there is the high quality support needed for children to develop and for parents to work and/or train, and to provide the national framework to make this happen by providing a guarantee to parents of flexible, high quality and affordable childcare that is available to all who need it, when they need it. This must be a central part of modern society, meeting the needs and aspirations that enables all families to flourish.

15. It must support children at the crucial early stages of their life to learn, develop and gain essential social, emotional and cognitive skills, supporting development, improving their outcomes, increasing social mobility so that life chances are improved for every child. All children need to be looked after safely in a nurturing environment, with the highest possible standards to ensure the best possible outcomes for the children being supported. We know that good childcare supports good early development and children who attend pre-school have much higher life chances than those who do not. Ofsted agrees7, and there is a wide evidence base to back this up8. 4Children share the emphasis of their first Early Years annual report on the importance of the quality care in the early years to support children’s development and its desire to raise the quality of early years’ provision to enable all children to flourish. Children from the poorest backgrounds need the most support in the early years to enable them to prepare for school.

16. It must also support parents, particularly mothers and single parents, back onto the ladder into employment, into the workplace and out of poverty (providing affordable childcare to get parents into work or work longer hours would be a key way to improve the lives of the 3.5m children living in poverty today)

Maintaining and improving the quality of childcare 7 Ofsted (2014) Early Years Annual Report 2012/13 http://www.ofsted.gov.uk/earlyyearsannualreport1213 8 Institute for Education (2004) The Effective Provision of Pre-School Education (EPPE) Project, Final Report - A Longitudinal Study Funded by the DfES, 1997-2004; Dearden L, Sibieta L and Sylva K (2010) The socio-economic gradient in early child outcomes: evidence from the Millennium Cohort Study. Longitudinal and Life Course Studies 2011 Volume 2 Issue 1; Field, F (2010) The Foundation Years: preventing poor children becoming poor adults. The report of the Independent Review on Poverty and Life Chances; Tickell, C (2011) The Early Years: Foundations for Life, Health and Learning, An Independent Report on the Early Years Foundation Stage http://www.ioe.ac.uk/research/66740.html

http://www.ofsted.gov.uk/earlyyearsannualreport1213http://www.ioe.ac.uk/research/66740.html


17. We know, from our own experience as a provider as well from our work as the strategic partner on Early Years within the Department for Education that nearly four fifths of the costs for childcare providers are consumed by staffing. Work by Brind et al (2012)9 suggested that 77% of providers’ costs were staffing, 7% were rent or mortgage repayments, 7% were materials including food costs, and the remainder of the costs were for administration, loan repayments, insurance etc. As a supplier of childcare ourselves we strive to keep the price per hour charged to parents at, or below the regional average where we operate. However, there is little scope or capacity to reduce the price, by reducing our own costs, as we believe fundamentally in the importance of maintaining high quality levels of care.

18. Trends in childcare prices have therefore been tied principally to changes in staff costs to providers, with some other increases linked to the cost of materials rising alongside inflation in the economy as a whole. As the latest Childcare and Early Years Providers survey10 has shown, long term trend for wages in the childcare sector has been increasing more rapidly than those in the broader national economy, connected to a historical legacy of low wages in the sector compared to the national average wage and increasing qualification levels amongst the workforce. Though this rise largely stopped around 2011, due to the general slowdown in the UK economy, our own anecdotal evidence – backed up by continued increases in the price of childcare being paid by parents in recent years11 – is that this long-term trend is continuing. There is little scope for movement, particularly with the continued drive towards higher quality, and qualified, staff within the sector as recommendations from the Nutbrown review12 are implemented. For example, from September 2014 an updated Early Years Foundation Stage (EYFS)13 framework will bring in the requirement that all future staff holding an Early Years Educator qualification, in order to count in the ratios at level 3, must also have achieved GCSEs in English and Mathematics at grade C or above. This is completely right as a move towards better qualified, better paid, staff is essential if we seek to retain, and enhance quality of provision. And is essential to providing a safe environment for the child to enhance and maximise their development in the crucial early years of life.

One proposal put forward in the past has suggested that ratios for early years childcare should be reduced in order to allow members of staff caring for children to look after a greater number per head and hence reduce the cost of childcare per head14. 4Children strongly believes that existing ratios have been protected for very good reasons linked to both safeguarding and child development. There is strong evidence to suggest that as ratios rise the quality of provision in early years settings

9 Brind R, Norden O and Oseman D (2012) Childcare Provider Finances Survey. London. TNS BBRB. Research Report DFE-RR213 10 Department for Education (2013) Childcare and Early Years Providers Survey 2011 https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/219589/osr18-2012v2.pdf 11 Family and Childcare Trust (2014) Annual childcare costs survey http://www.familyandchildcaretrust.org/childcare-costs-surveys 12 Nutbrown C (2012) Foundations for quality: The independent review of early education and childcare qualifications https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/175463/Nutbrown-Review.pdf 13 Department for Education (2014) Early Years Foundation Stage Framework https://www.gov.uk/government/publications/early-years-foundation-stage-framework--2 14 Department for Education (2013) Elizabeth Truss speaks at the Policy Exchange on childcare https://www.gov.uk/government/speeches/elizabeth-truss-speaks-at-the-policy-exchange-on-childcare

