The impact of early childhood education and care on children’s outcomes, and the sustainability of the sector

DOI: https://doi.org/10.58248/HS20

Overview of change

In 2019, childminders, private and voluntary nurseries and pre-schools together provided over 1.3 million places in England.¹ Research suggests that high quality early childhood education and care (ECEC) can have positive and long-lasting impacts on children’s outcomes, particularly for disadvantaged children. However, recent UK data suggest the evidence of actual benefit is more mixed.² Positive benefits are dependent on several factors, including the quality of care and parental engagement.^3,4 There are concerns that recent changes in UK Government policy are increasing the strain on quality across the sector and that the COVID-19 pandemic could reduce demand for ECEC, affecting children’s outcomes and the sector’s financial sustainability.^5,6

Challenges and opportunities

The early years sector has undergone several significant policy changes in recent years, as the UK Government, as well as other governments, have made large increases in the number of free hours of early years education available to parents of pre-school children, particularly among disadvantaged groups.⁷ This has been primarily in the form of subsidies and tax relief initiatives to help parents with the cost of ECEC.⁸  However, analysis of education spending in England in 2018–19 shows that, over the past decade, there has been a strong shift away from support targeted at low-income families and towards programmes for working families.⁹

Research indicates that ECEC can have a positive effect on children’s educational, cognitive, behavioural and social outcomes, in both the short and long term, if it is of high quality.^7,10,11,12 ECEC can also play a positive role in raising attainment and closing the gap between outcomes for children from disadvantaged backgrounds and other children.¹³ However, UK data suggest evidence of actual benefit is more mixed.⁷ Analysis of data from the Study of Early Education and Development (SEED) longitudinal study found possible benefits at age 4 years with use of ECEC between the ages of 2 and 4, that increased with hours per week spent in formal ECEC (such as a nursery or playgroup).¹⁴ However, SEED data also indicate that at age 5 years, there were possible benefits of an early start in formal ECEC (at or before age 2) especially for more disadvantaged children, but that there are potential disadvantages of high use (over 20 hours per week) of formal ECEC on child socio-emotional development.² Positive benefits are dependent on several factors, including the quality of care, such as the nature of the activities and relationships that children engage in within their settings, as well as group size, child–teacher ratios, staff retention, and teachers’ training and professional development.^3,7 Family and community engagement in ECEC can greatly contribute to ensuring continuous early development experiences for young children.^4,14–16 Interventions aimed at increasing parent engagement can improve children’s attainment and benefit their social-emotional outcomes.^16,17  

A report by the APPG for Childcare and Early Education in 2019 found that, since the introduction of the 30-hours funded childcare provision for some 3 and 4-year-old children, many early years settings have struggled to remain financially sustainable.¹⁸ Other research suggests that the policy may decrease the quality of provision and increase the attainment gap.⁵ Analysis suggests that the finances of childcare providers were already weak in several parts of the sector before the COVID-19 pandemic and that the lockdown has had severe financial consequences. In the medium term, a longer-lasting fall in demand for ECEC could affect children’s outcomes and hamper the financial sustainability of the sector.⁶ Following several petitions from the public relating to the impact of the COVID-19 pandemic on early years provision, the Petitions Committee recommended that the UK Government should conduct an urgent review of ECEC funding to ensure it survives the current crisis.¹⁹

Key unknowns

There is a lack of clarity as to what high-quality provision looks like in practice and how to measure quality.^7,20,21 This makes it difficult to assess how changes in government policy affect the quality of ECEC.^21,22 There is a lack of evidence on what approaches for encouraging parental engagement are effective.⁴ It is not yet clear how much demand for ECEC will recover and how quickly and what the long-term impacts of this will be on children’s educational, cognitive, behavioural and social outcomes, especially for children from the most disadvantaged backgrounds.^6,22 Experts also question what the long-term effects of being isolated from their peers will be on children’s social and emotional skills and their well-being.

Key questions for Parliament

• What impact have recent changes in government policies on funding for ECEC had on families’ access to high-quality ECEC? Has it increased the affordability of childcare for all parents and carers, including low-income families?
• What impact have recent government policies had on the attainment gap between children from disadvantaged backgrounds and their peers?
• What is needed to improve the quality of ECEC in England? What approaches for encouraging parental engagement in ECEC are effective?
• What are the impacts of closures in ECEC due to the COVID-19 pandemic had on children’s developmental milestones, including literacy, numeracy, social and emotional development, in the short- and the long-term?
• Is the pandemic likely to increase inequalities in outcomes for children from disadvantaged backgrounds, those with special educational needs, disabilities or those with English as a second language? What can the UK Government do to limit potential negative impacts and reduce inequalities?

Likelihood and impact

Medium impact and high likelihood with some impacts being felt now but others over a 5 to 10 year timescale.