Funding review on 30 hours to be published on 25 November

Making the announcement this morning at Nursery World’s Business Summit in London, the childcare minister Sam Gyimah confirmed that the Department for Education with a team of consultants from Deloitte, will report back their findings from the review on 25 November, alongside the Government’s spending review.

During the summer, nurseries were asked to share with the Government their costs of providing the free childcare places.

However, as Nursery World reported last month, most of the providers who responded did not give figures, leaving the Department for Education unable to understand the costs of providing the free hours.

Mr Gyimah said, 'We have been carrying out the funding review to understand the costs facing providers, which will allow us to set a level of funding needed to deliver high-quality childcare provision, while at the same time providing good value to the taxpayer. The review has been going on for six months. The results will be part of the 25 November Autumn Statement, which the Chancellor will be delivering for the whole Government.

'We have drawn on a significant body of evidence, including more than 2,000 responses to our call for evidence on providers’ costs, as well as roundtables to consider in detail some of the issues raised in the call for evidence. And we’ve also had Deloitte, an independent organisation, involved.'

According to the childcare minister, 1,800 local authorities and providers have come forward to register their interest in trialling the 30 hours free childcare as 'early implementers'.

During his speech, Mr Gyimah also hinted at the introduction of a funding unit rate, as well as assuring delegates that the DfE will come up with a figure to meet ‘reasonable costs’.

For instance he said that if a provider opened a nursery in One Hyde Park they shouldn’t expect the Government to meet their costs.

During his speech at the Business Summit, the childcare minister also revealed plans to make it easier for providers operating nurseries across different local authorities, such as being able to use the same health and safety standards at all settings.

As well as this, he said that the Government is looking at unifying systems for tax-free childcare and the 30 hours free childcare.

Mr Gyimah also committed to retaining the current adult: child ratios.

It follows speculation among the sector that the purpose of the childcare minister’s visit to Paris in September was to look at introducing more relaxed ratios.

Mr Gymiah told delegates that ratios are not the only measure of quality and that they shouldn’t continue to be used as a ‘convenient stick to beat Government with’.

However, the childcare minister did say that some providers have expressed to him that they want more flexibility on ratios during certain times, for instance when staff are off sick. This is something he said is willing to talk to people about.

He encouraged providers with graduates to use the 1:13 ratio, which he said allows owners to free-up resources and invest in their business.

The childcare minister reiterated the importance of qualifications for the workforce, saying that they are the best predictor of quality and GCSEs are ‘what you want for any job’.

Commenting on the speech, Purnima Tanuku, chief executive of the National Day Nurseries Association (NDNA), said, ‘We look forward to seeing the results of the funding review on November 25 as our sector and the future of childcare in this country hinges on the Chancellor giving nurseries a fair deal on hourly funding.

‘What we don’t want to happen is to shift from parents paying the market rate for childcare to the Government paying current inadequate levels for these additional hours.

‘We know from our research that demand is likely to increase, with 80 per cent of parents planning to take up the full entitlement of funded hours.

‘However, we are keen for quality not to be compromised in delivering the additional hours.’

Neil Leitch, chief executive of the Pre-school Learning Alliance, said, 'With many government departments facing cuts at the upcoming Spending Review, it’s vital that the Government ensures that the 30 hours offer is adequately funded. This means more than a one-off uplift in funding rates: fundamental funding system changes are needed to ensure the sustainability of the sector in the long-term. Tinkering around the edges and telling providers to be more ‘innovative’ and ‘creative’ in order to cut costs, is not enough – it is the Government that made this pledge and so it is the Government that must ensure that it is deliverable.

'As such, we welcome confirmation of the publication of the funding review, and hope that the findings will provide much-needed answers to the many questions practitioners have on the long-term viability of the free entitlement offer.'

Liz Bayram, chief executive of the Professional Association for Childcare and Early Years (PACEY), said, 'We know that PACEY members face a range of barriers in delivering the current free entitlement. For many, the level of funding is too low but they also struggle with inflexible local authority procedures; delayed payment and, for our childminder members, the reluctance of some local authorities to make it clear that parents can use their entitlement with registered childminders. For childminders the current ban on accessing the entitlement for related children is another significant barrier to participating in current delivery.

'There has been a huge increase in the quality of childcare offered to families over the last few years, with 85 per cent of providers now rated good or outstanding. This high-quality, which we know has the greatest impact in closing the gap for children from disadvantaged backgrounds, can’t be threatened by underfunding or expansion of free childcare that doesn’t put support for practitioners to continue to improve at its core.'