Transcript Monitoring of ethnicity in childcare by local authorities

Quality costs
paying for Early Childhood
Education and Care
Aims of project
• to identify the elements required for high quality
provision of ECEC
• to establish and cost a high quality model
• to identify the current costs and levels of funding
for ECEC in England
• to explore funding options for the high quality
model to ensure that the costs do not become
prohibitive for parents.
• Doesn’t include childminders
Methodology
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Literature review
Interviews with stakeholders
Two roundtables
Development of a ‘high quality’ model for ECEC
Social Market Foundation costed ‘high quality’
model, compared with current costs
• Researched who pays what currently
• Institute for Fiscal Studies costed a number of
options for funding the ‘high quality’ provision
High quality model
• Current adult:staff ratios
• For children aged 2 years and over: half of staff
as graduates (Level 6 qualified) and the rest
Level 3 qualified;
• For children aged under 2: one-third of staff as
graduates, the rest Level 3 qualified;
• Pay scales based on equivalent roles in schools;
• Other non-staff costs (premises costs,
expenditure on insurance, food, materials, etc)
set at one-third of the staff costs.
Table 1: Cost for one hour of ECEC provision
calculated by Social Market Foundation
Ratios
Cost with
High quality
current staffing cost
Under twos
1:3
£4.09–£5.05
£10.37–£12.48
Two year olds
1:4
£3.27–£4.11
£8.26–£10.40
Three–four year 1:8
olds
£1.85–£4.44
£2.94–£6.17
£2.23–£3.07
£2.69–£4.54
1:13
In London the
costs are 20%
higher
Summary of costs increases
• biggest increases for youngest children
• under the Daycare Trust high quality model, the
costs of ECEC in full daycare and sessional
settings up to three times current costs.
• the increases are just over double for full-day
care in Children’s Centres around 135 per cent
or 100 per cent when the cap on other costs is
applied.
• only around 15% increase for nursery schools,
and up to 27% increase in nursery classes
What do parents pay now?
Daycare Trust Survey
DCSF Providers Survey
Day nursery, London
Laing and Buisson
Day nursery
All ages, all types
Family Resources Survey
DCSF Parents Survey
£0.00 £1.00 £2.00 £3.00 £4.00 £5.00
Price per hour
Data from 2007-2009
What does Government
pay now?
• Free entitlement
– Dedicated Schools Grant does not ring-fence ECEC
– LEAs spend in Section 52 returns
• SSEYC grant
– How much are Children’s Centres about ECEC?
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Childcare for FE students
Childcare Affordability and Child Poverty pilots
Childcare element of WTC
Tax breaks on employer-supported childcare
• Much harder to add up
– Mixture of UK and devolved policies
– Some for under 5s, some for all children
Government spend on
ECEC in England
£m/yr
Free
entitlement
for 3-4s
2007/8
1,214
2008/9
1,790
2009/10
Standards
Fund for
expansion
to 15
hrs/wk
170
Other
DCSF
Funding
651
Other
funding (FE
students and
pilots)
Tax
credits
(all
children)
Tax breaks
on
employer
vouchers
(all children)
1,129
307
95
Total: £4.1bn, with £1.2bn more for Sure Start local programmes and Children’s Centres.
Around 0.4% GDP.
Based on various sources.
Meeting cost of High
Quality childcare
• Paying for existing ECEC at High Quality rates would cost £2.6bn/yr,
with parents paying £2.3bn/yr net. Parents of under 3’s would be the
hardest hit. Average spend on childcare increase from £49 to £93 a
week.
• Daycare Trust report highlights following options to reduce cost to
parents, with implementation by 2020
- Quality subsidy to providers for ECEC for 0-2 year olds linked
to staff qualifications
- Childcare element of WTC: subsidy rate to 100%, remove
work test
- Free entitlement: 2 year-olds: 15 hrs/wk, 38 wks/yr;
3-4 year-olds: 20 hrs/wk, 48 wks/yr
• Impossible to say how ECEC use would respond, so assume
unchanged
Copyright Institute for Fiscal Studies 2009
Summary of costs to parents
and government
(£bn/yr)
Parents
Total Gov’t
EEE
CCTC
Quailty
subsidy
(under 3’s)
Total
(parents
& Govt)
Current level of
spend, existing
CCTC
2.6
1.6-1.8
1.2-1.4
0.4
-
4.2-4.4
0.5
1.0
4.9
0.9
1.0
9.2-9.4
Additional costs of high quality
Increased
EEE,
subisdy,
reformed
CCTC
-0.7
5.7
4.2
Total costs
Future level
of spend
1.9
Copyright Institute for Fiscal Studies 2009
7.3-7.5
5.4-5.6
Conclusions
• If Government were to foot the entire bill for
centre-based ECEC it would cost them just over
£9 billion a year in England
• Our package would require £7.5 billion a year
from Government to deliver ‘high quality’
provision
• This would make total Government spend on
ECEC approximately 1% of GDP
• Wise investment in children’s futures & to make
savings in public expenditure in future years