By Montessori Schools Association’s Chairman Dr Martin Bradley

It’s easy to be rather cynical about the recent flood of DfE and other government publications which have come out in the last weeks of the summer term and into August. There is a mass of figures which, when put together indicate that the basis for the 30 hours rollout is not as secure as the government had stated. There are quite a few sets of figures to wade through, but I have tried to clarify them.

On 29 June the statistics for provision for children under 5 in England were published. These provide an interesting background to the 30 hours’ funding debate. They showed that 93% of 3 year olds had some funded education in January 2017, and that 71% of eligible 2 year olds also had some early education – this percentage refers to those who qualify for the premium funding based on economic need, high level SEN or disability, and looked after or adopted children from care.

 

2 year old places

3 year old places

4 year old places

Private and voluntary

84%

60%

19%

Childminders

4%

2%

Maintained nursery schools and classes

8% (up from 2% in 2015)

54%

54% (not including reception classes)

 

Thus childcare for 2 and 3 year olds is mainly in the PVI sector, whereas maintained provision takes over for older 3 year olds and 4 year olds – no surprise there, but good to have the evidence.

The great majority of funded places for 3 year olds are in the PVI sector, but the numbers switch for 4 year olds who go to school –

Places

3 year olds in PVI

3 year olds in maintained sector

4 year olds in PVI

4 year olds in maintained sector

2015

411,140

232,240

144,250

522,410

2017

404,110

224,630

146,290

529,020

 

The statistics also show the types of provider: in January 2017 the PVI sector had 18,900 providers offering places for 477,860 three and four year olds. 16,740 maintained schools and nursery classes offered places to 767,250 children. This last set of figures includes 150 secondary schools offering 4270 three and four year old places. Again this shows the higher number of 4 year olds in maintained provision.

Sure Start providers come under the PVI sector for the sake of these statistics and only 30 centres offered funded places (for 1,250 children), but they did have 320 linked providers offering 7,190 funded places. This suggests that many Sure Start centres offer drop in care probably linked to adult provision rather than nursery education.

Another interesting set of statistics reports exclusions from maintained provision in England 2015-16. 50 children aged four or under were permanently excluded, and 3,050 had fixed period exclusions. Most of these were in reception classes. There are no comparable figures for the PVI sector.

DfE issued two ‘News Stories’ on 18 and 19 July. The first is headed “Benefits of 30 hours confirmed as free childcare places soar” and the second “Childcare service opens for parents with children under five”. The first relates to a visit made by Robert Goodwill, the Minister for early years, to a nursery and also to figures showing that the 30 hours ‘early implementer’ programme (i.e. the pilot programme for the 30 hours funding) reported that   

  • 23% of mothers and 9% of fathers had increased their working hours as a result of the 30 hours’ funding, particularly those with lower incomes.
  • 78% of parents reported greater flexibility in their working life;
  • the ‘vast majority’ of parents reported improved finances as a result of the 30 hours (but this was slightly tempered by 84% reporting that they had slightly or much more money to spend); and
  • providers were willing to offer 30 hours and ‘there was no evidence of funding being a substantial barrier’ to delivering the 30 hours.

This news story has quite a lot of spin to it, as can be seen when I look at the sources later in this blog. The other news story refers to the Tax-Free Childcare and is much more direct, simply outlining the scheme without much comment. No doubt this reflects the problems many parents and providers have experienced with it.

The research bases for government statements about the 30 hours funding are reports published evaluating the Early Implementation of the 30 hours free childcare conducted by Frontier Economics and the University of East London supported by staff from the NatCen for Social Research. Their reports were published in July and beside the main evaluation report and its shorter Research Brief report (‘Evaluation of Early Implementation of 30 hours Free Childcare’, DfE July 2017 reference DFE-RB708, ISBN 978-1-78105-792-6 – the ‘Evaluation report’), there is a Study of Early Education and Development (SEED) on the potential value for money of early education, and an impact study on early education use and child outcomes up to age three.  

The value for money issue has been explored before, notably by Professors Christine Pascal and Tony Bertram as part of the Early Excellence programme which ran from 1997 to 2003. There are major issues about what factors should be taken into account as well as problems in comparing different types of provision, especially when seeking a ‘benefit to cost ratio’. However increased provision at ages three and four have indicated monetary benefits related to reduced later demand for SEN provision, lower truancy, school exclusion, crime, smoking and depression rates, along with subsequent higher employment rates and earnings. One issue here is that take-up of provision can often be linked to social class – or as Sir Michael Wilshaw the former Ofsted Chief Inspector termed it “the middle classes piling into the best preschool provision”! The research is interesting in the light of this statement.