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/219589/osr18-2012v2.pdfhttp://www.familyandchildcaretrust.org/childcare-costs-surveyshttp://www.familyandchildcaretrust.org/childcare-costs-surveyshttps://www.gov.uk/government/uploads/system/uploads/attachment_data/file/175463/Nutbrown-Review.pdfhttps://www.gov.uk/government/publications/early-years-foundation-stage-framework--2https://www.gov.uk/government/speeches/elizabeth-truss-speaks-at-the-policy-exchange-on-childcare


can deteriorate15, and certainly negates increasing the quality of staff elsewhere. This is particularly true for childcare of under 3s, as research from the University of Oxford / Institute for Education has highlighted16. Our experience as a provider, together with intelligence gathered from other practitioners in the sector, certainly suggests this is likely, notwithstanding wider concern that the welfare and safety of children could be compromised.

19. Given the importance of quality, we do not believe changes in regulation are an option. There are some measures that would help – for example, a reduction of VAT on some items, but with only very marginal benefit. Whilst, as a provider, we do everything we can to keep the price charged to parents as low as possible so as to make childcare as affordable as possible, there really is little scope to reduce our own costs as a provider. 4Children therefore would identify that the only real opportunity as a policy lever towards the aim of reducing the cost of childcare to parents as being through subsidy.

Developing a universal guarantee of affordable childcare for all children 0 – 14

20. The childcare market needs to be developed, sustained and grown, which responds to, and meets, parents needs and expectations in three areas: the sufficiency and flexibility of supply; the quality of care; and the cost and affordability of this care to parents. This is true for both school-age children (‘wraparound’ and holiday care) and the pre-school (0-5, including ‘early years’ support) children on which the committee is focusing.

21. There needs to be adequate supply of childcare in the market to meet potential demand - in every area – to ensure that the places are there, being aware that this is likely to mean a mix of different types of childcare. This may also mean the Government needs to step in to help support the development of childcare in some areas where the market doesn't respond. In our recently published policy paper “The Childcare Guarantee”17 we called for just such a radical change in approach to how childcare is provided, for all ages:

a) A ten-year staged plan to deliver a universal and affordable guarantee of 0-14 childcare by 2025

b) An extension of the number of free childcare hours over the next ten years, so that 25 hours of free early education is available for all children aged 1-4, with parents paying for extra hours if required

c) A move by schools to become more involved by providing an 8am-6pm day, and opening during school holidays, including for children under five

15 Mathers S, Sylva K and Joshi H (2007) Quality of Childcare Settings in the Millennium Cohort Study. DfES Research Report SSU/2007/FR/ 025 16 Eisenstadt N, Sylva K, Mathers S and Taggart B (2013) More Great Childcare Research Evidence University of Oxford / Institute of Education, London http://www.ecersuk.org/resources/More+Great+Childcare+Research+Evidence+March+2013.pdf 17 4Children (2013) The Childcare Guarantee

http://www.ecersuk.org/resources/More+Great+Childcare+Research+Evidence+March+2013.pdfhttp://www.4children.org.uk/Resources/Detail/Manifesto-In-Focus-The-Childcare-Guarantee


d) The widespread adoption of 4Children’s own model of Childcare Hubs which bring together all the childcare providers - schools, nurseries, childminders, out-of-school (wraparound) and Children’s Centres - in an area to provide co-ordinated and blended high quality early learning and childcare for children of all ages at times that parents need it

22. There is no shortage of advice on what affordable universal childcare means – a joined up system that parents can understand and find their way around – one that is clear on expectations and makes a commitment from the state that childcare will be available. The ‘childcare ‘guarantee’ would need to be backed up by a new settlement of cost sharing between parents and the state, one that does not need to be overcomplicated. The Government has already made decisions over the proportion of childcare cost the state must pay when setting the forthcoming tax free childcare scheme at 20%. The principle should be extended until it reaches 30%, 40% and 50% - whether it is through free supply side hours or a direct cost subsidy.

23. In practice this will mean bringing the different budgets for childcare together. It means increasing the number of free hours for three and four-year-olds to at least 25 hours a week and extending free places for two-year-olds to the same as well as offering support for children in their second year. It means providing access to free childcare hours for school age children in schools and the community after school and during school holidays. And it means investing in quality to ensure the best outcomes for children.

