Increasing the volume of childcare places

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					KIDS CLUBS NETWORK submission to the Treasury
Childcare Review.

Additional information on 3 key priorities:

       Increasing the numbers of school age childcare places
       Supporting sustainability
       Piloting integrated childcare for school age children in Children‟s
        Centres (including schools)

Increasing the volume of school age childcare places
Between April 1997 and September 2001 over 502,433 new registered school
age childcare places were established in the UK; benefiting more than
880,000 children1. Over 75% of these places received financial support from
the £220 million New Opportunities Fund „Out of School Hours Childcare
Programme‟. This equated to 7,000 new out of school clubs bringing the total
to around 10,000 by the end of 2003. This means there is approximately one
club for every two primary schools.

Despite the progress made as part of the National Childcare Strategy,
evidence from the NOF programme demonstrates that there is still a need to
expand childcare provision for school age children:

       New provision will support parents to move into training or work:

Research consistently demonstrates that providing high quality, affordable
and accessible childcare opportunities is crucial to supporting parents move
into work. In 2001, 43% of parents and carers said that they had been able to
take up employment opportunities as a result of new provision 2. Reviewing
the evidence, the full evaluation on the NOF programme concluded that,
“research leaves little room for doubt that there is a relationship between
availability of out of school care and parent‟s ability to work or engage in

       Demand is still high in most areas:

Despite recent advances, there is still only one childcare place for every 5
children under the age of eight4, 24% of all families experienced unmet
demand in 2002, and 86% of parents want more out of school childcare

  „Childcare and Early Educational Facts‟, DfES (2002). This figure does not include all the
unregistered childcare places.
  From an evaluation of the NOF programme.
  „Changing the Landscape: Lessons from the New Opportunities Fund out of school hours
childcare programme‟, October 2003 (p.16)
  Daycare Trust, 2003

The Childcare Review: Key Priorities (HM Treasury)
Kids‟ Clubs Network – November 2003
places5. When considering only school aged children the picture is even
worse – where there are only places for around 6% of children6. Evidence on
occupancy rates are telling here as well, demonstrating that a significant
minority of clubs are full and up to 19% of clubs have waiting lists 7.
Occupancy rates vary considerably across geographical locations,
demonstrating the importance of careful mapping and planning of childcare
provision. Measuring demand by occupancy rates and waiting lists
presupposes a given market rate for childcare in an area; at this point
affordability clearly becomes an issue in modelling parents labour market
choices and demand for childcare.

       The is a particular shortage of places for a number of key groups
        of children and young people:

Provision in areas of disadvantage remains problematic, as the market is
often unable to maintain viable childcare businesses based on parental fees
and Childcare Tax Credit support. Many of the difficulties here are part of a
larger sustainability issue, dealt with elsewhere in this document. However,
support for start up is especially critical in disadvantaged communities.
Beyond this a range of other shortfalls still exist. There remains very limited
out of school provision for young people aged 10 – 14, where there is
estimated to be less than 500 out of school clubs for the 3 million young
people of that age. Provision is extremely limited for parents who work
‘atypical’ hours, event though 61% of families have a parent who works
outside a regular nine-to-five. Black and minority ethnic families are also
under-represented in childcare facilities; 87% of white parents have accessed
some form of childcare in the last year compared to 81% of black parents and
70% of Asian parents8. In addition, services for children with disabilities are
excluded from the vast majority of childcare settings because the settings are
inappropriate for them.

       Provision is cost effective to start up – there is considerable
        scope for current providers to expand - and the NOF programme
        demonstrates that start up grants work:

The success of the NOF funding programme demonstrates that significant,
targeted and planned investment can deliver exponential increases in the
numbers of places and out of school childcare schemes. A combination of
start up grants and longer term funding for provision in disadvantaged areas
was successful in enabling a rapid growth in the sector. The experience
gained through the NOF funding means that a new programme of investment
would benefit from the knowledge of what works. Additionally, new funding
would be able to build on and add value to existing provision. Extra funding
could enable existing providers to expand, which many would like to be able
to do.

