Solutions and policy changes

Through a series of interviews with nursery owners, early years academics and researchers, there are a plethora of potential policy changes and solutions that could be implemented in the sector.

Some of the solutions revolve around money, some are more specific to the perception of the industry. Using the input of those in the sector, here are four solutions that could help tackle sector underfunding and a lack of awareness of what early years professionals are.

Scrap the 95% pass-through rate and give settings 100%

Local authorities must pass through an equivalent of 95% of the money they receive through the government's national funding formula. The threshold was brought in to prevent council underspend. But, the first suggestion is to remove the pass-through rate and give settings 100% of the funding.

Across a full year, the extra 5% of funding amounts to hundreds of pounds that settings can put towards educating children. This policy change aims to grant full funding for all children in settings. Then, with extra funding, further support for deprivation, quality and inclusions can be supplied separately.

Part of this policy change would also include free entitlement funding going directly to the provider. The intention would not be to exclude the involvement of local authorities. Councils can still assist with issues such as safeguarding but be removed from the funding pathway. Settings are the ones educating the children and managing the day-to-day costs. So, scrapping the pass-through rate gives providers full control over the funding they receive. A further benefit would hopefully be that it takes away the chances of any councils underspending their early years budget.

Fund children based on their needs

Another solution to the funding issues in the sector is to fund children based on their needs. Currently, a base rate is given to authorities alongside supplementary factors for children with special educational needs. The proposed change would set a clear base rate for children who do not have additional needs. For those requiring extra financial support for their education, an individual assessment should take place. The funding rate should be based on the needs of the child.

Adopting this policy means that the funding should be more efficient. Some councils try and allocate funding for all children with different needs using just the national funding formula. For example, taking 0.10p from a rate of £4.50. This does not produce high-quality outcomes for a SEND child.

A further requirement for this policy is that every council should have an educational psychologist. This is an important role in the council because people with higher qualifications need to be assessing the needs of children.

Improve early years knowledge of headteachers in primary schools

The reception years are still part of early education. That is why increasing the knowledge of childhood development is the third proposed policy change. The overall goal is to bridge the gap between nurseries and starting school. Headteachers would not be required to improve their knowledge of early years, more so encouraged so the transition is smoother for children.

Reception classes should also have an early years specialist who leads the education and has the power to make decisions. Once a child leaves for school, the same development plans they have should be continued. The communication between nurseries and schools could also be more tailored towards the children and their needs once they start school.

Emphasise new language for the sector

Arguably, one of the biggest challenges for the early years sector is altering the perception of it. Society needs to see early years as a highly professional profession. The importance of the sector needs highlighting. This avoids the image of the industry being a place for children to play and staff seen as babysitters. The policy would start from the top through government communication. The role of early years professionals needs to be stressed, alongside the significance of the first five years of a child's cognitive development.

Avoiding terms like 'childcare' could be one potential change Replacing it with education. Furthermore, addressing staff as teachers and not practitioners. Changing the words used to describe the sector and those in it would make a big difference.

What does the sector say?

Neil Leitch, chief executive of the Early Years Alliance, said:

"Research study after research study has shown that the first five years of a child's life are critical to their learning and development, and yet, for years, the early years sector in England has been overlooked and undervalued.

"Ministers have asked the impossible of early years providers: to deliver affordable, quality childcare and early education on funding rates they know are wholly inadequate - and as a result, we are seeing hundreds of settings closing every month. This cannot continue.

"It is vital that the government starts investing what is needed into our sector if we are to ensure that providers can remain sustainable, to recruit and retain high-quality early years professionals and to deliver the best possible learning opportunities to the children in their care."

Jonathan Broadbery, Director of Policy & Communications, National Day Nurseries Association, said:

"We have looked at what is leftover in local authority budgets and in March this year the figure was around 62 million pounds. Part of the problem is the complexity. If we were to scrap the 95% pass-through we would welcome that in principle because that makes it more straightforward for local authorities. They know what money they have coming in and how they would spend it. But there would need to be a separate stream from the government to keep supporting areas like safeguarding.

"Children with the same needs might also be funded differently because of decisions being made at local authority level. It would be useful if there was a national policy that outlined how children's needs will be assessed and what support they would get. We would support a clear approach to funding children based on their needs.

"Fundamentally, society needs to understand the amount of learning and education that happens in the early years. Change starts at the top and we should focus on learning opportunities, and not just the care aspects."