Expansion of funded childcare could ‘jeopardise’ quality of provision – watchdog

The Government’s expansion of funded childcare for working parents in England could affect the quality of provision or places for young children, Whitehall’s spending watchdog has said.

The risk of an influx of “inexperienced” early years staff, alongside higher staff to child supervision ratios for two-year-olds, may jeopardise the quality of childcare provision, according to the National Audit Office (NAO).

The findings are part of a report into the Government’s expanded offer of funded childcare for working families of younger children in England.

The NAO said “uncertainties” remain over whether the sector can expand to deliver enough places amid a lack of qualified staff and suitable space.

As part of a staggered rollout of the childcare offer, working parents of two-year-olds have been able to access 15 hours of funded childcare this month.

This will be extended to working parents of all children older than nine months from September this year, before the full rollout of 30 hours a week to all eligible families a year later.

The Department for Education (DfE) has assessed its confidence in delivering the places required for the next two phases as “problematic”, the report said.

Only 34% of local authorities, surveyed by the DfE in March, were confident there would be enough places in their area this September to meet demand.

The DfE said the programme management term of “problematic” was attributed without reflecting the mitigations which are now being put in place.

Confidence assessments will improve for each milestone respectively nearer to September 2024 and September 2025, it added.

Local authorities, sector representatives and the DfE told the watchdog that “insufficient staff represents the main barrier to expansion”.

Last week, the DfE estimated that around 85,000 new childcare places and an additional 40,000 staff will be needed by September 2025 for the full rollout.

The watchdog has warned that the expansion could also “impact the quality of provision or places for vulnerable children.”

There are concerns that a rapid growth in places may impact quality or displace children who are “more challenging or costly to support,” the NAO said.

The report said: “Specifically, the risk of a large influx of more inexperienced staff and providers, alongside DfE changing staff:child supervision ratios for two-year-olds and practitioner qualifications, could jeopardise quality.”

In March last year, Chancellor Jeremy Hunt announced that eligible families of children as young as nine months old in England would be able to claim 30 hours of free childcare a week by September 2025.

The Government also announced it would increase minimum staff-to-child ratios in England from 1:4 to 1:5 for two-year-olds, but the change is optional.

The timetable was set with “significant uncertainties” around feasibility, costs and benefits as the DfE did not consult the early years sector ahead of the announcement in the Budget, the watchdog said.

The NAO said the DfE was originally planning to roll out the 30-hour entitlement a year early in some local authorities to test feasibility, but it cancelled its plans due to “affordability constraints”.

The report concluded: “In extending entitlements, the Government’s primary aim is to encourage more parents into work.

“Even if DfE successfully navigates the significant uncertainties, it remains unclear whether the extension will achieve its primary aim, represent value for money and not negatively impact DfE’s wider priorities relating to quality and closing the disadvantaged attainment gap.”

The NAO has called on the DfE to monitor the impact of its childcare reforms on quality to understand whether “unintended effects”, such as on the availability and quality of places for disadvantaged children or those with special educational needs and disabilities (Send), need to be managed.

Gareth Davies, the head of the NAO, said: “The next phase of the reforms will be significantly more challenging, with little contingency and flexibility in its ambitious timetable.

“The Department must monitor the programme closely and respond promptly to emerging risks.”

Dame Meg Hillier, chairwoman of the cross-party Public Accounts Committee (PAC), said: “DfE needs to clarify with urgency what it will do if the early years sector cannot recruit the staff it so desperately needs, to avoid disappointing tens of thousands of parents over the next 18 months.”

Neil Leitch, chief executive of the Early Years Alliance (EYA), said: “With the sector currently facing one of the worst staffing crises in its history, ensuring that there are enough early years places to fulfil the huge promise that ministers have made to parents is likely to be near-impossible without urgent action from government, namely, a comprehensive workforce strategy underpinned by adequate long-term funding for the sector.”

In February, the Government launched a £6.5 million-backed recruitment campaign to encourage people to work in the early years sector.

The DfE also announced a trial to give new recruits and returners to the early years workforce a £1,000 cash payment shortly after they take up post.

A DfE spokesperson said: “This Government is delivering the largest ever expansion of childcare in England’s history.

“The NAO rightly acknowledges that we have already exceeded our target for the first phase of the roll-out, with almost 200,000 two-year-olds already benefitting from government-funded places, supporting parents to balance their career and childcare.

“We have taken decisive steps to prepare the sector for the next phases, including increasing funding well above market rates, launching a workforce campaign and new apprenticeship routes, as well as providing £100m of capital funding to help expand or refurbish facilities.”