  „Repeat Study of Parent‟s Demand for Childcare‟, DfES (2002)
  „Kids‟ Clubs Network – Industry Stats‟ (2003)
  „The Barriers to Childcare Provision‟, Callender/DfES 2000
  „Repeat Study of Parent‟s Demand for Childcare‟, DfES (2002)

The Childcare Review: Key Priorities (HM Treasury)
Kids‟ Clubs Network – November 2003
         More support for entrenching a strong development culture and a
          vibrant childcare infrastructure is needed for advances to be

The NOF programme did not fund direct capacity building in the out of school
childcare sector. The task of developing local infrastructure was fulfilled by
Central Government and local authorities via the establishment of EYDCP‟s,
and supported by the voluntary sector 9. Continuing to develop and entrench
these support systems will be vital if the funding targeted directly at growing
provision is to be maximised. Welcomed reforms over the last 12 months
have seen a strengthening of the local authority‟s role in mapping, planning
co-ordinating local provision – a task still being given practical and strategic
support by Kids‟ Clubs Network. Support for this work needs to be given a
high priority as the childcare sector establishes itself alongside statutory
services, both locally and nationally.

         Implications for the Childcare Review:

This Childcare Review provides an opportunity to make a bold commitment to
establishing an out of school childcare scheme at or near each of the 20,000
primary schools in the country over the next 5 years. Such a development
would cost around £200 million in start up funds... Funding for development
and infrastructure will also be needed; likely to be around 33% of total start

A development on this scale – a targeted and measurable investment in a key
sector with clearly evidenced pay offs in relation to employment, child poverty
and child development – would enable the establishment of 10,000 new clubs
and approximately 500,000 places. The result would be a childcare scheme at
or near every primary school in the country.

    An important example being Kids‟ Clubs Network‟s Fast Track consultancy project

The Childcare Review: Key Priorities (HM Treasury)
Kids‟ Clubs Network – November 2003
Sustainability of School Age Childcare
Despite the major successes of the New Opportunities Fund programme,
sustainability remains a key problem for a significant proportion of school age
childcare providers. NOF money combined one-off, one year start up grants
combined with extended funding for providers in areas of disadvantage.
Research and experience from the NOF period makes it clear that on-going
sustainability funding will be essential if provision serving some of the most
disadvantaged communities is to remain viable.

        Sustainability remains a key problem across the sector:

There is a varied picture of sustainability across the school age childcare
sector. Overall, 45% of clubs are breaking even, with 25% making a loss.
However, in disadvantaged areas the number making a loss rises to 62%10.
Even though 85% of schemes funded by NOF expect to still be operating in
12 months, this is more likely to be because they had found alternative
sources of funding than that they were breaking even. All these figures are
borne out by NOF‟s own evaluations. The implications of these findings are
that continued subsidy of provision will be needed if childcare in
disadvantaged areas is to survive. In other words, “Despite the fact that most
clubs are charging fees and operating at near capacity, two thirds of clubs had
received continuation from the NOF and 35% of clubs report that they need
additional financial support after the life of their grant”11. Sustainability
problems are particularly acute in deprived areas, where demand fluctuates
as parents move in and out of the labour market.

        Key Factors Determining Sustainability:

The factors that are most critical in determining the sustainability of school
age childcare provision are as follows:

     -   The socio-economic background of service users – and their ability to
         pay market rates
     -   The business skills of service providers
     -   The ability of clubs to secure alternative sources of funding.

Unsurprisingly, the impacts of each of these factors are often interlinked and
mutually reinforcing.

        Analysis of ‘Critical Sustainability Factors’:

evaluation of its out of school hours funding programme demonstrates that
sustainability problems continue to bedevil all providers, bar those operating
in an affluent catchment area. The 45% located in „deprived‟ areas will

  Kids‟ Clubs Network – Industry Stats (2003)
  „Changing the Landscape: Lessons from the New Opportunities Fund out of school hours
childcare programme‟, October 2003 (p41)

The Childcare Review: Key Priorities (HM Treasury)
Kids‟ Clubs Network – November 2003
probably never be able to break even from parental fees and Childcare Tax
Credit contributions, however these schemes are most likely to be able to mix
and match funding from a range of sources. In contrast, whilst the 41% of
schemes operating in „marginal‟ areas are able to charge higher parental fees,
market rates are not sustainable and alternative sources of funding are harder
to achieve12. The ability of parents to pay is crucial to sustainability, and price
elasticity is very limited. Small increases in price can drive parents away.

