Analysis: Time to act on low childcare wages

A report warning that the Government's lack of action over low pay in the early years workforce risks jeopardising its achievements in driving up the quality and professionalism of the sector has met with mixed reactions.

While leading figures from the world of early years are united in saying that the perennial problem of pay in private, voluntary and independent settings cannot be solved by the employers alone, they take different views on the recommendations made in the report, published by the Daycare Trust and the TUC.

But no-one queries the findings of Raising the bar: What next for the early childhood education and care workforce? - that pay and conditions for early childhood education and care practitioners are extremely low in comparison with similar positions elsewhere in the children's sector.

'The Government cannot say that pay is not a matter that it can involve itself in, pushing the problem back to providers,' says Steve Alexander, chief executive of the Pre-School Learning Alliance. 'It is immoral to expect the goodwill and motivation of the early years workforce to embrace qualifications but ignore low pay that bedevils the workplace. Providing support and education to our youngest children has to be valued not only in policy but through workers' pay packets.'

'We should obviously be working towards raising pay, status and conditions for early years workers and certainly in relation to early years teachers,' says David Wright, proprietor with his wife Anna of four Paint Pots nurseries in Southampton. 'But, speaking as a PVI provider, I can only afford to pay out what I receive in as income from increasingly hard-pressed parents. Salaries are by far the largest element of our expenditure.'

Purnima Tanuku, chief executive of the National Day Nurseries Association, explains that the problem for PVI employers is one of basic business economics. 'Day nurseries fully recognise the need to raise salaries following achievement of qualifications and in line with other sectors, and would dearly like to reward their staff. But as the report highlights, this cannot be achieved without direct Government intervention.'

Poor relation

The report spells out how much has been achieved in terms of expanding early years provision and driving up standards in the past ten years, yet the workforce remains among the most poorly qualified and lowest paid of all professions in the country.

It argues that the policy of raising standards before focusing on raising remuneration is creating recruitment and retention difficulties because highly qualified staff have neither a clear career path nor a reasonable wage for which to aim.

'If we wish the UK to deliver internationally-admired standards in early childhood education and care, we must not only attract high-calibre individuals into the workforce, but retain them too. This cannot be done on wage levels that often scarcely raise many recipients above the National Minimum Wage,' says the report.

It concludes, 'Given the significant investment that has already been made in improving training and qualifications for the ECEC workforce, this paper questions whether the Government is really willing to jeopardise these gains simply by ignoring issues relating to remuneration.'

The key recommendations of the report include:

- A stakeholder group should be established by the Government to examine the impact of poor pay and conditions

- New standards should be set so that pay and conditions improve in line with higher qualifications

- Childcare providers should have to supply details of staff wages as part of their Ofsted inspections to comply with NMW regulations.

The complexities involved in trying to solve an essentially simple problem are underlined by Andrew Fletcher, director of communications at the National Childminding Association. 'Given that childminders and nannies are self-employed, charging fees that the market will allow, new standards for pay and conditions would be problematic without substantial public investment to ensure that costs were not passed to parents.

'In addition, any high-level social partnership group should consider that a large number of those working in childcare are self-employed, whose interests might not be best served by trade unions and employers alone.'

Ms Tanuku adds, 'We would be interested in wide-scale research about pay, although any attempt to use these figures to propose pay scales or working conditions would be extremely difficult. Higher salaries in children's centres and pressure to keep fees affordable means that any national framework would not be reflective for many providers, and nurseries simply could not work to set scales unless they were sure that funds were available.'

'Low pay is irrefutable and we cannot waste time collecting data when we know that there is a problem,' says Mr Alexander. 'What is needed is action. In this context a "high-level social partnership" group needs to have teeth to make a difference. We do not need yet another talking-shop.

'As architects of improved childcare services, Government cannot hide behind free market principles when it suits. Indeed Government, through a number of welcome initiatives, has caused increased cost-side pressures to providers. We are operating in a highly managed and configured market place where pay for staff must share equal priority for Government in the way that qualifications do.

'From taking responsibility, Government will be faced with an unpalatable solution. Paying workers a fair rate, commensurate with the importance of their task, their qualifications and addressing recruitment and retention issues, will mean higher Government subsidy to the sector - a conclusion made even more unpopular in the current economic downturn.'

Ways to help

The Children's Workforce Development Council normally avoids commenting on pay by saying it is a matter for employers, but Pauline Jones, the national programme manager, did comment on the report to underline the work it is doing through the Graduate Leader Fund. 'There is quite a lot of money in the system for qualifications and we need to investigate further to understand if more is necessary,' said Ms Jones.

But Mr Wright says, 'The Graduate Leader Fund is a welcome initiative, which we are using to attract and retain higher qualified staff and to plan for succession - for example, by underwriting study and supply staff costs for foundation degrees. But it is tokenism when viewed against our overall wages bill.'

Ms Tanuku says an important step towards improving pay for PVI practitioners could be made through reforms of the free early years entitlement. 'The under-funding that a significant number of nurseries face not only impacts on sustainability but also on their ability to improve staff pay and conditions.'

June O'Sullivan, chief executive of Westminster Children's Society, identifies another means to enhance PVI sector pay - local authority contracts. She says, 'The tender process should take account of staff costs and pay, instead of almost colluding with low pay by awarding a contract to one bid over another because it is the cheaper. Local authorities should review the commissioning process to ensure that tenders include realistic costings for paying staff. If we are to pay staff properly, then the tender process must take account of that.'

'Money for the PVI sector comes out of parents' pockets or the Government's pockets,' says Jon Richards, senior national officer at Unison's Education and Children's Services. 'At the moment parents are being made redundant, so there is only one alternative.

'If the Government wants to achieve its aims and if it wants to make fundamental changes in children's lives, especially in deprived areas, then it has to stump up the money. It has to address the imbalance in spending between the schools sector and early years, unless they are going to take money from another budget - and it is a difficult time for doing that.'

He admits to being in an uncomfortable position as a trade unionist, suggesting public funding for private business. But he says there is a precedent in the way the Government finances residential care.

'We are talking about a sector where 30 per cent of nurseries are losing money, a sector that is facing tough times. You have to compare how much the Government spends on schools - £41 billion - with the £3.6 billion it spends on early years and children's services.

'It spends on these first five years of life less than a tenth of what it spends on schools, and yet we know these are the most crucial years.'

But if ministers do decide to 'stump up the money', Mr Alexander says they face stark choices as to where to get it from: raising taxes, switching funds from another budget, or making cuts in its flagship children's centre programme and targeting the provision of universal and affordable childcare on those who most need it.

'The solution is not easy and that is why policy makers avoided the challenge in preference to suggesting that pay is a matter for the market,' says Mr Alexander. 'The market is showing signs of immense cost pressures and the time has come to confront the issue of low pay, because it is immoral to continue to ignore it and it clearly will not resolve itself.'