24. There are some measures which can be taken to flatten the likely demand: for example, employers can also help to ease the pressure on parents by allowing them to work more flexibly. Yet, overall, the story is likely to be one of growing demand over time and working to ensure that the total number of places available to parents will grow in a sustainable way. This will require a number of specific policy interventions, including:

a) There is a specific need for more places in disadvantaged areas and Children’s Centres should play an increased role here, by restarting and extending the childcare that many have wound down over recent years: providing childcare themselves, or opening up as a community-base from which other providers can operate

b) Children’s Centres to have a central role in co-ordinating childcare in an area – forming a Childcare Hub to make finding and organising childcare straightforward, and allow parents to make more informed choices on the most cost-effective options

c) All schools to open their doors beyond the standard school day, all year round, and allow play schemes and community groups to come in and provide childcare activities, for all ages of children. For example, currently just one in five primary schools provides holiday childcare in this way


d) Using relatively limited sums of money that we know from past experience can have a significant impact in developing and increasing out-of-hours childcare places, and which must also be extended to the early years. 4Children believes there is the potential to provide relatively modest ‘pump priming’ income to providers to encourage them to establish new places in these areas of shortages. As set out earlier in our response, this has worked before, albeit for school-age wraparound care, by developing thousands of schemes and 423,000 additional childcare places through thousands of schemes supported by ourselves, working with the Education Department, and supported by the National Lottery New Opportunities Fund. Much of this provision was linked to schools and gave reassurances and a guarantee of quality to parents. A programme of similar ambition of scale would have a similar transformative effect today

If you would like to discuss any of the points raised in this response in more detail, please do not hesitate to contact me.

Yours sincerely,

Anne Longfield Chief Executive, 4Children


Appendix: 4Children’s work and experience of childcare

1. We were established (as the National Out of School Alliance) in response to growing concerns around the lack of childcare for school age children whose mothers were increasingly returning to work in the late 70s and early 80s (the ‘latchkey kid’ phenomenon)

2. The provision of school age childcare to support maternal employment was the focus of 4Children’s early work with campaigns and national development programmes to increase the availability and quality of childcare places

3. In the early 1990s the organisation worked with the then Secretary of State Gillian Shepherd to develop 3,000 new out of school childcare schemes to support mothers to work in partnership with Training and Enterprise Councils (TECs). The Out of School Childcare Grant which ran between 1993 and April 1999 as a pump-priming initiative to improve the quantity and quality of childcare available outside school hours and during school holidays.

4. We went on in 1997 to develop and support a further 7,000 more out of school childcare schemes by 2002, working from 1999 to 2003 with the National Lottery New Opportunities Fund (NOF) to allocate £220 million. This supported the creation of hundreds of thousands of out-of-school childcare places

5. In 2000 we launched a major national inquiry into childcare - The Millennium Childcare Commission. Chaired by Harriet Harman MP, which led to the call for 10,000 children’s centres across the country for 0 – 19 year olds. This led to the creation of the national network of 3,500+ Sure Start Children’s Centres

6. Renamed 4Children in 2004, throughout the decade we worked for (and funded by the Education Department) to offer strategic support and operational advice on developing children’s centres, extended school services, youth services and wider support for childcare

7. It was during this decade that we moved into the delivery of services, with the first Children’s Centre, the Carousel Centre in Essex, launched in 2005. By 2007 we were directly running 40 nurseries and out of school childcare schemes ourselves

8. Today we are the Government’s strategic partner for early years and childcare, and develop and deliver policy for childcare through The Children’s Partnership (the Government's voluntary sector partnership for children and families) we bring early years and childcare organisations together, support the development of quality and advise Government

9. We continue to spearhead a joined-up, holistic ‘family centred’, integrated approach to children’s services and work with a wide range of partners around the country to ensure children and families have access to the services and support they need in their communities


10. We are one of the largest providers of Children’s Centres as well as family and youth services across Britain, including childcare provision through our network of day nurseries, Children’s Centres and out of school and holiday clubs across the country

15 August 2014

Asda Stores Ltd – Written evidence (ACC0025)


About Asda

Founded in the 1960s in Yorkshire, Asda is one of Britain’s leading retailers. It has more than 172,000 dedicated Asda colleagues serving customers from 580 stores, including 32 Supercentres, 320 Superstores, 34 Asda Living stores, 189 Supermarkets, 26 depots and seven recycling centres across the UK. Its main office is in Leeds, Yorkshire and its George clothing division is in Lutterworth, Leicestershire. More than 19 million people shop at Asda stores every week and 98 per cent of UK homes are served by www.asda.com. Asda joined Walmart, the world’s number one retailer, in 1999.

Affordable childcare

At Asda we pride ourselves on connecting with and responding to our customers’ views. With this in mind, we launched the quarterly Asda Mumdex reports in 2012 which track the views of over 11,500 real mums of all ages on a range of issues, including their household budgets, the economy, their community and their kids. In the run up to the General Election, we are publishing a series of special Mumdex reports tracking the mood of the nation’s mums with an impartial and unbiased view of their sentiments on political engagement, voting intentions, the hidden contribution of mums to the economy and their top asks of the Government. Understandably, the cost and practicalities of childcare are a recurring theme throughout our Mumdex reports and we are therefore delighted to share the findings with you below as your Committee assesses the scope of affordable childcare in the UK. Further information on all of our reports can be accessed at www.your.asda.com/mumdex

August 2013 Asda Mumdex report

February 2014 Asda Mumdex report

71% say they have less disposable income than a year ago

51% have less in their savings now than a year ago

Two thirds of mums say they don’t do activities together as often

http://www.your.asda.com/mumdex


The cost of living is three times as pressing an issue for mums than youth unemployment.