allocated to support management committees in developing their business
skills and financial planning. Support could be targeted at local authorities
who are in a prime position to support here, building on the NOF experience
about critical factors influencing sustainability13. There is no evidence that
clubs requiring a subsidy are necessarily less competent at running their
finances; their inability to charge market rates simply make viability that much
more elusive for these schemes. In such cases, targeted and on-going
subsidy support alongside funding for management and business capacity will
prove a sound investment.

discussed earlier, the majority of schemes require additional funding – on top
of parental fees – to remain viable. Providers are forced to navigate through a
wide range of funding sources; much of which is time-limited. Factors such as
capital costs are significant too. For example, schemes based in schools or
other community venues, where the cost of rent and resources can be
minimised, often have a more secure financial footing.

        Implications for the Childcare Review:

The spending allocation for the last round committed roughly the same
amount for sustainability as it did for the development of new places for
school age childcare. On this basis, to realise the target of a school age
childcare scheme at or near every primary school in the country, alongside
maintaining sustainability for these and the already established schemes,
would require an additional £200 million.

   „Changing the Landscape: Lessons from the New Opportunities Fund out of school hours
childcare programme‟, October 2003
   For more details see, „Changing the Landscape: Lessons from the New Opportunities Fund
out of school hours childcare programme‟, October 2003 (p36 – 39)

The Childcare Review: Key Priorities (HM Treasury)
Kids‟ Clubs Network – November 2003
Extended Children’s Centres for Older Children
Kids Clubs Network is committed to the delivery of co-ordinated and
integrated services for school age children out of school.

The Government has invested significantly in out of school services for
children, through a range of initiatives including out of school childcare, study
support and more recently, Positive Activities for Young People. In addition a
significant investment has been made in targeted services for vulnerable
children through the Children‟s Fund. However, whilst investment has led to
a major expansion in out of school services for school age children, there is
still very little co-ordination or integration between different strands of
provision which retain their own professional starting points, value bases,
cultures and delivery mechanisms. The result is incoherent and inconsistent
provision which is short term, highly targeted and inaccessible for a large
number of children.

All evidence shows that children and families benefit more if services are
joined up and co-ordinated. The Children‟s Centre model is based on this
approach so as to combine early education, childcare and family support. But
these services are, at present, only being developed to support pre-school
children and their families. Consistent evidence shows that benefits from
early intervention are not sustained, and drop off, if positive support is not
continued through school age. Kids Clubs Network therefore believes that the
extension of the Children‟s Centre programme, to cater for all children, is an
urgent priority. Kids Clubs Network is proposing that that a pilot of centres is
undertaken within this spending review period to gain experience, evidence
and models of development, which can be replicated and built upon in the

The Extended Children’s Centre in Practice

The Extended Children‟s Centres could be developed in pilot from existing
Children‟s Centres in up to 50 areas.

In some cases, the Extended Children‟s Centre may be based around a
school or health centre, depending on the facilities which exist locally. In
some cases they may require an extension of the existing building or facilities.
Whilst the type of building may differ, the range of services on offer in the
local Children‟s Centre would have a common core for older children. For
each, this will include:

      A range of co-ordinated childcare, play and youth provision and a
       childminder network. Although the childcare schemes may not all be
       based in the same building, they would be co-ordinated, alongside co-
       ordinated childcare information. Each centre would have a range of
       places for disabled children, and would respond to the needs of local
       communities. The Centre would play a central and strategic role in
       providing childcare and out of school places for parents who are not
       working, and would work with other local partners to bring in funds.

The Childcare Review: Key Priorities (HM Treasury)
Kids‟ Clubs Network – November 2003
        As with Children‟s Centres for younger children these would include a
         resource base with information, toys and groups for all children
         and young people, parents and carers. The resources base would
         offer information to children, parents and professionals on all aspects
         of childcare, including child development, health, specialist needs,
         school and other support services.

        Targeted services for vulnerable school age children – targeted
         support for those with a particular need.

