PACEY, the Pre-school Learning Alliance (PLA), the Family and Childcare Trust and the National Day Nurseries Association (NDNA) are among the sector organisations that have submitted written evidence to the inquiry, which was set up to examine how pre-school childcare in England is funded.
A group of 12 peers will investigate the affordability of childcare and the justification for providing free hours and subsidising childcare through taxpayers' money, as well as childcare policy, child development, and whether state subsidies enable parents to work.
The key concern flagged up by organisations in evidence to the committee was underfunding, with providers pointing out that support for early education places has seen little or no change in hourly rates over the past five years, despite rising business costs. Many called for a radical review of childcare funding to prevent long-term underfunding driving costs upwards.
PLA submitted the results of its Early Years Agenda survey of 1,270 early years practitioners alongside its written evidence. The survey found that 73 per cent of respondents offering free entitlement places for three- and four-year-olds and 54 per cent of those offering places to two-year-olds did not feel they received sufficient funding.
The PLA said the Government's proposal that the Early Years Pupil Premium (EYPP) for three- and four-year-olds could be used to help fund an Early Years Teacher (EYT) was unlikely to be sufficient, as the premium equates to an additional 53p per child per hour. Its survey suggested places are currently underfunded, on average, by 91p per child per hour.
Some organisations added that funding reform is also vital to achieve workforce development ambitions to employ more graduates or EYTs without diluting quality by relaxing ratios.
Neil Leitch, chief executive of the PLA, said, 'The Government has to date refused to accept that current funding levels are inadequate and so we hope that the evidence we have provided will serve to clarify the current situation in this regard.'
Organisations also drew attention to funding challenges faced by providers and families based in rural areas, with PLA suggesting this is due to factors such as the loss of the Graduate Leader Fund in 2010, a lack of adequate SEN funding and the withdrawal of scarcity funding.
Jill Rutter, head of policy and research at the Family and Childcare Trust, said, 'Sixty five per cent of nurseries are run by the private sector and they don't operate in areas where there is lower demand and they can't break even. It is working families in deprived areas and in the countryside that are most affected by gaps in provision. Filling these gaps will need ... funding from the Government, but there is a bigger cost to the public purse if parents can't work because they can't find childcare.'
Several providers also expressed a desire for a consistent Ofsted framework for early years.
NDNA called for the preservation of the Early Years Foundation Stage Profile assessment of children at age five, while PACEY suggested that outcomes assessments should include social and emotional development, condemning current baseline testing plans as focusing on a 'narrow definition of development'.
The committee is expected to report in March next year.