Four in five mums do not trust UK politicians

70% of non-working mums said going back to work wouldn’t make financial sense, as hefty childcare costs would leave them financially worse off.

May 2014 Asda Mumdex report

With one year to go until the election, the report also revealed that the cost of living remains the number one concern for mums:

72% of mums want the Government to focus on solving the cost of living crisis, rising to 82% among young mums aged between 20 and 29

For 81% of mums, policies addressing the cost of living would impact their choice at voting time

Yet, more than half (57%) think MPs do not understand the financial pressures they are facing

Earlier this year we also published Getting Britain Growing: The Asda Plan for Growth which offers a series of recommendations, that are designed to achieve three goals; create an efficient, effective and affordable regulatory environment for businesses to operate in; ensure the Government helps businesses to exploit opportunities for growth and investment in the UK economy; and reduce costs for consumers, providing a boost to their spending power. In the third section on increasing consumer confidence, we recommend;

Introducing 10 hours of free childcare provision for children under two years of age

Introducing free childcare provision of 15 hours a week for all two year olds

Increasing the free childcare entitlement for three and four year olds from 15 to 20 hours a week

These recommendations aim to ensure working families have certainty in gaining access to affordable childcare.

Although we welcomed the announcement that the Government will replace the existing Employer Supported Childcare with a new scheme, which will provide 20% of childcare costs (up to £2,000 per child), more could be done to assist hard-working families who are struggling with the cost of childcare.

As the graph below shows, the UK currently has the highest costs of childcare for any country in the world, (apart from Switzerland), totalling 26.6% of average family incomes, compared to an OECD average of 11.8%.


Childcare net costs as a percentage of family income (Source: OECD: Doing better for families, 2011)

In addition, figures from the Daycare Trust and Family and Parenting Institute reveal that the average cost of a nursery place for a child under two is now £4.26 per hour in Britain, meaning that a parent buying 50 hours of childcare a week would face an annual average bill of around £11,000 per year.18 Nursery costs for three and four year olds in England are only 1.9 per cent cheaper than costs for children under two. Parents face costs for after school clubs as well, with the average club costing £49.67 a week in Britain. A parent with two children in an after school club for 15 hours per week would face an annual bill of nearly £4,000 during term time.19

There are a number of additional policies the Government could introduce to tackle the costs of childcare, including expanding free childcare to every child under four years of age. If government increased the existing provision of childcare to include: the introduction of 10 hours of childcare for children under two years of age, an extension of 15 hours a week of childcare for all two year olds, and increasing the free childcare entitlement for three and four year olds from 15 to 20 hours a week, it would provide a real boost to our consumers, many of whom are mums struggling on low incomes. Our Asda Mumdex report revealed that one of our mums’ biggest asks of the Government is to assist them with the cost of

18 Daycare Trust and Family and Parenting Institute, Childcare Costs Survey 2013 19 Daycare Trust and Family and Parenting Institute, Childcare Costs Survey 2013


childcare. This would enable many mums to return to or enter the job market which would increase household income and therefore stimulate spending in the wider economy.

This policy would increase government expenditure, but would be partially offset by increased levels of employment in the UK and savings in the welfare budget.

14 August 2014

Association of Directors of Children’s Services (ADCS) and Local Government Association

(LGA) – Oral evidence (QQ 122 – 139)

Association of Directors of Children’s Services (ADCS) and Local Government Association (LGA) – Oral evidence (QQ 122 – 139)

Submission to be found under Local Government Association (LGA) and Association of Directors of Children’s Services (ADCS) – Oral evidence (QQ 122 – 139).

Baroness Bakewell of Hardington Mandeville – Written evidence (ACC0031)


CHALLENGES FOR RURAL EARLY YEARS SETTINGS IN SOMERSET

Case Study – Rural Somerset Day Nursery

This setting is based in Somerset; it has a capacity of 24 children per day, opening between the hours of 8.00am and 4.00pm. It was built in 2006, transforming an old unused chicken shed into a purpose built setting which currently employs seven staff, four of whom are from the local village.

The setting has employed 2 Graduates over a four year period, as was the requirement of the Labour Government in rural areas in 2007 when the Practitioners embarked upon four years training. Initially each graduate was to be supported through the Graduate Leader Fund, £5000 each upon completion of the course. This was withdrawn in 2010 and replaced with a supplement of 27p per hour/per child. With a loss of £6922 per annum, the setting was only able to support one graduate at an hourly rate of £11.50p, well under that of a qualified teacher. The second graduate left in 2013 when the income was unable to sustain her hourly rate, which was less than the minimum wage.

The chart below indicates the loss of income, as it occurred, over a five year period. With such huge losses over five years, none of which could have been provisioned for year on year, is it any wonder that settings are at the point of non-sustainability?

