Childcare providers invited to give evidence on the cost of places

The Department for Education (DfE) wants to hear from early years providers and schools about what costs they have to meet to provide the early education places, as well any studies and research that have been carried out into childcare costs.

The call for evidence, which is also open to local authorities and parents, closes on 10 August. Its findings will be used to inform the review into funding, being led by childcare minister Sam Gyimah and taking place ahead of the summer.

The Government has committed to increasing the average funding rate paid to providers for the early education places ahead of the introduction of 30 hours of free childcare a week for three- and four-year-olds. Only households where all parents work will be eligible for the offer. Pilots of the scheme will start from September 2016 in some areas, before being rolled out nationally the following year.

Neil Leitch, chief executive of the Pre-school Learning Alliance, said, ‘We warmly welcome the call for evidence on early years funding, which will give providers a much-needed opportunity to share their views and experiences with Government. Having previously dismissed its findings, we also hope that the Department for Education will also take this as an opportunity to take into account the independent report into the free entitlement offer commissioned by the Alliance last year, which found that the existing schemes are underfunded by around 20 per cent on average.

‘Looking ahead, we believe that it’s vital that this review is used to ensure that the early years sector is adequately funded in the long term. A one-off funding increase may make for positive headlines, but will do very little to address the serious problems around business sustainability currently facing providers. As such, we look forward to contributing to the review and ensuring that it is fair, open and comprehensive.’

Liz Bayram, chief executive of the Professional Association for Childcare and Early Years (PACEY), said, 'It is excellent news that the Government has recognised calls from the sector to review the level of funding for delivering the early education  entitlement. PACEY met with the Childcare Minister yesterday to share our members’ concerns not only about the level of funding, but about  other barriers childminders can face in delivering the free entitlement. These include inflexible payment processes in some local authorities, the impact of delays in payment and the variety in rates between different authorities.
 
'We also spoke to Mr Gyimah about the need to look again at the issue of funding for related children – this is a barrier that does not exist for nurseries, and should be addressed for childminders, too.'

Purnima Tanuku, chief executive of the National Day Nurseries Association (NDNA), said, 'We have already presented the DfE with vital evidence from the sector including the last six years of NDNA’s annual surveys. Our latest research shows that 85 per cent of nurseries in England are making losses on the current 15 hours per week free childcare, an average of £809 per year for each funded child.

'Nurseries need to balance their books for the Government’s expansion ambitions to be achieved. The review must result in a meaningful increase in funding for childcare providers.'

'We would now ask the whole sector to contribute to the call for evidence to make it a success.'