The Early Implementer programme for the 30 hours was operated in eight local authorities (LAs). However only in one LA was a universal offer made to all eligible children or working parents. In the other seven around 400 to 600 children were offered places, making it hard to reach conclusions across the whole programme – as DfE has done in its ‘news story’. As the Evaluation document notes “early implementation was a very limited test of sufficiency because of the limited number of places in seven of the eight LAs” (p.9). Also any expansion of capacity (places) needed for the national rollout will probably be limited by problems in recruiting good staff, finding additional venue space – a problem which has badly affected the expansion of fee schools –  and in obtaining capital funding for investment. This is hardly an optimistic endorsement.

The eight LAs were to

  • test different approaches that drive market innovation and efficiency, supporting providers in different ways;
  • generating models of flexible provision related to parental working patterns and different child needs;
  • increase market capacity;
  • maximise parental take-up and employment;
  • test delivery systems, including eligibility checking of parents; and
  • positively promote the 30 hours’ offer.

The LAs were deliberately chosen to have varying backgrounds in terms of size, urban/rural, affluence, ethnicity, and type of childcare provision. Amongst the seven which had a limited number of places, two used childcare ‘hubs’, two allocated places to parents  in particular circumstances (one rural and one for lower income parents), two allocated places via employers, and one to a selection of parents and providers to test delivery models. This pattern is a useful research model, but it does not necessarily lend itself to the generalised positive publicity statements made by the DfE or to supporting a national rollout. By their very nature, some models might be expected to be more successful than others. The Evaluation report concludes that “Early implementation involved only partial implementation in seven of the eight LAs which meant that sufficiency of delivery and take-up by parents could not be fully tested” (p.19). Also LAs were selected for the early implementation programme on their track record for innovation and delivery of sufficiency (of places)” (p.19), not on being more generally representative.

Another complication is that these LAs were paid a funding rate higher than the 15 hours’ rate to bring it into line with the anticipated 2017 level of funding. Also all eight LAs planned to introduce additional measures to support greater flexibility in provision and half had planned to improve access for children with SEND and/or to support parents entering work.

The research analysis risks generalising from very limited samples. Thus in the one area where there was universal provision:

  • 50% of three and four year olds took up the extended hours;
  • 80% of providers delivered extended hours; and
  • 57% of the places were delivered by the private sector, 14% by the voluntary sector, 7% by childminders and about 2% by the independent sector.

Issues around the capacity of providers, are discussed. Unsurprisingly day nurseries had to make few if any adjustments, although some concluded that they would have to limit the extended hours places to a financially viable number, and some felt that any increase in demand would be limited by staff retention and recruitment problems. Playgroups had to make some ‘modest’ adjustments, but also found staff recruitment and retention an issue along with limitations in their weekly hours where premises were shared with other organisations. Childminders found the main issue was limited parental demand for the free entitlement hours. Schools were attracted to the scheme by falling rolls, but many could not respond or had problems where they saw delivering ‘early education’ as their core role and not ‘childcare’. Some schools have seen offering 30 hours a week as meaning between 0900 and 1500 – six hours a day during school times only. It will be interesting to see how this links to any free sessional nursery education they already provide. Also I does not address te goal of getting parents back into work.

But for all providers the main challenge was ‘uncertainty around the business implications’ of switching to an income based on the 30 hours’ funding. This is hardly surprising when the rates for 2017-18 were not known, where LA conditions for providers joining the scheme appear to vary considerably and where settings may have to alter their opening times. Also LAs need processes to deliver a reliable and robust payment system. Three recommendations are made for the national rollout:

  • all types of provider are likely to be willing to offer the 30 hours, but different types of providers may face different challenges in providing it and will need different forms of support – hardly a surprise. A review of sufficiency of places is needed, especially in April 2018 as peak demand for the summer term becomes evident;
  • recruitment of providers will need to “address the uncertainty about the financial implications”;
  • local payment systems needs to be efficient and reliable.

This is hardly the ringing endorsement suggested by Ministers, and supports MSA’s view that providers would in many cases be best advised to see what the situation in their LA is before committing to the scheme. Other issues included the need for providers to work together to support the 30 hours. Some 20% had formed new partnerships to do so, but there remains a need for LAs to support this.