Settings are unable to cover the growing needs of parents who require flexible childcare whilst the underpayment of the Early Years Single Funded Formula has reached the extremes of impact now. These figures have been worked out across a cohort of 20 children which takes into account the lower capacity in the Autumn Term and the higher capacity during the Summer Term.

SUMMARY OF INCOME LOSS

YEAR Hourly Rate

EYSFF Rate Loss

EYPS

Loss

SEN Loss

Sparsity

Loss

Predicted additional

loss from April 2015

Stretched Offer loss from April

2015

YEARLY TOTAL LOSS

2010 £4.25 £1,813 £6,922 £3,225 £11,958

2011 £4.25 £1,813 £6,922 £3,225 £11,958

2012 £4.25 £1,813 £6,922 £3,225 £3,420 £15,378

2013 £4.50 £1,813 £6,922 £3,162 £3,420 £15,378

2014 £4.50 £1,813 £6,922 £3,420 £15,378

2015 £4.50 £1,813 £1,922 £3,420 £1,938 £2,752 £12,073

TOTAL

£82,123


Loss over a 5 year period

The SEN reflects the highest loss of income for one child. The nursery cared for 5 children during a four year period, each needing various degrees of one to one cover over a four year period – those needs included Two children with Down Syndrome, One child from age two with Type One Diabetes, a child from the local travelling community with ADHD and One child in the Global Developmental Delay category.

All of these different needs demanded several different types of training, very often for the whole staff team, these costs are not in the calculation, but were vital to support these chidren to reach positive outcomes.

During this period of financial instability, the Sparsity funding was withdrawn, despite the fact that in the same year the local Playgroup closed and the bus services were reduced. This funding supported the setting through the Autumn and Spring Terms when capacity was at its lowest.

Despite this drop in income the setting has negotiated through the finance by reducing hours and holiday cover, in order to alleviate the strain through wages. The setting needs a minimum of 6 children to cover costs outside of the core hours. This is a very difficult for the setting, who currently care for just three families, including a local school teacher, who rely upon the out of core hour provision as they are working parents.

The proposed changes to funding in April 2015 will reduce this cover further, hitting the working families who most need the services, but there is no excess income to cover the underfunding. If the setting closes it will impact upon the 40 families who use the core hour service, but who do not rely on the funding to cover for work purposes.

This is the situation for a setting which has risen to all of the challenges which each government has proposed. It has a GOOD Ofsted Rating (Oct2013); it is Graduate led; all other staff are minimum NVQ 3; it trains EYPS, Apprentices and local College Students. It has a qualified Forest School Teacher and access to local woods and allotment and many of the children are high achievers when starting at Primary school.

Unfortunately the reduction in staffing will mean the Forest School and Allotment visits will have to cease unless the setting can enrol parents/careers to volunteer in order to maintain the ratios whilst groups of children are both inside and outside the setting. The setting has built ‘quality’ into its provision, but is unable to maintain it – the training budget is the only finance which is negotiable should the buildings need repairs. Settings are responsible for all aspects of provision – staffing ratios, services, pensions, rates, VAT – many of which schools get assistance with.

In conclusion

The question we must ask is:


Do children in rural communities have the same rights to equal opportunities as those in urban areas? The underfunding is now reaching the point of closure to many settings in Somerset. Practitioners are asking whether that was the original agenda, in order to move childcare into schools, for which the initial pilots are having negative results. Research has recognised that for every £1 put into childcare, the economy benefits by £7 in adolescence through early intervention.

When are we going to invest in our children’s futures?

Baroness Bakewell of Hardington Mandeville, MBE

On behalf of the Somerset Pre-school Learning Alliance

14 August 2014

Barnardo’s – Written evidence (ACC0054)


Barnardo’s submission to the House of Lords Select Committee on Affordable Childcare

Introduction

1. Barnardo’s works directly with over 200,000 children, young people and their families every year. We run over 900 vital projects across the UK, including counselling for children who have been abused, fostering and adoption services, vocational training and disability inclusion groups. Barnardo’s purpose is to transform the lives of the most vulnerable children.

2. Barnardo’s runs a number of services which help families and young people affected by poverty and it is an inescapable element of nearly all our work. Many of these families are either not in work or in very low paid employment, often working in jobs which pay at or near the minimum wage. They often experience multiple deprivation and struggle to afford many of the basics which other families can give their children. Working with these families on a daily basis gives us a valuable insight into the role childcare and early years settings can play in improving the lives of the most disadvantaged children, both by giving young children access to early years education and in enabling parents to access employment opportunities which can help improve the family income. In our response we draw upon this experience to highlight how childcare policy needs to consider the needs of the most vulnerable children and ensure that all families can access the provision which they need.

3. Barnardo’s believes there are a number of actions which the committee could recommend, to improve how childcare operates for low income families. In summary the committee should:

Propose an explicit statement which sets out the aims of state intervention in childcare. This should recognise that childcare policy needs to support parental employment, contribute to children’s education and work to help tackle income inequality.

