Big drop in England childcare availability

There have been widespread drops in the number of childcare places in England over the past year, a new report shows, as pressure mounts on the government to invest more in the struggling early-years sector in next week’s budget.

Childcare availability has fallen across several categories, according to a major annual survey by the charity Coram Family and Childcare. For example, only half of councils said there were enough childcare places for children under two in their area, down 7% on the year. Just under half said there were enough places for children whose parents work full-time, a drop of 11%. After-school clubs for primary-school children also fell slightly.

“The need for reform of the childcare system is urgent. As well as eye-watering bills, parents are facing widening gaps in availability of the childcare they need,” said Megan Jarvie, head of Coram Family and Childcare. “As the chancellor decides his budget, we urge him to recognise the value of investing in childcare.”

The UK’s patchy and expensive childcare system has increasingly been under the spotlight in recent months. Business lobby groups, think-tanks and Tory MPs have called for an overhaul of the sector ahead of next week’s budget, voicing concerns that childcare issues are stifling the economy by preventing parents from working. This has turbo-charged longstanding demands from families and campaigners.

The current childcare debate has largely focused on costs – UK families pay amongst the highest childcare fees in the world, largely because the state invests relatively little in this sector compared to other developed countries. But, as the Coram report shows, an equally important issue is that many families struggle to find spaces at all.

“It’s rare that we see drops in availability right across all categories, in the way that we have seen this year.”

Almost half (44%) of councils surveyed said that some or many local childcare providers had cut their opening hours over the past year, in a climate where many are struggling to find staff or make ends meet. The latest government data also shows that the number of childcare places at registered providers fell by 2% last year, having been broadly stable since 2015.

“It’s rare that we see drops [in availability] right across all categories, in the way that we have seen this year,” Jarvie said. “We’ll normally see one or two categories going up, one or two going down, a bit of a mixed picture. This feels a bit different.”

Coram, the UK’s oldest children’s charity, has conducted its annual childcare survey since 2002. The report found that it now costs £146 per week on average just for a part-time nursery place for a two-year-old, ranging from £125 in the East Midlands to £188 in inner London.

Families and nurseries struggling alike

Coram’s report shows that childcare shortages are often affecting the families who need it the most. This includes families on low or even mid-level incomes, as well as those whose children have special needs or disabilities.

Less than three-quarters (73%) of councils said there were enough “15-hour entitlement places” in their local area, a drop of 6%. This ranged from 45% of councils in the East of England to 100% of councils in the North-East.

“Entitlement places” refers to a government scheme that gives nurseries and childminders funding to provide 15 hours of free childcare per week for every child aged 3-4. In many households with two working parents, this goes up to 30 hours. But childcare providers say the government gives them too little funding for this scheme, forcing them to offer the spaces at a loss, charge parents top-up fees, or stop offering them.

The outlook for children with special needs or disabilities was particularly stark – just 18% of councils said there were enough local childcare spaces for this group, a drop of 3%.

“Coram’s report makes for shocking reading, with vulnerable children…being most at risk of having no early-years support or education,” Purnima Tanuku, chief executive of the National Day Nurseries Association, said. “This situation must be resolved with adequate investment from the government.”

An NDNA survey of over 470 nurseries, also released today, found that almost four in ten (38%) expect to operate at a loss this year, rising to almost half (45%) in deprived areas (see graphic above). Nurseries had to make up an average shortfall of over £1300 per child per year for a 15-hours entitlement place, the survey found.

NDNA data also shows that nursery closures accelerated in 2022, compared to the previous year, with a disproportionate number in deprived areas. This is particularly concerning because early-years childcare can help to close attainment gaps between children from rich and poor families, by helping all children to start school on a more equal footing.

Coram’s report lists specific solutions that would help ensure more affordable and accessible childcare. These include reviewing the government’s funding rate for entitlement places, extending the 30 hours scheme to more families, and improving support for children with special needs and disabilities.

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