  In addition the Centre would include:

      o A base for satellite activities including health visitors, children‟s
        dentists and clinics.

      o Youth activities, sports and arts programmes, and additional
        support for children with special needs.

      o A base for consultation with parents and children.

      o A base for training childcare workers and playworkers, as well as,
        parents/carers and young people.

Why Extended Children’s Centres?

All children benefit from safe and supportive environments for play and
learning but for vulnerable children it is especially important. For children who
experience the disadvantages of poverty, poor housing, disability or wider
discrimination, the Extended Children‟s Centre would be of particular benefit.

The benefits of providing co-ordinated opportunities and support for children
are widely recognised in a wide range of Government initiatives aimed at
tackling poverty and inequalities. The Children‟s Fund, Regeneration, New
Deal for Communities, Neighbourhood Renewal programmes, and Education
and Health Action Zones all acknowledge the benefits of out of school
childcare, learning and play for children and their families.

Extended Children‟s Centres would provide a co-ordinated and joined up
approach to tackling poverty which puts the child at the centre of the
community. Investing in an Extended Children‟s Centre would provide a
central focus for continued support for children throughout their school years.

Extended Children’s Centres Would Provide All the Benefits of an
Integrated Approach

      o Education – new opportunities would be provided for children to play
        and learn in an informal environment, as well as being able to take part
        in more structured study support sessions. Extended Children‟s
        Centres would have the capacity to offer structured one to one

The Childcare Review: Key Priorities (HM Treasury)
Kids‟ Clubs Network – November 2003
      sessions and targeted support programmes to support excluded
      children as they return to mainstream education. Activities for disabled
      children would also be offered enabling all children an opportunity to
      mix and make friends. The study support programme would be
      delivered through the centre.

   o Health – Extended Children‟s Centres would provide a broad range of
     healthy lifestyle programmes increasing children‟s understanding of the
     importance of nutrition, diet and exercise. Broader family health
     services and support can also be based at the Centre. As a safe place
     for children to play and learn, the Extended Children‟s Centre could
     reduce road accidents and accidents in the home.

   o Crime reduction – The Centre would provide positive leisure
     opportunities for 4 – 16 years olds out of school. Playworkers would
     provide positive role models for children over an extended period of
     time, supporting children and young people to develop their confidence
     and social skills. Extended Children‟s Centres would support safer
     communities, providing a positive focus for all children and families.
     Provision for young people – such as Positive Activities for Young
     People – would be delivered through the Centre.

   o Poverty – bringing together a wide range of support services and
     programmes for children, Extended Children‟s Centres provide an
     opportunity for local authorities and local communities to adopt a
     strategic and co-ordinated approach to tackling social exclusion.
     Providing information and advice on benefits and tax credits would
     assist in the fight to eradicate income based poverty.

   o Employment – Out of school clubs and wrap around childcare are at
     the centre of the Extended Children‟s Centre concept; supporting
     parents to take up work or study.

   o Parents – Support for parents through information and parents groups
     would take place at the Centre with co-ordination across wider groups
     in the community.

   o Community involvement – offering opportunities for volunteering,
     training and employment in the community.

The Childcare Review: Key Priorities (HM Treasury)
Kids‟ Clubs Network – November 2003
The Children’s Centre for Older Children

                     Promotion &                                Targeted
                       targeted                               intervention
                     programmes                                    for

                                   Play       Out of school

                          Targeted                      Parent
                         support for                   support
                          excluded                   programmes

      Implications for the Childcare Review:

Extended Children‟s Centres could draw their funding from a broad range of
current initiatives, including out of school childcare, study support, Positive
Activities for Young People, youth provision and the Children‟s Fund, in
addition to wider regeneration funds including neighbourhood renewal. These
activities are already being invested in and will require no further funds from
the Exchequer. However, it is likely that most buildings will require some
conversions to accommodate new services for the extended age range. It will
be important to provide some support from central Government for the pilot
period to lever in commitment and support from the Local Authority and other

It is therefore proposed that each pilot Centre should be allocated up to
£250,000 for start up costs... If 50 were established in a first phase this would
cost £12.5 million.

Kids’ Clubs Network
December 2003

The Childcare Review: Key Priorities (HM Treasury)
Kids‟ Clubs Network – November 2003

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