Recommend the publication of comprehensive guidance on the use of the new early years pupil premium to ensure settings are fully aware the role this money should play in helping improve outcomes for disadvantaged children.

Recommend increasing the generosity of the state support provided to families for childcare costs under Working Tax Credit, and the generosity of the free offer for three and four year olds. Together these two policies could work to more effectively help support families who need to pay for childcare in order to work.

Articulate an argument on the social benefits which business receives from childcare and consider the contribution which industry should make in helping support their employees with childcare costs.


Childcare policy

What should be the public policy aims of state intervention in childcare?

4. Barnardo's believes it is important that the Committee establishes a clear response to this question. There has been much uncertainty as to the aims of state intervention in childcare with different and sometimes competing aims being prioritised by different administrations. This is because the two main objectives – providing education for the benefit children, and supporting parental employment, can sometimes seemingly be in conflict. If the first of these is prioritised then the emphasis is on high quality care and a good quality learning environment for children, possibly at the expense of flexibility for parents to get the care they need when they need it. If, however, the second is emphasised, then quality of care can be compromised in favour of ensuring a flexible market place that can respond to parents need for childcare regardless of hours needed or location required.

5. In addition, in recent years there has been an increased recognition that the early years' sector has a valuable role in closing the attainment gap between richer children and their poorer counterparts. There has been a consistent and large gap in educational attainment in the UK, based on income, with children entitled to free school meals (a reasonable proxy for poverty) consistently underperforming compared to other students. These gaps in ability have been shown to start early and continue throughout the school career. The latest data for GCSE results for example shows that in 2012/13, 64.8% of pupils not eligible for a free school meal obtained at least 5 A*-C grades including maths and English, while this percentage dropped dramatically to just 38.1% among pupils who are eligible for free school meals20. The leading study on pre-school education “Effective Provision of Pre-school Education” (EPPE) showed that pre-school could play a valuable role in reducing this attainment gap; in fact this study estimated that one year in high quality part-time pre-school had an equivalent effect to raising the family income by £10,000 a year21.

6. This lack of directional clarity has resulted in state interventions over the last ten years which have at times seemingly pulled in opposite directions. For example in 2006 there was an emphasis on the need to relax rules on "quality" under working tax credit – so nannies and au pairs were included with minimal checks on quality. This contrasts with the high emphasis in recent years on the need to increase quality for example the development of the “early years teacher status”, aimed at encouraging more teacher led settings particularly in settings working with three and four year olds.

20 Data set as analysed by DEMOS available online at https://docs.google.com/spreadsheet/ccc?key=0At6CC4x_yBnMdDRBUEM1UEFZOVptOHI0amRDaG1SQXc&usp=sharing#gid=1 21 Sylva K, Melhuish E, Sammons P, Siraj-Blatchford I and Taggart B (2004) “The Final Report: Effective Pre-School Education”, The Effective Provision of Pre-School Education (EPPE) project Technical Paper 12, London: Department for education and Skills/Institute of education/University of London

https://docs.google.com/spreadsheet/ccc?key=0At6CC4x_yBnMdDRBUEM1UEFZOVptOHI0amRDaG1SQXc&usp=sharing#gid=1https://docs.google.com/spreadsheet/ccc?key=0At6CC4x_yBnMdDRBUEM1UEFZOVptOHI0amRDaG1SQXc&usp=sharing#gid=1


7. We believe that it is important that the Committee comes up with an explicit statement outlining the aims of policy in this area, and recognising these conflicting aims. This statement should encompass the need for childcare policy which supports parental employment, contributes to child development and tackles inequality.

Child Development

Does the provision of early education, currently for all three and four year olds and some two year olds, improve outcomes for children?

ls the provision of early education the best way to address inequalities in child development among pre-school age children?

8. Barnardo's has been extremely supportive both of the free universal entitlement for three and four year olds, and the targeted entitlement for two year olds. We believe that together these play an important role in contributing to child development and helping to reduce inequalities. The evidence base firmly establishes the benefits of pre-school education for children and there is solid evidence that universal early years provision helps provide advantages for children throughout their school careers. The results of the comprehensive, EPPE study established the beneficial effects of high quality provision on children's intellectual and social/behavioural development, when compared to those who did not attend pre-school22. This study also shows that the impact of good quality pre-school is long lasting. The 20ll report, which looked at the cohort at the end of year 9 - found that if a child attends a high quality pre-school then there remains statistically significant improvements in their academic performance in maths and science at the end of key stage three – aged 1423.

