Today (11 June) the Chancellor announced the Spending Review 2025, setting out how money will be allocated among governmental departments. This plays a key part in shaping policy decisions to achieve the Governments Plan for Change, which includes a focus on the early years and “giving children the best start in life”.

For early years and childcare, the Spending Review reiterated the plans the government has already made:

• £370 million for the delivery of 3000 school-based nurseries across England over the next four years.
• Free school meals for over half a million more children (for early years children this applies to nurseries within primary and nursery schools).
• Continued investment in the rollout of Family Hubs.
• Reforms to the SEND system.
• Further rollout of breakfast clubs for primary-aged children in England.
• Investment in early intervention and children’s social care.

Helen Donohoe, Head of Coram PACEY met with the Early Education Minister Stephen Morgan MP following the Spending Review announcement.

Helen Donohoe, Head of Coram PACEY comments:

“It is positive that the Department for Education has overall secured an increase in funding despite such a tight fiscal space. We also welcome the government’s commitment to supporting children with SEND, but this must extend fully to the early years.

Family Hubs will play a vital role in supporting families and we await further detail on their rollout. They must be integrated effectively with other services, including childminders and other early years and childcare settings. Similarly, we urge the government to recognise the importance of choice and flexibility for families accessing childcare and early education. Many children – particularly those with SEND – may thrive in smaller, home-from-home environments such as those provided by registered childminders and it’s essential that these settings are considered in policies including the delivery of school-based nurseries, wraparound childcare and breakfast clubs.

We now urgently need the promised early years strategy, setting out the government’s vision for the sector. As this week’s polling from the Early Education and Childcare Coalition shows, the current system is not working for parents or providers. Without urgent action, we risk further closures across the sector, leaving too many children without the high-quality early education and childcare that can be so transformational.”

New research from the Early Education and Childcare Coalition

Earlier this week, Early Education and Childcare Coalition (of which Coram PACEY is a member) published new research about the current state of the early years and childcare sector.  

Early years providers

The Coalition’s poll of over 800 early years providers in England paints a worrying picture:

• 18% are currently operating at a loss and 20% have had to dip into reserves
• One in ten say they’re likely to close down within two years due to cost pressures
• Over a third have limited the number of government funded hours on offer (or are considering doing this)
• Over a quarter have paused plans for staff recruitment
• One in five have decided to accept fewer children with SEND in the last twelve months to offset increased costs

The Coalition also published a new report with modelling by Frontier Economics showing the likely impact of the rises to National Minimum Wage and Employer National Insurance Contributions on provider delivery costs. The modelling suggests that providers serving disadvantaged two-year-olds are more likely to be affected. Download the full report

Impact of childcare costs on families

Additional polling published yesterday shows the impact of rising childcare fees on families:

• 15% of parents of children under five have quit their job due to the costs or availability of childcare over the past 12 months, and an additional 20% have considered doing so
• One in three said they have borrowed money from friends or family or taken out a credit card or loan and one in five have cut back on food shopping