Most providers were already offering opening hours which enabled the 30 hours to be provided. But this simply shows where the policy is directed – at full day care rather than sessional provision. Only 17% of places involved the use of school holiday provision, and many parents had been told that the hours were only available during term time. “Some day nurseries offered free entitlement hours only for a short day or during less busy sessions” (Evaluation p.19) – this seems likely to increase.

In particular 55% of free entitlement places involved additional payments. This is seen in a report in the “Times” newspaper of 5 August which stated that “parents are being hit with unexpected bills for activities including music, sport and phonics to compensate for the shortfall in funding for the 30 hours of free childcare”. ‘Nursery World’ reported (7-20 August 2017) that one LA had advised a nursery that “when it has staff spare, it could offer an ironing service for parents”. Others were advised not to provide tea and coffee for staff to save money, getting staff to clean the nursery rather than employ cleaners, or to put out a bucket for parental donations. This is not the basis for a professional childcare business.

The research on the impact on providers indicated that 67% reported no impact on costs – presumably for day nurseries. 38% reported no impact on profits, 22% said that profits had increased and 40% reported a decrease following the 30 hours introduction. Private providers saw the greatest impact on costs, whereas voluntary providers reported a negative impact on profits. It is clear that the whole funding issue is very situation-dependent, including whether the setting rents property, its existing status as a day nursery or sessional provider, and the size of the setting (linked to whether or not it is part of a chain of nurseries).

The survey also looked at the parents who used the 30 hours. 52% had degrees – a figure which surprised me, but which showed that Sir Michael Wilshaw’s comment about middle class parents may still apply. 34% of parents had a household gross income less than £31,200; 34% had income between £32,000 and £52,000; and 33% had an income of £52,000 or more. So the three income bands are fairly even and the government’s ‘just about managing’ category of families are less likely to benefit than relatively better off families. This is underlined by the lowest of the three income groups being most likely to increase their hours of childcare, whilst the highest showed more ‘no change’ in their hours of childcare – families just cut their costs.

This is reflected in changes in parental work patterns. Just 1% of mothers had entered work using the 30 hours, although 23% had increased their work hours. This was most evident in low income families, but it is not clear if such changes would have happened anyway. More positively 78% of parents said that the 30 hours gave them greater flexibility in work choices, linked to more secure employment, improved career opportunities and improvements in work-life balance. 58% said they had slightly more money to spend, and 26% had much more money to spend.

The research makes several criticisms of the policy. Calling it ‘childcare’ put off some schools which saw their role as providing ‘education’. Calling it ’30 hours’ when it comes down to about 20 hours when spread over 52 weeks, is misleading. Calling it ‘free’ when other charges are made is also misleading. Timescales are too tight. The need for multi-agency support from LAs is important, but these teams may not exist or if they do, may not be fully familiar with all the complexities of funding and variations between providers. The evaluation concludes that DfE needs to provide more support to LAs, including ensuring adequate funding for LA staff to implement the policy. Most tellingly, “Several elements of the policy at both the national and local level will be different in the national rollout, including funding rates, other support from DfE (not given to the rollout), the eligibility checking system and no obligations for LAs to undertaken additional supporting measures” (p.19),such as access for specific types of families or promoting flexibility. Finally, “Early implementation did not provide the opportunity for a robust evaluation of impact on parental work” (p.19)

All told, the policy seems to be a jump in the dark which does not take sufficient account of the variations and constraints around different providers. The tone of the DfE press releases is far too positive when set against the research evaluation. The group most likely to benefit is not those ‘just about managing’, although some of these will have degrees, but 2/3 of the take up has been from households with an income of over £32,000.

When set against the pattern of provision it seems increasingly clear that sessional providers, especially those who can offer fewer than 10 sessions a week, can only engage with the policy by entering into arrangements with other providers – but many of the latter will be full day care providers already able to offer the wrap around or holiday care and who may be able to operate alone.

MSA’s advice remains that ‘wait and see’ is likely to be best for many providers. If you can offer places for specific days when take-up is otherwise low, then this seems a good approach. If you are a day nursery or childminder, more may be offered, but committing to all places being open to 30 hours is a financial judgement which may not be sustainable. Bear in mind that the 30 hours rates are fixed until 2020, and inflation will continue along with other possible increases in costs such as the living wage.

All along, the great unknown is the willingness of parents to pay extra for meals and activities “which never appeared on the bill before” according to a mother reported in the Times on 5 August. Instead she is said to be being charged £25.72 a day as a ‘cost’ for the 30 hours.

Let’s see what happens in September – I’m sure that the press and other media are watching!

Best wishes,

Martin