9. Barnardo's is also very supportive of the two year old offer – which as of September 2014 should provide 15 hours a week of free pre-school provision to 40 per cent of the most disadvantaged two year olds in the UK. As noted above, gaps between children from different income backgrounds have been observed early in development. At 18 months, children of parents with lower incomes are scoring substantially lower in developmental tests than their better off peers - and by three (the year when these children would have previously entered pre-school), the evidence shows that children of a higher socioeconomic status have double the expressive vocabulary of children from lower social economic groups24. The two year old offer helps to address these gaps early, by enabling children from more disadvantaged backgrounds to attend settings with lower staff ratios (l:4), allowing more adult intervention. This helps these children to catch up with their

22 Sylva K, Melhuish E, Sammons P, Siraj-Blatchford I and Taggart B (2004) “The Final Report: Effective Pre-School Education”, The Effective Provision of Pre-School Education (EPPE) project Technical Paper 12, London: Department for education and Skills/Institute of education/University of London 23 Sylva K et al “Effective pre-school primary and secondary education 3-14 project (EPPSE 3-14) Final Report from the key stage 3 phase: influences on students development from age 11-14” (2010) Department for Education 24 Hart B and Risley T (2003) “The Early Catastrophe” Education Review 12(1) 100-118. http://xa.yimg.com/kq/groups/8446968/1524504014/name/hart+%26+risley+2003.pdf

http://xa.yimg.com/kq/groups/8446968/1524504014/name/hart+%26+risley+2003.pdf


development before entering larger pre-school settings at three, which typically have much bigger staff to child ratios, and are centred more on peer interaction.

10. The EPPE study also provides the evidence base underlying the extension of pre-school to disadvantaged two year olds, since it showed that it is the number of months in pre-school which makes the difference in terms of outcomes, rather than the number of hours per week. In fact the study found no difference between children who attended preschool part time or full time in terms of outcomes25.

11. Our 2012 report - Mind the Gap - argued that as the three and four year old offer is a flat universal entitlement (unlike the two year old entitlement), it does not do enough to tackle inequalities. In schools, the standard funding model for all pupils is supplemented for the most disadvantaged, so schools receive an extra pupil premium to provide extra services to disadvantaged pupils. Similarly the two year old offer provides an additional entitlement for poorer children of that age. However the three and four year old offer provides the same entitlement to all pupils irrespective of income and therefore is unlikely to do anything to close the attainment gap between the richest and the poorest students. We are therefore delighted that our top line call for an Early Years Pupil Premium (EYPP) has now been accepted by the Government and we look forward to this being introduced next year. We believe the premium will help to incentivise providers to take in more disadvantaged three and four year olds. Currently there is much evidence that shows that disadvantaged children are less likely to access outstanding pre-school provision and are more likely to access inadequate provision than their better off peers26.

12. However the ability of the premium to make a real difference to pupils will depend on its value. Barnardo's hopes that that the value of the premium (which has been set at a rather modest level), will rise over time in the same way that the pupil premium in schools has done.

13. We would also urge that when implementing the EYPP, the Department for Education heed the lessons learned from the introduction of the Pupil Premium. Here, as little guidance was initially given on its use it led to a significant proportion of schools simply absorbing the additional money into their budgets and not spending it as intended on the most disadvantaged pupils. Subsequently much clearer guidance on the use of the Pupil Premium has helped mitigate this problem, along with incentives for innovation (for example the Nick Clegg's prize scheme – a £10,000 prize for schools which make the most effective use of the pupil premium). There has also been a clearer role given to Ofsted in inspecting use of the pupil premium.

14. Barnardo's would urge that clear guidance on how the EYPP should be used must be issued for settings and linked to specific initiatives proven to help child development - such as speech and language therapy or additional hours. We would also stress that

25 Sylva K, Melhuish E, Sammons P, Siraj-Blatchford I and Taggart B (2004) “The Final Report: Effective Pre-School Education”, The Effective Provision of Pre-School Education (EPPE) project Technical Paper 12, London: Department for education and Skills/Institute of education/University of London


it is important that the EYPP and the Pupil Premium are not developed in isolation. Local schools and early years providers should be encouraged to work together to ensure that there is a consistency in transition for children as they pass from the early years into mainstream schooling. Ofsted should also have a role in monitoring use of the EYPP in inspections.

Enabling parents to work

Have state subsidies for childcare improved the ability of parents, and especially mothers, to work?

Are state subsidies aimed at reducing the cost of childcare the best way to enable parents, and especially mothers, to work while their children are of pre-school age?

15. Barnardo's has been very supportive of the system of state subsidies for childcare, which we believe have improved the ability of parents, particularly those on low incomes, to work. Currently families on low incomes can get up to 70 per cent of their childcare covered through Working Tax Credit, providing they work at least 16 hours a week (25 for couples). Higher earners are currently helped through childcare voucher schemes offered through employers which enable them to pay for a certain amount of their childcare tax free. These will gradually be replaced by the government’s Tax Free Childcare scheme, legislation for which is currently being considered by Parliament.

16. Clearly the reasons why parents choose to work, and the hours which they choose to work are influenced by many factors, relating to the needs of the children and the career aspirations of the parents. State subsidies alone are unlikely to result in a large increase in working hours of parents if they do not otherwise feel that working more would be beneficial to their family.

