MPs voice concerns over ‘economic realities’ of doubling free childcare places

By The Press Association14th June 2016News EnglandChildcare, Childrens Services, Early Years, News England, Nurseries

Plans to offer pre-schoolers 30 free hours of childcare a week may be in jeopardy if not enough childminders and nurseries are willing to offer places, MPs have warned.

Under a Government initiative due to be introduced next year, the current entitlement of three and four-year-olds to 15 hours of free care will be doubled.

But in a new report, the Commons Public Accounts Committee (PAC) says there is a real risk that providers will decide not to offer the extended hours, due concerns they will be left out of pocket.

The cross-party group of MPs also concludes that there are “unacceptable variations” in information available to parents about access to free childcare – with some reporting that nurseries and childminders only offer the entitlement on the condition that parents pay for additional hours.

Overall, the Department for Education (DfE) has made significant progress towards ensuring that young children benefit from 15 hours of free early education and childcare – with 94% of three-year-olds and 99% of four-year-olds taking up funded places in 2015, the committee says.

Take-up among disadvantaged two-year-olds is lower, at 58%.

But it raises concerns that there will not be enough funded places available once the offer is extended to 30 hours a week.

“Private and voluntary providers report that the amount they currently get paid for providing free childcare is not enough to cover their costs and they therefore rely on charging parents for additional hours or other sources of income to meet them.

“There is a risk that providers, who can choose whether or not to offer parents “free” childcare, will choose not to offer the new entitlement of a further 15 hours because doing so would reduce their opportunity to charge parents for hours outside of the entitlement.”

The committee says that the DfE should use pilots of the scheme, due to be carried out this year, to test whether nurseries and childminders are able to meet the expected demand.

The report raises concerns that the Department has no method for checking how local councils are managing childcare in their areas.

Funding is given to authorities for free childcare based on the number of eligible children locally. Councils use their own formulas to allocate funding to nurseries and childminders, and can keep some to pay for central services.

But the amount providers receive varies by area, with some getting £2.28 an hour for a three or four-year-old and others getting £7.15.

“The Department does not know how local authorities use the centrally retained funding or what they do to manage their childcare markets to ensure there are enough places to meet demand,” the report says.

The committee also warns: “There are unacceptable variations in the amount of information available to parents about access to free childcare.”

It adds: “Parents are unsure what their rights to free childcare are or who to complain to when needed. When the Department introduces the new entitlement with different eligibility criteria, this confusion is likely to increase.”

Committee chair Meg Hillier, said: “Parents need to be able to access a sufficient number of providers, of sufficient quality. The Government must implement measures to assure this.

“We are particularly concerned that the economic realities of providing childcare will deter providers from offering the extended provision.

“Evidence suggests this would most affect families from disadvantaged areas, which is doubly concerning given the already disappointing take-up of funded places for disadvantaged two-year-olds.

“The Government must take responsibility for identifying the reasons for this, and take remedial action.

“This needs to be in tandem with tackling weaknesses in the current system, in particular obstructions to parents taking advantage of the help and services available.”

Neil Leitch, chief executive of the Pre-school Learning Alliance, said: “The Public Accounts Committee is absolutely right to warn that there may not be enough providers willing to deliver the 30-hour free childcare offer next year if Government does not address the sector’s concerns.

“Independent research commissioned by the Alliance has shown that, even with the increased average rates promised by government, there is still likely to be a significant shortfall in funding when the scheme rolls out in 2017.

“Add to this the fact that many providers simply do not have the capacity to deliver extra childcare places, and it is clear that, without urgent action, many parents who have been promised 30 hours of free childcare may not actually be able to access them next September.”

A Department for Education spokesman said: “We are committed to supporting hardworking families and nothing shows this better than our landmark 30-hour free childcare offer.

“We have seen huge demand from local areas to take part in delivering that offer a year early, so we know childcare providers and local authorities want to help hardworking families too – and take-up of our existing offer for families of three and four-year-olds and disadvantaged families with two-year-olds has continued to increase.

“We will continue to work closely with providers as we get ready to provide this offer across the country in September 2017, backed up by our record investment into the childcare sector.”