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Nearly 100,000 new childcare places have been created for pre-school children since 1998 and the Government is on course to meet its targets for the provision of free part-time early education for three- and four-year-olds. But Sir John Bourn, head of the National Audit Office, reported today that more needs to be done to ensure that much of this new provision is sustainable. And, while considerable progress has been made in closing the gap in relative levels of provision between the poorest areas and others, there is still some way to go.

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Early childhood is a crucial period in human development. High quality care and education has wide-ranging impacts, especially for disadvantaged groups, while poor quality childcare can have a negative impact. The National Audit Office examined the developments in childcare and education provision for children below compulsory school age since the National Childcare Strategy was introduced in 1998. In particular, they looked at progress in improving accessibility (including in providing free part time early education places for all three and four year olds, creating sustainable new childcare places, and increasing the level of provision for disadvantaged groups); in making provision more affordable for parents; and in ensuring that it is of high quality.

Since the launch of the National Childcare Strategy:

  • 626,000 new childcare places have been created in England, but 301,000 places have closed.
  • Most new places have been in out of school and holiday provision, but 96,000 are for pre-school children.
  • There have been net losses of some types of provision, and there is a lot of regional and local variation. For instance the number of pre-school childcare places varies between 11 and 58 per 100 pre-school children.
  • There are sufficient early education places to give a free part-time place to all four-year-olds whose parents want one. Many areas across England now have sufficient places for all three-year-olds and the Government have brought forward the date for full coverage of three-year-olds to April 2004.
  • The childcare element of the Working Families Tax Credit and subsequently Working Tax Credit has been introduced and is now being claimed by 236,000 families.

Government funding has been an important factor in starting up provision, but this new provision is under threat. Only half of new providers know what they will do when their start-up funding ends, and there are a range of threats to sustainability. Many existing providers fail to cover their costs, and significant numbers lack sufficient understanding of costs to judge their viability. Few early years providers are planning to expand. Lack of capacity and a need for bigger premises are the main barriers to expansion.

In our surveys, few parents said lack of available provision prevented them using childcare, but around one in seven said there was no local choice for their child. There is insufficient flexibility to meet the needs of some, especially lone parents. Less early years provision is available in deprived areas than in other areas, although the gap is narrowing. Few providers, especially childminders, are able to cater for disabled children and many are not trained to do so.

The provision of free nursery education places and the childcare element of the Working Tax Credit have reduced the cost of early years provision to parents eligible for them. But for others, the costs of childcare are increasing. However, parents told us that other factors such as location, the quality of staff and facilities and availability at suitable hours were more important than cost in deciding whether they use early years provision or what type of provision they choose.

The Department has put in place a detailed framework of measures to improve the quality of childcare, National standards have been set for childcare provision, and Ofsted inspect childcare providers every two years. Providers have received the introduction of inspections positively, and the first inspections indicate that standards across the sector are acceptable.

Increasing the number of skilled and qualified childcare workers is a key aspect of improving the quality of early years provision. Lack of trained staff is a barrier to expansion, and the Department face a challenge in increasing the size and skills of the workforce in line with their targets for creating additional places. They have a strategy in place, but estimate that 175,000 new recruits will be needed between 2003 and 2006.

The National Audit Office report recommends that the Department should:

  • expand provision where it is needed by focusing more on developing integrated provision and ensuring it is sustainable;
  • provide more training and business support for childminders, and promote the development of childminder networks;
  • ensure that schools play a key role in expanding provision in deprived areas; and develop better measures of progress;
  • improve sustainability by ensuring that providers have access to assistance in understanding their costs and planning for the future; and give local authorities greater co-ordination and planning powers; and
  • ensure quality provision by doing more to expand the workforce, for instance by attracting more older workers, and provide training, especially in caring for disabled children and those with special educational needs.

"The Government has made impressive progress in creating new childcare places and in providing early education for pre-school children since 1998, but not enough of these new places are yet in deprived areas where they would most benefit children and parents. The Government's investment will be wasted if the new provision is not viable. More training is needed, especially for childminders, and providers need more support to help them manage their businesses."

Sir John Bourn


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