17. However we are aware that cost of childcare comes up frequently when talking with parents on the barriers they face entering the workforce. In 2013 we conducted a number of focus groups around the United Kingdom where we talked to low income families about the financial pressures which they faced. Childcare costs came up consistently as an issue for families who felt that provision would be unobtainable to them if state subsidies were not available. As one mother said:

“I have a child-minder at the moment, she lives across the road from me so I know her but I only use her because I go to Tech and I get a grant from the Tech to pay for childcare, otherwise I wouldn’t…the prices are mad, like if I had to pay [her] out of my own pocket it’s a hundred and five pound a day for three kids”

18. The importance of state subsidies in helping low income families access childcare, and therefore employment, is backed up by empirical evidence. When the Labour Government came into power in 1997, they embarked upon a programme of welfare


reform which saw the replacement of "family credit- an in-work benefit that provided limited help with childcare, with a much more ambitious "Working Families Tax Credit", which provided families with direct money to pay toward their childcare costs for the first time (initially at a level of 70 per cent). Research has been undertaken to establish the impact of this policy. These studies show that a number of recipients of the new benefit did increase their working hours as a result - I in 4 parents surveyed who were in receipt of the credit had changed the number of hours they worked since receiving the childcare tax credit and of those 80 per cent had increased their hours27. Another piece of qualitative research by MORI on the impact of the Credit28, found parents reported that they would not be able to continue to work without the subsidy, as one parent said:

“ I would actually be unemployed without it as I definitely could not work and afford the childcare and it makes me a bit better off and make me think I can work rather than not, which gives me a bit of something myself – to say “I can work”

19. The comprehensive evaluation of the Credit by the Institute of Fiscal Studies in 200229, showed it had increased labour supply of lone mothers by around 5.1 percentage points and the aggregate results suggests a fall of 99,000 in the number of workless families with children (although this will include effects of the other changes introduced though the credit). Taken together the evidence is indicative that state subsidies for childcare do have the ability to influence parental employment (at least at the lower income end) and need to continue to play a part in the government’s anti-poverty strategy which for some time has been premised on the argument that work is the best route out of poverty.

20. Given the reported concerns about childcare costs and their role in encouraging parental employment, we were concerned that one of the first acts of the coalition government was to cut levels of subsidy given to parents. The 2010 budget saw the maximum amount that families could claim cut from 80 per cent to 70 per cent under Working Tax Credit. We know from our work with families that this had an impact on many households. While the government has now effectively reversed this decision by proposing childcare support under Universal Credit at 85 per cent, the slow roll out of this policy means that families are currently not benefiting, and despite government rhetoric about a policy which ensures "work always pays", working poor families get less help with their childcare costs in 2014 than they did three years ago. We believe that it is important the policy is reversed and the government should prioritise finding funds to increase childcare subsidies under Working Tax Credit, to bridge the gap families are facing due to the slow roll out of Universal Credit.

27 S.Woodland, S. Miller and S. Tipping “The repeat survey of parents demand for childcare" (2002) Department for education and skills 28Nicholls J and Simm C “The Childcare tax credit element of working families tax credit: a qualitative study” (2003) Inland review. 29 Brewer M, Duncan A, Shephard A and Jose Suarez M “Did Working Families’Tax Credit work? The final evaluation of the impact of in-work support on parents’ labour supply and take-up behaviour in the UK”, (2005) Institute for Fiscal studies


21. Barnardo's is also concerned that the limits on the amount of childcare that a family can claim - which are currently £175 a week for one child and £300 a week for two or more children, have remained unchanged for some time. These impact particularly on families which face particularly high childcare costs, for example those who live in regions where childcare costs are particularly expensive, or those with a larger number of children. We would like to see these limits rise to take into account inflation since 2006. We also believe that as families receiving help through the new "tax free childcare" will have no limit on the number of children for which a family can claim support for, it would provide greater consistency between the two systems if a new higher limit was introduced for three or more children in the tax credit system. This would mean families who had a third child could be guaranteed to receive extra childcare support.

22. While we consider state subsidies for childcare costs to be essential in helping low income families access employment we would also highlight that the free entitlement has a role to play in helping parents seeking to combine work and childcare. State subsidies such as those provided through the working tax credit system, are by their very nature difficult for parents to understand, given that the amount that they will be awarded depends on the number of children, cost of childcare and also the family income. The free entitlement is easier for parent to understand and very much valued by the families we work with. We very much welcomed the extra flexibilities which were introduced to the entitlement when it was extended to l5 hours; allowing parents to take the entitlement over two days is helpful for those working on a part-time basis.

23. We are still concerned that many providers are only offering free provision on specific days or time slots and that parents have to top up the free entitlement by purchasing extra hours. We believe it is important that government funding for early years providers is sufficient to cover the costs to providers thus discouraging them from undertaking this sort of practice. Barnardo’s beli

Documents

CHILDCARE SELECT COMMITTEE - Parliament...The Royal Bank of Scotland (RBS), Camden Council and Confederation of British Industry (CBI) – Oral evidence (QQ 140 – 154) 574 Scope,