Ratios debate 'will rear its head again'

In 2017 the Conservative manifesto stated that if the party were to win the election they would look ‘at the best ways that childcare is provided elsewhere in Europe and the world’.

We feel that this is a prelude to the opening of discussions around childcare ratios, a discussion previously dismissed by the party back in 2014 following Liz Truss’ widely condemned report.

Aside from the manifesto, there are a range of issues the sector is facing which we believe will reignite the ratios debate. These factors include:

• 30hr funding rates being fixed for three years, as from last September. It is well documented that local authority funds are limited - and as ‘bulk’ buyers they will wish to mitigate increases.

• For nursery owners, operational costs including salaries, pension contributions, business rates, heat, light, insurance to name but a few are increasing year-on-year. Staffing costs are the most significant expense for any nursery, and if this cost could be reduced by expanding ratios, the greatest savings could be made.
• It’s unlikely that local authority fee increases, over time, will be enough to cover these costs. If they were to rise, this increase would likely be offset by an increase in operational expenses. They also wouldn’t provide an adequate surplus to remunerate the operator for their contribution of time, effort, and the ‘risk’ associated with running a day nursery. The attractiveness of the return on investment, for some providers, could substantially diminish.

The Government is reliant on the private sector to deliver its 30 hours policy. Prior evidence has shown that the private sector is more adept at running sustainable settings when compared to local authority operated settings. But operational pressures are making this more difficult for some - and the 30 hours has been cited on multiple occasions over the past six to nine months as owners have closed their businesses and ceased trading.

A reduction in staffing ratios is likely to be positioned by the government as being a proactive measure to assist business owners to mitigate expense, which in turn could offset the calls for future fee increases. Evidence demonstrating that a reduced ratio does not impact on ‘quality outcomes for children’ will undoubtedly be sourced by government to support announced reduction in ratios.

In the event of a ratio reduction, owners will be able to choose whether or not they wish to maintain their current ratios. For settings which are under financial pressure, it could be a way to ease this. Unless all follow suit, a further ‘divide’ will emerge in nature, type and quality of provision.

The sector is facing workforce pressures - and like the cost-reduction rationale, a reduction could potentially alleviate some of the recruitment challenges that providers face, on the basis of less staff being required. The suggestion is being met with mixed views from the sector who, ultimately, will always put the safety and quality of childcare at the forefront.

• For a discussion of ratios in Reception, see 'making ratios work', out in Monday's edition of Nursery World